Nagpur Municipal Corporation (NMC) is increasingly opting for outright encashment of its land property rather than risking its hand at owning and leasing out properties in commercial complexes. So from now on, Design, Build, Finance, Operate and Sale (DBFOS) could be a norm as civic body has decided to adopt similar strategy for it’s proposed Budhwar Bazar Complex, Kelibagh Road, Mahal. The project was in pipelines for long but delay in conceptualisation hindered the scheme and now the cost has escalated from Rs 99 crore to Rs 150 crore. Hence NMC has now decided to go for policy change on development of the commercial complex on its properties.

 

The proposal drafted by Project Department for discussion at general body meeting mentions that earlier agreement for development inked with M/s SMS Infrastructure Ltd. be scrapped considering significant changes in the scheme. The decision to opt for DBFOS stems from earlier deal on Metro Mall at Jaiprakash Nagar on Orange Street where Standing Committee permitted outright sale of under construction building for a consideration of Rs. 45 crores. The developer was granted right to commercially exploit the property.

 

A similar exercise is eyed now for Budhwar Bazar project also and the proposal was decided and approved by Standing Committee in year 2019. But the given slow pace of working, the work order was finalised only in year 2020. However the outbreak of Covid-19 and thereafter delay on part of developer put the project development on hold. In between the legal challenge and opposition to cutting of the trees on the land was also responsible for non commencement of construction work. Meanwhile with changes in FSI subsequent to changes in Development Control Rules, now the project total build-up area has risen from earlier 11707.46 sq.mtr. to 24697.96 sq.mtr and hence the upset price too is increased to Rs. 150 crore. Earlier the bid price was fixed at Rs. 99, 79,25721 and that time the building proposed was group plus four.

 

Now with grant to additional FSI, the construction would be of ground plus nine floors. Subsequent to the changes post termination of prior agreement, NMC would enter into fresh negotiations. Municipal Commissioner would have the final right on approval of the new contract. As per earlier policy, NMC used to lease out land to private developers and they would construct, finance and operate and then hand back the property back to civic body. But after bitter lessons from past wherein NMC machinery failed to manage its property, wisdom prevailed and for better utilisation of assets, outright sale was approved upon.