Finolex Industries Selling Pune Land To Raise 4 Billion Rupees

Finolex Industries Ltd., India’s biggest maker of pipes made of polyvinyl chloride, surged to its highest in almost three years after the company said it expects to raise about 4 billion rupees ($86 million) selling land.
The company revived its plan to sell 78 acres (31 hectares) of industrial land after an increase in real estate prices, said P. Subramaniam, chief financial officer, said in an interview. Finolex had in 2008 proposed selling the property, he said.
The land sale will help Finolex improve its cash flow, said Tejas Doshi, vice president of equity research at Sushil Financial Services Pvt. The company, which reported a 67 percent drop in profit in the three months through June, also plans to spend 800 million rupees to build a new factory, Subramaniam said by phone today.
The land sale will help “improve the balance sheet,” Mumbai-based Doshi said. “It will also help their expansion plans.”
Finolex will raise 500 million rupees by selling non- convertible bonds to build the plant and will fund the balance from its profit, Subramaniam said. The company hasn’t “finalized” the land sale yet, he said.
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MIDC To Give Five Acre Plot To PCMC For Fire Brigade Office

PUNE: The Maharashtra Industrial Development Corporation (MIDC) will give a five-acre plot to the Pimpri-Chinchwad Municipal Corporation (PCMC) to set up the fire brigade head office.
Avinash Patil, deputy director, town planning, said that PCMC had approached the MIDC to get land for a police station and fire brigade office in Bhosari.
PCMC fire brigade has one central office and three sub-stations in the municipal limits. The central office is located at Pimpri while the sub-stations are located at Rahatni, Bhosari and Pradhikaran.
The population of PCMC limits has grown rapidly and there is a need to open 17 sub-stations as per the population. The fire brigade is also searching for land to open its new sub-offices in various parts of the municipal limits.
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Pune State Forest Department To Wall Off Its Land

Fearing encroachment, the Pune division of the State Forest Department is planning to construct compound walls around forest land and hills in the city. The department owns approximately 2,000 hectares in Pune and it will soon forward a proposal to its head-office in Nagpur to get funds for the work.
“We have observed that encroachment on public properties is increasing on a large scale. Once an illegal property comes up on a forest land, it becomes difficult to remove them. Gradually, these grow into several slums and then things go out of hand. Hence, to prevent illegal inhabitation on our land, we have decided to erect proper compound walls,” said Ashok Pawar, assistant conservator of forests of Pune Division.
The forest department has land in Bhamburda, Pachgaon Parvati, Wanavdi, Kondhwa, Ghorpadi, Undri, Hadapsar and Warje. “We had arranged a tour of the members of the Pune Tree Authority of the Pune Municipal Corporation to the forest land in the city. They saw that there is absolutely no or very negligible human interference on lands with compound walls,” said Prabhakar Kukdolkar, a senior forest official.
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PCMC News: Online Property Registration Gets Strong Response

The Hinjewadi sub-registrar’s office became the first office in the state to roll out the online property registration programme, wherein property buyers could access their mutation entry online. With 64 online registrations in the pilot project, the land records department is planning to replicate the process across the entire state.
Settlement commissioner and director of land records, Dr Shailesh Kumar Sharma, said that the online mutation entry started on July 23 and in a month’s time they have received an overwhelming response.
The idea behind developing such a system was to ensure better transparency and accountability. The system monitors each officer closely and they will be assessed on the time taken for issuing the notices and updating the records. The software has been provided by National Informatics Centre (NIC).
The Hinjewadi and Paud offices that fall under the Mulshi taluka were covered in the trial run. The online mutation entry programme will enable property buyers to take a printout of their registration details, 7/12 extracts and property cards even from home, said the official.
The trial run saw the documents registered at the sub-registrar office forwarded to the tehsildar office where the officer receives an SMS mentioning the registration number. The notice has to be issued the moment they get the document.
Within 15 days the document gets uploaded provided there is no dispute. In case of disputed property, the entry goes into the dispute register to be cleared within three months. If there is no dispute, the buyer can get to see the registration details uploaded on http://mahabhulekh.mumbai.nic within fifteen days.
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Pune Mayor: Go Green, Get Tax Rebate

Mayor Mohansingh Rajpal has said that builders should play a more pro-active role in developing facilities for recycling of water, rainwater harvesting, sewage treatment as this will help reduce the load on Pune Municipal Corporation.
“In return, the PMC offers a 10% reduction in property tax that will make a project more attractive to buyers,” he said, while inaugurating the property exhibition series of CREDAI, Pune, VITS Hotel, Balewadi.
The mayor said, “The young generation of builders is doing a lot of good work for the city. Pune needs more and more young people in the process of development of the city,” he said.
The mayor asked CREDAI members to explore ways in which tourism can be increased in the city and assist the PMC to develop projects such as cleaning up the river, development of a world class exhibition centre, museums and malls.
The CREDAI, Pune, exhibition is from August 6 to 8. Projects on display cater to 1BHK to 5BHK flats, bungalow plots, pent houses, farmhouse plots covering all areas in PMC and PCMC.
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Criminal Cases Against Those Poaching On PCNTDA Land

PUNE: The Pimpri-Chinchwad New Township Development Authority (PCNTDA) has decided to lodge criminal cases against those encroaching on its land. The action is primarily aimed at building contractors.
Suhas Divse, chief executive officer of the PCNTDA, said the authority will demolish such constructions and the cost for such action will be recovered from encroachers.
Notices have already been sent to 22 property owners, who have illegally built structures after August 1, 2009. “We will give them time to wind up, but if they fail to do so, the PCNTDA will remove them. So far, very few cases have been registered. But now onwards we will lodge criminal cases against all such people,” Divse said.
A joint drive will soon be initiated with help from the Pimpri-Chinchwad Municipal Corporation. Divse said the PCNTDA is planning to strengthen its anti-encroachment squad. “At present, there are 50 guards in the squad. We will hire 50 more. Two engineers on deputation have been attached to the squad. A deputy collector level official will head the squad,” he said.
The PCNTDA was constituted by the state to provide affordable housing to industrial workers and the poor. For the purpose, land was acquired from 10 villages namely Nigdi, Bhosari, Chikhli, Akurdi, Ravet, Kalewadi, Chinchwad, Thergaon, Rahatni and Wakad.
The state was to acquire 4,323 hectare of land, but the PCNTDA has only 1,627 hectare in its possession. It did not take quick possession of land in villages of Chinchwad, Kalewadi, Thergaon, Rahatni and Wakad. As a result, farmers sold off their land to migrant workers who have constructed their houses on it.
Authorities say nearly 15,000 such constructions have been identified. “We have sent a proposal to regularise all unauthorised constructions made on PCNTDA land before August 1, 2009. The state government has to take a decision on it,” he said.
Incidentally, owners of houses in Yamunanagar area of Nigdi-Pradhikaran have extended their buildings on open spaces.
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Road Development: The Key To Pune’s Real Estate Growth

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There are often comparisons made between the infrastructure of Mumbai and Pune. The popular consensus seems to be that both cities are equally challenged as far as supportive infrastructure is concerned.
This is inappropriate for two reasons – one, Mumbai’s growth pattern has been very different from Pune’s. The city has evolved into the country’s financial capital, and the pressures on it are enormous and overwhelming, considering the fact that a significant part of it is an island that cannot grow horizontally to accommodate the growing real estate demands.
Pune, on the other hand, has an advantage by virtue of the fact that it has been able to add to its borders by means of surrounding villages. This has served to decreased pressure on the central city and encourage an outward growth pattern.
The challenges on Pune’s infrastructure – particularly its road network – have more to do with the speed of this growth. While there are various proposals for roads and road widening, these have to be translated into real time to be effective.
The pockets of infrastructural under-development are the result of both developers and the Government concentrating on existing growth areas and sidelining those with high future potential. It is a known fact that no area can grow in terms of residential, commercial and retail real estate unless the necessary infrastructure is first put in place.
This is quite a common phenomenon that is the result of the principle of fastest returns almost instinctually followed by both developers and the Government. Bangalore, for instance, was initially not well planned for radial expansion.
The approach in this city was simple – where Information Technology projects went, residential projects followed. IT and ITeS, as business lines, are not dependent on a city’s CBD areas and can workably exist in areas where property prices are low.
Once such a project is firmly in place, residential, commercial and retail establishments follow. Since this kind of growth in no way follows a master plan, the result is haphazard pockets of growth. This naturally leads to the neglect of areas that have not been so favoured. The syndrome is also evident in the case of other industries such as manufacturing.

For The Lack Of A Road….

To identity another factor that has compromised Pune’s holistic growth in terms of real estate viability – the first masterplan for the city designated a much more progressive ‘roadmap’ for the city’s road network, while the second one is decidedly sotto voce on these. Also, key roads leading to new growth areas are not being put in place with the speed necessary to ensure that these new areas have the requisite connectivity.
The roads leading to Kharadi – a major real estate growth nexus – have not been put in place due to an inappropriately slow speed of development initiative. Similarly, the Eastern bypass has been at the proposal stage for many years. In these and various other instances, the result is compromised potential.

Case Study – Pradhikaran Phase 2, PCMC

In comparison, the Pimpri Chinchwad Municipal Corporation (PCMC) has been proactive in terms of a proper road network. This explains why there have been such spurts in growth and corresponding real estate values in this region. Considering how much the authorities have already achieved, it is distressing that certain pockets in the region still show signs of infrastructure deficit.
A case in point would be Phase 2 of the Pradhikaran area, which comes under the purview of the Pimpri Chinchwad New Town Development Authority (PCNTDA).
The Pharande Group, which has made significant land bank investments in Phase 2, across Sectors 4 and 6, had already launched residential projects in Pradhikaran’s Phase 1. Under the aegis of Anil Pharande, a massive mixed-use development is now shaping up in Phase 2.
This area is extremely important for overall growth of the region, since it will cater to a huge chunk of the middle income housing demand for PCMC-employed mid-management cadre. However, because of the lack of proper roads, only the Pharande Group and a handful of smaller developers have taken the risk of venturing into this area to open it up for future growth.

The Origin Of Mismatch

The Pimpri Chinchwad Municipal Corporation (PCMC) area was established as a satellite town to Pune in 1962, and it quickly grew as an industrial market. Since the travel time between Pune and PCMC presented a challenge, the authorities soon perceived an increasing need to provide housing for people who worked in this area. This led to the formation of the Pimpri Chinchwad New Town Development Authority, which began to develop housing for the PCMC workforces.
The constraints of octroi and sales tax caused most industries to start moving out of the corporation limits. This caused a boost in the growth of the outlying areas. Development is now gradually shifting away from the core areas of PCMC, and the areas between Bhosari and Chakan.
Generally, the road network in PCNTDA area is quite suitable. Currently, a 45 meter spine road that would connect Nashik highway to Mumbai Highway (at Nigdi) is being developed. However, the lack of direct road connectivity from this part to Chakan presents a lacuna that reflects on this location’s overall growth potential.

‘Poor Cousin’ Syndrome?

Chakan has already found favour by large-scale industries and Bhosari was already an established industrial area, since it had grown in tandem with other industrial areas in the PCMC. The quick progress of these two areas has attracted the bulk of road construction efforts, and away from the area known as Phase 2.
Paradoxically, Phase 2 offers the advantages of generous land availability and low real estate costs. It also has an enormous future market driver in the form of the International Convention Centre at Moshi, which is being jointly developed by the Maratha Chamber of Commerce and the PCMC.
This project is currently only in the proposal stage, but it will add immense value to this sector. When the ICC becomes operational, it will positively affect real estate value in the northern parts of the PCMC area, right up to Chakan.
Developers already active in this area have put the blueprint for its progress in place. However, the blueprint needs to be transferred from the drawing board to the shop floor.
A suitable road network connecting Phase 2 to Chakan and Bhosari could vastly improve its chances of catching up with these growth sectors – and of fulfilling its intended purpose as a new residential safety-valve for the increasing housing demand from the PCMC area.

Lacking – A ‘Potential Value’ Perspective

The potential of this key area apparently lacks from a recognition of its inherent future value. A closer look at its promise for the PCMC real estate market would very likely cause a more fast-paced development of its road network.
There are earlier precedents in Pune, wherein languishing areas were given fast-paced infrastructure upgrades because of an upcoming market catalyst. When the recent Youth Commonwealth Games loomed closer, the enhancement of Baner Road and Pashan Road were put on the fast track.
In the same manner, it is not unreasonable to anticipate that the PCNDTA will take cognizance of the fact that Pradhikaran’s Phase 2 is extremely important by virtue of the fact that strategically juxtaposed New Rajguru Nagar has now been identified as the location of Pune’s new airport.
This being the case, putting down adequate roads in this area will set the stage for immense future growth of this strategically placed locality.

Author: Mohammed Aslam is Head – Pune, Jones Lang LaSalle India.
This article may be reprinted with due credit to the author and a link back to PunePropertyBlog.com

Pimpri-Chinchwad: Pune’s Last Hope For Planned Residential Development

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Pimpri-Chinchwad, the twin city located south-east of Mumbai, is the fifth most populated city of Maharashtra and also one of the most prominent industrial destinations outside Mumbai. In fact, Pimpri-Chinchwad is the decisive factor in making Pune the second largest industrial city in Maharashtra after Mumbai.

Industrial Utopia

Over 4000 industrial units in the large, medium and small sectors dot its landscape, among these some of the most reputed industrial companies in the country. If one includes Bhosari and Dapodi in its purview, Pimpri-Chinchwad’s repertoire reads like a regular industrial Who’s Who. Among the major names are:

  • Bajaj Auto Ltd.
  • Force Motors
  • Sandvik Asia
  • Alfa Laval
  • Forbes Marshall
  • Atlas Copco
  • Kirloskar Filters
  • Kalyani Sharp
  • Mahindra and Mahindra
  • Hindustan Antibiotics
  • Kirloskar Pneumatics
  • Tata Motors
  • Indian Card Clothing
  • Finolex
  • SKF Bearings
  • Greaves Cotton

… and many more
Pimpri-Chinchwad’s status as a power-driven property destination also derives from its matchless connectivity. Its strong road network encompasses major transportation corridors – the Mumbai–Pune Road, the NH-4 Bypass, NH-50 (Pune-Nashik Highway) and the roads connecting Aundh to Kalewadi and the Mumbai–Pune Road to Bhosari.

Development Potential

Until fairly recently, Pimpri-Chinchwad was perceived primarily as an industrial hub and not a residential destination. However, with industrial development on ascend the population has grown exponentially there. Today, Pimpri-Chinchwad has emerged as a as a metropolis in its own right, with a thriving residential market on par with the best-planned cities and towns in India.
The residential market has multiple market drivers. The proximity to Hinjewadi IT Park apart, there is no doubt that this area’s future development will now be driven by the industrial clusters which are heavily concentrated in the PCMC area. Many landmark developments such as the International Convention Centre are coming up here, which clearly indicates that the PCMC area has a high potential for development. These projects are all part of the PCMC master plan laid down three decades ago.
Residential real estate development in Pimpri-Chinchwad has picked up rapidly in the last three years, and this area’s tag of an ‘Industrial City’ has vanished forever. The first wave of housing projects was driven primarily by the redevelopment of industrial campuses and plots into residential projects that catered to the workforce at the MIDC/industrial areas in Pimpri-Chinchwad and Talegaon.
Today, however, the fact that the PCMC area is, in fact, a meticulously planned area is making a truly decisive play on its real estate fortunes. Government-planned cities have various advantages over cities that have expanded via organic growth.
Planned development such as witnessed in Chandigarh and Gurgaon are the wave of the future in Indian real estate. PCNTDA — the Pimpri-Chinchwad New Township Development Authority — is a model closely based on that followed by Chandigarh, Gurgaon and Navi Mumbai.
Pune has witnessed organic growth, and the deficits in proper town planning have resulted in much of its infrastructure problems and shortfall in residential developments. In contrast, the properly planned Pimpri Chinchwad area – especially industry-intense areas like Chakan – should be able to avoid the mistakes done in central Pune.
PCMC has the advantage of proper town planning and the resultant infrastructure. However, there are areas of concern about how adequately development is being addressed in this vital growth area.

Residential Space Shortfall

The PCMC MIDC area encompasses approximately 3000 acres. The Chakan and Talegaon belt comprises about 11000 acres, which means that Chakan will need about 50,000 acres of planned residential development.
This kind of development will happen in a periphery of around 50 sq km. However, the magnitude of actual development today is lamentable. This is a major lacuna. 50% of Chakan’s industrial era is already developed and occupied. Major industrial giants like Volkswagen, Bajaj and Mercedes Benz have already started production.
The key area of Pradhikaran is the logical location for absorbing the residential demand of this industrial belt; however planning for the residential requirements of employees in these industries in Pradhikaran is completely inadequate. This needs to be done soon. To boost the residential sector in Pradhikaran, proper road connectivity between Pradhikaran, PCMC and Chakan must be established.
Pradhikaran has the potential of becoming the latest real estate growth area – not only for PCMC, but in terms of Pune as well. Pune is, in geographic terms, a small city typified by haphazard development of its real estate market. The PCMC area is a diametric opposite – it is 100% planned, with the groundwork for the planning in place since 1965.
Pune’s growth boosters are education and IT / ITES. In PCMC, and particularly in the Pradhikaran area, there is a plethora of factors to amplify economic and real estate market growth, including IT, automobile and various other industries.
The result is that a huge magnitude of residential and utility space needs to be developed in Pradhikaran alone. However, this has not been addressed by developers.
Three years back, the average property rates in the PCMC area were below Rs. 1000/sq.ft. Now, the average rate throughout the region is between 2500-3000/sq.ft. – a growth rate that Pune has been able to replicate only in certain IT-centric or high-profile residential areas.
At the current time, it is still possible to locate residential projects to commercial projects in Pradhikaran. This allows for maximum appreciation potential, since the demand for either of these two segments feeds the other. In another five years, the area will have reached such a high level of development that such juxtaposition will no longer be feasible.
Developers still have an opportunity to take advantage of this fact and develop residential and commercial projects close to each other. While this makes excellent business sense, it will also ensure that Pradhikaran will attain a balanced real estate profile that dovetails perfectly with the PCMC master plan.
Currently, the residential property rates in Pradhikaran range between 2500-3000/sq.ft. Once the International Convention Centre and the new International airport are launched, these rates have the potential of doubling. Until then, the minimum appreciation potential for Pradhikaran will remain at a steady 15-20% year-on-year.
Anil Pharande is President of CREDAI PCMC 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

Pune Builders Seek Relaxing Of Construction Rules

PUNE: Responding to complaints from builders, Pimpri-Chinchwad mayor Yogesh Behl said that only the civic general body can make any change to the rules for constructions in the bus rapid transit system (BRTS) corridors.
“A delegation of 25 builders met me two days ago and said that the strict rules for constructions in the BRTS corridor have made it difficult for them to undertake construction in the corridors,” Behl told TOI.
Behl said that the Pimpri-Chinchwad Municipal Corporation (PCMC) has framed new rules for construction within 100 metres along the eight BRTS routes and four feeder routes which are called BRTS corridors.
While allowing double floor space index (FSI), the civic body also made it mandatory to double the parking space. If the area of the plot is more than 1,000 sq.m., the owner/developer will have to develop the parking area and give 25 per cent of it to the PCMC free.
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PCMC To Ask Pune Organisation To Vacate Depot Land

PUNE: The Pimpri-Chinchwad Municipal Corporation (PCMC) will send a legal notice to the Pune Mahanagar Parivahan Mahamandal Limited (PMPML) asking it to vacate land of a bus depot in Sant Tukaramnagar area of Pimpri following a change in the reservation of the said land.
Pimpri-Chinchwad mayor Yogesh Behl took this decision at civic general body meeting held on Friday, at the insistence of local Congress corporator Yashwant Bhosale. Bhosale also pointed out that the PMPML should shift the depot to the land given at Nehrunagar.
Behl announced the decision while ending the discussion on a proposal to give Rs 1.27 crore to the PMPML for paying salaries of its employees for the month of April.
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