Mumbai Real Estate: The Redevelopment Maze

arvind jain - desk1Arvind Jain, Managing Director – Pride Group

 

Redevelopment is not a new phenomenon in Mumbai. Various parts of the city have being seeing redevelopment in pockets for many years as the city planning authorities strive to accelerate urban renewal and improve the quality of real estate and infrastructure, and developers strive to make a profit. The redevelopment process happens against a backdrop of the city’s fast-growing population and the rising demand for space amid limited availability of developable land.

 

Redevelopment is necessary as every building has its own inbuilt shelf-life, after which the building becomes unsafe to live in. Such buildings are often difficult to maintain and are unattractive to the market. Also, without redevelopment, there would be no new supply in the fully developed city centres.

 

Mumbai has many land-constrained pockets with a fairly large stock of dilapidated, unsafe buildings with none of the amenities and conveniences that contemporary home buyers and office space occupiers expect for the mind-boggling financial outlay required to secure space in Mumbai. In the financial capital, redevelopment is the only logical solution to address the growing issue of urban blight, and for improving the overall profiling and viability of the city.

 

The benefits of redevelopment in a city like Mumbai are numerous – the urban sprawl is tamed to some extent, the economic competitiveness of the prime precincts increases, and the incidence of building collapses reduces. According to the most recent studies, areas in South Mumbai such as Colaba, Mumbadevi, Malabar Hills, Shewri, Byculla and Worli are beset with the highest burden of decrepit buildings in the city.

 

This encompasses over 400 buildings, of which more than 80 are in the C-1 category, which pertains extremely dilapidated and hazardous buildings. Apart from the south Mumbai constituency, areas such as the Dadar-Chembur belt, Mulund, Khar, Bandra and Santacruz are seeing considerable redevelopment activity.

 

The government of Maharashtra had taken steps towards boosting ‘cluster development’ in the city. Unlike the standard practice of redeveloping cessed, condemned or otherwise uninhabitable buildings, creating cluster development is a much more complicated affair because it involves redeveloping groups of structures within specified area – for example, chawls or slums.

 

However, despite its avowed focus on redevelopment, the government has not been able to translate its enthusiasm into a coherent and viable policy framework. Redevelopment of Mumbai’s oldest areas still faces the constraints of a lackadaisical rate of regulatory approvals and clearances.