Infra projects can be executed through the premium recovered from development projects
Real Estate

Infra projects can be executed through the premium recovered from development projects

SITARAM KUNTE, Municipal Commissioner, Municipal Corporation of Greater Mumbai, highlights the benefits of DP-2034.

What are the highlights of the plan for the real-estate sector?
The DP-2034 is conceived as a framework to provide opportunity to secure adequate floor space for anticipated growth. It is not an entitlement per se, but a maximum that can be attained, subject to other conditions. There will be adequate scope for new construction at any time. While avoiding market distortions, the plan provides reasonable incentives for inclusive development by using a layer of premium FSI across the city to raise finances and offering a simplified definition of FSI with minimal exceptions that is expected to reduce transaction cost and time. With the proposed regime, FSI will be a tool to manage physical development. It will not distort the market by creating scarcity of development rights but establish a framework within which the market can operate competitively. The FSI profile is seen as an outer envelope that will not be fully consumed in the next 20 years. Also, in the earlier DP, zoning provisions were restrictive. But the Draft DP 2034 has proposed provisions like residential-commercial or commercial-residential, thus permitting mixed-land use, which is the demand of the market.

How will the new DP help expedite infrastructure projects?
Earlier, FSI was restrictive and city development operated through various sections of additional FSI. DP-2034 has proposed two layers from the component of FSI as premium FSI, as premium A FSI @ 70 per cent of RR rates and premium B FSI as 100 per cent of RR rates. Although all other payments like premium for deficiency in open spaces, staircase or lift area premium, fungible FSI premium and additional FSI premium are proposed to be removed, the premium A and premium B from developments can be used for development of infrastructure.

What mechanism will be in place to expedite approvals as stated in the DP?
The Draft DP proposes the permissions as planning permissions and building permissions. As per the plan, permissible FSI is not an entitlement for the plot owner and proposed FSI profile is seen as an outer envelope. Full FSI can be achieved if requirements of other regulations like marginal open spaces, room sizes, parking, etc, are fulfilled. Hence, the proposals will be approved at building proposal sections, saving time and money.

How will the formation of this new DP support the MMR transformation plan?
The DP is conceived on the principle of transport-oriented development (TOD). The Metro network proposed by MMRDA to be executed in the plan period, i.e. up to 2034, is considered in the DP. FSI is based on TOD principles along these transit corridors. Cognisance of the node where the Trans-Harbour Link connects Mumbai has been taken, and zoning and FSI provisions made accordingly. Other provisions related to the MMR region will be dealt with by MMRDA. Infrastructure projects related to Mumbai can be executed through the premium recovered from development projects, which will not be fully consumed in the next 20 years. This will ensure that there is no scarcity of development rights that would cause distortions. In the case of Mumbai, it appears increased FSI will increase floor space consumption and not necessarily the density.

(Read industry views on the proposed DP-2034 on pg 100)

SITARAM KUNTE, Municipal Commissioner, Municipal Corporation of Greater Mumbai, highlights the benefits of DP-2034. What are the highlights of the plan for the real-estate sector? The DP-2034 is conceived as a framework to provide opportunity to secure adequate floor space for anticipated growth. It is not an entitlement per se, but a maximum that can be attained, subject to other conditions. There will be adequate scope for new construction at any time. While avoiding market distortions, the plan provides reasonable incentives for inclusive development by using a layer of premium FSI across the city to raise finances and offering a simplified definition of FSI with minimal exceptions that is expected to reduce transaction cost and time. With the proposed regime, FSI will be a tool to manage physical development. It will not distort the market by creating scarcity of development rights but establish a framework within which the market can operate competitively. The FSI profile is seen as an outer envelope that will not be fully consumed in the next 20 years. Also, in the earlier DP, zoning provisions were restrictive. But the Draft DP 2034 has proposed provisions like residential-commercial or commercial-residential, thus permitting mixed-land use, which is the demand of the market. How will the new DP help expedite infrastructure projects? Earlier, FSI was restrictive and city development operated through various sections of additional FSI. DP-2034 has proposed two layers from the component of FSI as premium FSI, as premium A FSI @ 70 per cent of RR rates and premium B FSI as 100 per cent of RR rates. Although all other payments like premium for deficiency in open spaces, staircase or lift area premium, fungible FSI premium and additional FSI premium are proposed to be removed, the premium A and premium B from developments can be used for development of infrastructure. What mechanism will be in place to expedite approvals as stated in the DP? The Draft DP proposes the permissions as planning permissions and building permissions. As per the plan, permissible FSI is not an entitlement for the plot owner and proposed FSI profile is seen as an outer envelope. Full FSI can be achieved if requirements of other regulations like marginal open spaces, room sizes, parking, etc, are fulfilled. Hence, the proposals will be approved at building proposal sections, saving time and money. How will the formation of this new DP support the MMR transformation plan? The DP is conceived on the principle of transport-oriented development (TOD). The Metro network proposed by MMRDA to be executed in the plan period, i.e. up to 2034, is considered in the DP. FSI is based on TOD principles along these transit corridors. Cognisance of the node where the Trans-Harbour Link connects Mumbai has been taken, and zoning and FSI provisions made accordingly. Other provisions related to the MMR region will be dealt with by MMRDA. Infrastructure projects related to Mumbai can be executed through the premium recovered from development projects, which will not be fully consumed in the next 20 years. This will ensure that there is no scarcity of development rights that would cause distortions. In the case of Mumbai, it appears increased FSI will increase floor space consumption and not necessarily the density. (Read industry views on the proposed DP-2034 on pg 100)

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