February 26, 2021 11:05:24 pm
In a bid to boost the long-pending redevelopment of small houses on its leased lands, the Brihanmumbai Municipal Corporation (BMC) has decided to provide various incentives to developers. Under a new policy, developers can now avail additional development rights and relaxation in the payment of premium.
The new policy was cleared in a meeting of the BMC’s Improvement Committee on Thursday. Chairman of the Improvement Committee, Sadanand Parab said, “The policy will benefit hundreds of old small houses as their redevelopment has not been moving ahead. With incentives, developers will come forward for their redevelopment.”
According to officials, there are several dilapidated buildings under BMC limits which are over 50 years old. With no benefits in sight, developers maintained that the redevelopment of such properties is not financially viable.
Under the old policy, redevelopment of old cess properties that are constructed on BMC-owned land and given on long-term leases was not being undertaken. Most of these houses are between 225 and 300 square feet (sq ft). However, while redeveloping these properties, builders would have to provide flats spanning an area of at least 325 sq ft, irrespective of the earlier flat size. Officials said that in such cases, developers could not get the sale component due to inadequate floor space index (FSI).
As per the new policy, developers will be offered 50 to 70 per cent additional incentive areas on redevelopment. They can also pay their premiums in five installments. Earlier, the premium had to be paid in two installments — 50 percent with the grant of the commencement certificate and the other half after obtaining the occupation certificate.
The policy has also reduced interest rates on the delay of premium payment from 18 per cent. In case of delay, builders will have to pay interest between 8.5 per cent and 12 per cent.
The policy also provides relief in terms of the deadline for redevelopment. Earlier, developers had to complete the redevelopment in three years; it can now be undertaken between five years and seven years, depending on the size of the plot in question.
Congress corporator and member of the Improvement Committee, Ashraf Azami said, “It is welcoming that the civic body is giving incentives to developers to speed up the redevelopment process, but I have suggested that all the proposals under this policy should first get the Improvement Committee’s approval.”
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