The Navbharat Mega Developers Private Limited (NMDPL), the special purpose vehicle (SPV) of Maharashtra government and Adani group, which has been formed to redevelop 600 acre Dharavi redevelopment project in Mumbai, one of the largest slums in the world, will get to sell 10 to 12.5 million sq ft of properties a year once the project is completed. The SPV aims to complete the project in seven years.
“Depending on the market conditions, we will decide how much to release,” said SVR Srinivas, CEO, Dharavi Redevelopment Project.
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Adani Group holds 80% share in the SPV and the Maharashtra government holds the remaining 20% stake.
Srinivas said the SPV will monetise the project’s transferable development rights (TDR). The SPV will take a call between free sale component and TDR, he added.
TDR are rights issued to a landowner that allow them to transfer their unused development rights to another location, often to encourage development in specific areas.
Srinivas refused to quantify how much they will monetise via TDR route. “Entire TDR can’t be utilised in Dharavi. The SPV will take a call between sale of TDR and sale free sale component,” he said.
Property experts don’t see this disrupting the market as there is huge housing demand in Mumbai.
“Half the people in Mumbai live in slums and there is influx of people into the city. There is huge demand for houses,” said Niranjan Hiranandani, founder and managing director at Hiranandani group.
He said the new supply in affordable, mid and premium housing will expand the market in Mumbai.
On the issue of government working on a law that developers in Mumbai have to buy 50% of TDR to be bought from the Dharavi project, Srinivas said the government is of the thinking that the rule will help in making Mumbai free of slums and help iin redeveloping them . DRP generates slum TDR as opposed to regular TDR available in the market, he said.
He added that a total of Rs 3 lakh crore will be invested in the project including rehabilitation work and infrastructure and funds will be raised through compulsorily convertible preference shares (CCPS). and they have raised Rs 4000 crore from Adani group.
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