Adopting a pro-builder approach, Maharashtra Housing Minister Jitendra Awhad invited realty players to become equity partners with the state housing authority MHADA to jointly develop mass affordable housing projects.
The state government will no longer just be a facilitator, but will be a partner to the risks involved as well as profits generated from projects undertaken under such arrangements, he said.
"The day I took charge I had announced I am pro-builder. I will do whatever it takes to ensure we build affordable homes. So far we have only been facilitators. Now I feel we need to change our approach. I want real estate developers to joins hands with us and become equity partners in projects undertaken by MHADA," Awhad said at CII Real Estate Summit.
He said the need of the hour is to create affordable housing to ensure housing for all.
"We have schemes like the PMAY which have proved to be a game changer. We need to scale it up and while doing so, we believe we can be equity partners. Also, we will ensure that all the legalities and approvals would be taken care of by us. We are willing to share the risks with developers. If the developer makes profit, we will also share the profit. It will be a win win situation for both," Awhad added.
Citing examples of proposed mass housing projects undertaken by the MHADA like the redevelopment of BDD Chawl in central Mumbai and city's red light area in Kamathipura, he said builders can become equity partners in such developments.
To assess the financing scenario for the real estate sector, the minister has also decided to meet lenders and bankers.
"I have already met SBI chairman and will soon meet the representatives of Indian Banks Association. While we are ready to address the issues faced by lenders, they are not willing to come forward," he added.
Meanwhile, Awhad said Dubai-based realty player Emaar Group has approached him and expressed its willingness to set up projects in the megapolis.
According to industry experts, such a move would be a win-win situation for all stakeholders as the presence of a state authority as partner would bring in more credibility to the projects.
"This will be a lethal combination as MHADA will bring credibility, assurance and faster approvals to the table, while private developers will get design, efficiency and agility, making it a win-win for all. Also, as the state government body is getting involved at the project level, financing will also be easier," Anarock Property Consultants Chairman Anuj Puri said.
He said governments of Uttar Pradesh, West Bengal and Haryana have adopted a similar approach for housing development and the model has been successful.
Praising the then chief minister Devendra Fadnavis-led government's initiative to curb land speculation by SEZ developers, Awhad said the new government will take forward this initiative to ensure creation of affordable housing.
"These SEZs where development has not taken place, we will take back the land allotted to them and reimburse them at the same rate at which it was acquired by them initially. The intent is to curb land speculation and create affordable housing on these lands," he said.
Awhad noted that a bill in this regard, titled SEZ Prevention of Land Speculation Bill, was expected to be tabled by the then Fadnavis government, but it did not happen. "But we will take this agenda forward and free such SEZ lands for creating affordable housing," he added.
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