Society invites a developer to take up a building project involving the construction of a new building with new FSI. The developer invests money, manages the project, gets approvals, and completes the construction. The society allows the developer to sell the additional salable area to recover costs and make a profit in proportion to the money invested and work done. Society receives extra carpet area, hardship compensation, corpus, rent, and other benefits.
Example: MHADA, Textile mill land, Cess properties, all Govt. owned property, SRA, Private Society where land rights remain with the existing society before and after the project.
Society invites and offers development rights to a developer and demands benefits in cash or kind, such as extra carpet area, hardship compensation, corpus, rent, and other benefits. The developer's offer is in lieu of the entire development and sale rights of the society plot.
Example: A farmer or society selling land for development in lieu of money or benefits.
The problem: 80% of private societies have adopted this model due to ignorance and developers' high handiness or greed. 90% of architects, engineers, and advocates suggest this option due to a lack of research and analysis or easy money.
Address queries as and when asked. This is easy for the Managing Committee (MC) and Project Management Consultant (PMC) but tough for members.
Organize the entire process so that maximum information about the project reaches all members before any decision is made. This is tough for the MC and PMC but easy for members.
Follow amateur or normal methods. Solutions are provided as issues appear, often leading to legal and technical challenges. This works better for corporate identities in the construction industry.
Follow a socialist PMC approach, which involves simplifying the project and information. It should be social first, then technical and legal, working better for non-corporate entities like housing societies. The entire project should be visualized through social, legal, technical, and financial angles in advance, with conceptual information provided to all members before decisions are made. This creates transparency and unity among members.
A Cooperative Housing Society may provide a limited Power of Attorney to a developer to obtain the necessary approvals. Some essential approvals include:
The Real Estate Regulation and Development Act of 2016 (RERA) was introduced and passed by the Central Government of India to safeguard home buyers and encourage investment in the real estate industry. Buyers’ grievances can be directed to MAHARERA for quick resolution. The act covers the entire process of purchasing a home, as well as redevelopment.
Any building that has not utilized the full potential of the plot under the prevailing DC regulations can opt for redevelopment. This is subject to the housing society and the owner having a clear, marketable title.
Transparency is one of the most important factors during redevelopment. All necessary terms and conditions must be listed and documented beforehand. No conditions should be accepted orally. Illegal activities are absolutely not permitted during the process of redevelopment.
There are several factors that go into determining the value of the offer. Each project’s feasibility varies based on factors like existing utilization of the building, the plot, how it is connected to the road, and sometimes even if road widening is needed.
When a project is redeveloped, homeowners can receive several benefits, including:
A cooperative housing society must call for a Special General Body Meeting (SGM) and put the resolution for redevelopment of the property to vote. Once a majority of the members agree, the project can go ahead.
The housing society must appoint an architect and project management consultant to draft the plan as per the DC rules. The plan can then be vetted by all stakeholders involved before approval. All members should be made aware of the project plan before it is finalized.
A structural audit helps determine whether a building requires repairs or should go for redevelopment. It is mandatory to conduct a structural audit for a building that is more than 30 years old and for buildings that are in dilapidated condition.