MASSACHUSETTS MNBTlVUTE
OF TECHNOLOGY
OCT
Pro-Forma for City Form
By
Akanksha Raina
LIBRARIES
B.Arch, 2010
School of Planning and Architecture
Submitted to the Department of Urban Studies and Planning in partial fulfillment of the requirements for the
degree of
Master in City Planning
and
Master of Science in Real Estate Development
at the
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
September 2014
0 2014 Akanksha Raina.
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Professor Albert Saiz
an Economics and Real Estate. Department of Urban Studies and
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PRO-FORMA
for CITV-=FORM
Financial Planning and Resultant Physical Urban Forin
New city Projects in India: Private vs Public investment perspective
Akanksha Raina
Master in City Planning
Master in Science in Real Estate Development
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ABSTRACT
Pro-Forma for City Form
by Akanksha Raina
Submitted to the Department of Urban Studies and Planning and the Program
in Real Estate Development on August 19, 2014 in partial fulfillment of the
requirement for the degrees of Master in City Planning and Master in Real Estate
Development
This thesis aims to examine impact of financial decisions on the city morphology, specifically on the
current crop of new city projects undertaken in India. While there has been some existing research
on impact of capital market, institutional framework, on the existing cities and their struggles,
there is littl that tis spoken about the motivations of development agencies, their manifestos and
aspirations, for the new cities that are being planned. My research explores green field projects
in an attempt to distill, through comparison and contrast, cities developed as a private or public
goods.
The physical design of the urban fabric of a city is a result of many forces. These could be the
economic, social, cultural, political or the aspiration aspects that dictate the physical form of the
city With the inflow of capital in the developing world new cities are being built from scratch in many
parts of the developing world. Visualized as products in the real estate industry as investments and
assured long term returns, these regions are conceived as places of enhanced productivity Cities
are now considered the drivers of consumption and accelerateors of economic growth.
India, with an increasingly open economy and history of social ideals, poses a unique dichotomy
of resultant new city building processes. As the state edges towards more open markets prourbanization policies, disparate methods of developing and financing new city projects wIl emerge.
The unique presence of two polar development strategies within the same macro context shall
enrich this study and let me draw parallels to distill the parameters.
The thesis shall explore the cases thorgh the lens of finance specifically and the implications of
financial strategies on the resultant urban form. A narrative format weaves in the socio political and
cultural aspects along with specific market conditions, of the two cases -Naya Raipur and Jaypee
Sports City, and provides detailed accounts of the policies and agency practices, what landlords
and realtors are responding to, and how ultimately these plans in place today evole into future
cities. Ultimately, these findings indicate how deeply embedded both social and fianncial scenarios
are in the development of cities and the need to question the adequacy of just one model instead
of the other.
Thesis Advisor
Albert Saiz
Daniel Rose Associate Professor of Urban
Economics and Real Estate, Department of
Urban Studies and Center for Real Estate
Thesis Reader
Michael Dennis
Professor of Architecture
Department of Architecture
ACKNOWLEDGMENTS
To Peter Ellis and Ferhat Zerin with the PENC Team for an experience of a lifetime in building a
new city in India
To Mr. Rohit Khandelwal DGM planning and Mr. Panigrahi, Chief Engineer at NRDA along with
Ms. Raina Dora- Vice Fresident Architecture, Jaypee Associates Ltd, for making themselves
available to answer questions an provide guidance regarding their expeirences in building these
projects. My thesis research would have been incomplete without your generosity.
To professor Albert Saiz, for your continued positivity, guidance and passion on this project, and
for bringing in the love of economics in my formative years here at MIT
To professor Michael Dennis for your kind words and encouragement.
To professor Tunney Lee for your humour and paitience and unwavering support.
To professor John D. Macomber for engaging conversations and valuable thoughts on setting up
the initial direction of this research.
To my classmates in the MSRED Program and DUSP for the great conversations and friendships,
and MISTI India for the travel support.
To my parents for their love,
and to my rock Apoorv Goyal
for this labour of love.
5
CONTENTS
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
6
METHODOLOGY
INTRODUCTION
2.1.
Trends of urbanization in India: the crisis
2.2.
The Indian cities
CASE FOR CITIES
THE NEW CITY PHENOMENON
4.1.
Evolution of the new city motivation
4.2.
Understanding of 'Indian urbanism'
4.3.
Morphology of Indian cities
CONCEPTUAL FRAMEWORK
THE CASES
6.1.
Introduction
6.2.
Challenges with the case method:
JAYPEE SPORTS CITY
7.1.
Narrative
7.2.
Regional Trends
7.3.
Project Drivers
7.4.
Development Strategy
7.5.
City form narrative
7.6.
Evolution of the plan
7.7.
Financial narrative
7.8.
Conclusions for the case
7.9.
Sports appendix
NAYA RAIPUR
8.1.
Narrative
8.2.
Regional Trends
8.3.
Project Drivers
8.4.
Development Strategy
8.5.
City form narrative
8.6.
Financial Narrative
8.7.
Case conclusions
COMPARATIVE ANALYSIS
9.1.
The Grid
9.2.
The land use mix
9.3.
The product typology mix
9.4.
Phasing
9.5.
Sensitivity analysis
PRELIMINARY CONCLUSIONS AND RECOMMENDATIONS
10.1.
Recommendations
10
11
12
14
15
19
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20
21
25
31
31
31
35
35
37
39
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42
48
53
56
57
59
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61
64
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66
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81
84
86
90
90
92
93
TABLES
Table 1. Noida
40
Table 2. Greater Noida
40
Table 3. Regulatory Masterplan
45
Table 4. Sports City Districts
45
Table 5. Changes in the master plan from 2010 to 2011
53
53
Table 6. Sports city built up area comparison (Gross Site area)
54
Table 7. 2010 Product Mix
54
Table 8. 2014 Product Mix
Table 9. Proposed masterplan phases
55
Table 10. Capital flows
56
Table 11. Demonstrative product pricing
57
Table 12. Population and trends of Raipur and anticipated trends for Naya
Raipur
63
64
Table 14. Recent Developments in Raipur Property Market
Table 13. Expected Demand of Residential Units
64
Table 15. Historical Land Rates in Raipur
65
Table 17. Distribution of Plotted and Apartment Housing
71
Table 18. Suggested plot sizes and development control guidelines
72
Table 20. Suggested (indicative) percentage of dwelling unit size based
on number of rooms
73
Table 19. Suggested land utilization pattern at sector level
73
Table 21. Contribution by various housing sub-systems to the total housing stock of Naya Raipur
75
Table 22. Population Phasing
78
84
Table 23. Case comparative data
Table 24. Goals and planning manifestations
92
Table 25. Naya Raipur Population in 2031
116
Table 26. Projected Land Rates in Naya Raipur
116
7
ABBREVIATIONS
*
SEZ: Special Economic Zone
*
SDZ: Special Development Zone
*
BUA: Built up area
*
FAR: Floor Area Ratio
*
CBD: Central Business District
*
JAL: Jaiprakash Associates Ltd.
*
JPSI: Jaypee sports international Ltd.
" NRDA: Naya Raipur Development Authority
" JNNURM: Jawaharlal Nehru National Urban Renewal
Mission
8
*
HUDCO:Housing and Urban development corporation
limited
*
PENC: Peter Ellis New Cities
*
YEIDA: Yamuna Expressway Industrial Development
Authority
FIGURES
Figure 1. SEZ in India
Figure 2. Chandigarh: the development of the sector model
Figure 3. Lavasa: Landscape
Figure 4. Lavasa: The Resort
Figure 5. Bid- Rent Curve
Figure 6. elasticity of demand and supply
Figure 7. Options in development stage
Figure 8. Benefits of option
Figure 10. Location wr.t Delhi
Figure 11. Layers
Figure 12. Market Trends
Figure 14. FAR Strategy
Figure 13. Masterplan grid comparison
Figure 15. Districts
Figure 17. Keyplan
Figure 16. 2012 Downtown district plans
Figure 18. Evolution of YIEDA masterplan
Figure 19. Sports City masterplan evolution
Figure 20. Grid Evolution
Figure 21. Change in typology of planned projects
Figure 22. Phasing
Figure 23. Population growth by individual uses
Figure 24. Population growth by phases (combined uses)
Figure 26. Location
Figure 27. Boundaries of administration
Figure 28. Land rates in Raipur
Figure 29. Regional plan
Figure 30. Structure
Figure 31. Green structure
Figure 32. Urban form and land use mix
Figure 33. Sector Layout
Figure 34. Typology Mix
Figure 36. Block Comparision
Figure 35. Neighborhood massing
Figure 37. Rivate vs Rivate development
Figure 38. Housing developed by private developer
Figure 39. Housing developed by Chattisgrah Housing Board
Figure 40. Phases of development
Figure 41. Grid compartive
Figure 42. Degree of gatedness
Figure 43. Greens: Public or private
Figure 44. Planning models
Figure 45. Neighborhood or district planning
Figure 46. NRDA inverted neighborhoods
Figure 47. Gated private enclaves of sports city
Figure 48. Risks undertaken in the two development models
Figure 49. The density and rent profile
Figure 50. Leasable area as per development plan for Naya raipur
Figure 51. Leasable area as per development plan for Sports City
Figure 52. Jaypee Sports City - 2014 Roject Typologies
Figure 53. Project Anchors
Figure 54. Project Status
15
24
25
26
27
27
29
30
37
37
39
47
47
48
49
49
52
52
52
53
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116
116
9
1. METHODOLOGY
" Narrative, built through development plans issued, marleting
data, interviews,
-
Cases, as a stand in for these disparate development models
in the country
-
Mixed methods, with
incorporates quantitative pro-
forma analysis and qualitative masterplanning analysis the
combination of all these resulted in
" Parameters for transforming strategy decisions for the
development process, morphology
" Pro-forma comparative for the two cases
" Trend evaluation for new cities in the chaging sociopolitical climate would generate implications for
" Rigourous analysis of impact of finance
" Morphological Impact of these strategies
" Bridging the divide in these two practice fields
10
2. INTRODUCTION
There once was a time when designing new cities was one of
the most ambitious and urgent tasks for any urban designer and
planner. The second half of the twentieth century saw a plethora
of new models, ideas, and designs specifically geared towards
the design of the ultimate 'City of the Future' The construction
of entirely new integrated urban systems and the writing of
technocratic and ideological books on how to build new cities
culminated in the building of hundreds of New Towns in Western
Europe, the US, and the new nation states of post-colonial Africa
'
and Asia.
The time is back here again. New cities are being built from scratch
all around the world. Fast emerging markets of South America,
Asia and Africa are key contributors in this trend. While these
glossy images remind us of the earlier era, the key distinguishing
factor between the earlier utopian visions and now lies in the rapid
advancement of technology We can now invest and construct
these visions of the future. Global capital is everywhere and
development is no longer bound by geographic boundaries.
There is also an ambition to display this rapid growth through
tangible beacons that would re-brand the pre-conceived notions
about states and countries. Building cities is therefore much
more than just an activity of economic development, but also a
very self-conscious move to display the "growth" in the economy.
These are therefore politically loaded schemes, as sometimes
seen in the projects in China, and sometimes as brainchild's
of megalomaniacal power-brokers from both private and public
sectors. We see new developments in China, Angola, Saudi
Arabia, which stem less from the demand of the rapidly growing
urban populations, but more as displays of opulence.
While this may mean that we see our visions being translated
into reality quickly, such instant cities are also most vulnerable to
market fluctuations and speculation. The accelerated development
within a fixed plan and time frame, with a finite vision, makes
these instant cities inherently prone to obsolescence. Without a
negative feedback mechanism to the system, we could anticipate
an investment and development overdrive. These two contrasting
scenarios make the city of the near future uncertain. How would
the long term aspirations be embedded into the finite structure of a
city plan? What would such a city look like?
11
These megaprojects are also real estate development projects and
are governed by the models of delivery and financial flows. The
city, therefore in this transformed perception, is also now a product
in the market. There is therefore an urgent need to assess the
impact of financial decisions on the design of new cities, and find
solutions informed by different models.
12
2.1.
Trends of urbanization in India: the crisis
Innovation is a response to an impending crisis. In the case of
India, as is the case with a lot of countries in the developing world,
the exploding urban population poses this crisis. Standing at 400
million which is approximately a third of the total population, it has
increased by 5 times as compared to the population growth of
2.5 times during last 5 decades. It was estimated that about 410
million Indians will be living in the cities by 2011 and 800 million
by 2045.The number of metropolitan areas in India grew from 5 in
1951 to 23 in 1991 and is estimated to grow to 52 by 2011.
This rapid growth is combined result of migration and growth of
the middle class due to the overall economic development of the
country The cities absorbing this growth however have to mitigate
the ever increasing stress on its infrastructure which threatens
to crumble anytime. Existing cities battle with pollution increase;
transportation system disorder; decrepit and failing water and
sewage systems.
Despite this staggering need, India is yet tojoin the urban century
with a mosaic of 500,000 villages with sixty percent of the
population dependent on agriculture. Fewer than 30 percent of
Indians are presently urbanized. This leads to a massive potential
for growth and development of urban centers.
Urbanization is both, the cause and effect of economic growth.
Yet urbanization in India has progressed at a far slower rate than
the overall economic growth rate generally This stems from the
country's severe problems in both management and financing of
cities. The service industry IT industry and manufacturing industry
were leading reasons to economic growth. The reasons for slow
urban development include policy biases against: replacement
of labor with industrialization, location of industries in urban
areas, and urban concentrations. Key issues that have acted as
roadblocks for urbanization in India have been:
Urban Infrastructure Investment: The high cost in moving to urban
areas with poor infrastructure facilities like water and sanitation
facilities, lack of affordable urban transport, and expensive land
development is a possible reason for slow urbanization.2
Rigidities in Urban Land Policy: The urban land cost grew high
because of the policy introduced in mid-1 970's Urban Land Ceiling
Act. The act made it difficult for people to change the use of land,
reducing the availability of land and increasing the prices in urban
13
areas. To summarize, many policies formed by the government in
the 1970's led to slow urbanization even during a period of rapid
economic growth.
Incompetent policy and administrative support for development:
There is lack of systems of redressal towards complex problems of
land rights and weak policy development and implementation. Such
vulnerabilities enable exploitation of system for individual gains and
further encourage red-tape and corruption within the system.
Thus we see the great need as well as the great inadequacy in
existing city policies that disable existing cities in absorbing the
increasing urban population. Lack of resources for making such
heavy infrastructural investments further undermines the city building
process within existing urban centers. These inadequacies expose
the residents to unregulated encroachments, artificially regulated land
values, privatization of public infrastructure and thus finally into a city
splintering into fragmented enclaves of stark disparities.
2.2.
The Indian cities
The Mega polis: aging giants
Some of the oldest, biggest and the economically most mature
cities of India, these large urban agglomerations have displayed
a sustained growth of population and jobs. 'Aspiration cities' for
the non-urban population who would also like to benefit from the
exposure to opportunities, the thrill of city life and be a part of the
urban India phenomenon. These centers see high migration from
the rest of the country As a result, they are already choked for land
and buckling under the infrastructure. While these mega cities form
the home for many private sector players that can be leveraged for
the development, the high amount of competition, existing planning
caps, and prevailing state of infrastructure do not position them
attractive investment areas. These could include, Delhi, Mumbai,
Kolkata, Ahmedabad, Bangalore, Hyderabad etc.
Figure 1. SEZ in India
15
The Tier Two: the promise of the future
A large portion of urbanized space continues to be described
by small and medium sized cities residing in between the rural
hinterland and hyper urbanism described above. These cities
are characterized by an intermediate and decentralized form of
urbanism, often haphazard and contrasting substantially with their
larger counterparts and smaller villages. Because of their size and
location, such interstellar urban nodes form a vital link within the
hierarchy of settlements and allow for the diffusion of development,
technology, knowledge and migration between the rural and the
urban. The Tier two cities also houses the growing middle class,
who are turning out to be the big spenders in the country while
the manageable scale of the city allows for better regulation an d
less challenges in development. These cities would include Jaipur,
Nagpur, Bhopal, Chandigarh, Coimbatore, Ludhiana, Mangalore,
Indore and Kochi
New Cities
Being a relatively new democracy, India has experienced
the phenomenon of city building in the recent past since
independence. These new cities have been a result of creation of
new states (New Delhi, Chandigarh) &townships created to house
residential development around newly developed manufacturing
centers (Bhilai, Bhubaneshwar), as well as satellite towns as
subsidiaries in easing of the pressure of exiting cities (Navi
Mumbai, Greater Noida) and lie in the close proximity to the
megapolis to feeds off the positive externalities of the strategic
location. Usually not developed as independent self-sustaining
cities, such peri-urban enclaves, similar t the dormitory cities in
Europe, support the exiting city's overflowing population giving
them the character of a denser suburb. These sub-center compete
for attention within the market and develop the surrounding region
to look like a poly-centric.
16
3. CASE FOR CITIES
There is a growing sentiment that India is going to urbanize at
an incredible pace and its future lies in a steady increase in the
number of its cities. 3 This comes cloaked in possibilities and
aspirations, which not only appear manifold, but in doing so,
transcend political, financial and economic ideologies with ease.
Realizing the need to create a level playing field for domestic
enterprises and manufacturers to be competitive globally the
government had in 2000 announced the introduction of Special
Economic Zones policy in the country, which would help delineate
new urban areas to enhance foreign investment, becoming hubs
to promote exports from the country. These enclaves provide
space away from the cobweb of existing city policies and archaic
procedures, creating safe havens for the purposes of trade
operations, duties and tariffs.
According to vide ress Note 2 (2005) dated March 3, 2005
the Government of India has decided to permit Foreign Direct
Investment (FDI) up to 100 per cent under the automatic route,
in townships, housing, built-up infrastructure and construction
development projects which is expected to attract foreign
companies to invest in India. Quite bent on the agenda for urban
development, the Government of India is taking financial as
well as technical help from International Institutions like Asian
Development Bank, Overseas Rogram for Economic Co-operation
(OPEC) and others. Remaining thresholds were crossed via
invitation to private companies in major projects as well and
adopting policies like Public rivate Partnerships (PPP's) and
Public rivate Funds for urban development. We also see the
development of a stronger mortgage market, FDI in real estate as a
percentage of total FDI inflows increased from 4.5% in 2003-04 to
26.5% in 2006-07.
The Central government used to spend Rs.15 4-5 billion annually
for city development. Now with programs like Jawaharlal Nehru
National Urban Renewal Mission, the budgeted amount is Rs.
500 billion. Thus the focus of the government is also towards city
building and they are keen to help cities grow and develop.
The new government elected by the Indian democracy has found
leadership in Narendra Modi, who comes with a clear mandate
for urbanization. His prior work in the state of Gujarat has been
17
a testament to pro-development policies and bullish approach
towards economic development. The State of Gujarat enacted the
Special Investment Region (SIR) Act in 2009, which according
to the Gujarat Infrastructure Development Board "shows the
commitment of the Government to set up world class hubs of
economic activity on the lines of fastest growing (sic) countries
of the world" Such policies have simplified and smoothened the
procedure for setting up special investment nodes (which include
SEZs) by creating an Apex Authority empowered to be the "single
window system and the first contact for setting up any economic
activity or amenity in the SIR"
While the proposed projects range from 250 "smart" cities to
DMIDC, (a direct result of the SIR Act) providing a swift avenue for
foreign invest in the urban development along a freight corridor,
there have been some other traditional, as well as nontraditional
models that co-exist.
These policy precedents show a continued commitment to
urban development, and while many cities do have the vehicles
to acquire the land, they lack the investments to be made for
the development of such large scale Greenfield developments.
This "open doors" policy for private investors to participate in city
building, who are also willing to invest finance in an otherwise
red-tape free context. Many countries like the Emirates, China and
Korea use these new developments as a tool to manipulate and
control an otherwise unwieldy urbanization process.
With pro-development policies at the national level and the and
eagerness of the state to allow FDI there is a new model for new
cities that is starting to emerge.4 There has been a consistent
attempt to internalize the bureaucratic red tape, and streamline
processes for ease of investment. While, the state may or maynot (which is the majority case) have the capacity to undertake
this, PPP models have become the new norm. These trends
lead to a new development model of a new city as a financially
self-sustaining unit, which is in dramatic contrast to the earlier
developments with socialist goals. While the first phase will be
developed in the same peri-urban fashion, these areas gradually
hold on their own through their future planning and investment
strategy Initiated by the conviction that the new city will not only
lead to an economic boom in the region, but also increase land
value, these urban utopias aim ape a densified suburbia and
create a controlled urbanity It thus is a great investment and
development idea for both the public and private developer India's
18
unique position as a social democracy lends both the public and
private developers to re-create these and allow the two patterns to
co-exist.
The following changes in the definition of the "city" happen along
with this theme:
City as a product: The system of the city, along with all its
processes is packaged and interpreted as a product, to be
developed, invested in, and managed. The system loses its
amorphous form, and becomes a finite structure.
Cities as economic drives: Other than being the direct creators
of primary employment (by attracting firms who would like to
re-locate for multiple reasons), the agglomeration will spin off
secondary employment and service industries (many a times,
informal I in the case of India). This active intervention changes
the economic base for the region and driving up consumption and
accelerating economic flow in and out in the region.
City as vision driver: It provides the opportunities to re-envision
the future of a region. It provides a quick and sure route to escape
from the existing shortcomings, and try to refocus by starting from
scratch with the hope the focus will shift eventually and regional
aspirations will be met.
City as a test bed: While the new cities are almost vehicles for
facilitation of the flow of global investment and capital, they also
act as experiment ground for new planning models (Transit oriented
development, smart city, Eco-City) While these terms may lack
clarity in the final vision, there is however hint at the motivations
of the developers and showcase attempts to incorporate newer
models in their planning process.
While these new policy decisions may come with positive
aspirations, there are some repercussions of such models
of development. It would be best to be cognizant of these
while moving forward with the analysis and acknowledge that
this particular topic has many lenses that lend color to these
developments.
1. Privatization / commercialization of basic services through
public private partnership with an introduction of user fees;
19
2. Liberalization of land and real estate market through repeal
of Urban Land Ceiling Acts and change in Rent Control
Acts;
3. Valorization of private sector and private credit rating
agencies over elected civic bodies;
Bringing the urban poor in the orbit of pay-and-use framework, for
example, user fee for basic services, etc.(CASUMM, 2006). The
sweeping transformation of urban governance is meant to create
a functional impotence of democratically elected bodies at various
levels.
Despite these concerns and misgivings, the increased emphasis
on the role of the private sector development has proposed new
models that create synergies between the two project managers.
20
4. THE NEW CITY PHENOMENON
4.1.
Evolution of the new city motivation
While new cities have changed forms over years, the main drivers
have been the ideological and historical contexts in which these
were developed. There has been a dramatic change in context for
new cities being built today, vs the new city building movement that
took place in Europe with the new towns.'
Social Democratic Cities
These have mainly been cities developed in the past, with an
exceptionally large reliance on the part of governments in all
segments of planning, architecture, urbanization, and infrastructure.
The central role of the state lies in creating a new society and its
ideals. The construction of completely new cities was therefore the
most ambitious assignment of urban planners and architects, and
the devising of new urban futures was the main obsession that
occupied the theoreticians.
Historically New Towns sprung up around the world in London
between the 1940s and 1960s; with the Dutch groeikernen such
as Zoetermeer, Spjkenisse, Capelle aan de lJssel, and New
Towns like Hoogvliet and Lelystad; the German New Towns and
large-scale expansion districts on either side of the Iron Curtain,
such as Gropiusstadt in West Berlin and Marzahn in East Berlin.
There are also the Scandinavian New Towns, which are praised
for their excellent design, but are now subject to social corrosion,
such as Gellerup near Aarhus, Albertslund near Copenhagen, and
Vtllingby and Rinkeby near Stockholm. And there are the utopian
icons, such as the Bjlmermeer near Amsterdam, Cumbernauld
in Scotland, Le Mirail near Toulouse, and Louvain la Neuve in
Wallonia, where the architectural avant-garde was given a mandate
otherwise inconceivable today's context of building cities entirely in
accordance with architectural concepts, with on an complete faith
in the ability of design to determine the a new urbanity and society
Market Cities
The new towns in Asia have a strong connection with the
accelerating prosperity in the region. These new towns house
the rising middle class of these developing nations . The new
migrants, who we also attribute this increase in urbanity to, usually
21
find a cheap room or apartment in older urban areas, in China for
instance in the 'urban villages Such overcrowded high-density
areas provide the affordable access to housing, restaurants, shops,
and jobs to the new city immigrants. The inner city neighborhoods
provide room for the immigrants through the migrating middle and
upper classes who witness an exponential rise in living standards
and move to New Towns.
Their demographic make-up would probably showcase the most
decisive difference with the historically described European New
Towns. While the former were initiated, organized, and financed
by (national) governments to contain the growth of the metropolis
and to provide housing for all layers of the population, in the
present generation of market cities their role has, to a large degree,
been taken over by large multinational enterprises, who work with
different principles. The exchange of knowledge, the competition
in global listings, and the ultimate authority over the plan now no
longer rests with national government, but with separate cities and
multinational corporations.
The City as Commercial Product
Economic motives are the dominant factor behind most New Town
initiatives today. On a governmental level, they are usually part
of a strategy to stimulate, diversify, and accelerate the regional
or national economy. On the level of the developers, the new
phenomenon is that the design, planning, and construction of
a whole new city can be a profitable business. There are stark
differences though. Instead of a community center, there is a
clubhouse next to the golf links. The present New Towns are
populated by the middle and upper classes, while the lower income
groups live in the old city or in self-organized cities, slums. By
default of their mortgage prices, these New Towns become a sort
of resort for expats and the (upper) middle class. Made possible
by its reduced demographic program, for the first time in history
the city can be considered a commercial product. While this social
segregation is not optimal, it also relives pressure from the inner
city markets, and does not completely displace. It is essentially this
dramatic change in the last decades in the huge diversification of
actors who are responsible for these New Towns, the way the cities
are programmed economically and the way they are financed,
maintained, operated, and built.
22
4.2.
Understanding of 'Indian urbanism'
City planning tradition in India is quite rich with historic examples
from Jaipur to the more recent industrial towns of Bhilai,
Bhubaneshwar, to the new Nano city, Lavasa etc. The new cities
rely a lot on image building and lend themselves to marketing
concepts, changing the perception of city living as a right to a
good traded in the free market. The new cities hire international
consultants who incorporate the planning traditions into the
plans that emerge and the urban form many a times stems from
international traditions than national ones. A quick analysis of the
new city plans of the past in India would help provide a context in
assessing the resultant city form is a new phenomenon.
Every human settlement consists of certain elements. Interactions
of these elements form a pattern - the urban pattern. The urban
pattern is a result of the relationships between people and their
social, economic and physical environments. Buildings and spaces
are created by people and quite often characterize them (Kostof,
1991). If the residents build the buildings themselves, then they
reflect their lifestyles.
Factors Influencingthe Urban Form
Many factors influence the form of cities. Traditional settlements
were shaped by (Lozano, 1990): the way in which nature and manmade features satisfy needs for protection and defense, the way in
which physical and economic landscape allows for communication
with other regions, the way in which the topography of a site
suggests the construction of a human settlement, the way in which
climate leads to building solutions. These factors influence the
cultural and spiritual form of the cities as well. Traditional cities
have used physical forms to interpret cultural and religious beliefs
(Lozano, 1990).
The Evolutionof the Urban Form of Indian Cities
For thousands of years, cities were very simple although they
rarely served single purposes. Tracing the evolution of Indian Cities
in this context, we now look closely at Chandigarh and Lavasa.
4.3.
Morphology of Indian cities
Chandigarh, 'The City Beautiful' came into being as a brain child
of India's first Prime Minister, Sh. Jawahar Lal Nehru, after the
country's achievement of its independence in 1947. It started
23
Figure 2. Chandigarh: the
development of the sector
model
from zero and it places itself in the line of modernist utopian city
planning projects.
As expressed by President Nehru, Chandigarh was to establish a
vision of the future" unaffected by traditions of the past" It would
be the capital that would serve as a model in city planning for the
new nation with water, drainage and electricity would be available
to even" the poorest poor" A modernist city, it was also formed
as a grid plan allowing for distinctive hierarchy of movement
as well as segregation of living spaces from congestion. The
basic component of the urban form was a concept for living, the
neighborhood unit, the sector.
In its first phase Chandigarh was organized in 30 sectors. The
sector was conceived as an autonomous unit including housing
as well as all service needed for everyday life. An example of
24
a neighbourhood unit precedent is the superquadra of Brasilia,
Brazil (1956-59) where the neighborhood unit was used as the
structuring urban element.
The programme for Government Housing allowed for a speedy
construction of a range of houses for different categories of the
government officials. Housing became the predominant element of
the city's built mass and came to have a much larger impact on the
city than the much slower private constructions.
"The inhabitants were organized in the sectors according to
existing social structures with the highest paid official and the
largest houses near the capital. The greater the distance of a
sector from the capital, the higher its density Densities came to
vary between 7persons/acre to 1 00persons/acre.
Critics such as Kevin Lynch and Christopher Alexander have
criticized the concept of the neighborhood unit to be isolationist
and segregating. They point at the aspect of self-sufficiency as an
element of exclusion.
Figure 3. Lavasa: Landscape
"We live in a time of transition. An order is dying and the new is
yet to completely replace it. Everything specially the socio-spatial
order that gave a sense of continuity to the established form of
life is changing, mutating and getting transformed In recent years,
cities have come to increased onslaught ofprivate capital. ft has
changed the ways city city life and politics was Imagined In India,
also, revolutionary changes are taking place in social organization
within cities spatial organization of cities, relationship of cities
with non-city-dwellers/non-city spaces, between cities within the
national territory and outside the national boundaries, and between
cities and the State."
-Prof. Abdul Shaban, Private Cities and Emerging Form of Urbanism in India,
School of Development Studies, Tata Institute of Social Sciences, Deonar, Mumbai
Lavasa is a hill town to be built in the Western Ghats to undertake a
25
Figure 4. Lavasa: The Resort
large-scale lifestyle development promoted by Lavasa Corporation.
Located 65 km from Pune in the Mose Valley and the backwaters
of the calm Warasgaon dam area. The area has been developed
as a pedestrian-friendly, upper- and middle-class alternative to
neighbouring city Pne's bustling urbanism. Mediterranean facades
and lake-front cafes give the development a resort-like atmosphere.
The town boasts of an 18-hole golf course, a club house, shopping
centers, a tourist destination around Lavasa.
-
The development of Lavasa is planned across three town centers
Dasve, Dananhole and third unnamed. One of these town centers,
Dasve is themed to have elegant housing, lakeside apartments and
multiple arrays of villas. It would also include a country club, day
school, hospital, hotels, resorts, spas and a center for excellence in
education and research.
Business Parks with commercial, institutional, IT and nonpolluting
processing firms will be located in the second phase of the
development and comuting modes will include personal cars, ferry
transport, ropeway (skyway or ski lift-type) traffic and electric public
buses.
When Lavasa Corporation Ltdt urned public in 2003, Hindustan
Construction Company (HCC), India's largest heavy civil
engineering construction company joined the project, becoming
the main investor with a 65% stake through its subsidiary HCC
Realty The developer believes that Lavasa is answer to experts'
claims that India will need to build at least 500 new cities to
accommodate the country's mass internal migration from rural to
urban centers.6
Real estate developed would be the major source of revenue for
this greenfield city, contributing upto seventy per cent, through the
available untouched land bank. The condominiums are priced to
start at Rs 2.7 million, planning to attract the uppermiddle class
from the 30 km away IT park of Pune ( Hinjewadi), as well as
Mumbai.
The Lavasa project meets a very real market demand. Middle
class families are attracted to many aspects: safety, a picturesque
setting, clean streets and a coherent architectural character give
Lavasa an almost resort-like atmosphere. And much like a resort,
the squalid homes of the urban poor are nowhere to be seen.
26
5. CONCEPTUAL FRAMEWORK
The conceptual framework that will be applied in thesis analysis
will operate at three levels. First is the urban economics approach,
which will enable us theorize the spatial pattern of new cities.
Second is the real estate development framework that would help
understand the development model and process through which
these megaprojects are executed.
The last one would be the framework of urban form assessment
using traditional parameters such as FAR, density, land use etc to
assess the urban morphology
The urban economics framework
Neo-classical theories of economics can be applied within the
context of the planning for new cities. While some might argue
that the assumptions are fairly simplistic, it is this reduction of the
complexity that provides an intriguing prospect of analyzing urban
from
I-Wr
2-
umen
&U*
". m
Fa
B
Figure 5. Bid- Rent Curve
KD
PA..
Figure 6. elasticity of
demand and supply
0 0'
Bid-rent Curve: dictates the FAR distribution that should take
place for a mono or multi centric city This would define the
size and the rent gradient. It assumes rational behavior by all
the people who as suggested as economic beings making the
most rational decisions. While, in practice, zoning laws define
these physical attributes, it is a great tool to assess some missed
opportunities and deciphering how the city would function.
Elasticity of demand and supply: One of the most crucial
aspects of the development is to understand the audience and
their indifference to volatility in the parameters of the product
offered. As we know housing is a commodity we need to know
the other options available to gauge the elasticity of demand. The
elasticity of supply will also vary for the two projects due to the
difference in project organization and delivery commitments.
Highest best Use: Another key concept that should be used
actively into city planning while working on projects of such scale.
While some might suggest that this concept would work only when
the plan proponents wanted to maximize the profit, it would also
be a valid argument to state that these uses might be reverted
to over time. As the planned city is not static and will evolve over
time, it would be best to provide a land use layout that follows this
principle. One could also say that such a decision would follow the
27
Coase theorem closely, and only aims to internalize profits from the
get-go.
Export Driven Economic Development: While many reports
(such as the one referred to before by Mckinsey suggest that cities
are drivers of growth), these fail to mention the need for export
economic development. A zero cost city would be able to use its
profits for the operations and make it a net zero profit. However,
cities are points of agglomeration, where people flock in not only
to benefit through the facilities, opportunities due to clustering, but
they also aspire to be better off financially from their home town.
Further, to ensure expansion and investments in the city, it has to
become a profit-making system -or at least self-sustainable. Only
the goods that are produced for outside demand will be able to
create profits.
Mobility of Labor: The success of the new city, while not only
depends on its economic drivers, but also on the friction in the
movement from one place to another In today's technologically
advanced cities, with rapid transit systems and city clusters,
there is high competitiveness within the cluster Contextual
strategic anchors will provide competitive advantage to the mobile
population and encourage investment that will surely result in
the regional economic development through both primary and
secondary sector of formal and informal development.
Spatial pattern: The configuration of cities has been moving
away from the mono-centric to a cluster idea, and more recently
to idea of a regional urban corridor While the Naya Raipur model
still stems from developing the regional cluster (through Bhilai,
Raipur and now Naya Raipur) the Jaypee project has a stake in
the corridor development and could probably be one of the biggest
planned developments on the corridor This not only gives them the
advantage of access to direct linkage corridor to two cities, but also
gives a directionality to future development, removing ambiguity for
future acquisition values.
28
Real Estate Development framework
Real estate is a unique investment vehicle in that it serves both
the financial and spatial markets. In the space market, real estate
represents a physical product that is developed in order to meet
market demand. These physical products, such as buildings are
combined with financial and marketing resources to create an
environment where people live, work, and play.
A
Understanding risks in the development process: More
importantly, real estate development is a risky business and
investor returns must match the level of risk undertaken and
managed in a project. Thus it is important to understand the
development process and risks associated at each stage. This will
also showcase elements of the development process where they
can have direct control over the outcomes.8
*
Phase 1: Land optioning and assembly, permitting,
development design
*
Phase 2: Construction
*
Phase 3: Lease-Up and Tenant Finishes
*
Phase 4: Stabilization and Operations
Phase 1: Land optioning and assembly, permitting, development
design. During this phase, the developer should conduct a highest
and best use analysis for the site. Once this is determined, they will
begin to option and assemble different land parcels, obtain permits,
as well as further develop the site plan and design of the project.
There is no set time frame for this phase of the development
project to be completed. It can take anywhere from a couple of
months to a couple of years. Because of this lack of certainty and
predictability, this is the riskiest phase of the development process.
The opportunity cost of capital (OCC) can be as high as 40%.9
Phase 2: During this phase, the development project is built. At
this point, the land is irreversibly committed to the construction
project, and it ceases to be a "land speculation" with real options
characteristics" The opportunity cost of capital(OCC) is usually
around 20%' 10
Figure 7. Options in
development stage
Phase 3: Lease-Up and Tenant Finishes
This phase reflects the completion of the major core and shell of
the development project. The space is now leased and occupied
by its tenants. This phase of the development process involves
29
less capital and less risk than the other components, therefore the
opportunity cost of capital falls around 10%."
Phase 4: Stabilization and Operations
During this phase, the project is completely or nearly leased up,
and operating at its long-run steady state level of profitability. 1
Optionality in Development: Through the work done by Prof.
David Geltner and Richard, we can analyze the decision to build as
a real option. An option is defined as: The right without obligation
to develop land at any time. When development is undertaken,
this option is surrendered, the cost of construction incurred, and
in return the value of the developed property is obtained. This
option-like characteristic allows the owner/developer to profit from
uncertainty during an upswing the market. 13
The flexibility to be able to hold the decision to build and modulate
it as per the market demand lessens the probability of a negative
outcome for the developer and he can time the launch as per
the market cycle. This value goes higher in markets with greater
uncertainty and would be quite useful in India's context.
Cut downsie; Expand Upside
Avoid downside ; Profit from Upside
VaBp
Figure 8. Benefits of option
30
The Urban Morphology Framework
the form of the city and its spatial relationships can be understood
in various measures.
UG~jij7
~o
Z+
density measures
http://densityatlas.org/
LKtvn
Aow
Ax
IA
use mix measures
grid size measures
http://densityatlas.org/
75 dwellings per heetar
Density: Most researchers such as Alexander and Forsyth claim
that measured density and other physical factors are independent
from each other (Alexander 1993, Forsyth 2003). We however
try to distill this into four sub-parts that can help describe
different dense conditions an their implications. Unwin used the
number of dwellings per acre (or hectare). In Germany the term
Weitraumigkeit (spaciousness) was introduced in relation to built
up density Le Corbusier introduced high density in terms of high
and spacious buildings to give sufficient open green spaces for
recreations (Berghauser Pont and Haupt 2010).*
Mix: Landuse and Typology: While mix in typology adds to variety
in the urban form, create the base for a collage city that can
be built upon over time, landus mix makes for ease of access,
promoting sustainble developments. Seen on the left is the
Function Mix model (MXI) as developed by Joost van de Hoek
with the purpose to measure various degrees of multifunctionality
(Berghauser Pont et.al 2011). The MXI model is dealing with the
degree of mix of functions in a quantitative way in terms of the
percentage of dwellings, work places and amenities, measured in
square metres.**
Grid Size: One of the key characteristics of recent studies on
urban morphology is the use of networks to describe the built
environment. In this perspective, the city is not seen as a collection
of building blocks that may have geometric regularities, ultimately
architectural styles, but a network of interconnected open spaces
created by those blocks- the urban grid(Martin, 1967, Hilier and
Hanson, 1984). Such studies unfolded cities in their underlying
spatial organization, tracing a connection between space and
society ad revealing that the urban grid itself contains an imprint of
society (Holanda, 2002).***
75 dwellings per hectare
75 dwellings per hectare
resultant typologies
31
* Mashhoodi, Berghauser Pbnt, Van
Nes , Combination of space syntax
with spacematrix and the mixed use
index, The rotterdam south test case
, paper ref # 8003, proceedings:
Eighth international space syntax
symposium, Santiago, puc, 2012
**lbid
*** Figueirdo, Lucas and Amorim,
Luiz, Decoding the urban grid: or why
cities are neithter trees nor perfect
grids, Bartlett school of Graduation
Studies,6th International Space
syntax Symposium, 12-15 Jun 2007,
Istanbul, turkey pg 2
Parameters extracted
Derived from the above stated three theoretical lenses we can
define the following parameters that would encapsulate the
development decisions taken through the lens of urban economic,
real estate development and urban form framework.
The grid size would determine the parcel size and right of way,
therefore describing the carrying capacity of the parcel in terms of
built up area, and transportation
The density parameter, classified into FAR, BUA would help
assess the density of the built environment. The people and DU's
per hectare, when combined with the earlier built intensity measure
provide information on the built product typologies.
The typology contributes to information about the mix of products,
both in terms of marketable goods, but also for diversification and
option strategy This mix in an urban environment also provides
positive externalities to all residents and breaks monotony
The phasing parameter would again quantify the strategic
decisions to respond to market demands, elasticices, or to work
in an artificially controlled environment. the former, though might
create inefficiencies, it also hedges risk for the developer in
adverse condititons.
the landuse parameter, would not compare mix percentages, but
also document the evolution in the evolving conditions. It would
also be wis to understand co-relations in development and returns
due to adjacences and quantify those opportunities.
LANDUSE
-PHASING
TYPOLOGY]
LDENSIT Y ]
GRID SIZE
PARCL -1Z
PLANNED
DEPENDENT
RIGH!
PRODUCT RANGE
32
FW
6. THE CASES
6.1.
Introduction
The case method presented a unique opportunity to compare and
contrast two very similar projects that aim to build a new city in
India. While the motivations both the projects make some strong
structural changes in the way the project is developed, these can
be observed when analyzed through the lens of a pro-forma.
Urban form on the other hand, also embeds within itself
parameters that impact the pro-forma for the two cases. These
cases will provide test material to analyze the in and outflows
between these two systems of understanding a city
We can further deduce the most risk prone parameters and how
their uncertainty would impact both the systems.
Hypothesis: that the city with socialist motivations, vs a city
developed as a product for profit making motivations should result
in different urban forms.
6.2.
Challenges with the case method:
The common denominators in the cases are undeniable, from the
global flow of capital, to the growing belief that cities are economic
drivers, to lofty political aspirations. It is this convergence that
provides the common ground for analysis. However, there are
also some limitations one should be cognizant of, before jumping
headlong into this approach.
First, while this study aims to isolate the two systems and read the
decision making factors from the lens of a pro-forma and the city
form characteristics, these lenses are by no means exhaustive and
cannot claim to cover the spectrum of socio -political, geographic,
cultural and other factors that govern the building of new cities.
Second, building a city is an evolutionary phenomenon, with
history narrative, and a common conscious at the core of the
layering process of different flows. The system therefore performs
as an open ended system, that is amorphous the cases therefore
do not present a static projection of the city but a snapshot in the
development process of city building of new cities. The images
33
associated with these are very telling, as these only act as baits
and marketing strategies to kindle the consumer imagination and
allows a play on perceptions.
Third, a word of caution on the definition of a city as used in terms
of these projects. There was a conscious decision to ensure the
scale, mandate and proposed plan for the project try to at least
be holistic in their nature and make an attempt to include all the
necessary components (land use, critical mass, employment, and
socio-economic mix). Many of such developments while these
(and many others) might claim to be new cities, they are disguised
housing developments via marketing and try to project the "live
work play: system that is the popular catchphrase in the market
these days. It is because of this obscurity in the definition of the
products that the pitfalls of these mega projects lie. Ideated as just
housing projects, they project of various amenities and proximities
that they do not possess in real life. The vibrancy of the city that
they promise is far from their sub-urban layouts and have no
semblance of the next generation city.
34
---
Frrrr
'FrF
-rr
IrF__
mr
oe Sports City
I,
/
I
I
t7
\
*%JfY
-- A
Project area
Projected population
2,021 hectares
1million peoplel
Cost of completion
Completion date
I
I
I
20351a
7. JAYPEE SPORTS CITY
"The GP is the first throw of dice that could wipe out the massive
debts that the Jaypee Group has accrued over the years. As
of date, the three listed Jaypee companies Jaiprakash Power
Ventures, Jaypee Associates and Jaypee Infratech have a total
debt of over Rs. 40,000 crore and revenues of around Rs. 16,000
crore. Jaypee has already spent around Rs. 2,500 crore on the
GP There is little chance that they will recover this investment.
However, the idea is not to make money off the circuit, but off the
real estate around it--a cool Rs. 1,50,000 crore over the coming
decades if everything goes according to plan'
-
"This is an image booster for them. F1 has a modern, tech-driven,
blg-boys-ieague kind ofImage and that will rub off on the group
as we//,"says Abraham Koshy, professor of marketing at the Indian
Institute of Management, Ahmedabad. However, expansion has
come at a price. The group's three listed entities -Jaiprakash
Associates, Jaypee Infratech and Jaiprakash Power Ventures
have a total debt of over Rs 45,000 crore currently
7.1.
-
(The
Figure 10. Location wrt Delhi
Narrative
The Jaypee City is a new city for 1 million people located 40
kilometers south of New Delhi along the new toll road to Agra.
city is owned in its entirety by the Jaypee Group, a private
company, who will build the infrastructure, parks, buildings, and
civic amenities. It will manage the city for a period of 100 years,
without involvement of local government. It is truly a city created by
private enterprise.
Lying right outside 'National Capital Region' The Sports city lies
in close proximity to Delhi as well as urban areas ringing it in
neighboring states of Punjab, Haryana, Uttarakhand, Uttar Pradesh
and Rajasthan.
Figure 11. Layers
Due to its density restrictions, and radial structure the urban
development has splintered into feeder residential neighborhoods
that sit adjunct to the city and allowed for travel to the core
with compromising on the quality of life. The two key cities that
witnessed the majority growth were Gurgaon (Haryana) and
Noida (Uttar Pradesh). Over time, these too have matured and
become urban employment centers that support the population
37
that resides within this region. The next tier of urban development
started to ring these secondary towns. Conceived as planned
"better "developments, they contested with the infrastructure of the
now congested secondary cities. This trajectory of development
manifested itself in all directions of the radial and diluted the
demand, as we go farther in any one direction. Following this
sequence, The Jaypee sports city would be a part of the fourth ring
of development in the NCR.
One would assume that this location dilution would be a great
impediment towards a project of this scale and ambition,
being landlocked, without any unique living environments
than its counterparts, However, the sports city has cut through
the succession hierarchy of development demand through a
combination of a rapid access highway and the development of a
star anchor attraction, which has changed the dynamics for this
greenfield development.
Controllingthe Access: Yamuna Expressway Project
The YIEDA (Yamuna Expressway Industrial Development
Authority) was created for the Yamuna Expressway Project
between Greater Noida and Agra, the longest Access Controlled
six lane (extendable to eight lanes) concrete pavement expressway
was conceived by Government of Uttar Pradesh in the year 2001.
To accomplish this project, Taj Expressway Authority (TEA),
a statutory body of the Govt. of Uttar Pradesh (GOUP) was
constituted in 2001. (TEA is now known as Yamuna Expressway
Authority (YEA))
The main responsibilities of TEA, inter alia, included: Acquisition
of land for construction of Expressway and area development and
Preparation of Zonal plan/Master plan for planned development
along the Expressway. They would also be responsible for
infrastructure works such as development of drainage, feeder
roads, electrification and other facilities in the area
While the Yamuna Expressway was developed to provide a fast
moving corridor that minimized the travel time from Delhi to Agra,
it would also relieve traffic congestion on National Highway -2
(NH-2). Linking the industrial and urban development of the
region (between Delhi and Agra), it would provide the base for
convergence to tourism and other allied industries, connecting the
main townships/commercial centers on the Eastern side of river
Yamuna. It is therefore was a classic example of land boosting
operation by the state, steered heavily under the aegis of the then
38
Chief Minister who particularly motivated in the development of
Greater Noida and allied areas.
The result was the 165 Km long expressway developed by the
Jaypee Group under Public-Frivate - Partnership, at no cost to
the government. However, as per the provision of Concession
Agreement, Concessionaire were given rights for collecting tolls
during the concession period of 36 years and also rights for land
development of about 25 million square meters of land along the
proposed Expressway. This land could be available for commercial,
amusement, industrial, institutional and residential development
would be offered on acquisition cost on lease for the period of 90
years.
7.2.
Regional Trends
Market trends
Income groups that the project caters to (their brackets, regional
trends, list of projects in this area)
Sector S1
Sector 74, 75, 76,
77, 78
Sector 100
107
Nolda-Greater NoWd3
Expressway
Greater Nods
troholhuceure
Markete, schooae)
Rteuldnft Cost
Proxholt to Orgaxsed
Proxhmty to ConWAMrW
Developmnd
Fourem l,*asruckre
Future Emplayient
Generanon
Explanatory Note: The greys/blues In Sectors 50, 51 depict well-developed infrastructure/social amenities and the
red block Indicates high property prices in this segment. While blues in Greater Nolda Indicate good infrastructure in
terms of road connectivity and affordable property price; greys suggest good future prospects in the long term.
50a 1 ith OWn
Figure 12. Market Trends
S==IOm eSwms Croaw
Inventory
The demand in Noida is maximum in the INR 40-80 lacs bracket
(which marks the middle income segment of the city) and due
to the severely crumbling infrastructure by the city, buyers as
increasingly preferring apartments that provide amenities such
as power backup. Therefore many projects that mainly appeal to
this segment of inner city migrators, represented frequently by
39
the higher middle and upper income groups are being developed
in the region. These owners are happy to pay a premium for the
private well maintained infrastructure support typically entailing
landscaped roads, uninterrupted power supply and well treated
water, mainly packaged into the product delivered by developer.
However, this opportunity has been open for quite a while in the
region and resulted in many competing products all around the
periphery of Delhi. The long list of these fresh stock options is still
far from saturated and has led the market to a slow moving though
not stagnant phase over the past six months making buyers
apprehensive. Thus, even the otherwise bustling Noida market is
not witnessing many soft launches, However, this micro-market
continues to attract investor interest from other parts of Delhi who
are second home buyers, looking to invest in the region for long
term returns.
Table 1. Noida
Short Term
10-12 months
Upside in capital value
Long Term
5u-bu months
10-15% YoY appreciation in capitai vaiue
with an upward bias on a conservative
note
Table 2. Greater Noida
Short
Term
_.ong Term
10-12 months
50-60 monthfs
Upside movement
-10%
an
in capital
value
vY appreciation in capital value with
on a conservative note
upward bias
While the area currently yields lower returns, it has plenty of
options and shows is anticipated to grow quickly in the coming
years.
40
7.3.
Project Drivers
"The project will be preferred by all class of people who have wished
to lead a lifestyle different from common people. Cost starting just
from Rs. 43.2 lacs onwards"
Building on the existing market segment analysis and the
execution of the expressway project, sports city provides these
very convincing sell arguments:
Proximity to Delhi and Noida: Greater Noida is situated
approximately 55 minutes (52 km) from the IGI International
Airport in Delhi, 45 minutes (42 km.) from Connaught Place,
Delhi via Noida-Greater Noida Expressway. The region is located
approximately 20-25 minutes away from Noida.
Proposed Metro Connectivity: The 30 km metro rail extension from
Noida to Greater Noida has been approved by the authorities.
Funded by the Noida Authority and built by the DMRC (Delhi Metro
Rail Corporation), the proposed 20 stations on the corridor would
spur development along the corridor This low friction movement to
and from an economic center redefines location for the project
Upcoming InternationalAirport: The Jewar International Airport
was proposed in 10 minute proximity to the project when the
proposal for the Sport City was first made. The airport would be
a prime anchor for the location and would create a strong service
base industry in the region.
Development of Excellent Civic Infrastructure: All the
infrastructure in the city would be developed and managed by
Jaypee who have made proposals to invest in sport related
facilities, institutions and many others.
Affordability in the regional context: While the prices have
touched new highs in the Delhi, Gurgaon and Noida markets;
Greater Noida and Noida Extension regions can still be considered
'affordable locations' with units priced at an average of INR 3,000
- 4,000/sq.ft. Approximately This discount provided in the location
is usually traded off by the homebuyer on enhanced facilities that
come as a parcel on these luxury products.
Commercial and IndustrialDevelopment: Despite well zoned-out
commercial and industrial regions, Greater Noida and its ancillaries
have lagged behind their competitor satellite town of Gurgaon in
terms of attracting corporate and MNCs into the region. While there
41
have been numerous factors, key reasons could be the need for a
more proactive effort to attract companies and the region's greater
distance from the international airport.
7.4.
Development Strategy
Organization within the JP group for the execution of the project.
REGULATORS
FINANCERS
JAYPRAKASH ASSOCIATESand SUBSIDARIES
YFJDA
PRIVATE DEVELOPERS
ELOPMENT PARTNERS
JAYPRAKASH ASSOCIATESandSUBSIDARIES
LOANS FROM VARIOUS BANKS
"oADO MO ERCrs
PRIVATE DEVELOPERS
JPS
42
W
@ SOM
43
7.5.
City form narrative
While the Sports city master plan was initially developed by SOM
(Skidmore, Owings & Merrill LLP (SOM) is one of the largest and
most influential architecture, interior design, engineering, and urban
planning firms in the world) the plan was later developed by Peter
Ellis New Cities in India. Many iterations and consultants for the
project have changed since, and this study looks at the plan as a
snapshot in time, studying the 2010 and 2011 master plans, and
their evolution in to the present master plan for the project.
Master plan
The 2011 Master Plan for Sports City builds on the vision and
overall framework laid out in the Original Master Plan developed
in 201 0.While significant refinements were incorporated into the
new plan, the plan stayed true to the spirit of the Original Plan, and
continues to reflect the following guiding principles:14
- A Beautiful, World-Class Modern City
- A Central Boulevard as the signature feature
- A Vibrant City of great urban districts
- A Rich variety of neighborhoods offering diverse housing choices
- A Walkable and Bike Friendly City
- A Connected City with modern roadways and transit
- A Green City with a connected system of parks and open spaces
- A city anchored by World Class Sporting Venues
The city structure therefore hosts a continuous park, 16 kilometers
long as its central feature. The project is then divided into districts
that each is anchored by sports or product character. These
districts, despite their varied cheated maintain a roadway network
creating a block size of approximately 200m by 200m.
The Institutional, commercial and residential typologies would
form the three dominant land uses, and would be sprinkled within
the districts, the scale, quantity and quality, would be determined
by the character of the product they support. Thus we see that
this development migrates away from the self-sustaining sector
typology, but provides each income group and density, a different
level of facility
44
This for example would result in the downtown commercial, Shop
cum offices, neighborhood retail etc. as typologies that emerge,
planned in proximity to the residential, but not embedded within
each the district blocks. The density studies within the block
focused on the carrying capacity of the built in terms of the FAR,
its iconic character as a part of the storyline for the development,
and much less emphasis on the equality of infrastructure access,
divorcing the traditional social impacts. This distinction, however,
is relatively fine grain, as all the homeowners would be already
paying a premium for living in this mega gated community
The overall project as divided into three portions (as separated by
the major roadway connections)
Jaypee greens sports city north
this torms the SDZ portion ot the development,
and then forms the core and non -core region of
Jaypee greens sports city
Jaypee greens sports city east
Table 4. Sports City Districts
Table 3. Regulatory Masterplan
i
b
r
core area
core area
7roads and other circulation
res
Comm
inst and amm
non-core
roads and other circulation
open area
-e
l
351.12
ha
35.02
op a2.7
236.64
ha
ha
ha
SPORTS CITY AREA SUMMARY
CRICKET DISTRICT
LAKE DISTRICT
DOWNTOWN DISTRICT
VILLA DISTRICT
GOLF DISTRICT
FORMULA 1 & STADIUM
TOTAL SPORTS CITY
SPORTS CITY CORE
50
85.
.14.Li...
79.06 HA
87.68 HA
224.67 HA
146.54 HA
108.71 HA
356.45 HA
1003.12 HA
E
I
AREA
351.12 HA
SPORTS CITY NON-CORE AREA 652 HA
I.
haIL..
45
It anticipated to house 1,000,000 people at an average family size
of 4.5, which would mean that the Jaypee group would have to
develop a minimum of 222,222 DU's, and make this one of the
biggest development projects undertaken in the country
Project Anchors
True to its name, the F1 racing track is the flagship project of
the sports city The project, developed independently by the
developers without any support by the Indian government or the
Sports Ministry was developed with the anticipation that it would
catapult the group on the global map. It was a great marketing
strategy showcasing the anchor and the real estate development
that surrounds it. This would create the much needed location for
the green field development, convert the adjacent land into a profit
making assets. Secondly the execution of the expressway and the
F1 would provide legitimacy and trust by the consumer who are
apprehensive by developer built products.
The JAL enterprise run by the Gaur family planned to build similar
sports anchors such as a world class cricket stadium for 100,000
and a hockey stadium for 25,000. Along with these they plan
to build a school district, health system, public transportation
company and their own security group for the city Again, the
capital costs here are huge, but the benefits outweigh the risks.
Jaiprakash Gaur is counting on the growing middle class in India
and their aspirations to fulfil his dream' 5
Other components of the project will include: a Financial Centre,
Residential Diversity Civic Centre Entertainment Districts and an
Educational Centre
It comprises world class higher educational facilities, universities,
medical centers, research and Development Park.16
Block comparison
While the districts were divided on the nature of projects they
would sustain, the blocks lay within them followed a similar sinuous
grid of 200x200, which would cluster together to conceive projects,
or individually develop into one project. While the higher FAR
blocks could be developed individually by other developers of even
by JP itself, the smaller FAR blocks would be clustered together to
form more suburban characteristic homes.
This block size was determined as the optimal grid for parceling
out development that could vary from residential to commercial
and a variety of housing types and residential development
46
MPA
PEDC RAN
)PSI OPTION
N
assma IquUSI
A
@Mma
nam.:
0"0e
a INIMMEN
low
ME
pir
@ame
a
smmaoomm
Naomi
Vm. aumna
-. 5
SAN
.&~ZEEE!!
---
NEWVO
MIDT0WN
Figure 13. Masterplan grid comparison
configurations with varying development densities and creating a
continuous network that would allow access to the public green
spaces in each block. The connected system ensures that any part
of the development block can be accessed without the need for
the rest of the block to be developed at the same time. The plan
is determined to not flow a strict grid character and curves into
sinuous forms, reinforcing the garden city images.
m
"
~,'*
Within the lot, 7% of the block size is required to be green
space, split into 2-3 parcels within the larger lot. There was no
mandate however, for certain percentage mix of land uses, and the
mandated mix could be applied in any which way.
~
Typologicalmix
I
t
IV
Figure 14. FAR Strategy
Share of the products that are developed in the project are not
mandated to respond to a certain mix or typology percentage
mandated in the YIEDA city plan in due to the special position
of the development as a SDZ (special development zone). The
product mix is derived as a response to the market demand and
evolves as per the needs of the developer. A blanket FAR of 3
has been distributed throughout the site, with no restrictions on
the height, which allows the consultants and developers to work
in relative autonomy in the way they anticipate the vision of the
city. Within this framework, there is also the possibility to also get
additional FAR, through purchase and bonus development rights
with compliance to green building/planning standards. 18
47
Given these, the 2011 master plan stipulated the development of
708,765 sqm as the built up area, which would be developed in
222,222 Dwelling units. This would mean that the average unit size
31 sq.meters for each dwelling unit.
Due to the high allowable FAR, the districts could create a variety
of products, each different in typology, form villas, to iconic towers.
Etc. The built typologies that were put forward were:
"
"
48
*
Town homes
*
Studios
*
Personal floors
*
Apartments : majority of the projects
*
Expandable homes (an addition in 2014) was added as
a test product differentiate between the floods of plotted
developments being offered.' 9
This however, impacts the average rates for the customers,
as they not only pay ore per sq meter, but also end up paying
more for a dwelling unit because of the bigger unit size.
Facilities such as parking (which is paid), mandatory club
memberships, further rocket up the cost per sq meter for the
final product, making the new city dream the reach of only a
select few
el
SPORTS CITY AREA SUMMARY
CRICKET DISTRICT
LAKE DISTRICT
DOWNTOWN DIST RICT
VILLA DISTRICT
GOLF DISTRICT
FORMULA 1 & STA DIUM
TOTAL SPORTS Cf1
Y
79.06 HA
87.68 HA
224.67 HA
146.54 HA
108.71 HA
3S6.45 HA
1003.12 HA
SPORTS CITY CORE AREA
SPORTS CITY NON-CORE AREA
652 HA
Figure 15. Districts
Villas
The average dwelling unit size was bigger than the comparable
units in the market as the developer wanted to showcase
themselves as a higher end market product. The typologies
included lavish 4 bedroom and personal floors, which would
be otherwise a very small percentage of a city The luxurious
nature of the product also encourages inefficiencies, which
conflicts with the wealth maximization motto, which would drive
the project to pack in the maximum number of people too, and
thus retained some idea of efficiency.
-/
-n
*
351.12 HA
Detail districtlayout
The district layouts were determined by the character they were
packaged to portray The down town residential development,
consisted of iconic towers, with FARS going up to 6.5 and , facing
the main boulevard and abutting one of the most commercial
intersections of the city This freedom allowed for the villa projects
to carry an FAR of 1 (approx.) and the downtown too carry FAR of
620, and this variety does create an imagibility between the different
product types. It also allowed the majority of the development to
follow sustainability principles, as higher density about the public
transport corridor (proposed within the city) and the lower density
was farther away. Such a development, not only maximized value
for the developer (with transit nodes creating the sub-location, but
also maximizing density in those zones, maximized profits.
Downtown districtdevelopment
4
Figure 17. Keyplan
M....M.
Figure 16. 2012 Downtown district
plans
one of the first neighbourhoods to be detailed in themasterplan,
the downtown district lies in close priximity to the F1 track and
would consisst of development that would mimic the high desnity
downtowns of the world. This would house a high percentage of
commercial, cultural projects and hotel projects. The residential
that would be developed here would face the landscaped
boulevard through sleek iconic towers and create one of the most
iconic mixed use districts of the new city
Special emphasis was laid on the urban charater that would be
generated in this neighbourhood as it would be the locus of all the
lower density residential around.
49
7.6.
Evolution of the plan
As is the case with megaprojects that span over large periods
of time, there were many important junctures that changed the
course of the development and led to the evolution of the master
plan in its current form. Shift in the political power led to a shift
on the aspirations and broke the momentum gathered by this
ambitious endeavor The fragility of the democratic setup, disabled
the unparalleled support the project enjoyed, and made crucial
changes in the development.
Other game changers included:
50
*
Aviation ministry norms stipulate that a second commercial
airport cannot come up within a radius of 150 km from
the Delhi airport. Land earmarked for the Jewar airport
was located about 72 km from IGIA. Moreover, the Delhi
International Airport Private Limited (DIAL) that manages
IGIA enjoys the right to veto any second airport that
conflicts with the mandatory 150-km stipulation. This led
to the cancellation of the airport project and has adversely
impacted development in the region as earlier efforts over a
decade were focused on the airport as a prime anchor.2
*
Indefinite timeframe for the approval for the proposed metro
line, due to stated inefficiency on this route, has made
investors in the region uneasy.
*
Protests against the land acquisition by the state on the
Yamuna expressway land which led to a revision of the
compensation to the farmers mandated by the court, has
made investors nervous about the region.
*
High losses incurred by Jaypee group on their investment
in the F1 project. Subsequent events, since the first race
have not generated enough interest, and the ticket prices
have been slashed by up to 60%. This has been a major
setback and resulted in an attempt to look for new revenue
streams.
*
One of the strongest factors in the change in anticipated
growth has been the lack of employment base in the area:
Most houses being purchased for investment, based on
speculation. Housing typologies are high end luxury with all
amenities provided and services. Thus high maintenance
costs with high travel distances, further discourage
investors to invest now in the region.
*
The entire route to this project is not yet saturated and
provides multiple options that are closer to the city for
customers. The transit corridor therefore taking away a
share of the anticipated demand.22
" Increased debt within the group: while the proposition
is a profit making one in the long term, most real estate
developers are short on cash and residential projects are
typically funded by customer advances. There are serious
concerns on developers' ability to build and deliver on
time, and also to repay lenders on time. The course of land
divestment, with no capex plan to moderate debt by -30%
was undertaken by the group in 2014. JPIN targeted to
lower its leverage (current net debt of INR68b) by -INR20b
to INR48b over the next 12-18 months. Barring positive
FCF generation, its game plan to achieve this would
be divestment of land/FSI at Sports City to the tune of
-INR20b. In the first leg, it has guided 50-100 acres of land
sales over the next six months. Also, the management has
strongly guided that it has no major capex plans over the
next 2-3 years.23
*
They also plan to lower pre-sales and core OCF estimates
by 15-20%. Given strategic slow monetization of their other
projects on the expressway, the group decided to lower
annual pre-sales run rate estimate to INR33b-35b in FY1315 (v/s INR40b earlier).
The first change set of iterations documented here concluded in
these observations (making a comparative analysis of the master
plans: evolution from 2010- 2012)25
-
Larger development blocks
-
Gated Residential Sites
-
Significant modifications in required density and FAR
-
Reduced roadways and a larger road grid
-
Land Use requirements per the approved Regulatory Plan
-
Changes in Market Conditions
51
Figure 18. Evolution of YIEDA
asterplan
Ep-.
VKT
4"
mAYM QP
I
jj
"Mt
Ift:I" WIX
Piksmi
201OMasterPlan
Figure 19. Sports City masterp an evolution
Figure 20. Grid Evolution
52
2011 MasterPlan
Table 5. Changes in the master plan from 2010 to 2011
June 2011
2,366400
7,087,678
2.995
August 2010
2,538,412
6,533,380
2.573
Table 6. Sports city built up area comparison (Gross Site area)
Commercial
Institutional
1
gateway district_
2
greenwood district
3
county district
4
lake district
5
downtown
6
golf district
7
villa district
8
central district
9
heritage district
10
knowledge district
3305700
688700
5185144
668700
56.85%
0.00%
Residential
6533380
77
8.48
Total
10507780
12341522
23.15%
Since the 2012, changes there have been moves towards
disinvestment in the project to lower the debt. Thus capex intensive
project were abandoned, and assets were liquidated. We see
a shift therefore in the typologies being marketed now, from
apartment buildings to plotted development. These have led to the
following shifts:
-
Smaller grid structure for the project
*
Shift in typology mix towards less capital intensive projects
*
Increase in the average unit sizes being launched
*
Introduction of newer districts in the project
2010 planned projects
Figure 21. Change in
typology of planned projects
w total apartments
m total plots
2014 planned projects
s total plots
a total apartments
53
Table 7. 2010 Product Mix
157,935
1
lake district/kove 2
2
lake district/kove
4R.562
167,225
3
lake district 11
64.750
260,129
4
Kassia
5
Kassia heights
6
Kassia 2
139,355
8
downtown resi 1
130,064
9
downtown resi 2
130,064
13
personal floor
14
residential in east
137.5q3
390,193
16
kadam kunj- IlII
?
71A
836,127
17
kadam kunj- 1
199,742
18
kadam kunj- l3
552,773
total apartments
3,551,219
4R562
141,677
260,129
6
185,806
?
133 546
10
golf district
320,515
11
GH at Villa District
232,258
total plots
552,773
Table 8. 2014 Product Mix
1
villa expanza
140-200 sqm
92,903
2
the Bougainvilleas
2000-4000 sqm
139.355
3
sunnyvIe houses
120-200 sqm
4
greencrest homes
175-250 sqm
5
county homes I
160-330 sqm
13q ARE
6
Yamuna Vihar Plots
175-250 sqm
141.645
7
the Krowns
125-175 sqm
R3
8
country homes
200-4000 sqm
?13677
total plots
1
aman Ill
2
boulevard Court
studio
me
2 bhk
C20
18;.
06
G+4 personal
3
Udaan
4
Naturvue Apartments
5
Budh cirtcuit studios
of studio
apartments
92,903
6
Budh cirtcuit studios I
I BHK
102.193
7
Kassia
1 to 4 BHK
14R.645
8
Kove
16T225
total apartments
1,207,739
15.806
1,2, 3, 4 bhk
15 floors
54
I
/
7.7.
Financial narrative
Phasing for the project
The project phasing was derived in the 2010 master plan based
on the population projection, rather than a defined timeframe.
This therefore translated into a more flexible structure, but
ensured that the phases were interdependent, and couldn't be
developed independently and out of sequence. The master plan,
which also does not follow a modular schematic ensure that
the sequence would have to be maintained for the successful
implementation of the project.
i 24,64,009
100%
PHASE I
PHASE 2
8 PHASE 3
* PHASE 4
*
*
PHASES
FULL BUILDOUT
60%
40%
Figure 22. Phasing
Figure 23. Population growth
by individual uses
Phase 2
Phase 3
16%
30%
49%
I71%
86%
100%j
6%
7%
16%
30%
64%
100%
6%
27%
16%
30%
64%
184%
91%
-CEIL
- RETAIL
L
N1IUTOAL~24%
-
Phase 4
-52%
PhaseS
Phase
100%
L100%
120.0%
24,4,0
--
___-
M
.
100.0%
T%
_
I
d~
_iL
60.0%
-V
40 0
%
.
20.0%
00%
10%
16%
_
w
Phase I
Phas
0 INSTITUTIONAL
0.8%
2%
a
OA%
0.5%
1.1%
3.3%
3.9%
9.0%
RETAIL
M COMMERCOAL
n RESIDENTIAL
Figure 24. Population growth
by phases (combined uses)
6
Phase 1
-RESIDENTIAL
POPULnN
PNAb
5.3%
9.9%
t
* 2,41,0
p
e
s
Phase S
Phase 6
7.6%
8.3%
9.0%
2.1%
4.4%
6.9%
1S.5%
32.7%
SI.4%
1
15.9%
3,22.mD
17,000
Phase4
23.1%
28.2%
32.7%
t 4,8B,000
t 6,1,W
t6,41,000
phase
Table 9. roposed masterplan phases
1
2
3
4
5
6
residential
16%
14%
19%
22%
15%
14%
commercial
6%
1%
9%
14%
34%
36%
institutional
9%
15%
28%
32%
7%
9%
10%
16%
29%
47%
74%
100%
55
Capital flows for the project
The capital flows in and out for the project were solely controlled
by the developer. As the state had not mandated any requirements
for EWS in the SDZ, the developer was free to make a full for profit
development. However, as they are also the sole developers of the
project currently, it exposes them to all the risk in the project. While
the costs of construction for the expressway and the RE could
be used as the demand for their cement producing subsidiary,
therefore benefiting two ways from this development (through
economies of scale), it also puts all their eggs in one basket due to
low diversification.
Table 10. Capital flows
development of the expresswa
roect
development of the F1 racing track
development of the real estate product
prto
toll formteepesa
ticket sales from
sale revenues
the
F1
events for the next five years
for the real
estate
no support from the public sector to dev F1 (no tax concessions, support)
The detailed cash flows for the projects and the assumptions are
included in the appendix.
56
Product pricing
Table 11. Demonstrative product pricing
charges
rs/sqft
BSP
3,300
Internal
Development
ChargesI
Electr Su tation
Social Club
based on the
floor/ project
typology etc
3,960,000
4,702,500
5,857,500
7,573,500
75
90,000
106,875
133,125
172,125
40
48,000
57,000
71,000
91,800
150,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
60,000
71,250
88,750
114,750
21,600
25,650
31,950
41,310
60,000
71,250
88,750
114,750
1,588,860
1,867,084
2,299,876
2,942,882
ComPlsory ar
150,000
Interest Free
Maintenance
50
250000 for
additional
parkSng
Depofit
Maintenance
ance year
2
One time lease rent
50
adv
Applicable taxes
Psi .50 per
sq.ft.per
month o yea
35%
The developed product includes many costs in the project, other
than just the cost of the development. The premium of living in
a multiple gated community presents itself in the costs to the
consumers.
57
7.8.
Conclusions for the case
It is evident that the disinvestment in the project has altered the
original character drastically and perhaps also permanently With
the plots replacing what was once envisioned as a high density
bustling mixed use downtown, dismantling the core areas of the
project, the new directions in the project are a far cry from what
has now remained only an exercise in the physical planning for a
new city. There seems to be no way for the project and its initial
ideologies to redeem themselves, which is unfortunate given there
were many lessons and good practices that were ingrained in the
business and physical plan for the project.
58
fit
sw
Naya Raipur
Project area
Projected population
Cost of completion
Completion date
8013 hectares
560,000 people
Rs. 1,500 -2000 crore
2031
8. NAVA RAIPUR
-
"Space is political. It is a product literally filled with ideologies"
Lefebvre 1991
'It will be modern in the use of technology uphold worthy traditions
and core values, and conserve the prevailing man-nature symbiotic
culture as well as abundant natural & cultural assets in the region.
The citizens will be offered a wide range of living options with
equity and dignity'
-NRDA Masterplan document
8.1.
-N
A
Narrative
Creation of a new state
On 25 July 2000, the Government introduced in the Lok Sabha
the Madhya Pradesh Re-organization Bill, 2000 for reconstituting
the existing State of Madhya Pradesh into Madhya Pradesh
and Chhattisgarh, along with similar bills for two other state of
Uttar Pradesh and Bihar.26 The division here is rooted in caste
distinctiveness, with upper peasant Brahmins and Kurmis leading
the movement for a separate state. Rich in mineral wealth
and an important rice-producer, Chhattisgarh has resented its
disproportionate contribution in revenues to any return it has
received from the state. The new state has a substantial tribal
population, but the Chhattisgarh movement was not driven by tribal
demands, as was the creation of Jharkhand.2 7
Thus, Chhattisgarh, the 26t state of India was constituted on 1st
November 2000 from the state of Madhya Pradesh. Raipur was
designated to be the capital of the newly formed state. With an
existing population of about 8 lac people and an expected influx of
a large number of new residents due to its new "capital-city" status,
the existing facilities and infrastructure of the city were expected
to soon become inadequate. With this in mind, the Government
of Chhattisgarh envisaged a new satellite city, one that would be
administratively self-sustained, and one that would depict the
hope, aspirations and achievements of the people of Chhattisgarh.
S2t
Figure 26. Location
The new state parted with much wealth from the parent state
with Pre-division, MP was the largest producer of cement in the
country and an estimated 43 per cent of this capacity is now part
61
of Chhattisgarh. It is also a power surplus state. However, Chhattisgarh
where an overwhelming 80 per cent of the investment is absorbed by
infrastructure projects, with very few projects in manufacturing and the
service sector Other than infrastructure, there is virtually no investment in
Chhattisgarh, except, to some extent, in metallurgical industries28 , making
the economy a little lopsided.
Creation of a new capital
The existing city of Raipur reflects an urban pattern is generally
unorganized and unplanned resulting in urban sprawl. Though the
current Raipur Master plan 2021 has triggered high density commercial
development along the eastern and western peripheral parts and planned
residential development through Town Development Schemes on the
adjoining green field areas along the NH-6, the inner city core lacks
adequate infrastructure and basic amenities.
It was under these conditions the Government of Chhattisgarh ventured
to build the new town near Raipur, under the Capital Area Development
Authority (CADA), now renamed as Naya Raipur Development Authority
(NRDA) as a Special Area Development Authority (SADA), in 200029. The
act defines the role of NRDA as follows:
.
To prepare Development Plan for the Special area
STo implement the approved development plan
To acquire, hold, develop, manage and dispose of land and
property
Figure 27. Boundaries of
administration
*
To accept grant from the state govt. and raise loans.
Although rapidly urbanizing, the state of Raipur has a high rural population
and the relationship between the national, global and local scales of
economy and culture is expected to be mediated through this new city
The state government moved to Naya Raipur in 2012, attracting new
workers, residents and businesses and beginning the establishment of a
new, urban population center This was a critical moment for the state, the
region and the city: the way that the new city develops and is inhabited
in the early years was believed to greatly influence its future form and
success.
The township would be developed around a new Central Complex that
would house the offices of the State Government and the Secretariat.
Thus we see that the city is built to showcase the political identity and
history of the state, and use it as a medium for economic diversification in
the region.
62
8.2.
Table 12. Population and trends of
Raipur and anticipated trends for
Naya Raipur
1971
2001
2,05,986
6,05,747
na
2011
2021
8,67,846
12,43,351
17,81,332
1,50,000
3,65,000
5,60,000
2031
n~a
Regional Trends
Shift from rural to urban
The state anticipates a shift in the percentage of the population living
in urban areas as 58.12% in 2001 to increase to 75% on 2031. Raipur
city alone has experienced a big jump in population from 205,986 in
1971 to 605,747 in 2001. This urban migration led growth is expected
to gain momentum in the future with the creation of Naya Raipur. 30 The
development of Naya Raipur will act as a planned centrifugal force to
attract new residents to the city of Raipur. Raipur's annual population
growth rate of 3.66% is much higher than the average growth rate in
Chhattisgarh and is expected to continue to grow in the foreseeable future,
though at a lower rate. 31
As per NRDAs projections for the population in Naya Raipur in 2031,
the majority of the people will be residents living in Residential Areas.
There will be large volumes of daily migration to the city of workers to the
Institutional, Commercial and Governmental sectors and also to the Retail
Sector
Existing inventory
Raipur is largely dotted with unorganized small players and brokers
accounting for nearly 100% of all transactions in real estate. Chhattisgarh
Housing Board had been the largest developer, but with poor planning and
low quality there are lack of consumers for these Housing Development
Board's properties. Thus, the preference thus far has been for plots and
independent houses over flats in the Raipur Region. This trend is also
attributed to the fact that no major builder / developer had been active in
this part of the country, until now With Raipur just gaining the status of a
state and the recent economic upturn anticipated, a number of developers
have announced large residential and commercial projects in and around
Raipur. Of the major developments coming up in Raipur, some notable
ones are: 32
63
Table 14. Recent Developments in Raipur Property Market
Treasure Island, Raipur
Entertainment World
Developers Pvt Ltd
10,80,000 sq ft Shopping Mall,
Hotel, Commercial space
Nearing completion
Treasure Market City Raipur
Entertainment World
Developers Pvt Ltd
3,500,000 sq ft Residential, Retail
Mall, Hotel and Commercial space
Under Development
City Mall 36
Operational
City Mall Developers
Retail
Magnetto Mall
Avinash Developers
Office cum Retail, Multiplex
Fit-out Stage
1,035,000 sq ft.
Gupta Infrastructure /
Raipur Development
RDA Mall / Velocity
Authority
700,000 sq ft Shopping Mall
Announced
Maruti Business Park
Avinash Builder
Announced
Commercial
Omaxe
Residential Development in 175
acres
Announced
Sahara India
Residential Development in 125
acres
Announced
Gujrat Ambuja
Development
Mall cum in
Residential
12 - 15 acres
Announced
Chhatisgarh Housing
Various Residential Projects
Under Development
Board
Boom in Retail
proximity to retail fetches higher returns to a builder, and thus most
of therecent deveopments are built around them. Three malls,
operational or are nearing completion will add nearly 3 million sq
ft of retail space in Raipur. The commitment and success of this
growing retail is also testimony to the growing affluence of the
areas. 33
Housing Demand
According to Naya Raipur Development Authority's Development
Plan, the average household size of Raipur City has decreased
from 5.37 to 5.25 during the period 1981 - 2001.34
IQ11 I
4.411
1 Aflf.A0
1 14.7190
w?s
A20
vss nnn
4-4n
5,60,000
127,273
2031 4.40
Source: Naya Raipur Development Authority
- Development Plan for Naya Raipur City
?2?1
64
Table 13. Expected Demand of
Residential Units
Table 15. Historical Land Rates in Raipur
Rs, Per Sq Ft
Lai u - 1rifIt:
I ,OU
OLD
1 QAA
2,250 - 2,600
2,500 - 3,000
Land - Residential
75- 100
180-220
265- 350
300- 400
Land - Commercial
2,000
8,0009,00
15,000-
9,500-
12,500-
Built Up - Retail
Built Up - Residential
Flat
n.a.
15,500
18,000 - 18,500
______
15,000 - 20,000
1,400-2000
Built Up - Residential
2,500 - 3,000
House Prime Location
Built Up - Residential
1,000-1,800
House
Built Up - Commercial 1,000
2,000______________________2500
3,400 - 3,800
4,000 - 5,000
______________
Source: Independent Consultant's Informal Survey
LAND RATES IN RAIPUR
INN"
Built Up - Commercial
Built Up - Residential House
Built Up - Residential House Prime Location
Built Up - Residential Flat
Built Up - Retail
Land - Commercial
Land - Residential
Land - Prime Residential
0
Figure 28. Land rates in
Raipur
* 2008
2000 4000 6000 8000 10000 12000 14000 16000 18000 20000
.2007
.2006
.2005
Based on the above and projecting a steady household size, the
projected demand for housing in Naya Raipur City has been be
forecast as on the left.
Although Raipur had been slow to catch up with the recent realestate sector boom in other parts of the country, the downturn has
not affected real estate prices as drastically as it has in other parts
of the county.15
The rates vary depending upon the specific location of the land
that is being bought / sold. The proximity to a main arterial
road, residential neighborhood, land classification, availability of
municipal services etc. all have an important bearing on the price
that is negotiated for the land parcel.
Bhilai - Raipur (sub regional system)
The regional landscape includes two competing urban
65
agglomerations of Raipur and Durg-Bhilai. While Raipur lies 16
kms away and has shown diversified economy where service,
trade and commerce are the dominant activities, Bhilai (25
km), functions mainly as an industrial town with the Steel Plant
polarizing its economic activities. An emerging scenario of share
of function of town shows that Raipur has clearly functioned as the
administration, trade and commerce capital; Bhilai is the industrial
town; Arang and Patan (also in the vicinity) the distributive centers.
Growth dynamics of towns in the region reflects the favored
location of many industries and business in the corridor of NH-6
and NH-200.3
66
8.3.
Project Drivers
Connectivity of Raipur to Airport, National Highways:
Just 5-7 kilometers from the Airport, Naya Raipur is very well
connected to all modes of transportation. With NH-43 to
Vishakapatnam and the Narrow gauge line to Dhamtari bordering
on the south, NH-6 to Kolkota and the broad gauge Railway line to
Vishakapatnam to the north, Naya Raipur is at the crossroads of
transportation. The Mandir Hasaud Railway Station is less than 2
kilometers from Naya Raipur.
The administrative seat for the state
/
The main economic base of Naya Raipur would be Government
State Capital functions.
Economic Development anchors
'
Diversification of economic activities would be attained by
providing (a) software technology park (b) gems &jewellery and
other similar industries (c) business offices (d) health education
and research services and (e) regional recreational activities like
Golf Course, Safari Park, and Botanical Garden.
8.4.
Development Strategy
The naya raipur development is planned under the following
partnerships at regulatory, financier, and developer levels. While
each role would determine tfinal outcome of the projet, NRDA will
oversee exection, land disposal and the masterplanning efforts.
REGULATORS
FINANCERS
GOVERNENT OF CHATTISGARN
NM)DA
WORLDBANK
MINISTRYOF URBAN DEVELOPMENT
(INNURM)
LOANSFIOMVARIOUSBANKS
MENTPARTNERS
##X47-CMUE
CHF IScARH STAE ELECTRICIYOARD
CHHATTISGA
PUW HEALTH ENGINEERING
DEPARTMENTAND WATER RESOURCEDEPARTMENT
CHHATTISGARH STATE RURALDEVELOPMENTDEPARTMENT
CHHATTISGARH STATEPUBIKWORKSDEPARTMENT
CHAT1ISGARHHOUSING BOARD
HUDCO
PRIVATE DEVELOPERS
OTHERCO-OP DEVELOPERS
67
,%VOWa
Aods
I'
LEGEND
I
RA --UMSe
to
W~uY
EJ
mA
GIve nau
a
Cg
fAR.AY STATION
"U
MT
kj
68
(ot~
Rm
,MAYA
-
-'A
smmi..nm.
RAVggt 9OUNMWWa
8.5.
City form narrative
The regional plan
The city is bounded on the north and south by existing railway
lines and to the west by the airport. The area is divided into 3
layers: Naya Raipur itself (Layer-1, including a 500m-wide green
belt), the peripheral zone (Layer-Il) and the airport zone (Layer-Ill).
Layer-Il acts as a buffer between the two cities' cores, keeping its
current agricultural role, but to be provided with social facilities for
the existing population.
Master plan
5ure 29. Regional plan
_Y
Fg u re 3 0. Structure
Figure 31. Green structure
The development plan follows from Modernist principles of zoning,
with major institutional and functional quarters acting as anchors
in the city and a strong emphasis on vehicle and public transport
movement between them. The eastern anchor is the Capital
complex; to the north a transport and logistics hub; to the west a
high-tech industries area; to the south a recreational zone; and
a Central Business District in the middle. This zoning is to some
extent mitigated by other functions including retail, health and
university developments Roads, transport and modern utilities. The
grid pattern of the infrastructure creates an orthogonal pattern of
Isectors' within which land use, density and certain configurations
of building lines are controlled in the Master plan document. This
provides a basis for phased development by private development
companies, Chhattisgarh Housing Board (which provides
subsidized housing) and institutions. The Master plan therefore
consists of a framework, with early stages defined in some detail
(and now implemented) and later stages indicated for illustration
only It is supported by a regional Mobility plan, and a Transit
Oriented Development study both of which are currently underway
and intended to inform the future development.
The new capital city of Chhattisgarh is envisioned as a mediumdensity development with a garden city character. A density of
250 persons per Ha has been considered appropriate for the
residential areas in 21 sectors, accommodating 16,000 population
in a typical sector of 800 x 800 m. The sectors shall be planned as
building blocks of the city and consist of three housing areas with
a population of about 5,000 each and a shared facility core at the
sector/ neighborhood level in addition to the area level facilities.
These housing areas shall be developed on the concept of graded
mixing based on number of rooms which is going to cater to all
classes of the society in an attempt to make the new city inclusive.
69
Residenial
Cdk
-
-
- -
211339
2637
181
Commercl-Retail
14467
Commercial
13067
163
194 13
26305
242
328
-
1moiesale
Indutialga
Special Industy
Putbc &Semni PR44ac,ecro,,nal
Transport
Wcnlost use
1846381
2304
213744
2 67
100677n
1256
1770
222
Figure 32. Urban form and
land use mix
The Master Plan defines 9 different land use zones, which classify
all areas inside Layer-I. The Composite Use Zone includes
residential, commercial, and industrial uses. The city level physical
infrastructure facilities are located outside the city and the area
is reserved under utility zone in the peripheral area. Besides the
basic 9 land use zones, two additional special zones are defined
to cover Layers II (Rural Zone) and Ill (Airport Zone). No urban
development in Layer 11 will be permitted before Phase 3 (2031),
except for those provided for the rural use as requirements for its
facilities
Social inclusion and affordable housing are key to the master
plan which does not intend to isolate and gentrify neighborhoods,
but allows the new development to co-exist within the existing
natural and social frameworks in the region. The distribution of the
residential sectors are such that the houses for EWS, LIG, MIG and
HIG, which are provided in a subsidized rate, are accommodated
in sectors 29 and 27 while the high end residential sector 30 is
being developed by the private developers. This segregation of the
sectors by different developers could lead segregation and gated
nature within the overall sector organization, which would be a
departure from the original ideals for the city
As we analyze the master plan, it is quite evident that the majority
of the development would be residential, however the
Population Segments catered: The Development plan attempts to
avoid a situation of inequality in the new city and thus mandates
a minimum 10% of dwelling units in each neighborhood to be
reserved for incremental housing. The majority of population is
anticipated to belong to the growing middle class in Raipur and
the surrounding areas, who are attracted to the new development
due to the infrastructural and planning investment. Further, the
proximity to the airport would also create market for a higher end
residential zone (within the CBD, and probably the developer
driven products).
Resi
-Leasable land area
1917
ntial area
Institutional area
_______________
Industrial
SEZ
_____
Public & Semi Public
Recreational
_15
___
Reail
wholesale 1
Total
70
194
4
263
5
1514
607
Tansportation
composite Use
Commercial area
% flba
38%
12%
65_
178
145
1
100%
Typological mix
High and Medium Income Housing throughout the residential
sectors of Naya Raipur. While the developments in Residential
Area are planned to have medium density housing, the Residential
developments in Commercial Areas (including the Central
Business District) will have High Density Housing (140 du / ha or
630 ppha). In order to achieve a balance, there will be an adequate
provision for Low Income Housing in addition of the housing
planned, there will be:
1. Plotted Row Housing
2.
Plotted Housing with Independent Floors
3. Multifamily Apartment Housing
4. Plotted or Semi-Detached Houses
5. Duplexes
6. Service Apartments
7.
In addition there will be
8. Housing for Private Employees
9. Housing in Commercial Areas
10. VIP Housing
11. Institutional Housing
These are distributed in the following typologies within the city:
Table 17. Distribution of Plotted and Apartment Housing
41%
-
100%
38%
50%
50%
5-6 rooms
11%
100%
Incremental Housing
10 %
100%
-
1-2 rooms
3-4 rooms
The majority of the development would be wither 1-2 or 3-4
bedroom apartments within mid-rise blocks. The plotted
developments would wither fall in the incremental product, or the
higher end range:
71
Table 18. Suggested plot sizes and development control guidelines
4U-DeiOw bU
(Incremental housing)
1
incremental
Above 60-120
2
Duplex
Above 120-250
2
Plotted with independent floors
Above 250-500
2
Plotted with independent floors
Sector level analysis: the neighborhood
At this broader level, the Master plan has parallels with
Chandigarh, the new capital city built in the late 1950s in northern
India, but the development at sector level is quite different.
Residential sectors are comprised of low-rise houses and mediumrise (7-9 storey) blocks of apartments. A proportion of these are
subsidized at different levels by the Chhattisgarh Housing Board,
with 15% of dwellings reserved for the lowest cost level (EWS or
Economically Weaker Section of the population). However, the
subsidy only removes the cost of the land, meaning that the cost
of an apartment or house may still be beyond the means of large
sections of the population. Within each sector are neighborhood
facilities, including retail and communal open spaces. The average
density of residential areas is 225 persons per hectare. 38
I
L
Fl1"MuI *uuA
i
SECTOR
SECTOR
II
Figure 33. Sector Layout
72
41%
3-4 rooms
38%
50%
5-6 rooms
11%
100%
-
Incremental housing
10%
100%
-
Figure 34. Typology Mix
100%
1-2 rooms
50%
The city has 21 sectors, each 800X 800 meters and is intended
to support a population of 16,000. The household size is
assumed to be 4.5 people per DU. The provision of requisite
social infrastructure shall be governed by the norms for residential
neighborhood as developed within the master plan will be the
responsibility of the developers.
4-2
inBkekd*,nbagme~npf.Menxrke
4000
4-2
q1
The initial development strategy assumed that each sector would
be given to one developer (pvt or co-op), who would in turn
develop the block as their project, with provisions as stipulated by
the master plan. There has been a slight shift from these plan, with
smaller projects within the sectors also been allotted to developers.
EmA,'xeekhmsfrjn
Span
Figure 36. Block
Comparision
The Open space would be around 10.54 % of the land area per
neighborhood.
While the developments in Residential Area are planned to
have medium density housing, the Residential developments in
Commercial Areas (including the Central Business District) will
have High Density Housing (140 du / ha or 630 ppha).
1-2 rooms
60%
46%
Residential
55-65%
35.2 -41.6
3-4 rooms
30%
42%
.5-6 rooms
10%
12%
Facilities
Open
spaces
10%
12%
7.68
Circulation
10-20%
Total
100%
Table 20. Suggested (indicative)
percentage of dwelling unit size based on
number of rooms
6.4
6.4
-
12.8
64
Table 19. Suggested land utilization pattern at
sector level
Community Faciit
Libra
Prirnary School
Plotted
developmen
Locai s)ppaly Centel,
CIpr
Um
,
Figure 35. Neighborhood
massing
73
Development Strategy
After the infrastructure has been developed, there have been a few
models envisioned for the development of various residential and
non-residential developments in the city.
The NRDA has identified several sectors and projects for possible
development under the Public Private Participation model. Search
for probable partners for such participation will be conducted in the
near future.
1. Entertainment Hubs
2. Information Technology Special Economic Zones
3. Hotel and Convention Centre
4. Golf Course with Township
5. Gems & Jewelry Park
6. Logistic Hub
7. Amusement Park
8. Logistic Hub
9. Detailed sector layout
While the housing developments could use either of these two
models
1. Cooperatives and Company Housing
2. Public Frivate Partnership in Housing Development
Post Occupancy
Management
Construction
Infrastructure
Land Assamb'y
Private Sector
/
Figure 37. Private vs Private
development
74
Government
Cooperatives
Table 21. Contribution by various housing sub-systems to the total housing stock
of Naya Raipur
1
Private Housing
74,602
60.23
2
Co-operative group housing societies
14,430
11.65
3
Housing for Government Employees
6,315
5.1
4
VIP Housing
2,666
2.15
5
Private Employee Housing
2,220
1.79
6
Institutional Housing
7,780
6.28
9,287
7.5
Urban Villages
6,560
5.3
Total
123,860
100
7
8
Others (CBD,
Composite use, Facility
rnmdnr)_
Notes
1. Housing for VIPs @ 150 ppha
2. Private employee housing for 25% of the total employees of the software technology
park
3. 25% area under institutional housing @ 250
ppha
4. Housing in commercial areas (CBD & composite use zone) to be provided as
composite use
Figure 38. Housing
developed by private
developer
75
IIII Ii'II'i
'liii'
Iii
______/
........
.
Figure 39. Housing
Phasing
developed by Chattisgrah
Each developmental phase shall include the development of the
Housing Board
requisite social as well as physical infrastructure to support the
phase wise population
Phase I Development of the Capitol Complex & the Government
offices along with housing for Government employees as an
initial impetus to growth. Would also include revenue generating
recreational activities like the resort, film city and the botanical
park. There would also some focus on the development of
transport logistic hub, the composite use area in the north and
a part of the composite use (Software Technology Park) next to
the airport to service the city as well as the region. To support the
development of the new airport nearby, a hotel complex and sociocultural area is also proposed.
Figure 40. Phases of
development
Phase 11 includes the development of the institutional area, the
exhibition ground and the city parkland along with residential
development. The theme parks in the north, the cantonment and
NCC and Police Academy block will also be developed.
Phase IlIl The last six residential sectors shall be developed in
the phase. The light industries and the software technology park,
government offices and government housing have been distributed
in more than one phase. The transportation hub and the integrated
freight complex shall be developed in the third Phase.
Table 22. Population Phasing
150,000
2011
Phase I
365,000
2021
Phase 11
560,000
2031
Phase 111
of
phase
I1
Area
at
the
end
Total developed
3057.46
3733.56
1222.16
8013.1
While the project spans the course of many years, there have
been two types of investment projections being made in the proforms. The first is the assumption of phasing of the development
as a percentage of the overall city. It is assumed that all uses
(commercial, residential, institutional etc. will be phased out at
similar rates) however, this is a gross mis-assumption as phasing
should be done not just incrementally, but thinking about the cause
Lease chedule Paranater
Leas Schedule Parameter
12%
10%
12%
10%I
8%
4%
-
__
--
LawSdiduls-a
I.dd
2%
Yomwise DW~tibion d Land Io be Lmin out
78
Ywwise Di~t2%onof~Laid to t Lem,,out
and effect of each phase on the other. While initial investment
should be more focused on developing anchors and employment
centers, the transient and permanent population will not be directly
proportional to this growth.
The two scenarios imagined, while trying to respond to an over
growth projection, do not detail out the future development plan
and methodology required, and therefore remain quite shallow in
their analysis.
Comparative lease schedules for the project, while the former
is a gradual growth model for all uses, the second tries to mimic
simplistic anticipated market trend with an assumption that sales
will pick up in the near future and then slump again. There is very
little data to support such trend evidence and, the curve should be
splintered into the different land uses, which then form correlations
with each other and generate an overall growth pattern for the city
Based on these assumptions the following surplus conditions have
been anticipated, which quite optimistic through their simplistic
assumptions.
300M0.00
ZOOM
D
--
-
-
--
--
----- -
-25000-0-
200000-00
-
5000000-Outlow
T
pp..
Financial
r
,o
n
ftlw
n Narratove
The project, while in the overall purview of the development
authority, is not being fully developed by them. As detailed out
in the development structure, the authority is only responsible
for the infrastructural and public work aspects of the city (which
is also partnered with other public agencies) and will essentially
be involved in the master planning, review and implementation
support. Thus the main outflows at this stage are on infrastructural
costs, master-planning and project reviews. The inflows happen
with the leasing of the land to private and co-operative developers.
Housing developed by the state, for the government employees
falls under the Chhattisgarh housing board.
Outflows
* Land Procurement
*
Engineering / Consulting
79
Pbwer Infrastructure
*
Water Supply
" Sewerage
*
Rain Water Overflow and Harvesting
*
Road Network
" Green Area Development
*
Overheads
Inflows
There are three sources of inflows for the project
1. Grants and loans by the state, MoUD, World Bank,
JNNURM
2. Revenues generated by the Reserve premium generated
by the land sales/ and leases
3. Operational and maintenance funding that includes lease
rental and a service charge for the recurring costs.
Grants and loans: The first are the loans and grants that have
been endowed for the development by the Chhattisgarh state
government and the ministry of urban development. There have
been other grants provided by the World Bank, and other banks
that support sustainable development. There has also been
support through JNNURM for the project and the funding structure
for these is listed as under
Reserve Premium:
'The Authority shall, taking into consideration, the cost of land
acquisition, cost of rehabilitation, maintenance and administrative
cost, development cost, location and usage of the property, fix
Reserve premium every year for different land uses which shall
come in force from the first day of June of every year'
Reserved Premium per Ha has been calculated considering two
different costs:
" Cost of land acquisition including rehabilitation,
maintenance and administrative cost
*
80
Cost of infrastructure development
The land is proposed to be developed by both NRDA, HDV and
private developers. While the individual residential and retail sold
directly to the end user will be sold at a markup (?) the majority
of the Revenue is the sale of Land to private developers. The land
will be disposed off as whole sectors, of parcels within, in tandem
with the market conditions. The proposed Theme Township and
Sports city township constitute over 100 and 150 acres each, and
the residential facility shall be a mix of villas, group housing and
club houses with sports facilities. A reserved premium rate has
been kept at Rs. 1,700 per square meter for the theme township.
The authority will invite bids over this reserved premium and taking
into account that this is almost 50% higher than the reserve that
mentioned in the development plan for residential development.
Hence the system of competitive bidding with a themed packaged
project would generate much more than the anticipated returns.
Operational and maintenance: would be paid by all, and would be
used for the maintenance of the public work systems, continued
master planning efforts, urban design and development.
Assumption for the pro-forma
The phenomenal growth in land rates since 2005 has stalled in
the recent years and even receded slightly Although rates had
grown nearly 300% during the period 2005-2008, there has been
a decline of nearly 20-25% in 2008-09. It is unlikely that such
an out-of-the-ordinary and explosive growth will be repeated
in the years to come. In the estimates for developing the proforma, consultants have mainly assumed growth in land rates
conservatively at 12%.
It is further added that in the absence of any recent market
activity in Institutional and Hospitality rates in the area, it has been
assumed that Institutional Land will be made available to qualified
Institutions at 50% of the Commercial Rate, and land will be sold
for Hotels at 60% of the Commercial Rate. Informal Retail will sell
for substantially less because of the lower FAR being sanctioned.
Based on Consultant estimates, it should fetch between 30% to
40% of the Retail locations.
Land Disposal mechanism
Three separate revenue models are being considered to dispose of
the land developed by NRDA:
*
Outright Sale: through auction to developers
*
99 year Lease of Land to developers: land to lease to the
81
developers who pay an upfront fee to the NRDA, who
in turn sub-lease the developed properties to the end
consumers.
*
8.7.
Sale of Land on Cost plus development cost model : sale
of land on Cost of Acquisition plus cost of development
methodology
Case conclusions
The Naya Raipur development model with their form and financial
narrative mechanism comes across as a basic framework within
which a detailed plan will have to be delivered to mediate and
anticipate long term strategies that might have to be undertaken.
The current plan leave a lot of room for navigation and therefore
also makes it very vulnerable to change in political ambitions.
As the 800x800 mega blocks get detailed and more fine grain
planning is implemented, only then will the real image of the city of
Naya Raipur emerge.
82
9. COMPARATIVE ANALYSIS
With the national policy has becoming more development friendly
with strong emphasis on supporting real estate and urbanization
across the country, it is imperative that we analyze the different
models for new city developments that are happening with the
context of India. Encouragement of RIETS shift the control of
capital flows to physical assets to private investors.
However, the dichotomy here lies in the fact that real estate
development is a very local and regionally informed process.
Capital transcending geographic boundaries tries to mitigate the
unknown risks and encourages standardization of product by
global standards norms and practices for ease of assessment
and opening up of non-traditional sources of investment in the
developing world. Thus free market development is seen to present
a real dilution of culturally derived morphology of the city
The process of building new cities evoke some apprehension
about the city form that would be a result of this process. While the
model that responds to the market and creates a feedback system
in the project, is looked down upon with disregard, planning and
mandatory allocation would safe-guard from a complete consumer
driven market.
However, we observe that despite the diametrically opposite
narratives in the two cases, their planning ideals stem from similar
new city planning paradigms globally.
"Contemporary urbanism is a consequence of how local and
interlocal flows of material and information (including symbols)
intersect in a rapidly converging globally integrated economy
driven by the imperatives of flexism. Landscape and people are
homogenized to facilitate large-scale production and consumption"
(Dear and Flusty 1998: 65). What is called Holsteinization - "a
process of monoculturing people as consumers" (Dear and Flusty
1998: 61).
The standardization of form as a function of the dissemination of
global capital inflows is one of the core observations.39 With prodevelopment policies and huge emphasis on real estate in the
new budget, along with encouragement of RIETS, in the industry,
there is a shift in private control of capital through the process of
tranching it into varying degree of real risk. This therefore converts
83
into real products of standardized values and risks.
As plans in progress, these two cases provide a rich tapestry
of the growing middle classes aspirations, political agendas
and a common hope for the future While the pro-foma and the
development structure for both the cities has been discussed,
the analysis will now asses the physical form of the cases,
understanding the structure that lies embedded.
Table 23. Case comparative data
Role of the new city
The new capital for the
state of Chhattisgarh
Luxurious integrated township
size
9522 hectares (overall)
2022 hectares
distance from nearest
17 kms. from Raipur
60 kms. from new Delhi
development vehicle
SPV (details from the
Part special development zone,
structure
Linear structure with self-
District layout with gated
client
board+ private
city_____________
development plan)
sufficient sector layout
Chhattisgarh housing
around the F1 track
part YIEDA acquired land
communities
Homeowners
developers
Jaypee Sports International
developer
Naya Raipur
Development Authority
Ltd, subsidiary of Jaiprakash
Associates Limited (JAL)+ other
privatp deveinpprs (potentially)
population
500,000 approx.
1,000,000
designers
local firms + intemational
consultants
local firms + international
consultants
year of full capacity
2035
2035
Block size
800x800
200x200
Max FAR / Min FAR
Min 1, Max 3
Min 0.8, Max 6.4
Widest ROW/narrowest
ROW
W 100mts/ N
W 42 mts./ N 20 mts
9.1.
The Grid
The initial proposed grids in the SOM master plan for sports
city were (10OxlOOmts). The compact grid displayed an evolved
hierarchy of roads that supported not just movement along these
corridors, but also become a part of the public space increasing
vitality, safety and enriching the urban environments. It would take
into account the cultural tradition of streets as public spaces, to
also support the informal economy that could develop along the
corridors. While the typologies of products provided may vary,
denser grids also mean a denser urban environment, irrespective
of the prescriptive FAR, and result in pedestrian friendly
84
1:01
E ll
Figure 41. Grid compartive
NR grid
00001331
0000
130 10003
HH O
1]3
1, 0000 0000
JP grid
development.
The size of the roads also determine the conditions urban
conditions that these will lead to. These not only define the
mobility and access patterns for the users, but also start to define
the density that can be supported. It can also start to define the
hierarchy in the urban environment.
It would have been a common assumption that private cities
would ideally work with bigger parcels, enclaves within these
environments to sell off to the bigger chucks to other developers
and get out of the project as soon as possible. This would
also support the fact that increasing paved areas increases
infrastructure costs, and decreases in useable area. Also, while
the overall management of the project lies with Jaypee, they
would find it difficult to co-ordinate with multiple developers and
smaller management controls. This should effectively expand the
size of plots they want carve out. However, if we look carefully at
the comparative case as well as the plan evolution, we realize
that there was a tendency to overall develop smaller and smaller
blocks. To begin with the motivations were a part of creating
an impressive urban environment (as recommended by the
consultants) as the developer is invested in the project for a long
term investment. Secondly, while the socio-political climate did
change, it was difficult to convince developers to bid for these
projects and find pre-bookings for apartments that justify the
high FAR they have received from the GOUP This led them to
bail on the larger vision for the city, and start monetizing parts of
their project as plotted development. If the trend keeps growing,
we could well see a smaller grid, but also a much lower density
driven by investor speculation and lack on funds available for the
developer to make denser products.
85
The Naya Raipur grid on the other hand create massive sector
blocks of 800x 800 which would house a population of 16,0 people
and would be subdivide into three sub units intersected by greens
and water bodies that are core to the cultural identity of the city.
0
EJ
M.N.
0
Figure 42. Degree of
gatedness
the gated sector
multiple degrees of gated-ness
Gated-ness: This layout was developed to support a selfsustaining community that could access retail and commercial
within this block.
While these blocks help create homogeneity in the development,
they also lack on sub-anchor that would add o the imagibility of
the neighborhoods. There's threat that these gated neighborhoods,
divided by the monumental axial roadways would not celebrate the
city, but only divide it into closed enclaves. This argument is one of
the core criticism made about the sector planning of Chandigarh,
which the Naya Raipur plan tries to emulate closely
The Jaypee grid structure on the other hand, creates multiple
enclaves, with gated complexes within this gated community There
enclaves however, are not self-sufficient, and while they might
I
F
NR grid
Figure 43. Greens: Public or
private
86
JP grid
contain, the overall structure of the city will encourage people to
mingle within the district and the city as a whole too.
We see that the public and privately developed areas both aspire
for similar form "security" as a method to disengage the various
classes through the new urban form.
Public space: while we see a lot of greens earmarked, the true
nature of the public space is not difficult to judge in the ports
city masterplan. The boulevard makes the core-greens, and is
defined as public space, however the gated nature of the overall
development stands as an impediment towards the true nature of
this space. Most of the greens are now either semipublic, or fully
privatized. It becomes a landscape dotted with gated communities.
In contrast the Naya Raipur does propose public green within its
realm, however, the neighborhood isolation would hinder a fully
public participation. The public greens provided that lie outside
these sectors, are proposed at massive scales, and intimidate the
human scale.
The land use mix
9.2.
-
cONcUflNCWE MODE
in~a
A
the
b
SrbSjeS s
heir
BC
Zoneof bWt
16 k Eongabou adev
*wnCacher. Te
Es,Zon of preogues
- MUC MOODR
Uton rete s,
Ebk
downtown,
] there are no
szme Trameiates
,*
betwe
rada
land
Fcore *~~sW
Figure 44. Planning models
the project straddles on the 16 km long boulevard, there are no
sectors, however the he city is defied in districts that are supported
by their own anchor The blocks sizes, mediates between land
use, and reconfigures to create special zones, such as downtown,
787
villa districts, etc., and creates urban varying urban environments
with distinct characteristics. The sinuous landscape with the roads
that wind around blocks softly making them better for pedestrians
vs vehicular traffic. There is also a conscious effort to maintain
87
the hierarchy of roads and define the urban wall, and create
continuous connections with the landscape, between the uses, and
within the communities too. While there will be expected control at
the degree of public nature in the management, on the structure,
the project try to be as homogeneous as possible.
The Naya Raipur city on the other hands lies embedded on
one hand on the sector format, and also plans to emulate the
district layout through the proposal of the downtown, and other
special districts and zones. At the end of each of the axis (north
south and east west) there lie institutional anchors that carry the
residential development within. While the layout ensures equality
in the residents with the mandate of representation of affordable
products, there is little excitement about the main spine of the city
that should tie the entire development together
I
Figure 45. Neighborhood or
district planning
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
mm
M
JP grid
NR grid
I
I
Figure 46. NRDA inverted
neighborhoods
/
?
Figure 47. Gated private
enclaves of sports city
88
'6
I
K
I4.
-4I
0 N O
MEN
9.3.
The product typology mix
A new city is a good which is available in the market. It responds to
the demand and supply in the market. While the public developer
has relatively freer control over the supply side, (to provide the
right of the city to people) the developers will act only once they
see sufficient demand in the market. The amount, typology of the
product, are therefore determinants of the elasticity of the demand
function. It is also a function of access to private finance, and
liquid capital with the end users, which are not within the control
of the developer. These costs can however be structured in a way,
towards specific target groups. This therefore limits the client base
that such a product can target and therefore dictates the socioeconomic profile of the city.
While housing is not the only component of such cities, a majority
of the cases are gated enclaves of mid to high end residential
development. To be a city in the real sense would require a
separate administrative base (as proposed by charter cities.
While this isolation from the rest of the urban context might seem
drastic and structure all ties from the boundary areas, the gated
enclaves also serve much similar aims. The users pay a premium
for this segregation which is distances the population from people
of different social-economic background. These enclaves are
many a time, with the increase in scale, further gated into groups
of different class of real estate products, creating a distinct class
based distinction among the population, which is also evident in
the urban form that results.
The delivery method and the product are derivate of the marketing
approach that focuses on responding to the market trend, branding
(insert cool stuff from the book) and Some of the key features
of the sale side would include, promotion, attraction (or anchor
institutions/tenants), sales (early bird bookings), highest best
use principle to maximize the overall benefit generated, and the
appreciation of positive externalities' that can be cashed into while
keeping in mind the demand elasticity.
These private developments would also harbor features such as
a premium for the maintenance and development of facilities,
security and other amenities. Especially in the Indian RE market,
most investors expect partial payment from the buyers well before
the final product has been developed, therefore using these funds
to invest in the construction of the project. This therefore hedges
their risk even before they invest, thereby transferring the risk
89
R
ES
K
1%
UL
A
4
N
E
V
v
R
EE
*.:20
N
0C
V
E
S
U
C
C
~NU
tAP
AY
HR5A
0
deve.rpmTent.
Wh5
Figure 48. Risks undertaken
in the two development
models
h
rn
edrns
h
model
romsan
- -NAYA
RAIPUR
DEVELOPMENT AUTHOITY
ideas w
projctcnainmay
pottyica,
JAYPEE SPORTSCITY
F Dramsae
netett
check6FsI
i
p
to'
Iace
creat
ha
osmce
trma
cnrold
u
directly to the consumer
While the grand renderings, the model rooms and prototypical
layout of houses do paint a vivid and sometimes quite detailed
picture of the final product vision, these are nevertheless the
signifiers of a lifestyle and choices that the users make. These
ideas, when translated from an investment to a constructed
project, contain many checks in place to create a controlled built
environment, where further development is monitored closely
While the operations usually are turned owner to either the
management company put in place by the developer, or transferred
to the residents, they restrict changes and evolution of the
development.
The products that generate the highest return for any developer
are residential, and therefore place making, efficient retail, and well
located institutional facilities are not their primary concerns. The
controlled access to these gated communities, further depletes the
user base for these more public uses, and potentially makes them
vulnerable, and highly dependent on the demographic that choose
to reside in the development.
These motivations lead to high density tower in the park typologies
in the development, where preference to low density comes at a
high premium.
90
In Naya Raipur on the other hand, we would expect to see that
the majority of the housing developed will be subsidized public
housing, it should look to attract first time homeowners, whereas
the sports city project is open to spec secondary investors. These
decisions in investment have territorial transformations. And would
promote the urban form that resembles a collage city over time.
However, we in that the majority of the residential development
proposed for Naya Raipur is also from private mechanisms, but due
to planning policy, hey are only allowed to develop a lower FAR.
This lies counter-intuitive to the need to create more affordable
housing. The natural highest best use has been discourage and
replaced with a planning governed landscape that still anticipates
to develop products on profit. The housing sub-system defined by
the development plan forecasts the requirement of 23 860 DU, out
of which 46% would be constitutes by 1 or 2 room units. According
to the development plan, the maximum share of the housing will
be fulfilled by private housing i.e. individual houses, apartments,
housing colonies and housing societies/ also, the plan reemphasizes again and again the cause for revision and response
to the market trends which would determine the mix, prescribed
FAR etc. The projected residential net density is 93 households per
hectare with a gross density of 250 persons per hectare. As per the
public private partnership model developed, government acquired
land will be sold or leased to developers or housing societies or
further development. The reinstitution of the private sector as the
main implementer, responsible for capital resource generation and
the manager for implementation, makes the control of the authority
less confident.
Naya Raipur
Jaypee Sports City
om
HE]
00000000
0
Figure 49. The density and
distance
H
[distance
rent profile
91
Table 24. Goals and planning manifestations
ideology
city
Garden
Garden____
city___ideology
er in the park typology and the garden
ity tynilny
____
Sector typology developed by Corbusier
Social equity and landscape holds
promintnct-
Manifestos that propagate eco-town/smart
Marketing ana I agibility holds
precpdt-nce
While the FAR overall might be capped at a lower number, these
developments will be gated and would defeat the otherwise
socialist ideal of mixing classes and making all parts of the city as
a public good. Such practices would segregate classes and create
fractured city image.
Despite the many attempts and repeated disclosure of strong
policy initiative, the development plan lacks clear cut policy
initiative, regulations and controls on part of national and state
governments. The plan follows a traditional planning schematic
adapted in almost all cities in India and the planning document is a
reflection of that. I leave gaping holes for an open market system,
while making many claims for a publicly driven development.
Figure 50. Leasable area
(Ha.) as per development
plan for Naya raipur
a
aa
~Cnoft kk
I
coampoita
4
Figure 51. Leasable area
(Ha.) as per development
1
.
Lk.
. residential . Commercial mInstitutional
plan for Jaypee Sports City
While the former might not necessarily mean the failure in the
resultant city form, it is most definitely a failure in the planning
goals that were developed for the city.
50% of land use developed in the new city is meant for
recreational purpose. This panning decision will lead to a
horizontal spread, where such a scale and dispersion of the built
is much questionable given the climatic conditions. Further, as the
plan tries to work on the principles of TOD, the optimum utilization
of such an infrastructure investment and sustainable planning
strategies would recommend higher densities and building
heights.
92
9.4.
Phasing
As a publicly developed project, the process of acquisition finds
firm support by the state and national level government, these tend
to be bigger in size, as well as budgets. With a longer time frame,
low interest rates on the government loans and grants. These
projects can tend to adapt and re-strategize their plans, therefore
opening up flexibly and can afford to take the first step towards
experimental development methodology However, the bureaucratic
processes that line the developments ensure compliance to
ancient standards. So while international funding and public
support make the process easier, the pressure of bureaucracy and
pre-established panning goals that the public sector projects take
the more traditional planning forms.
The phasing, and strategy for the private city on the other hand
is hypersensitive to the market conditions, with the developers
actively exercising their call option when the market conditions
are low Further, to minimize their exposure to risk, pay back
loans ten from private banks and high rates, and also to diversify,
most developers would want to quickly move out and monetize
the product. While operations can also yield good returns, it is
uncommon for a developer to stay with the development for a
long term. While the sports city had long term aspirations, these
stemmed from the anticipated potential bump the F1 race would
provide to the real estate. In the lack of a warm response they too
had to rethink their long their goals.
9.5.
Sensitivity analysis
While sensitivity analysis is a mathematical concept, which can
be used to model how uncertainty in the output of a system
(numerical or otherwise) can be apportioned to different sources of
uncertainty in its inputs.
As we see from the cases, these projects only project the future
city form and are constantly evolving as a factor of political,
social and economic forces. This uncertainty can be quantified
numerically through the parameters stated before that traditionally
define the built form fabric (these are by no means exhaustive,
but would provide an overview of the city morphology anticipating
the implications). In the future, we could use FAR, BUA, density
(of dwelling units, persons per hectare), grid sizes, typology mix
(plots vs apartments) and average unit sizes as parameters to
93
%
infer sensitivity of these towards a final outcome vs the financial
pro-forma factors such as phasing of the project, % grants vs
liquid funding, mandated densities and more. The core learnings
of this case are to understand the flows in and out between the
two models, both physical and financial, and the how the different
development methodologies structure his process. These cases
will allow us to understand the sensitivity from a case based
experience in the two settings and infer resultant trends.
94
10.
PRELIMINARY CONCLUSIONS AND
RECOMMENDATIONS
The truth in the so called advanced industrial world is that our own
stunted imaginations have largely lost the ability to think what a
society other than capitalism -with all its repressive and oppressive
aspects, and spanning the gamut of social relations-might look like
(Niel Smith, 'Another revolution is possible: Foucault, ethics and
politics' in Environment and Planning D: Society and Space 2007,
volume 25, pp 191-93)
Sports city, and Naya Raipur too an extent, acts as the auctioneer
of the public asset, a city. There is a hollowing out of state activity,
where capitalism is believed to be inevitability This elaboration
departs from a premise that is fairly reductionist but deterministic,
universalizing the assumption. Capitalism today is legitimized by
strong globalization impetus, subjecting the world universally to a
new economic configuration of unprecedented dimensions scales
and efforts. Thus despite the different practices, tendencies, and
proposed plans that glorify the mandates of the two developers,
these cities might converge in their final format addressing the
same forces and flows.
While the sports city fails in its initial vision of a sustainable city
built around sports anchors, due to the lack of funds, inordinate
risks taken vs the return expectations and a lack of assessment
of the uncertainties associated with a project of this scale, the
Naya Raipur project fails due to the overtly simplistic assumptions
of a state's role in providing an equitable, sustainable city. What
NRDA failed to comprehend was the planning principles adopted
and their economic and social implications that would entail given
the regional and cultural context. While noble in their intentions,
they are miss-guided in their assumption that profit making
development ventures would defy the ideals of the city especially
in the stark contrast to the garden city suburban dream they are
selling to the consumers.
i
t
a,, spaihi Suuture
fe
yew X
The land use methodology the eagerness to make a smart and
sustainable city while all in the right spirit, fail to convert into
actionable plans of similar spirit. We therefore see that despite
the different trajectories the two projects had started from, they
seem to converge in their private enclave, garden city and tower
in the park typologies. Be it because of market forces that shifted
95
the track of sports city, or the mis-guided planning scheme of
Naya Raipur, the evolution of these plans suggest very different
outcomes from the initial clear mandates. While many factors
contribute to what can be determined as the success of the final
outcome, we can perhaps suggest the following few parameters
that lie in sync with the factors that led to the evolution of these
new cities in the first place:
*
Achieving critical mass of population as the primary
occupants.
*
Creating and growing a steady stream of secondary
(temporary) occupants
*
Boost in the formal and informal economy due to direct
employment generated (through anchors, CBD, SEZ)
*
Growth in income generated through taxes (implying a
economically robust urban development)
*
Benefit generated to local as well as regional areas
(in terms of good outcomes from education, better life
expectancy, income per capita, increase in revenue through
manufacture, admin, and service sector, and options for
further diversification)
10.1. Recommendations
From the IP project to Naya Raipur
Jaypee has used the optionality in the project quite strategically
and re-allocated their funds as and when needed. While their
prime focus was to keep afloat and re-invest that money back
into the project, NRDA should also walk a similar tightrope and
be more careful with their finances. While they can afford to make
more diligent studies and a more careful approach to planning,
they also need to make sure that these principle work along with
the demands in the market and are not way off sync. Devising a
business plan will help tem generate funds that can be re-invested
in creating more affordable housing and developments that lie
within the corridor from Raipur to Naya Raipur. The failure to do
so actively, will not only result in the competitive development in
the area around by opportunistic developers, but also a failure
to attract employment generators in the city. Because the city is
being approached only as a public good, the delay in the demand
does not create a huge impact in the planning process, and results
96
in waste of precious public funds that could be actively used for
economic growth of the region. Further, he refusal to address
highest best use approach for the development, leads to monetary
loss, Opportunity cost for public land is mostly ignored: while many
might argue that sustainable development would be based on the
three p's there is always opportunity cost to any decision taken in
development. Therefore, an awareness of this would help make
better decisions and use taxpayers' money with prudence.
,
The Naya Raipur model also makes very simplistic assumptions
regarding the phasing of the development, without recognizing the
interdependency of the land sues and the sequential development
that is essential to attract maximum people to the new state.
Current investments have been made in capital intensive projects
that will neither attract many permanent residents, nor will create
an employment base for future new tenants. The Jaypee project
made many strategically sound decisions in their development
process. Their phasing to reflect the interdependency of projects,
critical population goals, as well as sound sequencing strategy
Despite their failure, this would be one of the core learnings for the
Naya Raipur project. Adjacency (which contributes to location)
should also be a prime factor in the lease reserve calculations.
As NRDA is only disposing of land, and then providing framework
for development, they do not partake in the revenue generated
from the typology of product generated on the land. It would
be wise to devise the land reserves in accordance to the FAR
allocated for each typology and not just on the area being leased.
The optionality that arises due to the long development term can
also be used to estimate best practices for and auction, over and
above the reserve price. While two projects have been opened up
for bid as a part of this process, these are again being developed
as self-sustainable enclaves at the far ends of the city.
From Naya Raipur to Jaypee:
Mix of uses as projected positive externality and form of
diversification: while this is a lesson well learnt by sports city
it would be good to not fill all capital operations in one kind of
development and project. While sports city started soft launches
with only apartments in the hopes that they would sell off soon,
the lack of a backup option, along with the sunk costs in the
expressway project and F1, bound them into a tight spot. Further,
many of their subsidiaries also dabble with the construction sector
(cement producing plants etc), and were adversely impact with the
97
downtrend in the market. Thus by undertaking all tasks within the
group, they expanded rapidly, but also on high risk.
Introduction of concepts of long term planning and flexibility
even in adversity could have increased the investment value
of the project and not just the market value. While the plotted
development sales were inevitable, the plan should have been
exploited for its modularity, which was compromised on once
the core corridors were converted into plotted development. The
project therefore has liquidated their most prime options. They
could further perhaps benefitted from zoning out some regions
from their plan, and not opened all to the market. Long term
phasing, with stricter guidelines would help preserve some of the
core ideals of the project and protect them from market fluctuation.
While Naya Raipur will see in migration to the city due to shift in
administrative capital and increase in population in the overall
regions (due to migration of new workers from around the region),
Further, the creation of the new capital by the state will also see
movement from the rental market to the ownership market as
access to credit improves, and various schemes are floated by
HUDCO and state banks in support of the development. There is
also high depreciation of property and the stock either lesser than
the demand (four quadrant model)
The JSC however thrives on the 2" home market, due to an
increase in disposable income. While this is not the ideal target
audience for such developments and can lead to the phenomenon
of ghost towns as in Tianjin, JP sports city, as many other
township with a shorter development and turnover time frame,
has succumbed to their demand. Their fees that add to per sq.
meter rates substantially serve as a deterrent for the consumers
they attract, as they wouldn't want to pay high maintained fee for a
property thy not reside at. Thus there as a lack on understanding
the consumer and their motivations for the project, which Naya
Raipur has captured through its narrative successfully
NRDA however has still fended off this particular investor
through the launch of mainly those projects that are open to
the government administration. Thereby attracting the existing
administrative workforce to invest through incentivizing, and
providing housing next to their new work place. This move will help
populate the area, lead to growth in the informal sector, and add
vitality to an otherwise anesthetic experience.
As seen in the case of JSC, the private developers are not
98
monopolists in the sector, and therefore have to constantly reevaluate their strategy, Naya Raipur is almost monopolistic
developer in the region. The motivation to perform optimally would
have a tendency to lag, as no private profits are involved.
Free-ridership of public goods vs Extra Premium for positive
externalities: Naya Raipur has a low FAR and less GC, thereby
suggesting that it should have much more green spaces than
the average city. The proposed development is not too high
density and the city's landscape is dotted with natural and manmade lakes (the contextual heritage of the state). While some
of the residents might value this low density, open and green
environment, other might not. Also, as these are anticipated as
the parts of a sustainable project, there is little premium that will
be charged for these decisions. This therefore creates a problem
of free-ridership and will created a sustained debt scenario for the
city.
Jaypee on the other hand goes at the other end of the spectrum,
and while they do provide low density and ample of greens, their
aim as a developer should be to maximize the FAR and charge
a high premium for the facilities provided. Here, security, open
space, and adjacency will have a direct impact to the price for
the products. These fixed costs also behave as sunk cost and
therefore prices out unwanted economic segment. These enclaves
therefore become the haven of the upper middle income only.
99
PARAMETER FLOWS Jaypee Sports City
ALJACESCY
,LANDUSE
SLONGTERM
PLANNED
-----------
PHA SING
iDPNEC
SHORT TERM J
---
H.Mk leitelSmap
9ss 6up noegs a "oa
-w-s
-
-
Ccr...dd itsis
1b~bba-mpema
~
COASo
~-AI-
--
ncssse a se~o aamse
n
1
'
2-
-
neb"s
suKMs snss
- - mea
nme
wsss
PRICE RANGE
-m a
SIZE RANGE
---------
I
< PRODUCT RANGE
BIGGERGRIEDM X
uses uus
HIHDENSITY
t""*,,N
LOW DESITY EOPL HDENSTATR
-kmww
C
Gemds
C
w ,Q wll mansm
asta
aasgen
m~aa
ttne
DU S HECTARE
ofe. t ftm
BIGGER GRID
-----------SMALLER GRID'
100
PARCEL SIZE
TYPOL.OGY
PARAMETER FLOWS
Naya Raipur
r%
A
LANDUSE
--
-
r
:
-z
-
LONG TERM
-------
PH----
-- - -- -IJE
--SHORTTERM
~~- - ,
E C
0
-
.e
-
-
-
EN
C
IPRODUCT RANGE]
-
-
-
--
-im
-
-
-
-
-
-
-
HIGH DENSITY:
-----------
-
.
4m..
\
ILI
0 LOW DENSITY_
Y
oLWE
PEOPLE, HECTARE
DU'S/ HECTARE
-
-
-.-
I
i
BIGGER GRID
9GRIDSIZ:]
SMALLER GRID
101
This pro-forma is based on data availbe in the [ublic domanin and the many masterpin iteration eveloped at
PEN. Many assmptions have been made where the information is not available. This analysis is only
demonstrative for strategy analysis. Pro-forma 2, will look at the impact of change in market conditions and
the deviation from proposed typologies, FAR and phasing
JAYPEE SPORTS
CITY
Financial Analysis
As the expressway and F1 track have contribute dto the development of the real estate in the Jaypee sports
city, it is therefore essential that they be included in the financial analysis for the project
income/inflow
03
Year Phases
2%10
2014
27020
202%
Rent Inflation
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
10%
10%
10%
10%
10%
16%
14%
19%
22%
15%
14%
6%
1%
9%
14%
34%
36%
9%
15%
28%
32%
7%
9%
10%
16%
29%
47%
74%
100%
Expense
Inflation
Growth in toll
%
)02Q
phases
residential
commercial
institutional
1
population
projection
DU's
22,222
35,556
64,444
104,444
164,444
222,222
residential
7,087,675
1,134,028
992,275
1,346,658
1,559,289
1,063,151
992,275
Commercial
5,185,144
311,109
51,851
466,663
725,920
1,762,949
1,866,652
Institutional
668,700
60,183
100,305
187,236
213,984
46,809
60,183
PHASING FOR THE PROJECT
12,,941,519.00
sales price per sq
40,598,202,400
35,523,427,100
48,210,365,350
55,822,528,300
38,060,814,750
35,523,427,100
sales of Real estate
feet
Residential
35,800
1
2
102
. ..............
....
3
Internal Development
Charges
Electric Sub Station Charges
75
85,052,100
74,420,588
100,999,369
116,946,638
79,736,344
74,420,588
40
12,444,346
2,074,058
18,666,518
29,036,806
70,517,958
74,666,074
Social Club Membership
Compulsory Car Parking
Space
Interest Free Maintenance
Deposit
Maintenance advance for
one year
One time lease rent
150,000
3,333,333,333
5,333,333,333
9,666,666,667
15,666,666,667
24,666,666,667
33,333,333,333
150,000
6,111,111,111
9,777,777,778
17,722,222,222
28,722,222,222
45,222,222,222
61,111,111,111
so
56,701,400
49,613,725
67,332,913
77,964,425
53,157,563
49,613,725
2
20,412,504
17,860,941
24,239,849
28,067,193
19,136,723
17,860,941
50
56,701,400
49,613,725
67,332,913
77,964,425
53,157,563
49,613,725
Commercial
55,000
17,110,975,200
2,851,829,200
25,666,462,800
39,925,608,800
96,962,192,800
102,665,851,200
institutional
33,000
1,986,039,000
3,310,065,000
6,178,788,000
7,061,472,000
1,544,697,000
1,986,039,000
1,000,oooooo
1,050,000,000
1,155,000,000
1,270,500,000
1,397,550,000
1,537,305,000
912,500,000
1,003,750,000
1,104,125,000
1,214,537,500
1,335,991,250
1,469,590,375
income from F1 ticket sales
toll from expressway
operation
2,500,000
103
costs/outflows
Rent Inflation
7%
7%
7%
7%
7%
7%
Expense Inflation
7%
7%
7%
7%
7%
7%
2,000,557
2,499,193
2,872,909
2,919,109
constructio
n cost
1,505,320
1,144,431
-15000
(22,579,794,600)
(17,166,464,100)
(30,008,358,150)
(37,487,889,900)
(43,093,638,150)
(43,786,640,100)
-25000
(28,350,700,000)
(24,806,862,500)
(33,666,456,250)
(38,982,212,500)
(26,578,781,250)
(24,806,862,500)
Commercial
-1s000
(4,666,629,600)
(777,771,600)
(6,999,944,400)
(10,888,802,400)
(26,444,234,400)
(27,999,777,600)
1 stitutional
-15000
(902,745,000)
(1,504,575,000)
(2,808,540,000)
(3,209,760,000)
(702,135,000)
(902,745,000)
-75
(112,898,973)
(8s,832,321)
(150,041,791)
(187,439,4s0)
(215,468,191)
(218,933,201)
(s6,612,768,173)
(44,341,s0s,s21)
infrastructure
development
Residential
1
2
3
maintenance cost
real estate
development costs
construction cost
(73,633,340,s91)
(90,7s6,104,2s0)
(97,034,2s6,991)
(97,714,9s8,401)
for expressway
project
(130,000,000,000)
maintenance cost
(9,100,000,000)
construction cost of
the F1 racing track
(9,100,000,000)
(9,100,000,000)
(9,100,O00,O0)
(374,500,000)
(400,71s,000)
(428,765,050)
(2,862,2s0,000)
(3,062,607,s00)
(3,276,990,025)
(9,100,00W0)
(18s,000,000,000)
maintenance cost
F1
(9,100,000,000)
license fees
(750,000,000)
(350,000,000)
(2,s00,000,000)
(2,67s,000,000)
(4s8,778,604)
(3,s06,379,327)
127,112,715,84
_N01
(312,679,295,379)
104
-- ------
2,577,259,927
24,012,111,009
46,694,088,226
99,625,828,773
1
Assumptions made in the case:
the case numbers are demonstrative only, and have been used to show inflow and outflows
phasing of the project
Demonstrative only, the actual phasing for the project and its driver are assumed to be current market considerations. As the
JP group is a large conglomerate, it would be easily able to diversify in case they feel they are getting lower returns.
However, the timeline and trend observations for the projects floated (release of projects and their typology lies within
public domain, shows that there is an urgency to capitalize the value locked in the real estate, thus a shorter phasing
schedule than the Naya Raipur case has been used)
land use mix
The land use mix in approximation by the PENC plan that was proposed in 2011. many changes have taken place in the
planning document since then and this particular mix is only demonstrative
product mix
is derived from the public available marketing documents
infrastructure costs
derived through publically available reports and approximate estimates made through news
derived through publically available reports and approximate estimates
construction costs
the
typologies
for
sqm
rate
average
residential
derived through publically available marketing handouts on site
commercial
same assumptions as NRDA
institutional
same assumptions as NRDA
derived through publically available reports and approximate estimates made through news
toll from expressway
derived through publically available reports and approximate estimates made through news
revenue from ticket sales
derived through publically available reports and approximate estimates made through news
costs for expressway
derived through publically available reports and approximate estimates made through news
costs for F1 track
sources
http://www.outlookbusiness.com/article v3.aspx?artid=265300
4
http://articles.economictimes.indiatimes.com/2011-09-22/news/3018927 1 iavee-sports-international-formula-one-management-buddhinternational-circuit
And many other anecdotal and news reports on the project.
105
.
.
....
...........
....
Appendix for the case
the FAR and ground coverage restrictions within the YIEDA building bylaws
However, as the majority of the sports city
24.1 Residential Buildings on plots (other than flatted group housing)
project lies within the Special development
average FAR
1.61
average GC
61%
family density
24.2 GROUP HOUSING (Flatted and
4.5
cluster type)--
upto 40,000 sqm
above 40000 sq.mtrs.
35%
40%
FAR
height limit
3
no limit
family density
24.3 INDUSTRIAL BUILDINGS--
4.5
average FAR
average GC
24.4 COMMERCIAL BUILDINGS--
4
0%
average FAR
average GC
24.5 INSTITUTIONAL--
0.00
0%
average FAR
average GC
0.00
0%
24.6 GREEN AREAS-average FAR
average GC
24.7 TRANSPORTATION-average FAR
average GC
24.4 COMMERCIAL BUILDINGS-0%
2
30%
24.9 INFORMAL SECTOR-average FAR
average GC
106
2
60%
zone, they have been provided with an
overall cap FAR for the development.
They can then choose to negotiate the
FAR between the different land uses, and
determine building heights as per their
design. This flexibility has led to an urban
form that encourages either plotted
development following the garden city
principles, or iconic high rise
condominiums, that form the iconic towers
for the development. It has to be kept in
mind that the developer is at all times
trying his best to market the product and
has to invest in brand creation for each of
the typologies.
AUna-wM
Bouievard Couat
Furthering the grand success of Jaypee
Greens Aman and Aman-U...
Jaypee Greens presents Boulevard
Oourt the desirable and comfortable ...
Nabuvoe ApwbtsB
Budh cidt stuos ii
It's time to plan for your child own
Life always gives a second chance I ...
-adnspace...
The EaUm.
Jaypee Greens brings to you Villa
Thesougainvleasare
residential pkfts...
Greencrest Homes, a community of
residential
Greens Sports Cty are epitome of...
Get ready to move Into your dream first
apartment..
vWb Eqmm
Expanza...
Udaan- the Personal floors at 1aypee
S-myV
premium
Hkmm
Come, build your own home at the
futuristic.
comby Honwk-n
Yatum Var-Plots
laypee Greens brings you the perfect
Build your home the way you want at
setting to build your dream home ...
the residential community...
Figure 52. Jaypee Sports City
- 2014 Project Typologies
107
. .
........
LANDS RATES AS LISTED OUT BY YIEDA
SI. No.
Category
1
Residential
11,500
2
Commercial
23,000
3
Group Housing
14,000
4
Institutional
A
Senior Secondary school] Inter College] Degree & Diploma Course] Engineering College] Dental College] University etc.
& upto 4,000 Sq. Meter
6,500
& addition to 4,000 Sq. Meter to 20,000 Sq. Meter
& addition to 20,000 Sq. Meter to 60,000 Sq. Meter
5,850
5,200
& addition to 60,000 Sq. Meter and above
B
Nursery School (in residential area)
C
Social Infrastructure
D
5
108
Rate Rs per Square
Meter
4,550
11,500
1) Electric sub-station] Post Office] Tele-communication centre & other Govt. office etc.
4,850
II) Milk Booth etc (Parag /Mother Dairy)
4,850
iii) Religious Place & Orphanage
iv) Hospital
4,100
8,700
Corporate Office
9,700
Industry
& upto 4,000 Sq. Meter
5,500
& addition to 4,000 Sq. Meter to 20,000 Sq. Meter
& addition to 20,000 Sq. Meter to 60,000 Sq. Meter
4,950
4,400
6
& addition to 60,000 Sq. Meter and above
Ware - Housing
7
Recreational greens
3,850
1.5 times of the above
Industrial rates.
4,500
INCOME/INFLOW
Rent Inflation
Expense
Inflation
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
7%
11W
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
0%
0%
0%
0%
0%
0%
slrstegyforthe
r...L-
2011-2
fbr I""s
2012-
2013-14
2014-5
2015-16
2016-17
2017-1
201.1-19 2019-20 2020-21 2021-22 2022-23 2023-24
2024-25
2025-26 2026-27 2027-28
2029-30 2030-31
2028-29
8%
5%
5%
5%
6%
7%
8%
10%
12%
10%
8%
6%
5%
5%
1,382
111
69
69
69
83
97
111
138
166
138
111
83
69
69
Retail
Commercal
Wholesale
138
11
7
7
7
8
10
11
14
17
14
11
8
7
7
131
10
7
7
7
8
9
10
13
16
13
10
8
7
7
Industrial
194
16
10
10
10
12
14
16
19
23
19
16
12
10
10
11
11
60
3
Residentll
-
nd Use
10%
Yeerwse Distribution of LUnd to be lawe out
Selinsee
Lnd
land '
13
16
18
22
27
22
18
13
72
84
96
119
143
119
96
72
30
60
30
36
41
47
59
71
59
47
36
60
30
s
3
3
3
4
s
5
6
8
6
5
4
3
14
9
9
9
10
12
14
17
21
17
14
10
9
9
327
205
209
289
246
286
327
409
491
409
327
246
205
205
327
532
737
941
1,187
1,473
1,801
2,210
2,701
3,110
3,438
3,683
3,888
4,092
47
Transportation
65
Composite Use
172
Total
492
cumulatue land
developed
-
30
-
592
Reoeetional
-
60
-
11
96
-
11
18
-
11
60
30
223
1194
-
special
Industrial Zone
Public & Semi
Public
-
Commerdal
4,092
4,092
4,092
4,092
4,092
492
Land Reserve premium
s-_In aij(
2025-26
2027-28
2028-29
372
427
565
-
-
-
-
-
266
293
322
355
390
449
516
593
682
902
-
-
-
-
-
231
254
260
308
339
389
448
515
592
788
-
-
-
-
-
139
152
168
184
212
244
260
322
426
-
-
-
-
-
76
84
92
101
111
128
147
170
195
258
-
-
-
-
-
69
76
84
92
101
111 128
147
170
195
258
-
-
-
-
-
63
69
76
84
92
101
111
128
147
170
195
258
-
-
-
-
-
138
152
167
184
202
222
244
281
323
372
427
565
-
-
-
-
-
330
3M0
437
502
664
-
-
-
-
Commerdiel
Retail
182
200
220
242
Commeriel
Wholesale
108
174
191
210
Industrial
Special
lndustrlWZone
Public & Semi
Public
86
95
104
114
126
52
57
63
69
52
57
63
Recreational
52
37
TransportatIon
114
125
134
147
162
178
196
216
237
261
287
2026-27
2025-26
-
2025-24
323
2019-20
-
2022-23
281
167
-
2021-22
244
2015-16
-
2020-21
222
152
120
-
201-19
202
201415
18
114
-
2017-43
184
201-14
Residential
Composite Use
2050-31
2029-30
2016-47
201241
-
201142
-
Land Risers. r
-
land Use
109
9,54
10,488
13,845
17,767
22,337
30,712
40,541
38,851
35,744
30,828
29,542
39,069
1,524
1,676
2,214
2,840
3,572
4,912
6,484
6,214
5,717
4,931
4,722
6,245
1,135
1,248
1,373
1,814
2,328
2,925
4,024
5,311
5,091
4,681
4,038
3,868
5,116
-
919
1,010
1,112
1.467
1,882
2,366
3,253
4,295
4,115
3,786
3,266
3,131
4,140
-
703
773
1,020
1,310
1,646
2,264
2,989
2,864
2,654
2,272
2,178
2,880
-
-_-_-_-
-
-
-
-
Revenue generated per year through scheduled land disposal
-
-
Industrial Zone
Public & Semi
Public
929
639
4,968
3,415
3,757
4,133
5,455
7,002
8,801
12,102
15,975
15,310
14,084
12,149
11,641
15,395
Recreational
2,464
1,694
1,863
2,049
2706
3,472
4,365
6,002
7,922
7,593
6,984
6,025
5,773
7,634
Transportation
591
406
447
492
648
832
COmPo sitUse
1843
1
1,266
1,93
L532
cumulative
lease premium
2,840,574,00
0
4,793,274,2
00
6,941,244,4
20
9,308,962,99
0
-
1,046
1,437
1,899
1,818
1,674
1,442
1,385
1,831
2596
3,264
4.489
5,926
5,678
5,223
4504
4,316
5,707
12,423,126,650
16,426,052,5
70
21,458,301,040
28,377,80
6,750
37,511,89
9,070
46,265,21
2,460
54,317,89
0,840
61,263,39
7,240
67,918,8
53,030
76,720,656,64
0
500,000.0
500,000,0
00
400.000,0
00
30,000,0
00
250,000,
000
250(031,00
53,520,00
0
40,140,00
0
33,450,0
00
33,450,000
-
-
4,560,000
-
-
-
-
-
-
023
Other
f total
Interest
-
-
-
-
Special
-
-
1,336
-
-
1,651
Industrial
,
-
1,
-
8,668
-
12,60
2,017
76,720,65
6,640
76,720,6
-
Residential
Commerdal
Retall
Commercial
Wholesale
76,720,6
56,640
56,640
76,720,6
56,640
76,720,6
56,640
Free
ticketing
37,000,00
0
0
0
250,000,000
300,000,000
350,000,000
400,000,000
00
600,000,0
00
669,000,0
00
53,520,000
33,450,000
33,450,000
33,450,000
40,140.000
46,8930,WD
53,520,000
66.900,00
0
80,280,00
0
9,120,000
7,296,000
5,472,000
4,560,00
0
0
7,296,000
4,56,000
4,560,000
4,560,000
5,472,000
6,384,000
7,296,000
9,120,000
10,944,00
0
640,000
400,000
400,000
400,000
480,000
560,000
640,000
800,000
960,000
800,000
640.000
480,000
400,000
400000
2,96K00
1,830,000
1,5000
1,850,000
2,220,000
2,590000
2,960,000
700,000
4,440,000
3,700,000
2,960,000
2,220,000
1,830,00
0
1,850,000
33,600,00
0
40,320,00
0
33,600,00
0
26,880,00
0
20,160,00
0
55,,00
0
66,000,00 55,000,00
44,000,00
0
0
33,000,00
0
-
Grantfrom
State Govt.
S50,WM,0
00
26,880,000
44,000,000
16,800,000
27,500,000
16,800,000
27,500,000
16,900,000
27,500,0
20,160,000
3,000,000
23,520,000
38,500000
26,880,000
44,000,000
110
.......
.......
..........
. ..
0
16.800,0
00
16,800.000
-
-
-
336,000,0
00
27,500,0
00
27,500,000
-
-
-
Contribution of
Got for BRT
-
&
~Sudy 8,000,000
66,900,00
-
-
91,200,00
0
230,00,00
400,000,002
-
Grant from GEF
for BRT
Grant from
MoUD for TOO
(BM
State Govt.
Contribution for
rolling stock,
GPS/PIS
250,000.00
000
-
5,,000,
-
Loan from State
Government
Loan from
World Bank for
BRT
76,720,6
56,640
0,000
6,604,000,
000
943,720,000
589,825,00
0
589,825,00
0
528,320,000
330,200,00
0
330,200,00
0
330,200,000
396,240,000
462,280,000
528,020,000
1,254,585,0
1,254,585,0
00
1,254,585,00
0
1,500,502,000
1,756,419,00
0
2,007,336,000
g8enfted
thwough ham
aw Frnu
2,007,336,00
0
00
1,179,650
589,825,000
707,790,000
825,755,000
943,720,000
1,415,580
0
1,179,650
O00
943,720,0
00
707,790,0
00
589,825,
,000
528,320,0
00
396,240,0
830,200,
00
000
2,007,336
1,505,502
000
5,000
660,400,0
00
792,480,0
00
660,400,0
00
2,509,170
3,011,004
2,509,170
,000
,000
00O
,000
000
589,825,000
-
330,200,000
-
-
-
-
1,254.585,000
0
0
0
0
-
Loan from
Various Banks
TOTAL revenue
11,796,50
-
Infrastructure
Grantfrom
state Govt.
1,254,58
0
0
The income to NRDA for the project is only via disposal of land and levying of lease rental and service charge. These are the inflows used to offset the Infrastructure and maintenance cost for the city
111
OUTLFLOWS
?012
Rent Inflation
Expense
Inflation
?01
3
Ye hw
DI2M0)18
1
7%
7%
7%
7%
2011)
20
9
2020
21
2021
22
2022
23
0 2
2023
21
202526
202627
20228
202E
29
2029
3Q
2030.
31
7%
7%
7%
7%
15%
9%
9%
7%
7%
5%
5%
5%
5%
6%
5%
5%
4%
3%
2%
2%
2%
2%
2%
2%
(8,447,060,
000)
(5,056,348
08,000)
(36,215,4
(5,561,736,
326)
(3,422,O6
.970)
(3,315,650
.502)
(2,566,955
227)
(2,566,955,227)
(inludes
(1,775,477,3
66)
(1,711,303,48
5)
(1,711,3
03,485)
(1,711,3
03,485)
(2,139,1
29,356)
(1,711,3
03,485)
(1,810,7
73,000)
(1,283,4
77,614)
(1,086,463,8
00)
(743,695
(748,69
5,275)
(641,73
(641,73
8,807)
(641,73
8,807)
(641,73
8,807)
softcosts)
60,000)
maintenance
(10,9136
00,000)
(34,22r,07
(33,156,50
5)
(25,669,552
0)
)
(25,669,S52)
(35,509,547)
(34,226,070)
207,281,45
3
(4,697,533
(3,636,799,
910)
(3,636,799,910)
(2,497,698,4
98)
(2,407,420,23
,217)
(4,s665,4
(4,152,949,79
1)
land
procurement
cost
(13,503,4
,ow)
infrastructure
expenditre
costs
Interest
cost
(55,617,363
,
8.8071
(34,226,
070)
(34,226,
070)
(34,226,
070)
(36,215,
587)
(25,669,
552)
8M)
(19,252,
1641
(19,252,
(21,729,276)
(14,973,
903)
(22,460,
460)
)
(19,252,
164)
(19,252,
64)
(2,407,4
20,239)
(2,407,4
20,239)
(3,009,2
75,298)
(2,407,4
20,239)
(2,547,3
S1,540)
(1,805,5
65,179)
(1,528,410,9
24)
(1,053,2
46,354)
(1,045,7
S9,402)
(896,36
,201)
(896,36
201)
(896,36
5,201)
(896,36
5 01
(4,132,9
(4,152,9
49,793)
49,793)
(5,196,1
87,242)
(4,152,9
49,793)
(4,394,3
40,000)
(3,114,7
(2,634
00)
(1,816,9
(1,557,3
(1,557,3
1 5,55)
(1,57,3 (1,97,3
56,172) 1 ,172)
6,084,487,
4,207,855
154
,528
4,9,6
8,061
(42,782,
sum
Loan
(27,254,3
repayment
32,000)
567,326,861
(87,86,4
(13,497.86
Total Costs
,275)
,
.12)
(8,05,899
1 ,5116.53)
(,46,341
,224AS)
(6,229,424,
IM)
(,229,424,,,O) 11)
9)
,3X
)
,O
(1,816,9
15,3)1 56,172)
5,172)
FINAL PROECT CASHFLOWS
(8,575,995,34
NO]
8)
(5,049,329,8
83)
(4,590,595,1
00)
(2,554,636,24
8)
(1,530,098,757)
1,545,041,028 3,003,648,646
5,434,577, 8,199,381,
531
873
6,266,823,
916
1
7,606,051,182
(1,
,535)
,9
16,91
5,535)
(1,
(1,557,35
6,172)
(1,557,X
6,172)
(1,557,35
16,172)
112
.............
....
....
(1,557,35
6,172)
Assumptions made in the case: NR
This particular case provides detailed material on their planning strategy, guidelines as well as the
financial assumptions made. Being a publicly enveloped project, which is funded by the MUD and WB,
the funding being made to the project is quite transparent.
phasing of the project
landuse mix
product mix
infrastructure costs
construction costs
Rate for Reserve premium
Demonstrative only, two phasing strategies (scheduled land disposal) developed in the business
plan for Naya Raipur. Both have been included in the narrative, while the more prudent option has
been applied for the pro-forma analysis
As determined by the Development plan
As determined by the Development plan
As determined by the Development plan
As determined by market analysis
As determined by the Development plan
113
Appendix for the case
Outflow and Inflow details
Infrastructure Upkeepment Cost ( 1st Five Years)
1%
Infrastructure Upkeepment Cost (Next Ten Years)
2%
Infrastructure Upkeepment Cost (Remaining Years)
3%
1
Roads & Bridges
98822
29917.03
24929.78
43975.19
2
Water Supply
30623
2288.03
13334.97
15000
3
Sewerage
25890
13
25877
0
4
Drainage
5000
0
3000
2000
5
Solid Waste
2500
0
2500
0
6
Power
43168.6
415
42753.6
0
7
Street Lighting
12000
0
7000
5000
8
Telecom
1000
0
1000
0
9
Land Scape, Social Infrastructure, Green Belt development, Lake Conservation
100000
364
29636
70000
10
Consultancy fees
3732
744.18
987.82
2000
11
Marketing & Publicity
1500
0
500
1000
12
Village Development
20000
12
9988
10000
13
BRT
17919
2077.29
15841.71
0
114
...................
The following assumptions has been made for calculation cash flow for the entire plan period
Assumptions:
Cost of Debt
11%
Loan from IBRD:
LIBOR
3.25%
World Bank Spread
1%
Tenure of Long Term Loan
15 years
Tenure of short Term Loan
2-3 years
OBSERVATION
Total financial outflow
Total financial Inflow
The various components which have been considered for the outflow are as follow:
The various components which have been considered for the Inflow are as follow:
v
Cost of Land Acquisition
v Interest Free Loan from State Government
v Cost of Infrastructure Development
v Infrastructure Grant from State Government
v Cost of Upkeepment of Infrastructure
v Grant from GEF
v Interest Cost
v Grant from MoUD
v Loan Repayment
v Loan from IBRD and various other Financial Institutions
v Lease Premium from Lease of Land
The total outflow for:
The total inflow for:
Scenario 1: Rs. 813867 Lacs
Scenario 1: Rs. 958362 Lacs
Scenario 2: Rs. 878868 Lacs
Scenario 2: Rs. 1046285 Lacs
Year wise outflow of fund for Scenario 1 & 2 has been shown below:
Year wise outflow of fund for Scenario 1 & 2 has been shown below:
115
..
......
....
........
140000.00
120000.00
100000.00
80000.00
60000.00
40000.00
20000.00
0.00
300000.00
250000.00
200000.00
150000.00
. . . . . . . ..
TV IV V V
0NN fn~ 4r,
N "4 N ""N N 4 N "N
0 0D 0D 0 0 0
N N N N N N4
V IV VN N
%b NO cc d%
N N Ng N N N N N4 N
0D 0 0D 0
N N4 N Nk
IVN N N
6~
N4 A"4 A aO
rM
0 CD 0
N N4 N
eV N N TT
r- cc m 0
-
Scenario 1
100000.00
-
Scenario 2
50000.00
0.00
0c 00
0 0D 0D 0D 0
N N N (N N N N N
06
M.
b)
Surplus
Scenario 1
At the end of the plan period a surplus of Rs. 1,44,494 Lakhs may be available for future reserve and further infrastructure development.
Scenario 2
At the end of the plan period a surplus of Rs. 1,67,418 Lakhs may be available for future reserve and further infrastructure development.
116
-Scenario
-
1
Scenaro 2
MN
Flow,est
Maw
Logistic Hub
NORTH
-
uanunwoe
__Firr~
Says Sol Charitable
trust hospital
naVANONWr
EX
International Cricket
sotCiyStadium
s Way
I SEZ
ARMY
Airport
CRPF
Central Business Dist.
Genms &Jewelry
&COSA
BSF
ITBP
Sec - 17:GOVT. Housing
SEZ
Capitol Complex
Ofice Complex
Fair Gr6
d
Naya Rakhl (Resettlement Village)
Sec- 26 (PSU & Bank housing)
lIt Housing Colony
Sr. Secondary School
Sec - 30: PVT. Housing
IIM
Sec -29: Housing Board Colony
Cancer Research Hospital
HP Fuel Refilling Station
SThemnetownship & Golf Course
Jungle safar
Botankal Garden
Raw atpura Sarkar Institute
CO P
NI Urban Mgmt
AyushUerity
Administrative
Academy
(TM University
* ==
Ayush University
I
Figure 53. Project A nchors
Figure 54. Project Status
Table 25. Naya Raipur Population in 2031
CBD
3.6%
2,250
0.4%
Special Industry Area
10,000
1.8%
Facility Coridor
19,000
3.4%
Institutional Housing
35,000
6.3%
Residential Sectors
434,192
77.9%
Abadi Areas
29,524
5.3%
Cantonment, Police Academy and NCC
TOTAL
Source: NRDA's Development Plan for Naya Raipur City
117
Functio ial, & In-progress, Up-coming
The Table below represents the estimated land rates in the years 2009-2012
20,000
Composite Use
lt
%
Law University
MWW"
7,406
557,372
1.3%
100.0%
I
Residential
Commercial
Retail
Institutional
Hospitality
I
3,165
16,501
15,823
8,103
9,724
1
3,544
18,481
17,722
8,914
10,696
1
3,970
20,699
19,848
9,805
11,766
1
4,446
23,183
22,230
10,981
13,178
|
ENDNOTES
1.
Provoost M. Why Build a New Town? Volume 34. March, 2013
[Online]. Available at: http://volumeproject.org/2013/03/whybuild-a-new-town/. Accessed on July 22, 2014
2.
Kundu A. IMPACT OF NEO-LIBERAL POLICIES ON URBAN
MORPHOLOGY: THE INDIAN CASE. World Bank, 1995
Note: The central governments in many countries of Africa, Asia
and Latin America, operating under structural adjustment program
and suffering serious debt problems, are examining ways to
decentralize some of the burdens of service provisions to the
local level. Of the 75 developing countries with populations over
five millions, all but 12 have initiated some form of transfer of
power to the local governments
3.
India's urban awakening: Building inclusive cities, sustaining
economic growth" McKinsey Global Institute. April, 2010.
[Online] available at: http://wwwmckinsey.com/insights/
urbanization/urbanawakeninginindia. Accessed on August
10, 2014. Note: India is one of the fastest growing economies
in the world. Various urban population growth projections
suggest that, in terms of magnitude, the accretion to urban
population in India over the next 30 years will be about
equivalent to that experienced in the last 50 years. It has been
projected that by year 2030 there will be 70 cities with more
than a million inhabitants ad the country has seen sustained
growth over the past few decades.
4. Kartikeya. Real estate FDI up 80 times in five years.
2010. [Online] Accessed on January, 17 2013
at: http://mobilepapertimesofindia.com/mobile.
es&pageid=1 &sectid=edid=&edlabel=TOIA&mydateHid=22-0801 0&pubname=Times+of+India+-+Ahmedabad&ed
name=&articleid=ArO0l 01 &publabel=TOI
5. Simons T- From New Towns to Eco-Towns: Transferable
Lessons in the Building of New Cities in Great Britain.
Massachusetts Institute of Technology, Sept 2010
6. http://www.newtowninstitute.org/newtowndata/newtown.
php?newtownld=1 756 accessed on August 15, 2014.
7. Gandhi S.S., Large-Scale Urban Development in India - Past
and Present. Collaboratory for Research on Global Projects,
D. U.
118
&
8. Geltner D. et. Al. Commercial Real Estate Analysis
Investments. Page 759
9. Ibid, 759
10. Ibid, 761
11. Ibid, 762
12. Ibid, 762
13. Ibid, 82
14. Jaypee Sportscity Masterplan Yearbook. Peter Ellis New Cities.
December 2011
15. Raghunath A., Mishra A.K. Will F1 Be Jaypee Group's Magic
Formula? Oct 24, 2011
16. ibid
17. Jaypee Sportscity Masterplan Yearbook, Peter Ellis New Cities,
December 2011
18. Yamuna Expressway Industrial Development Authority Byelaws,
[Online] available at: http://yamunaexpresswayauthoritycom/
sites/default/files/uploads/byelaws.pdf, accessed on July 20,
2014
19. Jaypee Sports City. About Us, Plots, Apartment. Retrieved
fromjaypee Sports City: http://wwwjaypeegreens.
com/sportsCity/sports-city-apartments-independent.
html?siteld=&adUnit=&adgroup=&keyword=&section
20. Jaypee Sports City Masterplan Yearbook, Peter Ellis New
Cities, December 2011
21. Jewar scrapped: Akhilesh cancels Mayas pet project setting
second International airport Delhi. Available at: http://www
dailymail.co.uk/indiahome/indianews/article-2141419/Jewarscrapped-Akhilesh-cancels-Mayas-pet-project-setting-secondInternational-airport-Delhi.htm. Accessed on June 15, 2014
22. Motilal Oswal Securities Limited (MOSL). Analyst report, April
16 2013, pg 5
23. Ibid, pg 1
24. Ibid, pg 1
119
25. Jaypee Sports City Masterplan Yearbook, Peter Ellis New
Cities, December 2011
26. Documents of constitutional and parliamentary interest.
Available at http://parliamentofindia.nic.in/jpi/december2000/
chap-7.htm, accessed on august, 2 2014
27. Robert L. Hardgrave, Jr. Frontline, Sept. 1, 2000. [Online]
accessed at: http://wwwlaits.utexas.edu/solvyns-project/
IndiacreatesNewStates.htm., August 7, 2014
28. Veengopalan PMadhya Pradesh Bifurcation blues. [Online]
available at: http://old.projectsmonitorcom/detailnews.
asp?newsid=2137 accessed on August 16, 2014
29. Naya Raipur Development Authority About Us. Retrieved from:
http://nayaraipurgov.in/node/149 accessed on August, 4 2014
30. Naya Raipur business plan 2011, as issued by NRDA on
January 2014
31. ibid
32. Meinhardt Singapore Ptv. Ltd. (Comprehensive Planning
Consultants to NRDA for the CBD project). MARKET STUDY
AND FINANCIAL FEASIBILITY PLAN for central business
district, page 18
33. Ibid, pg 19
34. Ibid, pg 19
35. Ibid, pg 19
36. Les Atelier, mitrise d'oeuvre urbine. Naya Raipur context
document: Shaping a new Capital city to fit Indian life.
International Urban Planning workshop, November 17November 30, 2012, pagw 18-19
37. Naya Raipur Development Authority. Naya Raipur Development
plan 2031.
38. Ibid, pg 18-19
&
39. Bieri D.S. Form Follows Function: On the Interaction between
Real Estate Finance and Urban Spatial Structure, Urban
Regional Planning, University of Michigan, Ann Arbor, 2013
120
FIGURES: REFRENCE
Figure 1. Viswamitra, The SEZ buzz is back!, 3. April 2010, http://www
anigalla.net/post/The-SEZ-buzz-is-back!.aspx, accessed on 5 August,
2014
15
Figure 2. http://chandigarh.gov.in/knowchd-general.htm
24
Figure 3. source: http://www.lavasa.com/hig h/master-plan.aspx#
25
Figure 4. http://wwwlavasa.com/live/live-home.aspx#
26
Figure 5. https://people.hofstra.edu/geotransleng/ch6en/conc6en/
landrent.htm
27
Figure 6. http://wwwtutor2u.net/economics/content/topics/elasticity/elasticity.of-supply.htm
27
Figure 7. Real options lecture presentation by Prof. Gelter
29
Figure 8. Harkless, Lawrence Bernard, Jr, Monkey see, monkey do : establishing new real estate development frameworks for the land optioning
and assembly process in Singapore, Massachusetts Institute of Technology, 2014, Pg 30
Note: This is the development framework that has been used for the
thesis. It is based upon the Daniel Kohlhepp development framework
model. 'The objective of this framework is to establish that there is a value
associated with each stage of the development process. This value can
either be held or sold depending on the developer's strategy for profit
development.
37
Figure 11. Jaypee sports city renderinf @PENC
30
Figure 9. Location wr.t Delhi @PENC
37
Figure 10. Layers by author
37
Figure 12. ICICI PSG Research & Consultancy, micro markets report,
March 2013
39
Figure 14. FAR Strategy @PENC
47
Figure 13. Masterplan grid comparison@PENC
47
Figure 15. Districts @PENC
48
Figure 17. Keyplan@PENC
49
Figure 16. 2012 Downtown district plans@PENC
49
Figure 18. Evolution of YIEDA masterplan @ http://yamunaexpresswayauthority.com/
52
Figure 19. Sports City masterplan evolution @PENC, and marketing plan
52
Figure 20. Grid Evolution @PENC
52
Figure 21. Change in typology of planned projects, author
53
Figure 22. Phasing @PENC
55
Figure 23. Population growth by individual uses @PENC
55
Figure 24. Population growth by phases (combined uses) @PENC
55
Figure 26. Naya Raipur, photographed by author on site visit in Jan 2014
60
Figure 25. Location, adapted by author from NRDA development plan 61
Figure 27. Boundaries of administration @ NRDA development plan 62
Figure 28. Land rates in Raipur adapted by author from NRDA development plan
65
Figure 29. Regional plan @NRDA development plan
69
Figure 30. Structure @NRDA development plan
69
Figure 31. Green structure @NRDA development plan
69
Figure 32. Urban form and land use mix @NRDA development plan 70
Figure 33. Sector Layout @NRDA development plan
72
Figure 34. Typology Mix @NRDA development plan
72
Figure 36. Block Comparision adapted from http://en.wikipedia.org/wiki/
Grid-plan
73
121
73
Figure 35. Neighborhood massing @NRDA development plan
Figure 37. Private vs Private development @NRDA development plan 74
Figure 38. Housing developed by private developer @NRDA develop75
ment plan
Figure 39. Housing developed by Chattisgrah Housing Board @NRDA
78
development plan
78
Figure 40. Phases of development @NRDA development plan
85
Figure 41. Grid compartive, author
86
Figure 42. Degree of gatedness, author
86
Figure 43. Greens: Public or private, author
Figure 44. Planning models http://lewishistoricalsociety.com/wiki2011/
87
tiki-readarticle.php?articleld=93
88
Figure 45. Neighborhood or district planning, author
d'oeuvre
mitrise
Les
Atelier,
Figure 46. NRDA inverted neighborhoods@
urbine. Naya Raipur 2012: Shaping a new Capital city to fit Indian life.
International Urban Planning workshopession book 2nd Edition projects
88
I team c, pg 88
90
@PENC
Figure 47. Gated private enclaves of sports city
Figure 48. Risks undertaken in the two development models, author
adapted from Geltner D. et. Al. Commercial Real Estate Analysis & In91
vestments.
88
Figure 49. The density profile and rent profile, author
Figure 50. Leasable area (Ha.) as per development plan for Naya raipur,
92
author
Jaypee
plan
for
as
per
development
Figure 51. Leasable area (Ha.)
92
Sports City, author
107
Figure 52. Jaypee Sports City - 2014 Project Typologies
116
Figure 53. Project Anchors
116
Figure 54. Project Status
All Images marked @PENC are property of Peter Ellis New Cities
122
TABLES
Table 1. ICICI PSG Research & Consultancy micro markets report,
March 2013
40
Table 2. ICICI PSG Research & Consultancy micro markets report,
March 2013
40
Table 3. Regulatory Masterplan@PENC
45
Table 4. Sports City Districts@PENC
45
Table 5. Changes in the master plan from 2010 to 2011 @PENC
53
Table 6. Sports city built up area comparison@PENC
53
Table 7. 2010 Product Mix@compiled from PENC
54
Table 8. 2014 Product Mix @compiled from http://wwwjaypeegreens.
com/sports-city-greater-noida.html
54
Table 9. Proposed masterplan phases PENC
55
Table 10. Capital flows@ author
56
Table 11. Demonstrative product pricing@ author
57
Table 12. Population and trends of Raipur and anticipated trends for Naya
Raipur@ NRDA Development Plan
63
Table 14. Recent Developments in Raipur Property Market@ business
plan by NRDA
64
Table 13. Expected Demand of Residential Units@ business plan by
NRDA
64
Table 15. Historical Land Rates in Raipur@ business plan by NRDA 65
Table 17. Distribution of Plotted and Apartment Housing@ NRDA Development Plan
71
Table 18. Suggested plot sizes and development control guidelines@
NRDA Development Plan
72
Table 20. Suggested (indicative) percentage of dwelling unit size based
on number of rooms@ NRDA Development Plan
73
Table 19. Suggested land utilization pattern at sector level@ NRDA Development Plan
73
Table 21. Contribution by various housing sub-systems to the total housing stock of Naya Raipur@ NRDA Development Plan
75
Table 22. Population Phasing @ NRDA Development Plan
78
Table 23. Case comparative data @author
84
Table 24. Goals and planning manifestations @author
92
Table 25. Naya Raipur Population in 2031@ NRDA Development Plan
116
Table 26. Projected Land Rates in Naya Raipur@ NRDA Development
Plan
116
123
124