Dharavi Redevelopment Plan Takes Off, Tenders Invited
Dharavi, one of the largest slums in Asia has finally invited tenders to start off with the redevelopment. This is the third time that the attempt has been made in this area spanning 593 acres which houses over 60,000 families. The minimum bid is set at Rs 3,150 crore.
The new plan
The new plan also holds that Dharavi be developed into a single cluster and not in parts. For this, a special purpose vehicle (SPV) with 80 per cent private stake and 20 per cent government contribution will be constituted to complete an estimated Rs 22,000 crore-project.
The lead partner would be expected to form the SPV with its own contribution of 80 per cent equity worth Rs 400 crore while the Maharashtra government would be putting in Rs 100 crore. The lead partner is also expected to look into further investment required for the project. The tenders will be available between November 28 and December 28 which is the last date for submission of bids.
What the SPV gets
While the SPV would be in charge of constructing free settlements for those eligible, in lieu, the SPV would be entitled to construct free sale area that can be sold to homebuyers in the open market. The FSI will be four times higher.
Given that the Dharavi area in Mumbai airport’s funnel zone (a controlled airspace where high-rises are usually banned owing to the safety of buildings), there are height restrictions imposed on buildings here. However, to ensure the project is successfully implemented, the housing department is seeking some relaxation in terms of the space between two high-rises which is currently 18 metres. For DRP, the department has suggested that the distance between buildings could be maintained at 12 metres so that more high-rises could be constructed.
What’s the future
Industry experts know that this much-awaited development could change the face of Mumbai real estate and not just for the slum-dwellers. Dharavi’s strategic location, close to Bandra and the Bandra-Kurla complex makes it a gamechanger. Given that Mumbai is already under pressure when it comes to residential housing, the redevelopment project could lift the burden off South Mumbai localities. Some even do not shy away calling it a potential business district. However, this is definitely, too early to arrive at such a conclusion especially after failed attempts to redevelop it. At the same time, it is also interesting to note that the government is offering sops and subsidies as also stamp duty waivers on the development rights agreement and the first sale of saleable area.