A macro and micro urban solution

Menon of Sobha rises to the occasion

If HDFC chief Deepak Parikh has raised the bar for the country's builders, then there is at least one among them who is ready to rise to the occasion.

P N C Menon, chairman of Sobha Developers, gets a pat on the back from M R Narayana Murthy every time he delivers a new facility for Infosys and is not the sort to give up a chance to strengthen his brand equity.

So he reacts positively to both the challenges that Parikh has posed before builders: start quoting rates to home buyers on the basis of carpet area and not super builtup area, and give a warranty for what you sell. After all, this is the biggest investment a middle class family makes.

Quoting rates on the basis of carpet area or plinth area (that's the international practice, he says) "is a very good suggestion and I will present the idea before our forum Karnataka Ownership Apartment Promoters Association," he says.

To him and other Bangalore builders it will make no difference as "Bangalore builders are very transparent about the common area." There is no reason why they cannot change to the practice of billing on the basis of plinth area to raise "the comfort level" among buyers.

He avers that Parikh may have been prompted by practices in Mumbai where there is an "overload of 5-10 per cent on account of non-built-up area" in the rates builders quote.

If there is a need to stick with the herd ("if all get together then it can be done") on the billing practice, Menon does not feel a similar need when it comes to giving a warranty.

"That is not an issue; I can do it (issue warranty) alone. Sobha can be the first to set the ball rolling. Globally issuing a warranty is part of industry practice. So I can't see why this cannot be done. The Bombay culture is different though," Menon says.

He has caveats though. From the engineering point of view, there can be a "settlement' issue with a building. And there can be natural calamities. "But our engineering competency is so programmed that we can give a warranty excluding settlement and natural calamities," he asserts.

Parikh may have imposed an agenda on Menon but he has two of his own. He has a solution for urban renewal and sustainable growth and also a programme that ties up with the present Union government's concern for the deprived.

On healthy urban growth, which is a concomitant to rapid development, Menon's idea is satellite cities of nothing less than 3,000-5,000 acres within 30 km from the city centre to decongest the existing city.

All that the government has to do is build a first class multi-lane road connecting that city to the old one. A consortium of builders can take care of everything else "� entire infrastructure within the satellite city, buying land from farmers at fair prices with government help and rehabilitate those displaced by the project.

"I am already talking to fellow builders saying, let us form a consortium." The ideal location for a city like this is down Bellary Road (it leads to the new international airport), which is already a six-lane highway.

Every aspect of the concept is important. The project has to be sufficiently big for it to be self-contained (offices, homes, markets, schools, etc) so that only 15-20 per cent need to get out of the city for whatever reason. The bigness allows integrated facilities to be built and the cost spread out.

A 5,000-acre city can be spread over 20 sq km and house 2.5 lakh people. "This is the solution for every city, the only solution," asserts Menon. He does not think the Sahara Group's Amby Valley fits this bill as in his view it is too far away from both Mumbai and Pune and is reached partly by a winding road.

If this is Menon's macro solution, he has a micro solution too. He has devised an affordable housing plan for the tradesmen (mason, carpenter, plumber, etc) who work for Sobha. They are critical to good construction and also need to live in a pleasant environment so as to develop the right attitudes.

"We are going to build 8,000 dwelling units for them in 10 years, starting next year." Menon reels off the figures: land at Rs 30-35 lakh per acre, 50 per cent ground cover for 'ground plus two' construction, 500 sq ft flats for Rs 2 lakh, with a subsidy of Rs 50,000 per flat which actually costs Rs 2.5 lakh.

"The subsidy bill will be Rs 40 crore in 10 years, from my personal wealth," Menon declares.