Noida: Co-developers will have to clear all land cost dues

Noida authority CEO, Amit Mohan Prasad, said co-developers for stuck realty projects will be approved if the new builders clear dues and have adequate funds

The chief executive officer (CEO) of the Noida authority, Amit Mohan Prasad, said applications for co-developers by builders unable to finish their project will be approved if the new builders clear land dues and have adequate funds to finish the projects.

Builders who are unable to finish their projects can get another developer to finish the housing project. (Sunil Ghosh/HT File)

Under the co-developer plan, developers unable to finish their projects can get another developer to finish the housing project.

The Uttar Pradesh government had on December 13, 2016, approved a project settlement policy to address issues faced by the realty sector in Noida, Greater Noida and Yamuna Expressway areas.

Under the policy, one of the options was for a builder to rope in a new builder who wants to invest money and finish incomplete housing projects.

“We are here to solve issues and ensure delivery of flats to buyers. I am ready to approve co-developer applications of any builder who is unable to finish a realty project. But the co-developer will have to clear land dues of the project and have the financial strength to finish the project and deliver flats to homebuyers,” said Prasad.

For instance, if a developer has to pay Rs100 crore in land dues in a stuck realty project, the co-developer will first have to first deposit Rs25 crore (25% of total land dues in the particular project) before taking it over.

“Before approving an application, we will examine whether the builder has adequate funds to finish the project. As of now, the Amrapali Group has submitted two applications as it wants to introduce co-developers in its two projects. We will check and take a decision soon,” said Prasad.

However, homebuyers whose flats are stuck in delayed housing projects are apprehensive of the co-developer scheme as they feel the old builder will be able to get away without fulfilling the promises made at the time of purchase of the flat.

“Our concern is what will happen if the old builder exits from the project and the new builder too fails to finish the project. We will have to suffer again. We hope the authority ensures that the new builder has the capacity to complete a stuck project,” said Vinay Gupta, a buyer.