High base rate of plots along with stringent bid opening criteria deter developers from bidding, alleges builders’ lobby

CIDCO's recent sale of plots has evoked poor response from the bidders resulting in the opening of bids for only two plots out of twenty six plots. It is alleged that the new plot release scheme which stipulates that plots with fewer than three bids will not be opened coupled with the high base price of the plots and consequently the EMD rates are the factors contributing to the poor response from the bidders. These concerns have become more pressing amid speculation that a new tender for around 40 plots may be issued after the model code of conduct ends.

“We will have to study the new tender document as to whether there has been any change in system of allotment of plots in case there are less than 3 tender bids for a plot. Also, if the EMD has been made more viable for bidders it may evince some more interest from the general public/builders as the plot may be. There have been instances in the past where CIDCO has refused to allot plots on legally untenable grounds & had to allot the same after intervention of the Courts. Stakeholders should be taken into confidence before making changes in bidding / allotment process,” said Raajesh Prajapati, Managing Director of Prajapati Group.

“In the current scenario, builders are more interested in redevelopment schemes. Many old CIDCO buildings are dilapidated and need redevelopment. Since most of these buildings are in strategic locations, bidding for redevelopment projects is more attractive to builders,” remarked Arvind Goel, Trustee of CREDAI, Navi Mumbai.

"Land in Navi Mumbai is already overpriced, making it economically unviable for most developers to bid for new plots. They would prefer commercial plots or redevelopment projects of old buildings," he added.

“Undoubtedly, the base price of the plots have been artificially increased. On top of that, the builders, in the face of stiff competition, quote higher rates. All this leads to higher rates of the residences and commercial establishments which adversely affects the pockets of the common man. There is a need to control this artificial hike in rates,” remarks Vasant Bhadra, President BANM.

“Cidco charges a % of Base Rate of plot as EMD for participating in tender bidding process. Reduction or Rationalisation of Base Rate by Cidco will result in softening of EMD which may result in increasing the participation of bidders in the tender process. This may result in resolving the requirement of multiple bidders by Cidco to ensure approval of bids for allotment of plot,” added Raajesh Prajapati.

When contacted, Priya Ratambe, the PRO of CIDCO, declined to comment on the matter.