Bangalore:
Recently, eight owners of an apartment complex in the highly-commercialised Indira Nagar summoned a reputed renovator-cum-developer and sought his quote for getting the apartments redone.
The apartments stood on a 4000 square feet (sft) plot.
As they poured through the estimates, they discovered that renovation would cost them a small fortune. The talks, then, veered to the galloping prices of plots in areas like CMH road, Indira Nagar, Sadashiv Nagar and those lining the main city roads such as Lavelle Road, Vithal Mallya Road, Koramangala and others.
As the discussion progressed further it become apparently clear that selling the plot would make better commercial sense than going in for renovation.
The residents instantly took a decision to sell the plot and apportion the amount between themselves.
With the money they would raise from the plot sale, they plan to buy a villa in the suburbs of the city.
They say they will also be able to stash away of the funds as savings. Not a bad proposition.
They are now proceeding with the plan.
This is not an isolated case. Most discussions of building renovations today have often taken the course of sale. They are happening in Malleshwaram, old Jayanagar, Sadashiv Nagar, Museaum Road, Koramangals, off MG road and off Infantry Road, where land prices have breached the roof.
"This gives a lot of scope for everybody to gain," explained a director of Shobha Developers.
"In some dingy old buildings built half a century ago, it is prudent to give up the small plot rather than pull down the old and rebuild and sell or rent out," pointed out Suresh Hari, secretary of Confederation of Real Estate and Developers Association of India (CREDAI).
In Mumbai, the story is different. But then buildings in Bangalore are far younger than Mumbai and it lacks a well orchestrated redevelopment law.
"It is, therefore, tempting for old property owners to cash out with plot sales and reinvest that money in plots that are one-third the price a little away from the congested parts of the city," says Hari.
Apart from the enticing land value, many who had been living a peaceful but luxurious life in posh areas now find the rapid commercialisation in their areas too distracting to suit their temperament.
"Such people, especially along the Metro route, are disposing of their property and withdrawing to quieter areas that assures them peace and a great sum saved from disposing of property and plots on Central Business District (CBD)," says Irshad Ahmed, a leading realty dealer.
Short by whisker of becoming a trend, this development has been taking place for the past 3-4 years in highly commercialised areas of the city.
"It is definitely a compelling story (for the residents in buildings)," said Sudeep Chandran of Terra Firma Consultants. "I am handling a couple of such cases in Indira Nagar and elsewhere where the economics works out better for the owners to sell rather than to rebuild or renovate in these days of humongous cost of building."
"At present, Bangalore is witnessing extensive horizontal expansion, especially towards north, south and east Bangalore. With complementary growth in the infrastructure, these areas will witness tremendous growth over the next few years with no scope for redevelopment," says Snehal Mantri, director marketing of Mantri Developers.
She believes as Bangalore is still growing at the seams it is possible for people to relocate without much pain.
If at all any redevelopment would happen, it would be only after regulations are put in place.
And Bangalore may have to wait a few more years to see well-meaning regulations for redevelopment.
"In Mumbai it is different. Corrosion due to proximity to sea happens faster and renovation in a few decades is essential. In the landlocked Bangalore such is not the case.
But where small, old and dark buildings were built long ago and today the place happens to bring riches due to unbridled price rise of land, it is wise to give up and take a great sum and relocate," said Ravindra Pai of Century Group.
"True," says K Sridhar, chairman of Builders Association of India (Bangalore centre).
"But for the sentimental value attached to the property, many (including myself) would have given up core city property because the land prices are so tantalising that it needs an iron will to hold on to it."
"Land price?" asked Jayaram L Panicker, a retired official now living in Neelamangala.
"I quoted and got the price for a 1000-sft plot in Vasant Nagar two years ago."
And the happy ending to his story is that he made a neat pile of money and is living in a spacious plot bought at one-third of that sum. He says there is no longer a 'land price' you quote and get it if the locality is prime.
Leading developers in the city love to quote Vijay Mallya's example here. Mallya and Prestige are building a super luxury skyscraper on Mallya's ancestral property on Vithal Mallya Road.
Many even go to the extent of saying that the cash generated from this deal has bailed out Mallya, who is a mired in debt because of his aviation business - Kingfisher Airlines.
Copyright restricted.
Under license from www.3dsyndication.com