Gujarat calling for Mumbai builders

23 November,2010 06:57 AM IST |   |  Varun Singh

Attractive prospects and lack of red tape attracts city builders to neighbouring state


Attractive prospects and lack of red tape attracts city builders to neighbouring state

It is Gujarat calling for real estate developers from Mumbai as sources point that at least a dozen prominent builders from the city are moving to the neighbouring state to grab a share of their booming real estate.

The major hubs include Ahmedabad, Surat and Rajkot that are providing attractive opportunities for developing SEZs (Special Economic Zones), IT hubs and townships.


Real estate prices in prime areas of Ahmedabad are as high as Rs 4,000 per sq ft and the construction cost is estimated at Rs 700-1,100 per sq ft

Hiranandani, the latest entrant, have acquired nearly 25 acres of land in Ahmedabad with plans to develop a township.
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Other names include Ajmera Builders and Godrej, who recently inaugurated its 250 acre township in the city.

Booming Gujarat

Suresh Patel, president of Gujarat Institute of Housing and Estate Developers, claims that at least 10-12 builders from Mumbai have come to Ahmedabad in the last few months.
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"The demand for housing here is about 1.35 lakh annually whereas the supply is less than 40,000. There is a huge scope for real estate development, which makes the city a lucrative market for builders," he said.

The growth of the industry in Gujarat is apparent from the difference in stamp duty and registration revenue, which shot up from 19 per cent to 34 per cent of the total state revenue in the last financial year.

Real estate prices in prime areas of Ahmedabad are as high as Rs 4,000 per sq ft and the construction cost is estimated at Rs 700-1,100 per sq ft. According to Patel, the last two industry exhibitions have seen property sale of over Rs 1,000 crore.

According to Jaynarayan Vyas, spokesperson for Gujarat government, "The incentives and transparency provided by our state are the main reasons for builders to come here.

The real estate growth is rapid because Ahmedabad will soon be a central business point whereas Mumbai has lesser scope of development, as it is surrounded by sea on one side and hills on the other."

Niranjan Hiranandani admitted that Gujarat presented more of opportunities. "There is a scope of development and hence we are moving to Gujarat. Transpa-rency is an important part, but not the sole reason," he said.

Maha unaffected

Maharashtra will, however, not be affected by this trend, believes former industries minister Rajendra Darda. "We have nothing to worry about as industries in Maharashtra are doing good and will do good in future too," he said.

State Housing Minister Sachin Ahir also echoed the sentiment, saying, "Gujarat has developed 'single window clearance' as incentives to builders. We are also trying to develop a similar system soon. There is no way that Gujarat can overtake Mumbai or Maharashtra."

However, Dr Vaijyanthi Pandit, director of Federation of Indian Chambers of Commerce and Industry, said that although it was hard to overtake Maharashtra currently, at some point Gujarat would be able to achieve it.
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"The growth of industries are faster in Gujarat because of good facilities. Setting up an industry is easy there as permissions and other paper work doesn't take much time."

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red tape attracts Mumbai builders Gujarat construction