By Mr. Aditya N. Shah, Director, Mayfair Housing
A city whose growth story has closely mirrored that of the nation’s economy, Mumbai is more than just the financial capital of India – it is also the country’s most populous city, housing over 22 million inhabitants and more than 3,000 multinational companies across various industries, including IT, finance, manufacturing, and several others. And as per recent estimates, the city is showing no signs of slowing down. In fact, McKinsey Global Institute predicts that India’s urban GDP share will rise from 63 per cent to 75 per cent by 2035, with a majority share coming from Tier 1 corridors such as Mumbai–Pune. A Knight Frank report further adds that India’s top eight cities will need an additional 1.2 billion sq. ft of office space by 2035, creating a consequential demand for residential developments as well. For a landmass that is already bursting at the seams, there remains only one direction for Mumbai to look – up.
A planned and phased renewal
Cluster redevelopment can play a transformative role in addressing Mumbai’s multi-pronged challenges of ageing infrastructure and unplanned growth. The model proposed by Regulation 33(9) of the Development Control and Promotion Regulations (DCPR), 2034, attempts to bring order to the chaos by setting a baseline for eligibility criteria, offering incentives for developers, and emphasising sustainability across the development pipeline. In that, minimum area requirements of 4,000 sq. m for Mumbai proper, 6,000 sq. m for suburbs, and 10,000 sq. m for extended suburbs have been outlined, which are applicable to pre-1969 tenanted structures under MHADA, transit camps to house displaced residents, and housing societies that are over 30 years old and have been deemed unsafe. In turn, developers have been incentivised with higher Floor Space Index (FSI) for up to 4.0 FSI in the island city and proportional incentives in suburban areas, as well as FSI bonuses that are contingent upon the integration of public amenities and an inclusive blueprint that includes affordable housing.
Redeveloping Mumbai’s future
The focus on freeing up land for residential spaces is astute – the city’s residential market is fast-approaching a value of Rs 1.5 trillion, with 6-7 million housing units, and currently registers annual sales of around 150,000 units. Data shared by CREDAI-MCHI reveals that 25,000 buildings in the Mumbai Metropolitan Region (MMR) are over 30 years old and, hence, eligible for redevelopment. At the same time, Mumbai also clocks an annual population growth of over 1 per cent, with nearly 70 per cent of its residents of working age and around 35-40 per cent under the age of 25. One of the first projects undertaken in the city has been the vitalisation of the Bhendi Bazaar neighbourhood, which overcame initial setbacks to highlight how efficient planning can not only create vibrant living spaces but also thoughtfully incorporate green building practices. The project currently incorporates rooftop solar panels with a combined capacity of nearly 600 kw that light up public areas such as staircases and streets. Electrical systems have also been modernised to improve efficiency and reduce losses, while rainwater harvesting systems and modern sewage treatment plants recycle wastewater. Vertical garbage chutes have been installed to wet and dry waste segregation in every building.
An eye for roadblocks
To successfully replicate and further build upon the success of such projects, it is crucial for developers to carefully consider pertinent challenges such as fragmented land ownership and disputes, which can hinder the aggregation of plots needed for large-scale cluster development. At the same time, they must also secure the trust of tenants, incentivise them, and offer legal protections. Financial instruments such as REITs and municipal bonds, coupled with government subsidies, can help manage the high costs and risks associated with land acquisition, rehabilitation, and construction.
Cluster redevelopment can help to address some of the most pressing concerns faced by the city’s administrators while also presenting a significant opportunity for the city’s developers. By adhering to and building on government-prescribed norms and regulations, developers can not only contribute towards the creation of balanced living spaces but also lay the foundation for a sustainable model of redevelopment that transforms the way cities are mapped and laid out.
