While Builders And Urban Planners Are Urging An Increase In FSI To Allow Cities To Grow Vertically, CMDA Has Shot Down The Proposal Saying Chennai Does Not Have Supporting Infrastructure
Lack of basic infrastructure and public transportation in the expanded city limits has once again led to a clamourfor higher floor space index (FSI) in inner Chennai -FSI being the ratio of built up area allowed by the government to the plot area available. But CMDA officials say the city does not have the infrastructure for further densification.
Expansion into the suburbs hasn't helped in the development of suburbs, as was originally envisaged. For instance, only five of the 42 local bodies added to Chennai Corporation have an underground sewage system today .
In 2012, a high-level steering committee of the Central Planning Commission recommended giving higher FSI for payment of 50% of the land cost. The revenue sogenerated should be suitably “ringfenced“ for funding infrastructure projects to sustain higher FSI, the committee recommended. With Indian cities having among the lowest FSI in the world, the panel called for strategic densification -a planning strategy to accommodate future urbanization needs. It suggested incentives that would encourage states and cities to pursue this strategy for future urban development.
In Chennai, the CMDA fixes a maximum of 3.5 FSI, which includes premium FSI that comes with an additional payment. For planners, FSI is an indicator of permissible development, considering the available infrastructure. Given the constraints imposed by narrow roads, water supply, sewerage and traffic management systems, a higher FSI would be a boon for land owners and developers but a bane for the city, R Kumar, managing director of Navin Housing said.
Experts say a higher FSI would result in extra load on the already congested and chaotic roads. “If not supported with basic infrastructure, a higher FSI will lead to a complete breakdown of services,“ said P S N Rao, head of the department of housing at School of Architecture and Planning, New Delhi.
Countering the argument that there is not enough infrastructure within the city to support vertical expansion, experts cite the case of MRTS not receiving enough patronage. They also wonder if full use would be made of the upcoming Metro since much of the recently settled population lives in the suburbs -beyond Metro's reach.
As a compromise, some experts say higher vertical growth could be allowed along the mass rapid transit system, metro rail, proposed bus rapid transit system and bus routes. “FSI is an important tool for transit-oriented development,“ said Raj Cherubal of City Connect. “The relaxation of FSI can be conditional upon implementation of requisite infrastructure. The FSI fee could be ploughed into capital and maintenance,“ he said.
But CMDA planners do not think FSI can be raised now, and turned down CMRL's proposal for higher FSI last year saying “it would not serve the real purpose.“ They think densification of the city that has a population of 26,553 persons per sq km would wreak havoc on the existing infrastructure. “The current FSI is fair. If we develop the capacity to handle a greater demand for urban services, we can take a call then,“ said a senior government official. “We need to approach FSI carefully ,“ he said.
It is the responsibility of the government to enhance infrastructure, says N Nandakumar, president of Tamil Nadu chapter of Credai. “We need to step up capacity to suit the development. Decongest the city by going vertical,“ says Nandakumar.
After Lull, Action Heats Up In Country’s Real Estate Sector
Private equity giant Blackstone Group is in discussions to acquire an IT special economic zone (SEZ) in Noida owned by The 3C Company for a little over Rs 600 crore, as its appetite for India’s commercial real estate continues unabated.
The global investor is likely to buy 3C’s 25-acre Oxygen Boulevard SEZ located on the Noida Expressway, people directly involved with the matter said. The deal involves tenanted office space and undeveloped land.
Blackstone is negotiating the transaction on its own at this stage even though it has two joint venture commercial real estate partners in Bangalorebased Embassy Group and Pune-based Panchshil Realty, one of the sources men tioned earlier added.
The PE investor has spent $1 billion in recent years to emerge as one of the largest office space landlords in the country, with a portfolio of 21 million sq ft.
Blackstone declined to comment for the story. An email sent to Vidur Bharad waj, director, The 3C Company, met with no response.
Text messages and phone calls to another company director Surpreet Suri also elicited no response.
Blackstone has picked up several marquee commercial assets through a series of acquisitions, including the Express Towers in Mumbai, eyeing a potential listing of these assets under a real estate investment trust (REIT) in the near future.
The New York-based fund is also closing a Rs 1,050-crore deal with Milestone Capital for 1 million sq ft of office space at Vikhroli in Mumbai, which TOI had reported in May.
Indian stock market regulator Sebi earlier this year unveiled guidelines for domestic REITs, but market participants are seeking more tax breaks.
Southern developer Nitesh Estates, which built India's first Ritz Carlton hotel, has bought Israeli billionaire Mordechai Ziss er's 1-million-sq-ft Plaza Centre Mall in Pune for Rs 300 crore, according to at least three sources aware of the matter.
Zisser's diversified conglomerate Elbit Imaging Group, through its subsidiary Plaza Centers, operates a global portfolio of 37 retail assets in Central and Eastern Europe and India, under the same brand.
The acquisition of the Pune project, spread over 6.5 acres in Koregaon Park, by Nitesh Estates marks Elbit's exit from retail in India after having invested in prime land parcels prior to the 2008 meltdown.
