Mumbai landlords may benefit from redevelopment

Windfall for 17,000 dilapidated city buildings

Landlords of 17,000 old (mostly) dilapidated buildings in Mumbai city may soon be entitled to a 10 per cent share in redevelopment profits according to a proposal cleared today by Maharashtra's council of ministers.

"For far too long, the nearly 20 lakh people housed in these ramshackle buildings in Mumbai have been put to risk. Litigation by either landlords or tenants have effectively stalled any redevelopment plans for these buildings which are in a precarious condition. We are seeking to end this logjam, by authorising the Maharashtra Housing and Area Development Authority (MHADA) to acquire such buildings for redevelopment. While the tenants of the existing structure would be re-housed for free in the new building developed on the existing plot, the landlords too would be given a share of up to 10 per cent in the profits from the commercial plots," chief minister Vilasrao Deshmukh told mediapersons.

Deshmukh added that the proposal cleared today foresees each tenant given a free accommodation in the redeveloped complex. The landlord too would be entitled to a free 225 square foot accommodation or 10 per cent of the profits realised from the sale of the additional units created in the new building for commercial sale by MHADA (whichever is higher).

Another stumbling block to the proposed plan is related to the fact that 40 per cent of these 17,000 buildings fall under the coastal regulation zone (CRZ) where no development is permitted.

Deshmukh said, "We have already communicated to the Union government that since these are already existing structures and considering their dilapidated nature, the redevelopment of even those building falling under the CRZ should be sanctioned. We are awaiting the Centre's response to our proposal."

"We will also direct the Brihanmumbai Municipal Corporation (BMC) to create a single window clearance facility for this scheme so that multiple permissions do not create a roadblock in the redevelopment of these old buildings," Deshmukh added.

The council of ministers also cleared a proposal which will henceforth exempt green houses and polyhouses located in the state from the ambit of being termed as industrial units. Henceforth, these units will be categorised as agricultural units.

Deshmukh noted that the state was going through a power (energy) crisis with the period between January 24 to 30 witnessing a daily power generation of 8,496 mw in the morning against a demand for 10,747 mw. The evening peak hour demand of 11,311 mw also experienced a shortfall of 2,236 mw as only 9,075 mw was generated during this period.