TN mulls blacklisting builders violating norms

Our Bureau
Chennai, Feb. 19
The Tamil Nadu Government will consider blacklisting developers, builders and related professionals who repeatedly construct buildings that deviate from the approved plans, said the Minister for Town Planning and Urban Development, Mr Parithi Ellamvazhuthi.

Inaugurating FairPro 2010, a three-day property fair by the Confederation of Real Estate Developers Association of India – Tamil Nadu, the Minister said that the State Government is considering the proposal to regulate developers. The Chennai Metropolitan Development Authority and the concerned local bodies will not give permission for proposals submitted by builders who have deviated from approved plans in earlier projects and will even blacklist them if they repeatedly break the rules.

Emulate FMCG sector
Mr Vikram Kapur, Member Secretary, Chennai Metropolitan Development Authority, urged the developers to emulate the FMCG sector in keeping prices low to reach out to the mass market segment. It may be low margin business but the volumes are huge, he pointed out.

His ‘pet peeve,' Mr Kapur said, was that the lowest prices builders were offering were around Rs 10 lakh a residential unit and some were looking at products priced around Rs 5 lakh. What happens to those who could only afford around Rs 1.5-2 lakh, he asked.

For slum dwellers ousted by land acquisition for infrastructure projects, the CMDA has forwarded a proposal to the State Government envisaging issue of 20 sq.m of Transfer of Development Rights (TDRs), which developers could utilise to provide built-up space. The notification would soon be formalised, he said.

Cutting cost
The authorities were working closely with the developers to address issues to bring down costs. Approval processes were being speeded up and paper work simplified, Mr Kapur said.

Mr Prakash Challa, Vice-President, Credai national chapter, said the RBI should take steps to improve fund flow for projects. Huge inflows through FDI and QIPs were happening which were an indication of the vacuum left by the banks in funding for real estate projects. Banks' exposure to real estate was around Rs 95,000 crore which is less than 4 per cent of their loan portfolio. After the recent improvement in the residential market scenario, commercial properties are also looking up and banks need to channelise funds to the sector, he said.

More than 40 developers are showcasing a wide range of residential projects at Fairpro and offering attractive pricing schemes. Source: Hindu BusinessLine