News: Mumbai builders scout for greener pastures

(DNA 05/01/2007) Mumbai - The ever increasing land rates and non availability of plots are pushing realty developers in Navi Mumbai to cross the creek and travel towards Mumbai or even go beyond the state to invest in projects.

This could be the beginning of a new trend in the city, whereby lack of investment opportunities is pushing them to look for greener pastures elsewhere. Builders feel that the land rates in Navi Mumbai are touching the sky, due to which they are now looking for better options. Bhoomi Group's Managing Director Vijay Gajra said, "Land in prominent locales is being tendered at rates as high as two lakh per metre and much higher and at the same rates there are many prime plots available in Mumbai."

Bhoomi has their first residential project in Santacruz - Balaji Towers in partnership with Mumbai-based developers. Gajra has also invested in projects in other states like Chandigarh where he is developing Defence Enclave, a residential colony for defence employees and a mall in Ahmedabad, both with local developers.

In partnership with Bhoomi for the Ahmedabad shopping mall is Bhagwanji Patel, a Kharghar-based developer who is constructing a shopping mall called Ark in Andheri. Patel said, "CIDCO is releasing few lands and there are very less plots available in Mumbai as well. But when compared life in Mumbai is faster and has its own advantages."

Another incentive to these developers is that sales are acquired easily for Mumbai projects. Gajra said, "In Mumbai, sale is acquired easily and there is not much effort required towards marketing. Mumbai is attractive to us from every medium. So it makes more sense for us to invest in places there."

Devang Trivedi, MD of Progressive Builders said Navi Mumbai builders generally keep a 20-80 per cent ratio with lesser number in Mumbai. He said, "Margins are better in Mumbai but the environment is different there. Here we are habituated to title clear plots and dealings with CIDCO, but in Mumbai we need to go through lot of formalities."

Similar problems are faced by Mumbai builders who come to Navi Mumbai, as they do not earn a huge margin.

With developers from city looking out for investment opportunities in Mumbai and other states, it could mean warning bells for CIDCO. Even Ahmedabad is not too far for some builders from Navi Mumbai.