Mumbai: This weekend is a prestigious luxury hotel in South Mumbai the location of meetings for members of a chic housing company on Altamont Road, one of the most expensive residential enclaves in India. They will meet three of the leading developers of Mumbai separately to pitch their redevelopment offers. The competition between developers for such Prime -property will be aggressive, given that new apartments can reach the prices of RS 1.50 Lakh per square foot.
On Saturday, a prominent developer from Goregaon booked a large banquet room in the hotel. Another major developer booked a whole restaurant on the 19th floor of the same hotel for the members of the Society on Sunday, followed by lunch. Later in the afternoon the third developer presents his redevelopment plan with a national footprint.
The redevelopment mania of Mumbai has reached new levels, with builders who get out of the way to seduce housing associations in Tony areas such as Malabar Hill, Nepean Sea Road, Carmichael Road and parts of Bandra. A prominent developer justified these meetings in luxury hotels as a “necessary exercise for business development”. “It’s expensive, but the developer has to set up his vision of a comfortable location,” he said.
‘Spend on 5-star lunches, no problem if projects are worth crores’
A developer, who finally picked up the redevelopment rights in the sea-development breach Candy Society in the sea, invited his members for a final presentation about ‘drinks and dinner’ in a five-star hotel in South Mumbai.
A prominent developer has justified such meetings. Lunch can cost RS 5,000 per board and the entire presentation from approximately RS 5 Lakh to RS 10 Lakh. “The whole society is invited. So there are no private deals with a few members,” said the developer, who did not want to be identified. “What we need is a good LED screen, sound system and the right cooling for the presentation,” he added.
A source of real estate market recently told another interesting incident. A senior executive in a risk capital fund was shocked when he saw the budget explained by a builder who had applied for a debt financing of a redevelopment project. The financing requirements are normally divided into pre-intimation of disapproval (IOD) and posio-financing. Financing before the IOD has the normal payment heads that must be made to BMC for control costs, NOCs from different departments, including Fire Brigade, for which huge amounts must be deposited, purchase of the floor area (FSI) through payment of premiums, transfer of development rights (TDR) of the market, and so.
While he investigates the financing requirements, a new head called “Entertainment” attracted attention because of the enormous amount of figures. Of course, the person who recommends the punishment of amounts on his plate must check the details of each head, and “entertainment”, who encountered dozens of crores of roepies, came looking for control. The builder then revealed that in order to get a project in chic areas, lunches and dinners should initially be organized for selected five-star hotels for office carriers and members of the Management Committee, then for all members who will help reach the 51%plus target for redevelopment.
The director expressed his fear of convincing his administration about the need for such enormous editions and found that the head under which such huge amounts are being sought – “entertainment” – would naturally be noticed first. The builder replied Cool that the nomenclature could be changed to “Education” because “we inform members about the benefits of entrusting us with the task of redevelopment”.
A Nepean Sea Road Society has had several lunch meetings and brunches with builders on Sunday because their society is on the land of collector and is not a member of paying the amounts for the conversion of its status to keep free. The builder who pays for these free lunches makes special efforts to convince them that he can get the conversion to keep the members at least time for free.
In a Carmichael Road Society, members did not want to join the adjacent society for cluster re -development only because the neighboring field of society was fueling to Pedder Road and by joining them, the tag of Carmichael Road that gives them premium selling price has been lost. They had to be convinced and services of top five star hotels were used.
Veteran -ownership expert Pranay Vakil said that the land prices in South Mumbai are so exorbitant that developers prefer the redevelopment route. “Once you have convinced society, the developer gets control of the country with high FSI and a considerably free sales area in luxury places,” he said.
So if a single redevelopment of society in a chic South Mumbai district could be worth a few hundred crores, a paid meal and presentation in a large hotel is no problem for an A-list developer.
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