RK studio sale being seen as big opportunity for realty in city
While the real estate market is still coming to terms with the slowdown, news of RK Studio, a 2-acre prime property in Chembur, being put on sale, is being seen as a big development for the city by developers and real estate agencies.
Realty experts and builders shied away from quoting an amount that the property might fetch; however, the residential property rates in Chembur, where the studio is located, are currently between Rs16,000 to Rs 18,000 per square foot, said industry experts.
Two acres works out to 87,120 square feet in plot size, and the buildable area can be two and half times or more of that, according to the Floor Space Index (FSI) norms, depending on the use the land is put to.
The new Development Plan for the city has capped base FSI for residential development in suburbs at 2.5. It is as high as five for commercial development.
Shirish Baijal, chairman and managing director of Knight and Frank, real estate consulting firm, welcomed the news and said this is a positive boost for the industry. “It’s a rare piece of land which is close to several infrastructure projects like metro and eastern freeway. Both the projects provide public and private commuting options which developers will be interested in. In addition, it’s a huge area which provides flexibility to builders for mixed-use development of land.”
Anuj Puri, chairman of Anarock Property Consultants, expressed a similar opinion. “Chembur has a vibrant residential market and the prime location of the studio makes it ideal for both retail and residential properties.”
Despite the optimism, developers and experts also pointed out that the land values had dropped in the last two years.
“The present real estate market has become more prudent and mature in land dealings. The land value has dropped by 25-30% in the last two years. You might not see the same exorbitant amount for properties now as one did earlier. The next usage of the land will also determine its price,” said Pankaj Kapoor, founder and managing director, Liases Foras real estate research firm.
In June, City and Industrial Development Corporation (Cidco) had sold a 3.3-acre plot in Nerul, Navi Mumbai for the low cost of Rs 181 crore at Rs 1.33 lakh per square metre. The cheap going price was reflective of the sector slowdown as three years back a similar plot was sold for Rs 2.92 lakh per square metre.
While the potential of the RK studio plot is substantial, experts also said that it will have to be settled vis-a-vis the liabilities already created on the plot.
A major fire had gutted a part of the studio last year, destroying stage 1 of the studio during the shooting of a reality show.
The landmark site in Chembur was built by Raj Kapoor nearly 70 years ago. Kapoor’s son and actor Rishi Kapoor confirmed that the family has decided to sell off the property. RK studio will now join other landmark studios which made way for commercial and residential development. Kamalistan in Andheri - owned by Kamal Amrohi’s family, was sold to three developers in 2011. Natraj Studio, also in Andheri, was sold in 2007. Today a gated community stands on the spot.