Dharavi, a splice of prime land in the heart of Mumbai, is termed as gold mine by many real estate developers. The Dharavi Redevelopment Authority (DRA) [earlier this year] had invited global as well as domestic players to submit their bids latest by April 20. However, the most ambitious Rs 25,000 crore Dharavi redevelopment project has not received a single bid till date. Keeping this in mind, DRA has extended the deadline to May 5. The government has set a target of seven years to complete this project.
It is said that the reason for such lackluster bidding is fear of political opposition and the risk in a sluggish real estate market. This is the second attempt made towards the redevelopment of Dharavi area. Earlier in 2007, the Government had expressed their intentions and had also received 14 bids. Out of 14, seven backed out while others were found faulty and the project failed to kick off and was finally cancelled in 2011.
Nirmal Deshmukh, CEO, DRA, confirmed the news about receiving zero bids. He even said that the authority has extended the deadline to May 5.
In March this year, DRA had arranged for a pre-bid meeting to enlighten the builders to take upon Dharavi development. As many as 16 developers, who evinced interest in taking up the project, attended the pre-bid meeting. Sixteen developers included top names from the real estate business, including Oberoi Realty, BG Shrike Construction Technology, Omkar Realtors, Kalpataru, among others. However none of them submitted their final bid for the project.
The redevelopment of Dharavi was divided into five sectors and the sector five was taken up by the Maharashtra Housing Area Development Authority (Mhada) for redevelopment. Tenders were invited for other four sectors with one developer for each sector.
For the other four sectors, the Government estimated the redevelopment project, with a floor space index of four, to create 1.08 lakh houses across the four sectors, of which 40,000 would have formed the sale component of the four developers. Of the rest, at least 55,000 houses were to house Dharavi’s existing eligible residents, while the rest of the housing stock was to be given to the Government to be sold as affordable housing in the market.