What is Redevelopment Process this is the most common question which comes to our mind whenever we hear about Redevelopment.
The redevelopment Process may also be termed as rebuilding. The old structure is demolished and a brand-new structure is rebuilt in the same place.
What is the Redevelopment Process?
What are the benefits of Redevelopment?
Redevelopment benefits people whose homes have become old, outdated, dilapidated and worn out. It benefits people who are aspiring for a new lifestyle but within the same premise and locality. Especially for multifamily housing or apartments which have become more than 35- to 40-year-old. After Redevelopment, society members will get a brand-new house with a larger area and modern specifications.
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What is the first step towards Redevelopment?
It is to form a Redevelopment committee of core society members to think of various ways and reasons to redevelop their society. Committee to get done Structural audit of the building/society from a reputed agency. Another important role of the society Redevelopment committee is to put together various documents of the building like Government demarcation (Sarkari mojani), old sanctioned drawings, legal land documents, etc.
Whom should the Redevelopment committee approach first?
They should first approach a professional team of architects and project management consultants who will guide them to prepare the ‘ Feasibility report ‘. They must also appoint a legal advisor in the project whole is an advocate dealing with land and property matters.
What exactly is a Feasibility report?
A Feasibility report is an independent study done by a team of professionals on your project. This team after discussion with society gives
- The various reasons why society should go for redevelopment
- The various possibilities of Design options for new buildings in the same plot based on currently updated building Byelaws
- The broad cost of the new project
- What additional area existing tenements or members will get in their homes
- Various ways in which the project can be financed by selling additional apartments
This report can give prospective developers or promoters a fair idea of investment and returns.
Is it necessary to get a Private Developer involved in the Redevelopment Project?
Redevelopment projects can be done in two ways.
A) Self-finance –
where society members contribute money initially for the construction of the building and do this by involving architects and project managers to design, sanction from local authorities and oversee the project construction done by a competent contractor.
B) By involving the Private Developer–
Here the society approaches various private developers with the Feasibility report through a Redevelopment Tender. The developer giving the largest additional area on the existing apartment area is selected apart from confirming his construction quality, financial status, etc after studying earlier projects done by the same developer.
In the developer-based model, the entire responsibility of funding the project lies with the private developer who then recovers his money by selling additional tenements.
Which of the above models is better?
Technically Self-Redevelopment is better as a society can fully control the design and construction quality of project but since this requires society members to crowdfund the initial amount for construction, the developer model is usually used.
Who are the various Professionals to be appointed by Society?
Society needs to appoint:
A Team of Architects and Project Consultants:
A team of Architects and Project consultants who advise regarding the Design of new buildings and technical matters of construction like quality and specification of building materials. This team must remain till the end of the project. The role of advisory Architect is crucial since all design options coming from the developer are scrutinized by him. He suggests value addition in various designs, explains the same to society members and confirms that they are getting the additional area the developer has committed.
The project consultant keeps check on the project schedules, if required manages day-to-day supervision, controls material quality and ensures that the developer delivers the same specifications on-site as promised earlier. Is also involved in tendering process to appoint the developer based on proposals received.
The Legal Advisor:
The legal advisor oversees the legal procedure between the developer and society. The role starts from collecting various legal documents of the property, getting the conveyance deed, Drafting and guiding the memorandum of understanding between the developer and society, guiding the process of final agreements, guiding legal action against the developer in case of any default on not following any procedure or agreement clauses, etc.
How much additional area do existing society members get?
This is the most important intention of Redevelopment and can range anything between 20% to 40% of the existing area. This depends on various factors like the size and shape of the existing plot, the number of existing tenements, the size of existing tenements, FSI available, the width of the access road, etc. In reality, the percentage is just a number and much depends on what is value addition an existing owner gets.
For example for an existing owner having 1 BHK, value addition will be to get an extra bedroom in the new apartment along with various other modern amenities. Another Important fact is to check that additional area is given back in higher percent as the usable area in rooms rather than adding it in balconies or terraces.
What is the minimum plot size required for redevelopment?
This depends on many factors, but the most important is when additional tenements are added, considering the height of the new building, more marginal open spaces are needed to be left. Thus, with smaller plot sizes of less than 10000 sq. ft with becoming challenging to fit the floor plan.
What does RERA have to do with Redevelopment?
Rera is a regulatory authority that puts in legal conditions on developers during the construction process, handing over new tenements in time. This is applicable to practically any new building including redevelopment projects. Also, RERA calculations of carpet area are a bit different than standard carpet area calculations which are the basis for additional carpet area to be calculated during redevelopment. Thus only thing the building committee must ensure is that the Developer registers the new building under RERA.
What are the benefits of getting or buying a flat in a Redevelopment Project?
- As compared to prebuilt real estate projects where there are limited options of design available, the design of redeveloped apartments can be controlled and made as per the requirements of existing owners.
- Since most Redevelopment projects are smaller in size and located in prime areas of cities, new buyers get good ownership opportunities to be a part of a developed area.
- Also for these smaller projects, Customization of apartments to suit the needs of your family is possible and take care of by most developers.
Thus, the Redevelopment process normally falls into many phases; it begins with theorizing the housing development and moves through to occupancy in the new buildings.
I hope this article answers all your queries regarding the Redevelopment Process. Any further queries and feedback are appreciated.