Page 23 - April 2022

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CONSTRUCTION COSTS UP 10-12% IN MARCH, SEEN DELHI: NDMC TO REVAMP THREE HOUSING COMPLEXES.
INCREASING FURTHER BY DECEMBER New Delhi Municipal Council (NDMC) has decided to carry out
major maintenance and revamp work at selected sites on priority,
taking note of the deteriorating condition of municipal housing CONSTRUCTION
complexes in the area.
To begin with, NDMC has finalised a scheme for repairing houses
and common areas in three societies for municipal sanitation
staff - Balmiki Basti housing complex (Mandir Marg), costing `7.5
crore; Palika Dham Housing Complex, Gole Market (`4.5 crore);
and housing Complex Bapu Dham, Chanakyapuri (`1 crore).
On October 2, 2014, when the Swachh Bharat Mission was
Average construction costs for estate developers have bumped launched, the prime minister initiated a cleanliness drive in Balmiki
up 10-12 percent year over year in March, a report by Colliers Basti, Mandir Marg said NDMC vice-chairman Satish Upadhyay.
India said. The improvement work will include strengthening of balconies;
Residential costs have gone from Rs 2060 per square foot in March flooring of flats, scaffolding and painting work, repairing oftoilets
2021 to Rs 2300 per sq ft in the same period this year and industrial and bathrooms, installation of rainwater pipes, etc. Presently,
expenses from Rs 1900 to 2100 per sq ft. NDMC has 3,500 quarters of Type I to Type VI.
The cost of key materials like cement and steel, which account for
a large share of construction expenses, has risen over 20 percent. SWAMIH FUNDS TO INVEST `24,151 CRORE ACROSS 252
Developers, who have been cautious about increasing prices as STALLED PROJECTS
the market recovers from the virus, are now reviewing their pricing The SWAMIH Fund, or Special Window for Completion of
in the face of rising costs, the report noted. Construction of Affordable and Mid-Income Housing Projects
With rising material costs, developers will be compelled to increase Fund, will invest in 252 projects with sanctioned funds to the tune
prices as construction materials account for about two-thirds of of `24,151 crore. It will benefit 1,47,378 home buyers.
the cost of construction. Developers have already been operating The Union Cabinet had, in November 2019, cleared a proposal to
on thin margins over the last few years. The rising cost will impact set up a ‘Special Window’ in the form of alternative investment fund
developers in the affordable and mid-market segments more as (AIF) to provide priority debt financing for the completion of stalled
they are already operating on lower margins. With wholesale price housing projects. The SBICAP Ventures would be the Investment
inflation (WPI) and material cost seeing a double-digit rise, the cost Manager to the first AIF set up under this special window.
of construction can rise by a further 8-9% by December 2022. SWAMIH Investment Fund was formed to complete construction of
stalled, brownfield, RERA registered residential developments that
LULU GROUP TO INVEST `3,500 CR IN TAMIL NADU. are in the affordable housing/mid-income category, are net-worth
Lulu Group, the $7 billion Abu Dhabi headquartered retail positive and require last mile funding to complete construction.
conglomerate, will invest `3,500 crore in Tamil Nadu to set up It has a target corpus of `12,500 crore with a green-shoe option
shopping malls, hypermarkets and food processing and logistics of `12,500 crore.
centre. An MoU for this was signed recently by Pooja Kulkarni, MD
and CEO of Guidance Tamil Nadu and MA Ashraf Ali, Executive Project approvals
Director of Lulu Group in the presence of Chief Minister MK Stalin According to a government statement, around 111 projects have
at the Abu Dhabi Chamber of Commerce HO in Abu Dhabi. been granted final approval. Investments (deal size) will be `10,992
As per the MoU, the first shopping mall will come up in Chennai by crore against which the project cost is `30,503 crore. Beneficiaries
2024 while the first hypermarket is expected to open by this year- or total units under the investment were 63,716.
end itself in Coimbatore at Laxmi Mills compound. On the other hand, preliminary approval has already been
The Lulu Group will also set up food processing and logistics granted for 142 projects, entailing an investment of `13,159 crore
centres for procuring and processing agri-produce for exports to where the project cost was `36,267 crore and number of dwelling
Middle Eastern countries. A high-level delegation from Lulu will units coming up stood at 83,662.
soon visit the state to finalise locations and related formalities. Recently, Ashwini Kumar Tewari, Managing Director, SBI, Intl
In India, the group has three shopping malls in Kochi, Trivandrum Banking, Tech & Subsidiaries, and Suresh Kozhikote, MD, SBICAP
and Bengaluru respectively. Its fourth mall is expected to be Ventures, handed over the keys to home-buyers of Panchsheel
opened in Lucknow in the state of Uttar Pradesh by end of May Greens 2 located at Greater Noida in Uttar Pradesh. The project
this year. was completed within eight months of it receiving SWAMIH funds.
Lulu currently operates more than 225 hypermarkets and shopping Although phase 2 of the project was launched in 2012 with 760
malls in the Middle East, Egypt, Indonesia, Malaysia and India. The units being spread across four towers and villas; it was stressed due
group employs over 57,000 people globally. Lulu hypermarkets to paucity of cash flows.
and department stores have a 32 per cent share of the retail Funding commitment by the GoI has resulted in its revival, thereby
market in Gulf Cooperation Council countries, the release said. providing relief to over 750 plus homebuyers and provided direct
A State government release said that the LuLu group will generate employment to more than 600 labourers, the government
employment of around 5,000 persons. statement said.

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