Sunday, November 17, 2013

Mhada ‘gifts’ newly repaired society to builder for redevelopment

MUMBAI: For a nominal premium of Rs 165 crore, Mhada, the state agency entrusted with providing affordable homes, has allowed a builder to redevelop a Worli housing society with a development potential of around Rs 2,000 crore. The buildings were repaired and painted three years ago, but the Maharashtra housing and area development authority still declared them dilapidated so that the project could be pushed through to procure a much higher FSI since the plot falls under coastal regulation zone (CRZ II).

Mhada's role in the Shivshahi cooperative housing society case raises questions about whose interests the housing authority has at heart: economically weaker flat-buyers or influential developers. In 2010, Shivshahi CHS, comprising 192 flats allotted to low-income families in 12 buildings, awarded the redevelopment rights to Wonder Value Realty, a joint venture floated by HBS Realtors and IL&FS.

Earlier that year, a Mhada policy had scrapped the premium option and instead made it mandatory for it to receive a proportionate share in the built-up area from the builder when such properties are redeveloped. But the housing authority did not insist on its share: at least 600 new tenements for economically weaker sections (EWS) in a prime area like Worli. "This has caused a huge loss to Mhada, whose basic principle is to create housing stock for the common man,'' said sources.

Responding to TOI's query as to why it let go of its share, Mhada CEO Satish Gavai said, "Your information is maliciously incorrect on fact and law.''

R B Mitkar, Mhada's resident executive engineer, said the builder's proposal was received on August 18, 2010, just before the new policy stipulating sharing of built-up area came into force. "The Mumbai board approved the proposal as per the earlier premium policy,'' he said.

Yet, documents including official file notings made available to this newspaper show that the proposal was submitted to Mhada on December 23, 2010—several months after the revised policy was introduced. In fact, on the same day Shivshahi housing society wrote to the chief officer, Mumbai board, proposing to redevelop the property under development control regulation 33 (5).

Also, the modified CRZ notification of January 2011 stipulates that only buildings declared dilapidated are eligible for a floor space index of 2.5 FSI for redevelopment in CRZ areas. All other redevelopment projects for Mhada colonies in CRZ II are entitled to 1.59 FSI.

In an email reply, Kayvanna Shah, CEO of Wondervalue Realty, said, "Mhada cannot undertake redevelopment of an ownership society like Shivshahi without the express consent of the society. There is no provision in law where Mhada can unilaterally decide to become a developer of an ownership society without their express consent. Therefore, there is no question of Mhada generating 600 EWS flats from the society.''

Asked why the buildings were declared dilapidated despite being repaired recently, Shah said, "Dilapidation is an existing established state of the building. However, they had to be repaired partially to be made habitable, for the safety of the existing members of the society since prevention is better than cure.''

The three-acre land on which the Shivshahi society stands, was leased to Mhada by the municipal corporation for 999 years for building EWS tenements for industrial workers. The buildings came up in 1950.

Shivshahi is just one of the five societies in the 34,000 sq m (8.5 acres) Mhada layout. Of this, Shivshahi occupies about 12,325 sq m (3 acres). Sources said open spaces and recreation ground belong to all the five societies. Yet, the FSI generated from these common areas was parcelled off to the developer by Mhada. "This additional FSI belongs to all societies within the Mhada layout and not just Shivshahi,'' they said. TOI has learned that as a result, the construction permission is a phenomenal 9.57 times the plot area.

Residents decided to go in for redevelopment by inviting tenders from builders in April 2004. Since then, it is alleged, several state politicians were interested in this property because of its prime location.

The plot thickens

Shivshai CHS At Worli

Society Plot Area: 12,325 sqm

Total FSI On Plot: 30,814 sqm

Market Rate In Worli: Rs 40,000 to Rs 60,000 a sqft

Mhada Gets Premium Of Only: Rs 165 crore

Estimated Loss: 600 Affordable Homes