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Posted at: Apr 14, 2018, 12:55 AM; last updated: Apr 14, 2018, 12:55 AM (IST)

FAR reaching move

Liberalising Floor Area Ratio norms in Punjab can revitalise the real estate sector in near future
FAR reaching move

Vinod Behl

The Punjab government has recently revised and revamped the building rules in the state, by liberalising FAR, with a view to revitalise the real estate and construction sector in the state. The move is also meant to pave the way for uniform and organised urban development.

The new rules approved by the state government under Punjab Urban Planning & Development Rules 2018 , incorporating the provisions of the National Building Code (NBC) 2016, provide for purchasable unlimited FAR for group housing, commercial, public office, hotel and industrial buildings while increasing permissible FAR for residential plotted development and educational buildings. ‘

More on the platter

FAR (Floor Area Ratio) or FSI (Floor Space Index) is the ratio of a building's total floor area to the size of the plot on which it is built and higher FAR allows developers to carry out vertical development and build more on the plot.

The new rules that replace the Punjab Urban Development Authority Building Rules 2013, have a provision for rental housing, warehousing, multiplexes and integrated freight complexes. Under the revised rules, there is a provision for an increase in commercial use in group housing projects from 0.20 per cent to 1 per cent. For commercial buildings, ground coverage has been increased from 40 to 45 per cent while for the retail service industry, 5 per cent additional ground coverage has been permitted.

Following Haryana model

The new building rules in Punjab are on the lines of Haryana, which allowed additional FAR on payment. The new development could be seen in the light of Punjab governments attempt to bring in unified building rules for municipal and non-municipal areas covering all categories of construction, in order to ensure uniform and organised urban growth. The idea is to bring in uniformity in terms of norms related to FAR, ground coverage, road width requirement, minimum parking requirements, the maximum permissible height of the building and bring in more clarity with regard to seeking approvals for different categories of buildings.  

 Low FAR has been the bane of urban development, restricting residential supply and thereby making homes costlier. The higher FAR, on the other hand, leads to greater housing supply, crucial for affordability. The real estate sector has been demanding easing of FAR restrictions on construction of high rises. 

Positive impact?

In line with the demand of the real estate sector and the recommendations of the Niti Ayog, the Centre has decided to form a task force to look into upward revision of FAR norms. But, how will the newly amended building rules play out in Punjab real estate? Ananta Raghuvanshi, ED Sales & Marketing, DLF Home Developers Limited, says, "An increase in FAR comes as a welcome move. The land supply in urban areas has always been limited. However, given that cities continue to grow and more so vertically, this move of the Punjab government could help fill the gap and prove beneficial for both urban as well as rural communities. Upgradation of infrastructure, as and when required, must keep pace with these reforms". 

Vineet Relia, MD, SARE Homes, too, welcomes the state government's policy initiative of liberalising building rules. "This will facilitate better urban planning and development, leading to expansion of towns into cities and will contribute to the increase in overall infrastructure". L.C Mittal of Motia Group, however, exudes cautious optimism. "Obviously with extra purchasable FAR, under the new policy of Punjab government, developers will be able to do more construction. But to avail additional FAR for the purpose of constructing more flats, builders must have sufficient parking space. So, only those builders who have sufficient parking space will benefit from this policy. The benefit of the policy will also depend upon what price the government fixes for the purchasable FAR. Though we do not have any requirement, yet some developers may well make use of this new policy". 

According to urban planners, reservations in terms of ground level implementation should be based on the areas that lack proper infrastructure. It is feared that additional FAR may lead to densification, putting further pressure on inadequate infrastructure. This is clearly evident from the fact that close to 36 cities out of the world's 100 most dense cities are in India. Also, the advantages of extra FAR do not automatically translate into housing units becoming affordable, unless the government invests substantially in infrastructure and connectivity. 

Moreover, retrofitting of the existing infrastructure and providing new infrastructure is in itself a huge challenge. However, revenue generated from the sale of additional FAR, could be utilised by authorities to provide for new infrastructure.

— The writer is Founder, Ground Real(i)ty Media, a real estate consultancy firm


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