Pune Property Blog

Anil Pharande

Affordable housing is a term we use for residential units in India’s urban areas which are affordably priced with respect to households that fall within a specific limited income range. There is no single set of parameters to define what an affordable housing unit should cost in India. This is because the pricing and feasibility to developers of affordable housing is a function of the city, location within the city, type of project being built and also the construction technology employed.

In India, it is appropriate to judge the affordability of a home on three broad parameters – the monthly income of prospective buyers from the target segment, the size of the home and, of course, its price. There is another element that should be mentioned, namely the target clientele itself. We tend to look at the word ‘affordable’ solely in terms of the LIG (lower income group) segment. For this segment, affordable housing would mean 200-300 square foot dwellings priced at between 7-12 lakh.

But what about people who earn more than the average factory labourer but still cannot afford to buy a decent 1 BHK flat of 300-450 square feet within ten to fifteen kilometers of their workplaces? They too need affordable housing – housing appropriately priced for the middle class. The home buyers in this segment can afford to buy flats in the price range of Rs. 30-35 lakh via home loans.

Obviously, they expect a certain standard of living, comforts and facilities for this expense. However, but even such flats are hard to come by in our larger cities. This is the case even in Pune.

Today, around 30% of India’s population lives and works in urban areas. This means that they occupy less than 2% of the land available in the country. If we zoom in on Maharashtra, it emerges that close to 60% of the overall population lives in urban locations. Distressingly, a closer look at a city like Mumbai reveals that over 50% of its citizens live in slums. Mumbai’s slums occupy less than 4% of the land available in the city. Obviously, the affordable housing quotient has gone badly wrong in Pune’s prosperous neighbouring city. However, the problem is larger than just one city, which continues to get negative press only because of its exorbitantly high property rates and enormous annual inward migration.

Despite everything being said on the matter, the shortage of affordable housing in India is getting worse instead of better. The country’s urban population of 285 million has multiplied itself by five over the last half century. It is projected that it will continue to increase at this fast pace, and that 50% of all Indians will be living in urban areas by the end of the next three decades. So, if the shortage for housing for the lower income segment stands at 25 million today and there is no increase in the pace of supply of affordable housing launches, what will this figure look like in 30 years?

Let us look at the situation from a real estate market point of view. There is, in fact, a gigantic market for affordable housing in India. Currently, it is valued at anything between Rs. 5-10 trillion. What is really being done to address this huge market – especially the one constituted by the ever-growing middle class? There are next to no Government incentives for projects with flats in the Rs. 30-35 lakh bracket.

While the only answers to this question in Mumbai seem to lie in small projects on the far outskirts of the city, Pune presents a far more encouraging picture. Developers of township properties in Pune have now begun addressing this market with an internationally inspired property development model called integrated townships. This model is based on maximum value for money to buyers, based on high-grade common infrastructure and shared facilities in more cost-effective, yet progressive areas like the Pimpri Chinchwad Municipal Corporation.

With fully integrated township projects like Woodsville and Celestial City, we at Pharande Spaces have been successful in delivering affordable housing for the mid-income segment of home buyers in Pune and the PCMC area.  There are various reasons for this success.

For one, land for these integrated townships was acquired early on in upcoming locations such as Ravet and Moshi. This meant that the price of the finished products could be kept within the means of Pune property buyers. Secondly, townships like Woodsville and Celestial City are conceived and constructed on a model that allows luxurious facilities and amenities on an economy of scale. In other words, it is possible to provide luxurious features for all units in these projects on the basis of a large-scale master plan.

Anil Pharande is Vice President – CREDAI (Pune Metro) and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

This article may be reprinted with proper attribution to the author and a link back to PunePropertyBlog.com

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Anil Pharande, Chairman – Pharande Spaces & Vice President – CREDAI Pune Metro

The Spine Road is a monumental contribution to the PCMC real estate sector by the Pimpri Chinchwad New Township Development Authority (PCNTDA). This becomes evident when we study the benefits that this massive infrastructure initiative brings with it. The Spine Road is the latest initiative by PCNTDA’s focus on location-efficient development.

The PCMC Spine Road connects two major highways and provides an access focus for the residential, commercial and industrial centres in the PCMC. As the longest stand-alone road within the PCNTDA limits, it is a significant step forward in relieving traffic congestion on internal roads. It also features six lanes with cycle tracks, service roads and parking facilities, thereby vastly improving the quality of living for all residents living along its perimeter.

It is generally accepted that improved road connectivity is very important for real estate growth. Most property brokers will make a big case out of an area’s excellent road network and how this improves the appreciation value of a proposed property. But how exactly does this phenomenon work? What is the real ‘connection’ between better roads and better real estate values?

Road Connectivity And Quality Of Life

Fundamentally, major roads such as the Spine Road in PCMC reduce vehicle travel by cutting down the distance that needs to be traveled between destinations. This has a direct effect on residents in connected areas. With shorter distances, people can comfortably choose to travel public transport or two wheelers, thereby cutting down fuel expenses. This also decreases noise and air pollution in residential areas.

Improved road connectivity also improves the overall safety of a neighbourhoods. This is because it becomes easier for emergency services such as fire brigade and ambulances to reach them. Likewise, it is possible for residents to reach hospitals faster – this can sometimes make a difference between life and death.

An undertaking such as the PCMC Spine Road is also a blessing for employees working in the area’s numerous manufacturing and service industries. In Indian cities, the amount of time it takes to get to and from one’s workplace is an extremely important consideration. By allowing the residents of connected neighbourhoods to reach and return from their workplaces faster, the amount of time they can spend with their families increases significantly. The same paradigm applies to school-going children.

The Health ‘Connection’

Reduced travel time also reduces the incidence of various physical ailments as well as stress levels. Longer travel times give rise to higher exposure to traffic pollution and extreme climate. Several serious health problems such as deep vein thrombosis and lung infections have been directly linked to extended automobile travel on a regular basis.

Similarly, road rage and reckless driving are often the direct result of the traffic congestion caused by insufficient road linkages. Also, as road connectivity improves further, the shorter travel distances can encourage the use of health-positive travel modes such a bicycles.

The Personal Finance ‘Connection’

Ever-increasing fuel prices were once a concern only to the middle class – today, they have gone so high that even the more affluent classes are feeling the heat. Electric cars that can meet the travel requirements of a normal-sized family are still a distant dream. We hear that Tata Motors is developing a air-powered car, but it is unlikely that we will see such solutions on the roads for several more years to come. In the mean time, like it or not, we are dependent on fossil fuel-driven vehicles.

The magnitude of savings that are possible because of improved road connectivity must not be under-estimated. It is a known fact that the transportation expenses of residents in well-connected areas is lower; a lesser-known fact is that communities which live in areas without good road connectivity often spend between 10-15% of their monthly income on transportation alone. The figures rises proportionately to the number of vehicles the family operates.

The Real Estate ‘Connection’

These are the reasons why road connectivity has such a massive impact on real estate prices. Simply put, there is a higher demand for homes in well-connected areas because they equal an easier, safer, healthier and more cost-effective way of life. In this context, the arrival of the PCMC Spine Road has become a game-changer for the region’s real estate market.

The investment value of residential properties along the Spine Road has not been lost on investors, who are now making a beeline to residential developments in Moshi, which is one of the most prominent areas along this road.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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Before, Wakad was an anonymous village with around 5000 sugarcane, onion and groundnut farmers. In 1983, the Pimpri Chinchwad Municipal Corporation (PCMC) acquired fifty per cent of Wakad. By 1998, PCMC counted Wakad as one of its areas.

Wakad is now the focus of younger, financially fit families that are looking at upgrades and moving into larger, nature-endowed homes on the outskirts of the city. With the increasing congestion of the previously preferred area of Aundh, the neighboring Wakad is Pune’s new hotbed of future growth. Wakad has a perfect location, with close proximity to the Infotech and Biotech Parks at Hinjewadi, the Pimpri-Chinchwad Industrial area, the Mumbai-Bangalore Bypass, the Express Highway to Mumbai and the Balewadi National Sports complex. It is only about 80-90 minutes away from Mumbai, thanks to the Expressway and the Bypass. This makes Wakad an excellent value proposition

The word’s leading automobile giant General Motors Ltd., is setting up a plant in Talegaon, in close proximity to Wakad. Some of the finest schools and higher educational institutions have come up in this area, which is much preferred as a residential destination because of its natural splendor and unpolluted environs. Naturally, property appreciation is showing an increasingly upward trend at Wakad.

The Emergence of Thergaon

Thergaon is yet another of the Pune property market’s rising stars. In a scenario where many of the urban areas within Pune have reached saturation point, it is the suburbia and outlying localities that are receiving increasing attention. Thergaon is amongst the most promising locations among them.

The fact that it is now knows as both the Aundh Annexe and Chinchwad Annexe is significant. Both Aundh and Chinchwad are highly developed in both in terms of residential and commercial real estate, while Chinchwad is a major industrial entity in its own right. Wakad and the Hinjewadi Software Technology Park lie at approximately the same convenient distance from Thergaon along the Pune-Mumbai Highway, bestowing their various benefits as well.

The general location of suburban Aundh is favored for many reasons – all of them of great importance in the property market context. Being unsaturated and relatively free from congestion, localities like Wakad, Baner, Pimple Saudagar, Pimple Nilakh and Thergaon still offer relatively pollution-free environment, spacious living conditions and affordable property rates while retaining the advantages of modernized, developed Aundh.

Moreover, town planning authorities have taken it upon themselves to avoid the more obvious mistakes committed in the over-development of Aundh. The pace of development in the above-mentioned areas is carefully controlled. Only residential and commercial projects that fit well into the overall master plan are allowed. From both an investment and home-buying angle, localities like Thergaon make eminent economic and aesthetic real estate sense.

Great Connections

The Pimpri Chinchwad area features some of the nation’s most prominent industrial entities, and is home to the redoubtable Maharashtra Industrial Development Corporation belt. As such, it provides innumerable opportunities for employment and entrepreneurship, and counts amongst the most prosperous and progressive areas in the country.

Similarly, Aundh has proliferated in leaps and bounds over the past few years. HOwever, Aundh is now plagued by overcrowding, noise and air pollution as well as unrealistic property rates. The Hinjewadi Software Technology Park is a byword of Pune’s IT Revolution, having attracted major corporations active in this vast and progressive field.

Thergaon offers the ideal solution for home buyers who want the advantage of proximity to both these employment hubs. Thergaon has ready access to the above-mentioned areas, but remains inherently peaceful, free of excesses – and highly affordable. Since these advantages came to light, some significant additions have been made to the landscape at Thergaon:

The Aditya Birla Hospital is a major coup for the future of Thergaon’s standing on the property market. The establishment of this deluxe medical facility there had been proposed in response to the quiet environment and convenient accessibility to Pune’s more centralized parts. As a medical establishment, it rivals the most prominent and respected in Pune and has attracted a lot of attention. In addition, it provides a significant amount of employment and commercial advantages to the immediate area.

It is also no accident that the Pimpri Chinchwad Municipal Corporation (PCMC) has decided to launch its ambitious Sunny Water Sports Centre in Thergaon. The basic functions of this establishment, designed along international guidelines, is to train and discipline youngsters with potential in the refined water sports of canoeing, kayaking and rowing, under highly qualified training instructors and in a carefully monitored environment.

The organizing committee for this undertaking found the Pawna River that flows along Thergaon to be the ideal venue. Apart from a professional training establishment, the SWSC will also serve as a deluxe recreational facility for water sports enthusiasts interested in speedboats, water scooters and so on.

On the industrial front, the well-known Padamjee Paper Mills have contributed in no uncertain way to Thergaon’s overall economy. This sizable organization provides for the blue-collar sector what Hinjewadi does for the white collars – adequate employment, steady economic status and additional interest in the area as a suitable residential abode.

In short, things are definitely looking up at Thergaon. Numerous notable builders are taking an active interest in establishing projects there, and the future of this charming little locality is as bright as that of Wakad, Pimple Nilakh and other outlying areas of Pune.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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In Pune, property and quality of life were once synonymous, but that can no longer be taken as a given. In earlier years, it did not really matter much where one chose to buy property in Pune – all locations were more or less supportive of peaceful family life in their own right.

Today, while considering flats for sale in Pune, one has to consider a number of variables – among them the levels of traffic congestion and pollution, the availability of basic facilities such as water and, of course, quality of the neighborhood.

Let us take Kothrud, for example. This once charming area was one of the first suburbs to be developed after the old city. Even today, it is considered a desirable core area due to its strong connection with the city centre via Karve Road. However, for better or for worse, Kothrud is also mentioned in the Guinness Book of World Records as the suburb with the fastest urban growth in the world.

Kothrud started developing in late 90s. Back then, Pune City was truly a Pensioner’s Paradise, with little economic activity. People from Mumbai looking to buy property in Pune preferred Kothrud, naturally leading to an accelerated rate of development.

By the time the IT/ITES boom began in 2000-02, Kothrud was a full-fledged residential destination. Because of this, it fortunately did not go the way of suburbs like Aundh and Baner in the West or Viman Nagar in the East as they joined the IT/ITES bandwagon.

Over the past decade-and-a-half, Kothrud has evolved as one of the most densely populated residential destination in Pune. Residential projects are very scarce and the demand is enormous. However, because of the manner in which it grew, Kothrud was not developed holistically in terms of social infrastructure.

Many other areas in Pune developed on similar lines, and the old Pensioner’s Paradise charm soon gave way to massive, relentless development. This began the hunt for less cluttered and more lifestyle-supportive residential locations.

Thanks to the Mumbai-Pune Expressway, Wakad is only about 80 to 90 minutes away from Mumbai

Fortunately, Pune is not a sea-locked city like Mumbai, and there was scope for looking further ahead. One of the first areas to emerge as a preferred area to settle down was Wakad – a once-nondescript village with 5000 locals who farmed sugarcane, onion and groundnut in its rich, black, fertile soil.

In 1983, the Pimpri Chinchwad Municipal Corporation (PCMC) acquired 50% of this virgin location. By 1998, PCMC counted Wakad as one of its areas. Today, Wakad has emerged as the focus of younger, financially fit families that are looking to upgrade their lifestyle by moving to larger, more nature-endowed homes on the outskirts of Pune City.

With the increasing congestion of the previously preferred area of Aundh, neighboring Wakad was seen as the perfect location, with close proximity to the Infotech and Biotech Parks at Hinjewadi, the Pimpri-Chinchwad Industrial area, the Mumbai-Bangalore Bypass, the Super Express Highway to Mumbai and the Balewadi National Sports complex.  Thanks to the Expressway, Wakad is only about 80 to 90 minutes away from Mumbai, and Mumbaikars looking to buy property in Pune saw it as an excellent value proposition.

Of course, Wakad is just one of the chapters that the Pimpri Chinchwad Municipal Corporation has in its book of Pune real estate successes. Today, Ravet and other sectors of Pradhikaran in the PCMC have become the new residential real estate watchwords in Pune. These areas are developing fast and are even now venues of extremely modern integrated residential projects.

However, the development of Wakad marked the beginning of a new residential real estate trend in Pune – the quest for better environments to settle down in and recapture some of Pune’s erstwhile glory as Queen of the Deccan.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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In the rush to develop projects during Pune’s real estate boom time, the very important factor of support infrastructure was neglected. This was especially true for projects within the city and the adjoining areas. Due to the high demand for properties, people kept on buying and developers kept on building even though infrastructure was declining rapidly.

However, Pune property buyers soon discovered that both their standard of living went down and the investment value of their properties stagnated because of the inferior infrastructure. Eventually, the new breed of Pune real estate buyers became more aware of the importance of basic infrastructure, and of their right to expect it. The highest demand is now for Pune flats that are affordable and also offer basic civil infrastructure such as adequate sewage, access roads, connectivity to important places, water and electricity supply, etc.

The problem of Pune’s infrastructure deficit is actually very surprising. The problem should logically be lower for projects developed within the city limits. After all, the municipal corporation has the advantages of sufficient funding and opportunity for forward planning. However, it is areas such as PCMC which have taken the infrastructure message more seriously. As a result, infrastructure in the Pimpri Chinchwad Municipal Corporation is visibly superior to what Pune City has to offer. People who have bought homes in township properties in Pimpri Chinchwad are even better off, because these projects offer high-class internal infrastructure, as well.

The PCNTDA (Pimpri Chinchwad New Township Development Authority) has ensured that all residential areas in the PCMC have sufficient infrastructure. As a result, the quality of life and appreciation potential of residential properties in PCMC are at a very high level. Meanwhile, Pune continues to face problems of traffic congestion, lack of adequate open spaces and green areas, pollution, etc. The Maharashtra Government has been proactive in assisting with infrastructural enablement for its cities. However, it is not possible for the Government to rush in with support infrastructure whenever developers decide to build.

As such, developers should assume a larger share of responsibility for the establishment of infrastructure for their projects if they aspire for success for their projects. However, there is one more thing the Maharashtra Government can do to ensure that Pune’s newer areas get sufficient infrastructure. It can revise its policies on development and follow the model adopted by forward looking bodies such as the Pimpri Chinchwad Municipal Corporation and the Ahmedabad Urban Development Authority (AUDA), which has implemented large-scale infrastructure reforms that do not necessarily involve huge budgets.

The model involves acquiring a larger tract of land, putting in all necessary civic infrastructures, and returning that component to the owners as developed land that has immediate market value. In return, they retain the remaining part for further development of their own projects.

 Anil Pharande – Vice President, CREDAI Pune Metro & Chairman, Pharande Spaces

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The draft Development Plan (DP) for the 23 villages to be merged into Pune’s Municipal limits has been more or less finalized. It has given emphasis to the Pune metro, and it also proposes to increase the permissible height for high rises in the established parts of the city from 100 metres to 150 metres. Vertical growth is obviously the only way to go in the areas of Pune where horizontal spread is no longer possible.

There is great potential for Pune real estate, and the Development Plan is supposed to aid its growth. However, there are some major areas of concern when it comes to its efficiency in doing so. One of the prime concerns is the process involved in formulating, finalizing and implementing the DP in the first place.

This process comes under the purview of the MRTP Act for urban growth in Maharashtra. As it stands now, it is archaic and extremely slow-moving process. To begin with, just getting it from the blue-print to approval stage involves several agencies. Only when the required approvals have been obtained from all these agencies can the Development Plan be finalized by the Chief Minister and implemented by the Pune Municipal Corporation.

This is an extremely cumbersome process, and the amount of red tape it takes to finalize and implement the Pune Development Plan is enormous. It should be remembered that the Government of Maharashtra has to handle the approval and implementation of the Development Plan in tandem with countless other proposals from all over the State. This is why this process usually takes anything between 10-15 years to be finalized and put into actual practice.

These huge delays further give rise to vastly increased costs, wasted time and negatively impact on the city’s GDP. At this critical juncture of deployment of Pune’s development Plan, it would make sense to look at more progressive models of planned urban development. The Government of Maharashtra could consider the method that has worked so well in Ahmedabad in close-by Gujarat and in the neighbouring Pimpri Chinchwad Municipal Corporation.

There are good reasons for considering the Pimpri Chinchwad Municipal Corporation as a suitable role model for progressive urban development. Only recently, the PCMC was honoured with the ‘Best City in India’ award at the hands of the Prime Minister himself. Pune’s booming sister city simultaneously received two further national awards under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) for the improvements made in its water supply and waste water management, and for effective enforcement of policies aimed at the Economically Weaker Sections.

What is this progressive model of urban development that could transform the PMC, as well? In simple terms, it involves three distinct, time-bound stages. In the first stage, the Government acquires land under roads and reservations at a stipulated rate or in the form of TDR (Transfer of Development Rights). A blueprint for complete social and civic infrastructure creation of the new zones to be developed is then drawn up. This includes roads, water and electricity supply as well as designation of areas for residential development, schools, shopping, hospitals, workplace hubs and industry.

The laying down of this infrastructure can then put on the fast track by creating a Special Purpose Vehicle for a dedicated infrastructure fund. Pune’s new Development Plan will a certain number of kilometers of road length. The total cost of road development can be calculated and the cost per square foot could then be loaded on to the residential development of these areas in the next stage. Interestingly, this cost is very minimal and can be easily borne.

With the kind of will and focus that was displayed by PCMC when it used this model, the entire road development and civic infrastructure development can be completed with three years. At this stage, the newly established and fully infrastructure-enabled areas are then opened up to developers for residential and commercial development.

The advantages of such an approach are manifold. In the first place, there is a uniform, horizontal spread of real estate. Development does not take place in pockets, but in a scientific manner. The creation of road networks and electricity and water supplies before actual real estate development ensures that property prices remain rational and equitable. There would be a very favourable effect on the affordability of homes in these new areas. All these factors together ensure that there is optimal economic growth that benefits everyone.

The Government of Maharashtra has already committed itself to fast-track growth of its cities. By adopting the above-mentioned model, this commitment can actually bring real-time results.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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Anil Pharande

In simple terms, open spaces are areas within a residential project that are not being developed but kept vacant. The developer may turn open spaces into a landscaped green zone or keep them vacant but well maintained. The important thing is that an open space is not built upon in any manner. Why are open spaces so necessary?

Open spaces are very important to residents because they enhance their quality of life. It is a psychological fact that lack of open spaces in a residential project leads to more stress and less overall satisfaction among residents. If there is nothing but concrete to look at when one steps out for work in the morning and returns home in the evening, the only real sanctuary is the flat itself.

Residents living in projects without open spaces feel trapped and without any real choices of what to do with their spare time. Children do not have enough space to play in, which makes them more cranky and demanding. Meanwhile, privacy is compromised and individual families are forcibly thrown together.

Open spaces provide a sense of spaciousness that makes one feel good about living in a neighbourhood that provides them. In a city like Pune, the central areas can no longer provide open spaces because seemingly every square foot is being developed either as a residential or commercial space. Lack of town planning within the PMC jurisdiction has ensured that this trend cannot and will not be reversed in the primary city. The only way of providing open spaces to Pune property buyers today is in township properties in areas like Pimpri-Chinchwad.

Various sociological studies conducted both in India and the West have clearly indicated that uncontrolled development that leaves little or no open spaces for residents is bad for human health, both in a psychological and physiological sense. Air quality decreases significantly in projects with no open spaces, since air cannot circulate properly. This means that polluted air gets trapped between buildings and seeps back into the individual homes. Also, open spaces provide more motivation to be physically active and engage in healthy things like jogging and outdoor play, which has both physiological and psychological benefits.

Good township properties are planned in a manner that allows for plenty of open and green spaces, from which all residents benefit. These open spaces are permanent features, which means that they will not be encroached upon or developed by the builder at a later stage. They are, in fact, part of the blueprint submitted for the project’s approval. In other words, the developer is legally bound to protect and preserve these open spaces throughout the entire life-cycle of the project.

Not surprisingly, township properties with plenty of open spaces also command higher property values than similar properties close to the township. Again, this is because access to open spaces improves quality of life, which is a precious commodity for Pune property buyers today. In the PCMC area of Pune, a number of well-planned townships are coming up in Moshi and Ravet. These township projects offer an abundance of open spaces, apart from recreation centres, gymnasiums and children’s play areas.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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Anil Pharande

It has been a while since anything concrete has been done about creating more affordable housing in India. Considering the great need for budget homes, it is remarkable that there is so little interest being shown in providing them. Of course, Indian developers have their own constraints – the cost of bank borrowing, the lack of realistic incentives from the authorities, the ever-increasing cost of land are just a few of them.

Meanwhile, the Government is busy battling inflation and simultaneously trying to keep India’s economic growth from sinking even further. It is very evident that, despite its obvious linkages to the economy, the real estate sector is not on its priority list at the moment.

In cities like Pune, even middle income home buyers are struggling to find homes within their budgets. Pune property rates have gone through the roof, with many blaming investors from Mumbai for this fact. The employment situation is far from brilliant in Pune these days. People are unable to increase their financial situations by shifting to better jobs because the job market has shrunk considerably over the last one year. Interest rates are also astronomical. Many aspiring home buyers are looking at buying small 1 BHK flats in dilapidated housing societies – projects so old that most banks to grant home loans for them.

What is the solution? Is there another model of affordable housing that would help both the EWS and middle class to realize their dream of home ownership? While this is a difficult challenge in land-strapped cities like Mumbai, Pune still has enough land to spare to offer one possible solution. This solution, which requires the involvement of both the Government and the developer community, is Special Residential Zones (SRZs).

The concept of Special Residential Zones or SRZs is not a new one. It has been discussed in the past and is, in fact, nothing but a natural extensions of the existing SEZ model tailored to the Indian residential property market context.

A Special Residential Zone is a model of affordable housing development that creates a separate economic microcosm or entity. The model can be tailored to attract developers by means of various incentives and tax breaks. A important feature of a SRZ would be subsidized rates for land and construction materials, which would be a further incentive for developers to get involved. In this model, the Government would provide the necessary infrastructure to make the SRZ approachable and inhabitable. In other circumstances, developers would have to see to this themselves.

The SRZ model calls for a change in certain fiscal policies, and also for simplified parameters for development approvals and sanctions. The primary objectives would be one of social responsibility, though part of the incentives for developers would be a commercial component.

In the SRZ model, the Government would incentivize the development of affordable residential units. The long-term objectives would include the lowering of housing prices in certain areas, since the SRZ model will eventually alter local property market dynamics.

As in the SEZ model, the land on which the units are developed would be long-term leasehold. In other words, the property buyer would own the property, but not the land it stands on. As everywhere else, ownership dynamics would conceivably change once the property has been occupied for over 12 years.

True, the concept of SRZs still needs to be developed. However, the point here is that it can be implemented very well around Pune, since there are considerable land parcels available on the periphery that would make the SRZ model possible.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

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The Pimpri Chinchwad Municipal Corporation follows a real estate model that has proven to be the most progressive and sustainable all over the world. The essence of this model is ‘planned development’ or ‘controlled urbanization’. PCMC is a twin city to Pune, but in that respect is uniquely different. Annual inward migration into the PCMC has been calculated at a staggering 70%, while in the Pune Municipal Corporation, it is only around 30%.

Moreover, PCMC is attracting the crème de la crème of the Indian business world. This upper crust of professionals is the senior managerial cadre that administers to Pimpri Chinchwad’s booming IT and manufacturing sectors. The housing demand from this segment has revolutionized the residential property sector in the PCMC, with New Age residential configurations such as integrated townships increasingly taking centre stage.

While Pune continues to benefit from its own property market drivers, real estate development there has not followed any sort of plan. In fact, it is not hard to see it becoming a smaller version of chaotic Mumbai over the next decade.

A HOMOGENEOUS, MULTI-FACETED MOSAIC

In the same time span, PCMC will have attained its fullest potential as a model city of the future. Obviously, it will look very different from what we see today. It will have grown exponentially, into a harmonious montage of large industrial units, IT Parks, hotels, shopping and entertainment plazas, educational institutes and healthcare facilities – towering above public parks and gardens and crisscrossed with multi-lane roads and flyovers.

Further, the additional 25,000 acres of land that have come within the PCMC jurisdiction by virtue of the last Development Plan will eventually result in the addition of at least 2 million new homes. These homes will cater to every social stratum of property buyers, from the lower to the high income segments.

HORIZONTAL AND VERTICAL EXPANSION – CREATING A SPECTACULAR SKYLINE

In other words, there will be tremendous – yet controlled – horizontal real estate growth in Pimpri Chinchwad over the next decade. Most spaces allocated for residential use will have been utilized for that purpose. But this will not result in an urban jungle, since the PCMC planning blueprint will enforce the maintenance of vast green spaces at all stages of development.

Moreover, the Pimpri Chinchwad Municipal Corporation will at all times endorse self-sufficient real estate developments such as townships and other integrated residential projects. The PCNTDA (Pimpri Chinchwad New Town Development Authority) has charted a regulated, progressive and environment-friendly course for real estate development in the Pimpri-Chinchwad region. The town planning authorities have adopted the most sustainable and progressive models for optimum residential real estate. This means that residential projects in prime areas of the PCMC such as Ravet and Moshi will conform to the master-plan of scientific uniformity in real estate development and growth.

In fact, the addition of 25,000 acres will not suffice for this region’s real estate development over the next decade. This is because the PCMC will have to accommodate a massive demand for housing. The population growth in PCMC over the last 25 years has been almost ten-fold (from 200,000 to 2 million). There is reason to believe that population growth is likely to cross 50 lakhs (5 million) by 2035.

This growth will be fueled by several factors. On the one hand, there will be a huge requirement for homes from the rapidly growing manufacturing sectors of Pimpri-Chinchwad and the Chakan-Talegaon belt. Chakan itself, though a burgeoning industrial hub, has little to offer by ways of residential facilities. The onus naturally falls on PCMC, which will necessarily be the residential location of choice for the entrepreneurs and employees of these units.

Simultaneously, there will be the spill-over effect from Pune City (which will have reached complete saturation point in the next 20 years or so). We further have to factor in the ever-increasing migrant population from all over the country, attracted as much by the excellent education institutions as by the varied career opportunities.

The obvious solution lies in growing vertically as well as horizontally. More land will have to come within the purview of planned development, and building heights will need to increase from the currently permitted 70 metres – approximately 22 floors plus parking – to 100 metres or more. FSI, which still currently stagnates at 1, will need to be raised to at least 2, or even 2.5.

This means that over the next decade and a half, PCMC will be a skyscraper city on the lines of Gurgaon.

WORLD-CLASS INFRASTRUCTURE

In most cities, such growth would mean serious infrastructure challenges. We have already seen what happens in a city like Mumbai, where skyscrapers are being built without sufficient parking, connectivity and municipal amenities to support them. However, thanks to the master plan that PCMC will always adhere to, the necessary infrastructure will precede the building of high-rises. I firmly believe that in the next 20 years, the Pimpri Chinchwad Municipal Corporation will serve as a national and even international benchmark for planned, scientific vertical real estate growth.

An essential prerequisite to support this massive growth is an advanced public transport system. With an eye on this future requirement, PCMC has adopted a model similar to Ahmedabad’s Janmarg – a scientifically designed BRT-based public transport system spanning 130 km across 14 routes in PCMC. This system involves 4-lane wide, exclusive roads with grade separators that will reduce the dependence on private transport in favour of more efficient public transport.

This, in turn, will result in smooth traffic flow, less road blocks, radically lower pollution levels and a healthier, energy-conserving environment. To ensure that there are no hitches in the development of this lifeline, the PCMC has established an Urban Transport Fund for its funding.

Another requirement for efficient transport is more connecting roadways. A ring road is on the drawing boards, but that will become truly effective only with the implementation of a hub-and-spoke road network. To illustrate this point, there are currently only two arterial roads connecting Pune with Pimpri-Chinchwad, and only two connecting Pimpri-Chinchwad with Chakan. These cannot sustain the enormous increase in vehicular traffic that industrial and residential growth will generate.

Again, it is my opinion that this alone may not suffice to cater to the public transport needs that will emerge over the next two decades. I personally feel that an elevated skybus or monorail network or even an underground rail network will be called for.

THE ULTIMATE GAME-CHANGERS

I cannot end these musings without mentioning the new International Convention Centre at Moshi, which will cover a sprawling 200 acres. The Convention Centre alone will spawn a huge tourism, hospitality and retail boom which will convert PCMC into a major urban destination both within and outside Maharashtra, perhaps second only to Mumbai. Global hotel chains will have redefined the hospitality sector, and the shopping centres will be populated by marquee retail brands.

In fact, the next two decades are surely going to see PCMC being catapulted into the international Big League, giving it a distinct global identity in its own right.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

Copyright secured by Digiprove © 2011-2013 Pharande Spaces

In Pune, something very new and exciting is happening on the residential real estate market. Where ordinary flats were once the most sought-after type of residential property, the trend is slowly but surely changing to a demand for township properties. The more discerning Punekars of today says that nothing less than the convenience and ambience of a township property will do.

Who are these people? Mostly representatives of the IT and manufacturing sectors. These, along with some other discerning professionals, have apparently become fed up with the congestion of the inner city, and the lack of amenities in the projects there. They are setting their sights on the spacious, green environment of areas beyond Aundh. Pimpri Chinchwad, with a special focus on the booming market in Pradhikaran properties, is especially in demand.

What is it about these township properties in the PCMC area that makes them so different from other available ones on the Pune property market? Well, one reason is that nothing within the suburbs of Pune can match the bliss of living in a township property. The mantra in these avant-garde resindetial projects in Pimpri Chinchwad is still ‘respect and enjoy Nature’. In the township properties in areas like Moshi and Ravet, green environment is carefully maintained and traffic congestion is unheard-of, despite the proximity of the Express Highway.

The environment is absolutely perfect for families to live in. There is so much demand for these properties that many prominent developers have snapped up prime land exclusively for the building of township properties. Other factors also add to the popularity of these townships – the Expressway, of course, is a vital one. The Expressway is the umbilical cord between Pune other major cities, beginning with Mumbai. In many ways, the Expressway is the lifeblood of Pune’s commercial progress. In addition, the nearby Mumbai-Bangalore Highway brings in further commercial growth and intercity connectivity.

With the kind of investment value that localities along these two major highways get, their popularity comes as no surprise. However, the Expressway has also brought about the existence of the Hinjewadi Infotech Park. The professionals that work there need homes close to their offices, and also privacy and peace in their time away from work. This has been another driving factor behind the township properties mania in the Pimpri-Chinchwad Municipal Corporation area. Obviously, another contributing factor is the Pimpri-Chinchwad industrial belt.

In the not-so-distant past, township properties were a residential genre reserved exclusively for the ultra rich. This has changed drastically with their rising popularity. The fact is, owning a township property in Pimpri Chinchwad has now become a feasible option for Mr. Everyman.

Anil Pharande is Vice President of CREDAI Pune Metro and Chairman of Pharande  Spaces, a leading construction and development firm that develops township properties in the PCMC area of Pune, India.

Copyright secured by Digiprove © 2011-2013 Pharande Spaces