Scams hit real estate prospects in Bhubaneswar
After it came to light that government records had been manipulated in the hub of real estate activities at Chandaka, investors will be wary about putting their money in the city, feel developers
Sep 23, 2014
Source : The Times of India


BHUBANESWAR: Recent developments in land and chit fund scams have worsened miseries of the real estate industry in the city.

After it came to light that government records had been manipulated in the hub of real estate activities at Chandaka, investors will be wary about putting their money in the city, feel developers. The Ponzi scam money trail into realty has already hit the market.

Villages such as Shampur, Gothaptana, Daspur and Andharua are sought-after destinations for real estate projects. However, after the government discovered collusion of revenue department officials in manipulating department records and creating patta (record of rights) for buyers illegally last month and the arrest of some officials earlier this month, the real estate sector is shaken.

"There may be a handful of dubious players, but the sector has suffered a major trust deficit in the city. If people can't go by government records, they have reason to be suspicious," said Pradipta Biswasroy, president of Real Estate Developers Association of Odisha (Reda).

Biswasroy said the majority of the players would remain unscathed, but it will take years to regain investors' confidence, he said.

The government has begun verification of a complaint by residents of Gothapatna, Ghangapatna and Malipada that some known developers grabbed government land, grazing grounds and communal land amounting to more than 50 acres and built apartments without approval from the Bhubaneswar Development Authority (BDA).

Change of lease-hold property to free hold and their conversion from agricultural to homestead land has come under the government scanner in various localities.

The timing of this development could not have been worse as the real estate sector has been going through a phase of slowdown for the past three to four years. "Of late, very few new projects have been floated because of the uncertainty. Most developers have been striving hard over the past couple of years to complete the ongoing projects," said D S Tripathy, joint secretary of the Confederation of Real Estate Developers' Association of India (Credai).

Tripathy said the Modi government's relaxed norms for foreign direct investment (FDI) in the real estate sector, announced in Budget 2014-15, were expected to give huge push to housing projects in tier II cities like Bhubaneswar in the forthcoming festive season when non-resident Indians come calling. However, the ongoing situation may dash the city's real estate market's hopes to invite FDI, he said.

The Centre eased criteria for FDI by reducing minimum size of project from 50,000 square metres to 20,000 square metre and investment amount from at least US$ 10 million in a project to US$ 5 million.

Notably, High-Tech Group, Seashore, Artha Tatwa and Sarala Realcon, all having real estate interests in the city, have come under the scanner for dubious money circulation business.

Umesh Patnaik, president of Association for Odisha Real Estate Developers(AFORD), said the market was going through a delicate phase. It would be, however, difficult to assess or blame any single factor for this.

Latest Realty News

Probe into Land Scam Begins
Sep 23, 2014
Additional Chief Secretary of Revenue Taradatt reached Dharmasala tehsil in the district to probe the land scam and verified several documents in this regard
CBI arrests Mohanty in Artha case
Sep 23, 2014
The Central Bureau of Investigation (CBI) arrested former advocate-general (AG) Asok Mohanty for his alleged links with Pradeep Sethy, chairman-cum-managing director of money deposit circulation company Artha Tatwa (AT) Group
Green norms for commercial projects to be relaxed
Sep 23, 2014
The Union environment ministry is set to ease clearance norms for townships and building and construction projects in or close to wildlife sanctuaries, national parks and eco-sensitive zones
PM's plan for 100 smart cities: Government set to ease norms for FDI in construction
Sep 23, 2014
The Narendra Modi government is set to substantially ease norms for foreign investment in the construction sector, hoping to drum up interest in the prime minister's plans for 100 smart cities as well his affordable housing initiative
Lotus Greens to build 4 realty projects; eyes Rs 4,400cr sales
Sep 23, 2014
Real estate firm Lotus Greens Developers today said it will build four new projects in the national capital region with expected sales of Rs 4,400 crore over the next four years
Home prices set to zoom as Delhi government hikes circle rates
Sep 23, 2014
Home prices in the capital are set to go up further with Delhi government today hiking the circle rates -- the minimum valuation at which properties have to be registered -- by up to 20 per cent
'Smart Cities' to be Identified Before Budget: Venkaiah Naidu
Sep 22, 2014
The Centre will start identifying urban areas which can be transformed into "smart cities", before the Budget, Union Urban Development Minister Venkaiah Naidu said
Excess prime land for Hyderabad metro rail project
Sep 22, 2014
In what could turn out to be the next big land scam, huge tracts of excess land was acquired by the government for the Hyderabad Metro Rail project
South Delhi administration recovers land worth over Rs 100 crore
Sep 22, 2014
In a series of anti-encroachment drives carried out between August and September, the south Delhi administration has retrieved gram sabha land worth more than Rs 100 crore
'GDA notices no deterrent to illegal constructions'
Sep 22, 2014
Despite thousands of notices being issued by the Ghaziabad Development Authority to errant developers, illegal constructions continue to mushroom in various parts of Ghaziabad

Latest Realty News Of State

Realty Talk's