Games Village developer fighting funds crunch,L-G Tejendra Khanna asks civic agency to help firm meet deadline
The prestigious Commonwealth Games Village project,struggling to touch the finishing line under its cash-strapped prime promoter Emaar-MGF,is finally looking at financial succour from the Delhi Development Authority (DDA).
In a meeting on March 13,sources said,Lieutenant Governor Tejendra Khanna directed DDA the projects other stakeholder to advance Rs 100 crore to Emaar so that work at the site could continue unabated.
It is understood Emaar-MGF had asked DDA for help in December last to meet deadlines. The Dubai-based realty major and the DDA are in a public-private partnership to build 1,168 flats at the site to host athletes. The contract defines Emaar will develop the Village and sell two-thirds of the flats at the market rate to raise funds for the project. The remaining flats were to be sold by the DDA at a pre-determined price.
However,the flats some priced over Rs 2 crore are not finding buyers because of the slow market. Sources said only 200-odd apartments of Emaar had been booked.
Khanna has now directed the DDA to check the feasibility of buying out the remaining Emaar flats at a negotiated price. A committee,with representatives from the DDA,the central public works department,Housing and Urban Development Corporation,the National Buildings Construction Corporation and Pricewaterhouse Coopers,has also been formed to determine the cost of the apartments. A DDA official said: The L-G has directed DDA to release the advance for immediate relief,and then arrive at an MoU to decide about the rest.
Emaar-MGF reportedly requires around Rs 1,000 crore to finish the project on time. According to a development facilitator,the advance amount will sustain the project for the next two months.
Principal Commissioner,DDA,Veena Ish told Newsline: We are looking at all possible funding options to assist Emaar. The urban bodys public relations director Neemo Dhar said: The DDA is committed to ensure that the Games project is completed on time.
The contractors facilitating the project are still apprehensive. It has been more than a week since we heard of the interim relief,but have not received the money yet. Time is running out and workers are leaving. In a few months it will be monsoons.
When contacted,an Emaar spokesperson confirmed that project partner DDA is discussing appropriate funding options. The companys corporate communications official Santosh Singh said: We are in touch with the DDA.
Last December,Emaar had reportedly asked DDA for a loan,admitting to a cash crunch. In a letter on December 22,the DDA refused a loan,saying the contract agreement did not allow it. Later,in February this year,DDA reportedly said it might consider a loan or buy out flats if the need arose.