Thousands of realty investors who have hugely invested in lands will be affected by the new development plan issued by Ahmedabad Development Authority (Urban). As per the new plan no more Non- Agricultural certificates will be granted.

Banning the conversion of agricultural land for other purposes, Ahmedabad Development Authority has decided not to entertain any more new NA applications. All the more the pending NA applications will also be cancelled. The new development plan is expected to affect thousands of property investors who have invested mainly on land.

Investments on land are considered as a suitable form of investment for the small scale investors. As they do not have sufficient fund to develop projects, they can opt for investing on lands which will surely bring them higher returns within a couple of years. There are many who have invested on lands with the purpose of constructing farm houses or to sell it out after some couple of years.

However with the new development plan of the Ahmedabad Authority, those who have invested in lands will be trapped as the new rule permits the construction only in 5% of land. The new plan is applicable in 68 villages which fall under the Ahmedabad Development Authority.

The new plan will be mostly affecting the farm house- constructions. Most probably the farm houses will be impossible to be built as they will not be given the permission to construct building on agricultural lands.

As per the new rule the village- limits will be extended to a further 200 m radius. Though constructions will be permitted in this area, people have to first gain the consent from the Ahmedabad Development Authority. Once they attain the consent, they will be able to make houses in these areas. Relaxations on constructions will be applicable for township projects and institutional constructions.

Ahmedabad Urban Development Authority has announced a 30% rise in the floor space index on February 1. The increased FSI will enable the builders to construct taller buildings. The new development plan will be applicable to around 68 villages and other areas of the city.

Finally Ahmedabad will witness taller residential and commercial development in the city. High- rise apartments and taller commercial malls will become common in Ahmedabad. Paving the way for vertical real estate development, AUDA has announced a 30% rise in the floor space index.

However the announced changes in the FSI rates are believed to bring about coinciding swings in the General Development Control Regulations (GDCR) too. While bringing maximum transparency and standardization; GDCR ensures least flexibility in interpretation.

Currently the FSI in R-2 zones is 1.2 and this will be improved to 1.8. Under the new development plan, separate land parcels will be allocated for roads and infrastructure development. Further lands will be separated for constructing residential projects, industrial centers and agricultural fields as well.

Besides the FSI- alterations in the R- 2 zones, AUDA has raised the FSI in the R-1 zones as well. The existing 1.8 will be bettered to 2.5 in the R-1 zones. Up to now the builders were permitted to develop only buildings with a maximum height of 40 m. However with the new development plan the builders will be able to build buildings up to 70 m.

The new development plan is expected to help the builders construct taller buildings. Moreover they will be able to meet the increased demand for affordable housing units in the city. The builders will be able to provide homes at lower rates as they are able to cut short a major part of cost spent for purchasing land. The vertical development is comparatively less costly compared to the increased land prices.

The panel said the charges for additional FSI and land-use conversions should be at least 50% of the circle rate in the area and should be determined professionally. It added that additional FSI should be permitted selectively.

The commission’s steering group on urbanization said the revenue from grant of additional FSI should be “suitably ring-fenced for funding infrastructure projects to sustain higher FSI”. “The proposals, if accepted, would substantially increase availability of housing stock and moderate realty prices,” said an urban development ministry official.

Calling the present density regulations in Indian cities “archaic”, the report noted that Indian cities had the lowest FSI in the world. “This (densification) should be part of a balanced strategy for expanding the effective supply of prime land and, in the process, raising funds to finance urban infrastructure improvements,” the committee noted.

The Centre should introduce incentives that encourage states and cities to pursue densification strategies for future urban development, it said. Many cities were already levying such charges for additional FSI in some form or the other, it noted. Hyderabad, for instance, has a ‘city level impact fee for high rise buildings’ and Ahmedabad has systematically been selling a limited amount of additional FSI.

The committee said higher FSI should go hand in hand with provisions such as amalgamation of plots to make housing more affordable. Rather than the current practice of having a blanket FSI across a city, the panel wanted mixed land use promoted through the concept of granular FSI. “Densification with mixed land use as a planning strategy needs to be followed by the authorities to accommodate future urbanization needs,” said a ministry official.

Indiabulls is expecting a strong demand at projects in tier-II cities such as Baroda, Ahmedabad and Indore as these have been appropriately priced, between 2,000-5,000 rupees per square feet. Indiabulls is assured that they can meet the increasing demands for residential real estate.

This trend has added to the stagnant spaces in new malls, which have already been finding it difficult to get initial bookings from retailers. According to a report by global real-estate solutions firm Cushman & Wakefield (C&W), the mall vacancy rate in urban India touched a high of 16% by the end of 2008.

The survey was carried out across eight major cities—NCR, Mumbai, Kolkata, Ahmedabad, Bangalore, Chennai, Hyderabad and Pune. The report attributes the vacancy levels to inconsistent mall supply and revival of the high street as the most sort after retail destination. The highest level of vacancy in malls was witnessed in Delhi and Pune, with vacancy levels of 24% and 15%, respectively.

“There is a gradual but noticeable exodus from malls to single-format stores on high street. Today, retailers seek viability in stores and give lesser importance to stores for branding purposes,” says JLLM (Jones Lang LaSalle Meghraj) MD (retail) Shubhranshu Pani.

“The retailers are preferring the high street because of higher visibility, independent access and the greater comfort level as compared to the malls,” Cushman & Wakefield retail services director Rajneesh Mahajan adds.

There was no authentic data to indicate such a trend. Thus, property buyers remain confused, not knowing, for instance, whether Mumbai property prices fell more than that of Delhi in the last quarter?

The same does not happen with equity investors. At the end of the day, anyone wants to know the day’s market trend and for this he could take help of BSE/NSE website or see next day’s newspaper to know the exact rise or fall of Sensex or Nifty. Sensex or Nifty are taken as a barometer of market sentiment. With years of index publishing, a sort of credibility and association has been built with the equity investors by these financial institutions.

NHB made a beginning in this direction in 2005 when it launched a project for preparation of the real estate price indices for the residential housing segment, NHB Residex. To start with, the project envisaged compiling the indices for 10 cities — Greater Mumbai, Kolkata, Delhi, Chennai, Bangalore, Hyderabad, Ahmedabad, Kanpur, Jaipur and Patna. It also gave price appreciation figures for major cities at the time of the launch of the index. However, getting data from NHB has been tough for analysts.

With various mutual funds planning to soon launch real estate funds, it is imperative that a reliable index data, preferably from a government body like NHB, is made available to act as a benchmark.

Capturing real estate prices in India has its own challenges. Thanks to different types of housing that are made available by builders, there are large variations in property price in a single locality. It is difficult to put a single price to a locality which has different class of houses, say premium as well as low cost.

However, NHB with its wealth of information on loan disbursements and other crucial figures could do a lot for the industry. Since most financiers would have data on a city-wise basis, it could be shared with NHB for internal index calculation purposes. If NHB cracks the same, it could be one big step towards making the industry more competitive.

For the Gujarat Institute of Housing and Estate Developers (GIHED) has joined hands with the Association of Indian Americans in North America (AIANA) to host their first international property show at the second ‘Chaalo Gujarat: World Gujarati Conference’ to be held at New Jersey in August 2008. The first conference was held in New Jersey in September 2006.

The three-day conference-cum-exposition, in which nearly 50,000 NRGs are expected to participate, will primarily see Ahmedabad-based realtors pitch Amdavad as well as upcoming residential and commercial property projects worth over Rs 20,000 crore to NRGs.

The property fair will also showcase a glitzy Amdavad of tomorrow, replete with jumbo projects like Gujarat International Financial Tec-City, Sabarmati riverfront project, Bus Rapid Transit System, new international airport as well as a 3-D colour laser show and special film.

Ms Jennie Chua, Ascott’s President & CEO said, “Citadines Ahmedabad Parimal Garden marks our entry into West India and extends our footprint beyond the southern cities of Bangalore, Chennai and Hyderabad“.

Chandigarh: DLF, a leading real estate player in the country, plans to invest Rs 1,250 crore for the development of its multiplex business. The company has planned to add minimum 500 screens in the next four to five years across the country.
DLF’s entertainment arm DT Cinemas will set up a megaplex, which will have 12 screens with a total capacity of 2,500, as part of their upcoming project, Mall of India, at Gurgaon.
Expected to be one of the country’s biggest malls, it will cover an area of 40 lakh sq ft.
DT Cinemas announced the opening of their multiplex at DLF Infocity, IT Park, Chandigarh. Infocity covers an area of 1,90,000 sq ft and most of the space has been leased out. The mall will start operating within the next 10-12 days.
Kajal Aijaz, CEO, DT Cinemas, said that with the multiplex offering state-of-the-art facilities like Christie cinema projection system, excellent acoustics, wall-to-wall carpeting, extra legroom with comfortable slideback seating and push back armrests for the audience, they were eyeing about 66 per cent occupancy at the multiplex in the first year.
With DLF planning to set up another 120 malls in different parts of the country, DT Cinemas would be the chief attraction in most of these malls.
Apart from Ludhiana and Jalandhar, where multiplexes would be opened in a couple of years, the company is also opening multiplexes at Savitri-GK2, Shalimar Bagh, Vasant Kunj and Saket in Delhi and Star Mall, Gurgaon, this year, Aijaz said.
DT Cinemas will also set up multiplexes in Hyderabad, Chennai, Kochi, Bangalore, Mumbai, Pune, Ahmedabad, Goa and Kolkata.

The company is also ready to start assembling its, yet to be launched, A4 variant in the country with an investment of 10 million euros.

Mr. Benoit Tiers, MD, Audi India, said, “We are expecting to sell 1,200 of our cars in the Indian market in 2008 compared to 350 cars sold last year on the back of growing demand for luxury cars in the market”.

He said that the company has observed 80% growth during the first quarter of 2008 by selling 220 units in India.

Further Mr. Tiers said, “The sale of total luxury cars in India during first two months of this year posted 176% growth, while the car industry as a whole posted just 9% growth, which shows the demand for luxury cars is growing at a tremendous pace”.

When asked about the launches, he said Audi was considering introducing its smaller SUV Q5 here. “First it will be rolled out in Europe and UK then we will launch this car in India,” he said, but refused to give any timeline.

Meanwhile, Audi would launch its A4 version here in July. He informed, “We will also start the assembling of this car at our plant in Aurangabad which will have initial capacity of 800 units that will be doubled during next year. To start assembling this car, we would invest 10 million of euros”.

At present, Audi assembles A6 variant at its plant and has so far invested 20 million euros.

Audi also plans to open five exclusive showrooms in Ludhiana, Chennai, Kolkata, Cochin and Ahemdabad. At present it has showrooms in Delhi, Hyderabad, Gurgaon and now Chandigarh among others.

As per current thinking Railway land is to be given to developers for commercial development through transparent bidding process on long term lease basis for development work without any budgetary resources. The work of redevelopment of identified 26 stations into World Class Stations are planned to be undertaken through PPP basis.

No funds from Railway Budget are envisaged to be invested except to the extent of meeting requirement of viability gap funding in exceptional cases of development of stations as World Class Stations.

The 26 stations identified for redevelopment as World Class Stations through PPP are : Nagpur, Pune, Carnac Bunder (Mumbai), Howrah, Lucknow, Anand Vihar (Delhi), Bijwasan (Delhi), Amritsar, Chandigarh, New Delhi, Varanasi, Chennai, Thiruvananthapuram, Secunderabad, Tirupati, Ahmedabad, Patna, Bhubaneshwar, Mathura, Bangalore, Gaya, Jaipur, Agra, Bhopal (Habibganj), Kanpur and Guwahati.