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Owners of industrial plots converted for commercial use in Chandigarh have sought an increase in permissible floor area ratio (FAR) and revisions to building norms, citing concerns over economic viability. The association representing these owners has urged the administration to raise FAR from the current 2.0 to at least 2.5 and relax height restrictions. Around 125 plot owners had converted their properties under a 2005 policy, contributing nearly INR 1,200 crore in charges. However, stakeholders argue that existing development constraints, including mandatory infrastructure provisions, reduce usable space and limit returns. The demand comes amid broader policy discussions on FAR enhancements for industrial areas in the city.
Owners of industrial plots converted for commercial use in Chandigarh have sought revisions to floor area ratio (FAR) norms and building regulations, stating that existing restrictions are limiting the economic viability of their developments. Advertisement
The demand, raised in the past week by the Chandigarh Industrial Converted Plot Owners Association, comes at a time when the administration is considering increasing FAR for industrial plots in Industrial Area Phases I and II. Stakeholders have argued that similar relaxations should be extended to converted commercial plots to maintain parity and ensure fair treatment.
Under the 2005 conversion policy, around 125 industrial plot owners opted to convert their properties for commercial use by paying substantial conversion charges ranging between INR 20,000 and INR 30,000 per sq yard. This process generated approximately INR 1,200 crore in revenue for the government. However, despite this financial contribution, converted plots are currently subject to a FAR limit of 2.0 and a maximum permissible building height of 30 metres.
According to the association, a significant portion of the permissible built-up area is consumed by mandatory infrastructure requirements such as staircases, lifts, parking provisions and common utilities. This reduces the effective commercial area available for leasing or business use, thereby impacting project feasibility and returns.
The association has proposed that FAR for converted plots be increased to at least 2.5, in line with the levels being considered for industrial plots, and that height restrictions be revised to allow practical utilisation of the additional built-up area. It has also called for a separate policy framework for converted plots, recognising their distinct commercial nature and operational requirements.
Stakeholders have emphasised that without such policy adjustments, the investments made in these properties risk becoming financially unviable, particularly when compared with competing markets in neighbouring states that offer more flexible development norms. The demand also includes calls for updated building plan regulations that would allow greater flexibility in internal configurations suited to commercial use.
The issue is part of a broader set of regulatory discussions in Chandigarh, where authorities are evaluating changes to building bylaws and land-use norms to improve land utilisation and support industrial and commercial activity. Proposed reforms include increasing FAR limits and easing planning constraints to enhance the city's competitiveness as a business destination.
The outcome of these deliberations is expected to have implications for commercial real estate development in Chandigarh, particularly in industrial zones where land supply is limited and vertical development is critical to optimising asset value.
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