Babus, politicos got prime Emaar plots

From Times of India - Aug 13, 201o

Is the controversy over the Emaar-APIIC land deal rooted in the promise of free or heavily discounted villas to select sarkari babus and politicians? If sources are to be believed, about 15 of the 125 odd 'Boulder Hills' plots, earmarked for villas, were allotted to bureaucrats and senior leaders from the state who were either 'gifted' this land or given a hefty discount for buying them. Sources, however, say that these 'deals' (with the babus) were struck not by Emaar but a third party — a developer who was given the 'selling rights' of the villas by Emaar way back in 2005. Some of the netas and babus however agreed to take the largesse not in their name but in the name of relatives, claim these sources.

These villas which would be worth Rs 25 crore (approx) when constructed as per market estimates, were 'sold' to some officials for as little as Rs 20 lakh, sources say. In fact some reports even claim that a disgruntled senior bureaucrat landed at the Emaar MGF office in New Delhi to claim his villa, which is yet to be constructed. The villas were to be built by Emaar Hill Township (P) Ltd, the company executing the project. Why the villas had to be offered at heavy discount to netas and babus is not quite clear (You got to be kidding me, right? :-) Why else, to look the other way while Emaar keeps selling away land and taking away government property) . Emaar MGF's CEOShrikant Joshi when quizzed about this preferred not to comment on the matter.

On Thursday evening, there was also news of a quarrel breaking out at the Boulder Hill golf club, between MGF officials and customers of the township. "I do not know of any trouble, but I would not be surprised if it happened," said a member of the club adding, "The customers are an agitated lot as no work has taken off at the site yet. This despite each of them having paid over a crore each." As of now, not a single apartment or villa has been completed by the developer. Other than four model homes, there has been no other construction activity at the township site till date. Apart from 125 villas, 350 apartments were supposed to be constructed. But other than the golf course and a central club house, nothing else has come up.

Worse, MGF is now believed to have shelved its plan to build some amenities initially promised to its customers. "They were supposed to build a club house in each apartment block but have now decided against it. Had it not been for certain clauses in the agreement they would have dragged MGF to court," a customer told TOI.

Meanwhile, Emaar MGF officials claimed that the Andhra Pradesh Industrial Infrastructure Corporation (APIIC) was well aware of Emaar MGF's inclusion, as co-developer, in the Emaar-APIIC joint venture project. Denying APIIC's claim about Emaar Properties PJSC 'illegally' selling its stake (in the APIIC-Emaar joint venture, Emaar Hills Township Pvt Ltd) to its sister concern Emaar MGF, they said that the decision to involve MGF in the venture was "in compliance with all its (Emaar's) agreements with the state APIIC's vice-chairman and managing directorB R Meena had shot off a notice to Emaar on this matter kicking off a controversy. Emaar has replied to this missive.

"There is proof of official communication between Emaar and APIIC regarding the inclusion of MGF in the project wherein APIIC has given its nod to the proposal," said Shrikant Joshi adding, "In fact, following APIIC's approval, the department of information technology and communication as well as the Union ministry of commerce & industry issued a no-objection certificate to the deal."

Referring to a clause in the collaboration deal, signed between Emaar and APIIC in 2003, Joshi said, "The clause clearly states that the 'developer' (Emaar in this case) can at its discretion assign its rights towards development, management and operations of the integrated project to other parties....with an in-principle approval by APIIC, not to be unreasonably withheld." Joshi added, "When APIIC representatives were on the board of the joint venture, it is understood that the body was aware of the MGF deal."

Read more: Babus, politicos got prime Emaar plots? - Hyderabad - City - The Times of India http://timesofindia.indiatimes.com/city/hyderabad/Babus-politicos-got-prime-Emaar-plots/articleshow/6302399.cms#ixzz0wV1Ko0np

Emaar MGF Boulder Hills - Big Scam - Buyers BEWARE!!!

As I suspected, Emaar Boulder Hills is a stinker. I had written about Emaar and the various issues in my first post in March -> http://hyderabadrealtyradar.blogspot.com/2010/03/whats-deal-with-emaar-mgf-boulder-hills.html

Emaar Boulder Hills is turning out to be a big scam. The state government is claiming that Emaar defrauded them by taking away the entire share from the government. Essentially, the government did not make a penny from the land that was given to Emaar. This could not have been done without the connivance of politicians who have most of the villas in Emaar. The entire project is in jeopardy. People who ended up buying the apartments will be the ones affected without any recourse. Read related reports here:

http://timesofindia.indiatimes.com/city/hyderabad/Next-board-meet-to-take-final-decision-on-Emaar-properties-misdoing/articleshow/6295608.cms

http://timesofindia.indiatimes.com/city/hyderabad/APIIC-loses-prime-land-in-blind-deal/articleshow/6290374.cms

http://www.deccanchronicle.com/hyderabad/congress-mlas-demand-emaar-probe1-821

Emaar issue snowballing into a major controversy

Wakf Board says APIIC-Emaar deal void


As good as Emaar Boulder Hills may sound, with their reduced pricing and all, stay away from it until all these issues are resolved. Seems to me that Emaar will sell the apartments and get out of this project. They have reduced the scale to cut down their losses.

TELANGANA POLL RESULTS PUT A NEW DAMPER ON REAL ESTATE IN HYDERABAD

TRS and BJP swept the by-polls and the people's mandate is clear - "We want a separate Telangana State". In the short term, real estate prices will be affected negatively in Hyderabad. People who already put some money down on apartments have canceled and taken their money back.

Legal Action Being Initiated Against EMAAR on Boulder Hills

July 7th, 2010 - Deccan Chronicle
http://www.deccanchronicle.com/hyderabad/cmo-seeks-info-emaar-deal-817

CMO seeks info on Emaar deal

The government has asked the AP Industrial Infrastructure Corporation (APIIC) to protect the interests of the state at any cost.

Reacting to a news item published in these columns, the Chief Minister’s Office (CMO) on Tuesday sought details from the APIIC on the changes made in the agreements by the Emaar Hills Township Pvt. Ltd. (EHTPL) and its impact on the APIIC’s revenues. “We have asked for a detailed note on the violations,” sources in the CMO said.

The major industries minister, Mr Kanna Lakshminarayana, also convened a meeting with the officials of the industries and APIIC and discussed the issue.

Sources said the officials briefed the minister about EHTPL entering into an agreement with Emaar MGF without informing the APIIC.

The officials also explained about the legal action being initiated against Emaar. The minister asked them to take all steps to protect the corporation’s interests.

On Monday, it was reported that APIIC accused its partner Emaar of defrauding the state in the Emaar integrated township and golf course project at Manikonda.

More trouble for EMAAR Boulder Hills - Beware!!!

The following is from Deccan Chronicle, July 6th 2010:
http://www.deccanchronicle.com/emaar-township-gets-red-card-apiic-434
Emaar township gets red card from APIIC

The prestigious Emaar integrated township and golf course project at Manikonda has run into trouble with the co-promoter, Andhra Pradesh Industrial Infrastructure Corporation (APIIC), accusing its partner Emaar of defrauding the state.

APIIC has hurled the allegation after Emaar Hills Townships Pvt Ltd, the joint venture company, entered into a development agreement-cum-general power of attorney with Emaar MGF without its approval.

With this agreement, the majority of sale proceedings will go to the Emaar MGF and not the JV which developed the project.

Sources said APIIC served a legal notice on its partner for violating the rules and conditions of the collaboration agreement.

It also urged the government to prohibit registration of any transaction pertaining to the township.

“The agreement with Emaar MGF is against financial interests of the state and APIIC since it purports to transfer huge share of profits by way of revenue share to Emaar MGF,” said the APIIC.

APIIC added that the agreement with Emaar MGF was nothing but a sham device for “siphoning of funds” out of township project and to deprive the shareholders, particularly the corporation, its due share in profits.

Check legal documents and ownership clauses before buying an apartment

There are many instances of people squandering away their hard earned money by investing in an apartment where the clearances have not been obtained or the land title is not clear. Worse still are instances where the builder still owns the land on which the apartments have been built and only the apartments are sold to the apartment owners. There are even instances of apartment complexes where the builder keeps ownership of the roof and has exclusive amenities such as a rooftop swimming pool, garden, tennis court, etc. You may end up paying maintenance charges for your builder's amenities which you never can/will use. There are instances of builders having penthouses and exclusive use solar water heaters which are filled using the common water tank. You will end up paying for the builder's extensive use of the lift. There are many instances of builders having penthouses as party pads and having a party every weekend.

Consider the following factors before buying an apartment:
1. Does the builder have legal possession of the land?
2. Does the project have appropriate local body clearance - (For ex: GHMC in Hyderabad)?
3. Do you have ownership of the land [equivalent to your share in the apartment complex) and is this clearly mentioned in the documents?
4. What are the common areas in the apartment complex (Rooftop garden, tennis court, swimming pool, etc.)?
5. Will there be a society in the apartment complex? Will the builder have the majority share in the society - [Beware of this situation as you and other owners will be marginalized]?
6. What will be the maintenance charges and who decides the maintenance charges? Will the amenities be available to both the apartment owner and tenant [in case you rent out the building]? You may be shocked to know that some complexes have owner only clauses.
7. What are the restrictions, if any, for renting out your apartment?

The foul play in super-built up constructions - (Source: Moneylife India)

Sourced from Moneylife India - Original Article at http://moneylife.in/article/8/5236.html

Written by: Pallabika Ganguly

Developers are busy constructing six feet wide flower-beds in their properties for hiking FSI

Developers in Mumbai are vigorously using the super-built up area and misleading consumers. In November 2008, the Maharashtra government came up with a housing policy which stated that sales of all properties should be done on carpet area basis. However, developers still do not sell the properties on carpet area basis because they get a chance to play with the free Floor Space Index (FSI) areas by including it as part of the super built-up area and they charge the consumers for the same.

The regulation was supposed to become a law within three months of the draft legislation. By March 2009, it should have been a law, but it is not being followed. Builders are still constructing properties on super built-up basis without passing on the benefit of the free FSI to consumers.

“The Brihanmumbai Municipal Corporation (BMC) only allows four feet flower beds,” said Pranav Desai, a Mumbai-based architect.

Most new properties have huge spaces dedicated towards flower beds, which are given to the developers free of FSI. “Today developers are talking of flower beds, which are 12 feet wide—how can you call it a flower bed? Developers are bucking the system openly and blatantly and no one is telling them anything,” said Pranay Vakil, chairman, Knight Frank (India) Pvt Ltd.

If you glance through the brochures of various developers, you will come across a common feature—they mention the super built-up area, built-up area and (in brackets) the carpet area. They are following the law, but only indirectly. One high-rise at Peddar Road, south Mumbai, has not received the occupation certificate because all the balconies are flower beds, which are approximately six feet wide.

An industry expert pointed out that after the law was passed, all the properties have to be sold on a carpet area basis. However, a few developers have cleverly converted the total built-up area into carpet area, which has eventually raised the price of the property. It has not made any difference to the developers, but consumers have had to suffer.

“Developers have drastically raised the super built-up area of the new properties. From 50% super built-up area, it has almost reached 100%,” said Pankaj Kapoor, founder, Liases Foras.

However, with the increase in super-built up area, the cost of properties has also doubled over a period of time. Consumers are getting lesser space at a higher cost. For example, if an apartment of 1,000 sq ft carpet area had a saleable area of 1,400 sq ft in Kandivali (a Mumbai suburb) in 2005, at that time, the apartment was priced at Rs2,500 per sq ft. The total cost came to Rs25 lakh. But now, an apartment of 1,000 sq ft is quoted as 2,000 sq ft saleable area. Taking the current cost into consideration, it is priced around Rs8,000 per sq ft. The total cost of the apartment has jumped to Rs1.60 crore.