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Kolkata residents moving to suburbs as land prices soar
The middle class in Kolkata has started migrating to the suburbs in search of affordable housing. And targeting this section are not only local realtors but investors from countries such as the UK and the US as well. After the development of the Rajarhat area northeast of the city, where a showpiece satellite township is coming up, the new target of realtors seems to be neighbouring Barasat and Madhyamgram towns in the North 24 Parganas district, and Maheshtala in South 24 Parganas. The West Bengal Housing Board has taken up a Rs.800-million joint venture housing project in Barasat with developer Bengal Shelter Housing Development, said Barasat Municipality chairman Pradip Chakraborty. ‘Our municipality is upgrading the sewerage system and augmenting water supply in a big way,’ Chakraborty said. However, most real estate development is taking place through the private sector.
One such real estate company is Eden, which is constructing several housing projects, all partially funded through foreign investment. ‘Since all our projects are financed partially through foreign funds, we have to adhere to some guidelines, which make it imperative for us to look for land that is of significant size,’ Eden chairman Indrajit De said. Under the rules, projects with foreign funding need to be spread over an area of 540,000 square feet, which roughly works out to five acres or more of land. ‘It is impossible to get such a huge tract of land within the city,’ De said. The other reason, which is driving these players out of the periphery of the city, is the escalating land price.
Earlier, De said, European funds were more aggressive in investing in real estate as business practices in Eastern Europe are very similar to that of India. But now US funds have also become very aggressive, he added. Eden is actively working with Real Estate Investment Trust (REIT) Asset Management of the UK, and recently signed an agreement with Philadelphia-based Lubert-Adler. REIT has already spent around $20 million with Eden. Another reason that made Maheshtala attractive to De’s company is that it is the only municipality in West Bengal that has its own Geographical Information System (GIS) – an information system that allows data storage for, among other applications, urban planning and logistics. Additionally, the municipality plans to widen the Budge Budge Trunk Road, which connects Maheshtala to Kolkata, from 12 metres to 25 metres.
Major residential projects in Maheshtala are Eden City and Calcutta Riverside. Several shopping malls, multiplex, clubs, sports complex with stadium, a golf course, Information Technology Park, hospitals, schools and an engineering college are also coming up in the area. At Maheshtala, flats are now selling at Rs.1, 650 per square foot. The target end users are middle class people. ‘Our focus is the low-income group and middle-income group segments. We are selling flats at Rs.1, 179 per square foot at Barasat and Rs.1, 500 per square foot at Madhyamgram,’ Padmanabh Bhartia, director of real estate developers Fortune Group said. ‘We have completed Fortune City in Madhyamgram, which has 600 flats. We have come up with another project, Fortune Township, on Jessore Road in Barasat,’ Bhartia added.
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