Hyderabad, December 29: After a good run all through 2011, the real estate industry in the Old City has suddenly come to a grinding halt now. Not only has construction activity taken a back seat here, but even sale of land in this area has dropped significantly, say builders.
Reason? A government order (GO 86) issued about five years ago that labelled several parts of asal Hyderabad as ‘congested zones’ and imposed strict building restrictions on them. The GO did not pinch builders so far as there was space in parts of Old City that they were busy developing.
But now its only in these ‘congested’ localities that there is developable land bank available. This has led to builders fighting for an amendment of the order and they say they have no choice but to keep their ventures on hold till the matter is resolved.
So areas such as Noorkhan Bazaar, Sultanpura, Shalibanda, Hussaini Alam, Ghansi Bazaar among others, which have large plots of land measuring from anywhere between 1,000 square yards and two acres (9,680 square yards) waiting to be developed into plush housing complexes, are now either lying vacant or giving way to unauthorised constructions.
“It is not economically viable for us to develop these properties,” said Vishal Doshi, director, Abode Shelters, explaining just why builders have been turning their back on these ‘congested’ zones, especially at a time when the demand for modern apartments in the Old City is soaring.
“The GO states that buildings in these zones cannot be higher than 10 metres (roughly three floors). That is impossible to abide by considering that the land rates in the Old City are no longer modest. Unless we can build at least five floors, we will get no returns,” Doshi said.
According to industry sources, the going rate of land, in and around asal Hyderabad, is currently around Rs 35,000 to Rs 40,000 per square yard.
Predictably, Doshi’s proposed project on a one and half acre plot at Ghanibazar is gathering dust at the moment. So is Asif Ali Khan’s venture in Noorkhan Bazaar, the area that saw huge real estate movement in the early part of this year.
“It is unfair that these areas, despite having reasonably broad roads, are marked as congested zones. Had we been allowed to build five floors and more, these pockets would have changed the face of the Old City,” Khan, managing director of Maci Developers Pvt Ltd, said. What seems to irk builders further is the absence of similar demarcations in the new city.
Pointing out how areas such as Khairatabad, Lakdi-ka-pul and even Punjagutta are as cluttered as some parts of asal Hyderabad, they say that even these localities should be banned from housing tall buildings.
“At least half a dozen of the Old City areas that have been labeled as congested zones in the GO do not have heavy vehicles moving through them, unlike in Khairatabad and Punjagutta, or lead to serious traffic congestions everyday. Despite that, those places have no restrictions. If we continue to treat the Old City this way, it will forever remain backward,” said an Old City realtor, on condition of anonymity. Such hurdles, he said, had compelled him to move his business towards Kompally (new city), albeit against his will.
Meanwhile, rumours of a new GO, which is expected to annul the current government order, has lifted the spirits of some. While an official confirmation on the issue is still awaited, builders say that would come as a boon for the Old City. However, there are some voices of concern with residents pointing out that not every piece of land should be developed. There is a need to retain some lung spaces in this part of Hyderabad, they say.
Courtesy: Times