It expected to generate Rs 700 cr in 4 to 5 years in the form of premium and lease rent, but only one tenant has come forward after two years
Under policy, existing occupant or bidder can develop land as per the use of the area, for example residential or commercial properties
The Vacant Land Tenancy (VLT), a policy that was expected to generate a handsome revenue for the BMC, isn’t successful even two years later. Hence, the civic body is offering flexibility by giving developmental rights to lessees by clubbing two or more plots under the VLT policy.
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The standing committee cleared the policy in March 2020, to generate income from the lands that the corporation had given on lease before Independence. Under the policy, it was decided to grant a VLT plot measuring 125 sqm and above on lease. Redevelopment, once approved, shall fetch a premium on surplus area, lease transfer premium and fees.
Though there are 610 such plots, the policy is applicable to only 213. The remaining plots are either reserved under the development plan for open spaces, roads and dispensaries or encroached by slums. Considering the area of about 1.48 lakh sqm, the administration was expecting to generate a revenue of Rs 700 crore in four to five years. However, after two years, only one tenant has agreed to pay a premium of around Rs 7 crore.
“The issue here is that tenants are not developers, who are able to manage to give a lease amount that runs in crores. Once the area has developed, they will earn from it. But, these tenants don’t have an initial amount for investment. Now, one tenant from Dadar has come forward to submit the premium under the policy that is around Rs 6-Rs 7 crore,” said a BMC official. Hence the BMC has decided to become flexible with granting rights, if more than two plots are clubbed together to make a project more viable, he added.
According to the policy, occupants will have to leave in case they were unwilling to take the plots on lease. Such plots will then be leased to interested parties for 30 years, through a bidding process. The existing occupant or the bidder can develop the land as per the use of the area, for example residential or commercial properties. But the administration hasn’t taken any decision with regards to it.
Mumbai has 3,688 VLT plots, mostly spread across Parel, Dadar, Mahim and Sion, worth over Rs 2,000 crore even by conservative standards. The BMC has been getting a rent of about Rs 30-Rs 100 per plot, or Rs 3.5 lakh annually from all these plots together. The lessees cannot develop the property without the civic body’s approval.
213
No. of VLT plots the policy is applicable to
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