Developers in the race for plum redevelopment projects in SoBo | Mumbai news - Hindustan Times

Developers in the race for plum redevelopment projects in SoBo

ByDraupadi Rohera
May 03, 2024 09:23 AM IST

Listed developers are competing with each other enticing the gentry with lucrative offers – ranging from 40 to 60 per cent additional space per resident

MUMBAI: The most sought-after pin codes of south Mumbai are witnessing a wave of redevelopment. Every week at least six to seven housing societies in Walkeshwar, Breach Candy, Malabar Hill, Napean Sea Road, Worli and Altamount Road are putting out public notices inviting bids from A-list developers.

1Developers are in a keen battle to secure prime projects in SoBo. (Aniruddha Chowdhury/Mint)
1Developers are in a keen battle to secure prime projects in SoBo. (Aniruddha Chowdhury/Mint)

Pankaj Kapoor, director of Liases Foras, said while the “redevelopment craze in the island city took time to come, it is now surging, with every fourth or fifth housing society gearing up for a ‘luxury’ makeover”. Listed developers are competing with each other enticing the gentry with lucrative offers – ranging from 40 to 60 per cent additional space per resident to whopping corpus of funds and hefty transit rents. He said in the last one year eight projects were announced in Malabar Hill, Altamount Road and Walkeshwar; they are: Ruparel House, Little Gibbs, Sunteck Realty Project and Lodha Malabar.

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Pooja Dalal, 75, a resident of 70-year-old Sheetal Baug, in Walkeshwar, is looking forward to the shiny new structure that the Lodha Group has planned on the site, slated to be completed late 2025 or early 2026. “Both Lodha Group and Godrej Group were competing for the deal. But we went with Lodha as they made a better offer,” she said.

Sheetal Baug was a composite of three buildings, whose upkeep had become a challenge, given the wear and tear over time. “Our lifts were not working and maintaining the building was also becoming hard. Hence, we opted for cluster redevelopment by roping in the two neighbouring buildings as well. This gave us the advantage of extra FSI,” she said.

Lodha offered 100 per cent extra space per flat owner. Additionally, she received 85 lakh per year as transit rent in lieu of her 900 sq ft flat. In future, the developer will sell the free sale component for no less than 1.50 lakh a square foot! Dalal now lives in Churchgate and is waiting for the project to be completed.

Dr Hasnain Patel, chairman of Merryland Cooperative Housing Society, near Worli Seaface, is scouting for good project management consultants to prepare a feasibility report for the 56-year-old building before bids can be sought from reputed builders. “We anticipate at least 50 per cent extra space per flat in the new construction. Apart from that, we are also looking forward to amenities like centralised AC, state-of-the-art security systems, well-equipped gyms, etc,” said Patel.

In the same neighbourhood, residents of the 45-year-old Satyanarayan Building, have appointed Kabra Group for the job. “Our building was very old and before the Brihanmumbai Municipal Corporation could declare the building uninhabitable, we decided to go in for redevelopment,” said Sharad Maheshwari, a member of the housing society. Maheshwari has moved to a rented accommodation in Prabhadevi, as the “builder is paying us the transit rent, which made the shift easy”.

Other owners of buildings in Worli in negotiations for redevelopment are: Kavi Apartments, Khanna Construction House and Sea Breeze.

Developers are in a keen battle to secure prime projects in SoBo. Consider this: K Raheja Corp and Rustomjee Group were bidding for the sea-facing Palmera Housing Redevelopment project, on Narayan Dhabolkar Marg. Raheja eventually won after making a jaw dropping offer of over 50 per cent additional space to every resident, a big corpus of 70 to 80 crore and a transit rent of not less than 200 to 220 per square foot! Additionally, the new building will have many lifestyle amenities.

On the other hand, Rustomjee is all set to replace the 16-storeyed Miami Apartments in Breach Candy with a 40-storeyed luxury tower, complete with perks and amenities. The deal, insiders said, includes additional space between 30 to 60 per cent per flat owner, and 30 lakh to 40 lakh paid to each member. After rehabilitating the families in the new tower, the developer will build nine extra floors in the free sale component. The present property rates in the area are over 1 lakh per square foot. HT’s efforts to reach out to the Rustomjee Group elicited a “no comments” response.

So why has redevelopment suddenly picked up in these wealthy neighbourhoods?

Sanjay Daga, CEO and managing director, Anex Realty, a property management consultancy firm, put it down to the dilution of CRZ norms and increase in FSI of up to 4. “Under rule 33(9) and 33(11) of Development Control (DC) regulations, apart from the extra FSI, the developer also gets fungible FSI (the additional area developed by the builder beyond the permissible FSI limit) on case-to-case basis. Hence he is able to pass the benefit in the form of 40 per cent plus additional space per resident. The math works well for both the developer and the society,” said Daga.

Anuj Puri, chairman of property consultancy firm ANAROCK explained the spurt of activity in the area on the citizens unwilling to move out of their neighbourhoods. “There is a well-established eco-system in south Mumbai, with its own charms,” he said. “People don’t even want to move to Bandra.”

Puri added that there is no scope for new luxury projects in the vicinity as “there are no greenfield projects or land parcels available”. The only way forward, he said, is the redevelopment route. “This allows housing societies to get a brand-new contemporary makeover and simultaneously the supply of inventory in this niche market gets enhanced through the free sale component,” said Puri.

According to Daga, the estimated redevelopment size in the Mumbai Metropolitan Region (MMR) is to the tune of 30,000 crore encompassing over 14,800 century old buildings that will amplify the market supply by 15 to 20 per cent. There are 1800 planned redevelopment projects across MMR.

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