Business Line : Features / Investment World : Land row aftershocks hit Noida Extension

Business Line : Features / Investment World : Land row aftershocks hit Noida Extension

Once a bustling hub for property business, the road to Noida Extension now wears a deserted look. With the mercury soaring in Delhi NCR, one would rather stay indoors than brave the heat to go house hunting. But this summer, the sales agents of housing projects along this dusty stretch have an additional challenge to deal with – the very feasibility of the projects.

It is now almost 20 days since the Allahabad High Court struck down acquisition of over 150 hectares of land in Chak-Sahberi village at Greater Noida (dubbed Noida Extension by builders). For the large cluster of housing projects in this area, there seems to be no end to the uncertainty looming over the fate of these projects. If anything, worry lines have deepened with each passing day.

BOOKINGS PLUNGE

Over the past weeks, bookings in the market have fallen 30-40 per cent, says Mr Anuj Choudhary, Director of Panchsheel Buildtech. Industry observers reckon the figure is closer to 70-75 per cent.

Builders are attempting to put up a brave face to the crisis – some claim the worst is over and that market is getting back on its feet. Others shrug off downcast sentiments as a temporary blip. But brokers and property agents have a different story to tell. A site visit reveals just how unnerved the market is. “Hardly any follow-ups are taking place, and fresh bookings are on hold. The entire area is feeling the heat,” says a broker on conditions of anonymity.

His colleague, who shares the temporary sales stall — one of many lined up along the road - says fresh client walk-ins have tanked from the previous average of 25-30 enquiries over weekends, to just 4-5.

“It is not the builders' fault, it is a dispute between farmers and Greater NoidaAuthority,” he says but then grudgingly admits that ultimately it is the buyer who bears the brunt.

As such, Noida Extension reportedly has projects by 50-55 developers planning an overall 10,000 units, but there is no official word on how many proposed units fell on Chak-Sahberi land (only parts of Sectors 16 B and Sector 4 are impacted).

For the record, affected builders Amrapali (its Smart City project alone talked of 5,700 units) and Mahagun have offered customers a refund or option to shift to other projects nearby. Other like Supertech claim that no construction had commenced on the portion of land parcels under dispute.

BUYERS IN PANIC

But with thousands of existing buyers in panic over the fate of their booking, potential customers in the market have, overnight, turned risk averse.

A property agent, who markets projects for multiple builders in the area, notes that enquiries – occasional ones that trickle in – begin on the note “what is the guarantee that your projects will not be hit in future!”

A few kilometres away at the marketing office of Shree Builders, an irate customer wants to know the status of his apartment booked in SkyGarden project. The particular project is safe, he is told. But a verbal affirmation is hardly enough to soothe frayed nerves. “How do I know that my tower has not been affected? Who is to say exactly where the village starts and ends?” he fumes.

Sales representatives at Gaursons India are handing out press clippings which list specific sectors and projects hit by the High Court ruling. This helps clear the air over its ongoing projects that, it claims, are not directly affected.

WHY THE CONFUSION

“There is a lot of confusion on just how many units in the market have been impacted overall. This is because the Greater Noida auctions have been through plot numbers and not Khasra numbers (village land denomination),” says Mr Manoj Gaur, Managing Director, Gaursons India.

In fact, the builders' association CREDAI has requested Greater Noida Authority for a letter that will clearly outline which plots have been hit and to what extent, he adds. Prices, at least for now, remain where they were. But that could change depending on the direction of talks between the authority and farmers.

So will Noida Extension's loss yield unexpected gain for other locations – Noida, Indirapuram, Vaishali, Vasundhara, or even Raj Nagar Extension?

The opinion varies. “There is no match for infrastructure and prices that Noida Extension offers. It is only a matter of 2-3 weeks and things will return to normalcy. Already there is talk of compensation and settlement between the authority and farmers,” says Mr Choudhary of Panchsheel Buildtech.

Others are not as optimistic. “Consumers will explore ready-to-move options in Noida and Indirapuram. Given the prevailing uncertainty, they will hesitate to lock up funds into projects which have 2-3 year completion timeline,” says a real estate marketer.

Clearly the last word, on aftershocks emanating from the Greater Noida land battle, is yet to be written.