Will the EWS go the Garuda way?

Will the EWS go the Garuda way?


Land for the proposed project near the National Games Village
Faiza Haneef |ENS
19 Sep 2008 04:08:00 AM IST

BANGALORE: After selling its properties at throw away prices to developers after developing them, the Bruhat Bangalore Mahanagara Palike (BBMP) may soon lose yet another commercial land in a prime locality.

Not learning from the past, it has decided to hand over land worth over Rs 200 crore to construct economically weaker section (EWS) quarters to the controversial firm that executed the Garuda Mall.

On Thursday, the Cabinet gave a formal nod allowing Maverick Holdings and Investments to re-build the EWS quarters on a public private project (PPP) model on a built-own-operate- transfer (BOOT) basis.

According to the deal, the developer will get 50 per cent (three and half acres) of the commercially exploited land, while the remaining will be used for construction of EWS quarters.

The builders will develop residential apartments for 1,648 EWS families on seven acres and the remaining seven acres will be exploited for developing commercial space, said managing director of Maverick Holdings Uday Garudachar.

BBMP sources, however, on condition of anonymity, said the land value at this location is around Rs 5,000 a square metre and the builders with about three and half acres of land at this location will have land worth Rs 200 crore in their pocket. However, it is for sure that the land which is sold to these builders, will never come back to the BBMP after 30 years, as per the BOOT agreement, he suspected.

His suspicions are not misplaced, for, in the past, BBMP has shown similar "generosity" to Divyashree Chambers located off Langford Road adjacent to the Hockey Stadium and the Garuda Mall on Magrath Road. The BBMP, which developed a first ever joint venture with Shyamaraju and Company to build Divyashree Chambers on 88,660 sq. ft of land, sold its stake to the developer at a throwaway price of Rs 25 crore. The agreement then was that the builder would develop the land by constructing a complex with two basement floors, ground floor and three floors. In return, the company was entitled to 60 per cent of the land and the building. But after sometime, the BMP sold its interests in the land and the building, which had an area of 1,92,235.3 sq.ft., to the builder for a song. The government, after a couple of years, also allowed the builder to construct four more floors. In the case of Garuda Mall, the prime commercial land of BBMP worth around Rs 264 crore went to the Garuda Mall after a period of time and now all that the BBMP gets is Rs 15 lakh as parking fee from there, while the mall owners get hefty rents running into crores per month. The land, on which the mall has been constructed, belonged to the civic body and the space was earlier used for parking corporation’s ambulances and hearse vans.

faiza@epmltd