Dull real-estate scene shatters Railways’ Rs.10000 Crore dream

RAIL RealtyMumbai: The much-hyped commercial development of railway land in Mumbai is just refusing to take off. All the four railway plots – at Thane, Bandra, Mulund and Bhandup – have got stuck in various issues, putting paid to railways’ hopes of reaping upwards of Rs 10,000 crore to invest in the creaking railway infrastructure. The biggest of them all – a 43,000 sq m plot in land Bandra (E) has already seen two failed tenders, in May-July 2014, and now city-based railway officials say it could work, only if major changes are made to the tender requirements.

“The railway’s rule that land will be leased only for 45 years is proving a hurdle in Mumbai. Real-estate firms want a longer lease. Secondly, there is a demand for residential property in the city but the railways is not keen to give its land for residential purposes as it would mean losing the plot forever,” said a top railway official.

An 8,900 sq m plot of land along the eastern fringe of Thane station, which the railways wants to convert into a ground parking plus two-floor commercial complex, has now got stuck as well.

“The state government had agreed to a Floor Space Index of 3 for the plot and traffic issues had been sorted out. However, with Thane being chosen as one of the 400 stations to be redeveloped under the Swiss Challenge method, this plot of land will have to be kept untouched to fit in with this new plan,” said the official.

The other plots that have got stuck are a 28,600 sq m one in Mulund, near the railway goods shed, and a 38,600 sq m plot along the eastern boundary of the Bhandup station. “The Bhandup plan has been rejected by the state government as it believes there is no supporting infrastructure like roads and water supply, among other things, in case the plot has to be commercially developed,” said the official.

The plot at Mulund is not getting positive vibes, said officials, because of the overall slump in the commercial property scene. “There is a shortage of buyers for commercial space in complexes along LBS Road, Mulund’s most developed spine. Malls there are shutting shop to convert into residential enclaves. Under such circumstances, expecting buyers for a plot of land much farther away from LBS Road is too optimistic,” said the official.

Prabhat Sahai, CMD, Mumbai Rail Vikas Corporation, said: “We will have to take a pragmatic case-by-case approach for commercial development of railway land in Mumbai rather than the current ‘one-size-fits-all’ method. At the same time, there has to be 100% transparency in all deals. Hopefully, commercial development of railway land in Mumbai will take off soon.” MRVC has been entrusted with developing the four plots.