Are Developers to be blamed always?
In a city like Mumbai with limited land mass and an ever increasing population,
every Developer has to go through numerous challenges such as:
1. Selecting a good land parcel within the limited land available .
2. Getting the title whetted through solicitors with very complex and
comprehensive paperwork.
3. Appointing an architect to ascertain the area permitted to construct.
4. Procuring the land at the correct price – an extremely challenging job,
considering the severe competition and the mismatch between demand and supply.
5. Planning and designing the building, utilising the FSI available (the area one
can build on a particular land).
6. Calculating the cost for construction, premiums, fees – official and otherwise,
unexpected contingencies and arranging funds for the same.
7. Identifying the correct professionals such as architects for designing, planning
and liasing with the BMC, civil contractors, plumbing contractors, electrical
contractors etc.
8. Making applications to the concerned authorities for permissions. After all these
are organised, they have to arrange all marketing materials and set up a marketing
team to sell the project.
9. Tie up with financial institutions to arrange finance for the prospective buyers
Mumbai being the most densely populated city in the country, has the highest
land cost, material cost, labour and also the premiums and fees to be paid prior to
construction.
Despite all these challenges, most reputed developers try their best to deliver
quality products on time. But, that’s not all. There is another side to this as well
which surely can’t be ignored.
Some developers build far more than the permitted area jeopardising the investors
money and the project. This is the single most significant reason of innumerable
buildings not having an occupation certificate (OC). There are also some that divert
funds collected from investors for a particular project to others leading to
inordinate delays, causing great inconvenience to the buyers.
Another way for developers to maximise returns is by using substandard materials
to create after selling a major chunk of the project. There are times when there is
an unexpected rise in rates in particular areas.
The developer having sold majority of his stock, starts demanding extra money
from buyers in the form of development charges, betterment charges, transfer
charges etc.
Pro Tip: For a developer, construction is their core business and like in any other business the main objective is to make money. There is no room for emotions, it may be a Dream Home, Dream Office or any other property for you, but for them it’s just another business deal.
My personal experience:
Having negotiated for millions of sq. feet with numerous developers over the last 40
years, I can confidently tell that most of them do try and deliver the best to their
buyers within the promised time frame despite of all the challenges like stress,
money management, handling the government, machinery professionals, labour,
anti-social elements and lots more.
See you next week. Until then, Please feel free to share your feedback and opinions in the comments below.
