This Article is Published in “The Housing Times, November 25, 2017” issue.
The use of word “Redevelopment” in Co- Operative Societies initially evokes very positive & optimistic feelings among the Members. However, when the process of Redevelopment is discussed, the positivity & optimism is overcome by the feeling of Anxiety. The complexity involved in the process of Redevelopment is the real cause of this Anxiety.
This is an initiative to document the process of Redevelopment in a series of articles titled “Redevelopment of Co- Operative Societies – A Challenge Worth Taking”. The objective of this initiative is to create awareness among the Society Members about the stages involved in the Redevelopment process. The awareness shall help the Society Members to take informed decisions about & during the Redevelopment process of their Societies thereby reducing the Anxiety.
Before beginning the process of Redevelopment, it is necessary to take a look at the external environment & understand its impact. At present, the Redevelopment of Co- Operative Societies is majorly influenced by the following external factors.
• Development Plan 2034 for Mumbai
• High Court Stay on New Construction
• RERA, 2016 & MahaRERA 2017
The Municipal Corporation of Greater Mumbai (MCGM) has already passed the Development Plan 2034 for Mumbai & submitted it to the Government of Maharashtra in August 2017. It is expected that the Government of Maharashtra shall approve the Development Plan 2034 for Mumbai & thereafter it would be release during early 2018.
The Municipal Corporation of Greater Mumbai (MCGM) is already taking measures on the garbage processing at the dumping grounds. Moreover, it has begun communication with citizen on Solid Waste segregation. There is a very good chance that these efforts are going to produce positive results. The success of these efforts & the concrete plan submitted by the MCGM for the Solid Waste Management may positively influence the Bombay High Court to reconsider its Stay. In view of this, the relief from the High Court Stay on New Construction is also expected during 2018.
The Government of India has enacted the Real Estate (Regulation & Development) Act, 2016 & the Government of Maharashtra has setup the Real Estate Regulatory Authority – MahaRERA from May 01, 2017. This is the most exciting development to date to influence the Real Estate activities in India. RERA, 2016 & MahaRERA 2017 impact all the stakeholders in the Real Estate industry including the Societies that are planning the Redevelopment & are under Redevelopment process.
The RERA, 2016 & MahaRERA 2017 are introducing the never seen before Transparency & Accountability in the operations of the Real Estate Industry. These attributes are forcing all the stakeholders in Real Estate Industry to imbibe the Corporate culture in their operations. A new breed of Real Estate Professionals & Organisations with modern business concepts & models are arriving on the horizon. They are going to be the future of the real estate Industry. The stakeholders resisting this welcome change in their operations are going to be extinct sooner than later.
In this external scenario, this is the right time for the Societies planning the Redevelopment to proceed further. The provisions of Development Plan 2034 for Mumbai are in the interest of the Redevelopment of Societies & efforts should be made to utilize them to the fullest advantage of the Society. The Solid Waste Management of Mumbai City is also moving forward for a massive change & the Swachh Bharat initiative is going to make Mumbai a better livable City.
It should be categorically noted that in the Redevelopment project, the Society & the Builder/ Developer are equal partners having equal stakes. The Members of Society should not feel that their position is inferior to or weaker than the position of the Builder/ Developer in any way. The Safety & Security of Society Member’s interest is of paramount importance & should not be compromised at any cost.
Under the regime of the RERA, 2016 & MahaRERA 2017 the Builder/ Developer is bound to demonstrate a Corporate outlook in their functioning. The Co- Operative Society should also gear up to match it with its equal Corporate outlook in its functioning. A Co- Operative Society demonstrating Corporate outlook shall enjoy immense benefits out of it.
The Builder/ Developer is responsible for the Registration of Redevelopment Project with MahaRERA & its compliance during all the stages of Project execution. This is an important condition to be met by the Builder/ Developer for the successful execution of the Redevelopment Project. In case the Builder/ Developer defaults on MahaRERA Compliance, the Redevelopment Project could land in serious trouble thereby risking the Society & its Members interests also. The Co- Operative Society in its own interest should equip itself to access the MahaRERA Compliance of its Redevelopment Project & take appropriate corrective actions, if needed.
The Redevelopment of Societies has many benefits to all the Stakeholders in Real Estate Industry, but the Society Members get the maximum benefits. For the Safety & Security of Society Member’s Interests it advisable to carry out the Redevelopment Project under Professional guidance & with eyes wide open. Let’s move forward & take the Redevelopment Challenge in true Spirit.
Sanjay Geete