A'bad builders expect FSI bounty

Following the state government’s announcement to increase FSI (Floor Space Index) in Surat, Rajkot and Jamnagar, real estate developers in Ahmedabad are hoping a similar windfall comes their way. Higher FSI has been a long-pending demand of developers, who feel vertical growth is essential to stabilise the realty market and provide affordable housing in the city.

With property costs steadily going northward in Ahmedabad, the middle-income group has been hit hard. “If one wants to save natural resources and agricultural land and provide affordable housing, vertical growth is the only solution,” said Jaxay Shah, national vice-president of Confederation of Real Estate Developers Association of India (Credai).

With higher FSI being announced for three cities, developers in the city expect a similar bounty ahead of the assembly elections.

“Our demand for higher FSI has been pending for around 10 years. Higher FSI will help reduce the land component in project costs and, thus, make housing affordable,” said Suresh Patel, vice-president of Credai-Gujarat and former president of Gujarat Institute of Housing and Estate Developers (Gihed).

Developers say they want the market to remain consistent and give them good returns. “We do not want cyclical business. Prices shoot up during a bullish trend, and now we are witnessing a bearish trend,” said a leading developer on condition of anonymity.

However, developers are not expecting across-the-board increase in FSI in the city. They believe the state government will announce the measure for areas in the vicinity of BRTS corridor and in specific pockets to boost affordable housing.

According to sources in the real estate sector, higher FSI will not have any immediate impact. “It will take around six to eight months for the government to implement the policy after the formal announcement is made. Developers will launch their schemes accordingly which will take another two years for completion. It’s only then that one can expect results,” said sources.

However, the government is keeping its cards close to its chest. It seems even if any announcement is to be made, it will be done only by CM Narendra Modi. Minister of Urban Development and Urban Housing, Nitin Patel, said there was no proposal to hike FSI in Ahmedabad. “FSI was lower in other cities, so it has been increased. Ahmedabad already has higher FSI,” he said.