In a proactive move, the UP government has initiated a pilot endeavour involving real estate giant Hawelia Group, which has assumed control of a 22-acre incompletely executed venture named Shree Radha Sky Garden in Greater Noida. Under this transition, the new developer is slated to complete and deliver more than 2,000 flats, exemplifying a promising step towards project revival and housing provision. The proposed co-development policy enables developers to seek market funding for project completion. The move aims to address the growing issue of stalled real estate projects in the region.
The Uttar Pradesh government is contemplating the implementation of a co-development policy to rejuvenate stalled projects in Noida and Greater Noida, according to sources familiar with the matter. As part of an ongoing pilot project, realty developer Hawelia Group has taken charge of a 22-acre partially completed endeavor, Shree Radha Sky Garden, in Greater Noida. Under this initiative, the new developer is set to finalize the delivery of over 2,000 flats.
In addition, the new developer is expected to settle dues totalling Rs 175 crore owed to the Greater Noida authority, clear about Rs 63 crore in construction finance, disburse Rs 20 crore to vendors, and address other outstanding payments. The overall investment required for project completion is estimated to be around Rs 450 crore.
Nikhil Hawelia, Managing Director of Hawelia Group, stated that their proposal initially covered four projects, but the state government requested a pilot project. This co-development policy would allow the new developer to seek funding from the market, a possibility that wasn't feasible under the existing management model. The proposal is anticipated to gain approval in the upcoming board meeting of the Noida and Greater Noida authorities, thereby opening avenues for the revival of more stalled projects.
During the UP Global Investment Summit 2023, Hawelia Group entered into the only Memorandum of Understanding (MOU) with the Uttar Pradesh government. The MOU outlined investments and strategies for resolving stagnant projects. Nikhil Hawelia expressed the urgent need for such policies to revive long-pending projects and fulfil homebuyers' expectations.
According to the Confederation of Real Estate Developers' Associations of India (CREDAI), Noida, Greater Noida, and Ghaziabad collectively hold 190,000 units worth Rs 1 lakh crore in a stalled state. Notably, at least 36 real estate projects in Greater Noida are undergoing insolvency proceedings. In the case of the Greater Noida project, the existing developer has delivered approximately 2.5 million sq ft, while the new builder is poised to complete another one million sq ft, along with the potential for an additional 2 million sq ft of development.
Nikhil Hawelia highlighted the opportunity to revise selling prices, aiming for a project's viability. Hawelia Group is actively addressing RERA cases from buyers and repurchasing properties. The accumulated dues owed to authorities, including premium, interest, and penal interest for allotted plots, are estimated to reach Rs 40,000 crore.
Traditionally, builders have undertaken stalled projects primarily through contractual or debt management models, avoiding financial, legal, and authority liabilities. The legacy of stalled projects has predominantly surfaced in the Noida and Greater Noida region over the past decade. Previous efforts to address these challenges occurred via legal platforms, including NCLT and Section-8 of the RERA Act, 2016.
Advertisement
Facebook
Whatsapp
