Sometime in 2008, the Chairman of probably India’s largest Real estate company, while speaking at an Industry seminar remarked in his trademark humility- “Yes, I am large, but, India has the scope, need & space for a 100 more organizations of my scale & ability. To my wisdom, a few of them would arise from the Delhi opportunity”.

Whence the MPD 2021 was notified in Feb’2007, there was palpable excitement in the air about the biggest Real estate opportunity in the country. Yours’ truly also found himself busy with the business suits & private jet brigade in immersing myself into .ppt presentations on the “Oh so visible” factors like demographics, policy & regulation support, demand & supply, financing & opportunity etc.

Then came the usual ‘showstoppers’. The approach of the multiple involved  agencies (DDA, MCD, State, Center, etc.etc.)  seemed mired in petty politics & pseudo legal tangles, than achievement of the stated objective of “qualitative improvement in the quality of life” of Delhi.

The progress has been slow, albeit, assurances kept flowing in from different quarters about how “Delhi would be turned into a World class Megapolis” soon.

However, hope prevails!  2011 & onwards would see the Delhi masterplan MPD 2021 galloping back into contention, and the Policy makers, investors, developers, buyers & land selling villagers & the law of the land cannot ignore the opportunity any longer.

Let me elaborate on how each stakeholder is going to benefit out of the MPD opportunity, and what their compelling motivations would be.

Policy Makers – I would like to critically look at the three essential influencers, namely the political class, various arms of the government & civic administration.

There is a cemented realization that DDA cannot remain the monopolistic real estate developer of Delhi, esp. in the context of the complex modern & contemporary requirement of infrastructure. Also, acquiring land wholesale, and subjecting it to inaction & illegal development & occupation cannot be sustained any longer. Acquiring land for a pittance from the farmers can lead to social unrest, with the increased consciousness about the multiple scams & illegal gratification allegations surrounding government development agencies. Hence, DDA would progressively evolve into a master planner, which can monitor the private developers, who would be entrusted with a much larger role in the development of Delhi NCT.

The surrounding cities of Delhi, namely, cities of UP (NOIDA), Haryana & Rajasthan evolved a much more robust Real estate market through policy initiatives attractive to the private investors & developers. Today, a Gurgaon city might be contributing almost half of the revenue to the state of Haryana on certain categories of business. I ask these four questions in retrospect.

• Wasn’t Delhi’s inaction, which allowed these cities into the backyard?
• Lacking their own captive demand, didn’t these cities fulfill the pent up demand of Delhi?
• Can Delhi coffer afford to let go the revenues of Millions?
• Wouldn’t the demand overflow back into Delhi, if the eco system becomes conducive?

Our research reveals that almost 55% of the current urbanized areas of Delhi are haphazardly developed, either as illegal colonies, unauthorized developments or Urban slums. More than 1500 colonies & clusters do not have access to basic civic infrastructure & amenities.

Some hurting statistics – In 1972, 800 unauthorized colonies were regularized in Delhi. 567 were in 1977, about 600 regularized between 1989-2002, & 1639 unauthorized colonies identified for regularization in 2009. Is this the Culture of Urban development in Delhi?

Can those who want to be re-elected afford to sell the same old “gasoline in new bottles?”

If your answer is the same as mine for the above queries, we seem to be cracking the puzzle together.

Law of the Land – If we jog our memory, in 2007, the MPD 2021 document was released in a hurry to ensure that the citizens were not affected by the various court rulings, sealing, demolitions etc. 2008 & 2009 also beckoned elections for the assembly & MCD. Collectively, some protection was delivered to the citizens like the special provisions act 2008 etc. Assuming that some provisions of the acts have lapsed as on 31.Dec’2010, would the citizen be free from the wrath of the authorities, and courts alike? Let us not forget that the Supreme Court, which is hearing many petitions, too would be keen that the development of Delhi be structured, organized & people friendly, in accordance with the MPD 2021 vision document. The courts & administrators would like one uniform document to govern the development, rather than a discretionary outlook on the development of the capital state of India.

Investors – Irrespective of the words in which described, all investors work through the cardinal truth of “return on Investment”. It is not rocket science to figure out that ROI is better achieved by catering to the captive demand, than creating supply first & then go looking for demand, at the end occupier level.

Delhi today has a projected captive shortfall of almost 2 million dwelling residential units, factoring in the population increase from 1.32 crores to 2.5 crores. Going by the demographic indices, almost 2-3 lakh able bodied educated youngsters would be the resource available to the industry, per annum, to be added into their work force.

Someone needs to be either blind, or irrelevant to miss this opportunity.

Developers – here are some statistics to chew on. I would present my case after you have digested these numbers.

• Real estate likely to contribute more nearly 15% of GDP soon
• RE would be the largest employer after agriculture
• The business potential of RE in India would cross US $150 Billion (compared to the much touted IT industry approx. US $65 billion)
• Delhi has more than 400 sq. Kms of Urbanised areas, which need redevelopment

The last sentence being specific is the attention grabber.  When we talk of development & developers, it is not just agricultural land which can be converted to building, but also, a Singapore like business opportunity. Old, defunct, dilapidated & unsafe buildings can be knocked down & reconstructed, to create more modern, contemporary, safe & quality buildings, both residential & commercial. If we look around our own colonies & neighborhood, we have these opportunities begging for attention.

Redevelopment besides, the MPD 2021 almost brings to fore fresh development opportunities in all spheres, including infrastructure, parking, SEZs, a fresh supply of virgin land exceeding 50,000 hectares. Also, developers please note that Delhi would at all times be more attractive to an institutional investor, compared to any other tier II, Tier III city.

Wasn’t Mr. Chairman right when he said that the “next Leader Company would arise from Delhi?”

Buyers – The master plan of Delhi talks extensively on the concept of integrated cities, wherein the ‘walk to work’ concept can truly be implemented. Assuming all goes to plan, aided by the multi level investments from the Center, State, MCD & local civic authority & the robust private sector, the developments under the new master plan would be a lot different than the surrounding cities.

Ask yourselves – “If you get to live where there is connectivity, better power supply scenario, the capital of the country, functional metro, local transportation, better policing & security & source of livelihood, and products in all price categories, would you still want to go a few score miles out?”

I rest my case, your honours !!!

Farmers & Land owners – Owing to the better social infrastructure in rural Delhi, the second generation of land owners in Delhi understand economics better, and aren’t averse to buying land farther, at cheaper prices, after getting their rightful price of land in Delhi. Also, it is almost recognized in all quarters of governance today that Delhi is no longer an agrarian state; why talk farming excepting vegetables.

For the private players, buying land cheaper than the NCR markets, within the boundaries of NCT, is not a challenge anymore. The caveat as usual remain, if they are aided by knowledge.

The creators of the Delhi master plan are not shouting from their rooftops about a fact, for reasons unknown. MPD 2021 document won the ISOCARP award 2008 for Urban planning, competing with 6 other cities of the world.

The recognition citation reads –”For the capacity to articulate a holistic planning at one of the most complex metropolitan areas of the world, and facing key changes that are in common in many other megalopolises of the planet: from shelter to trade and commerce, from industry to environment, from conservation of built heritage to urban design and from development code to  plan monitoring.”

In summary, if you are a stakeholder of any sort in the real estate industry, here is one opportunity you can risk “Ignoring at your own peril”

Ramesh Menon is a Director with Certes realty Ltd, a domain focused advisory firm on the Delhi Masterplan 2021