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Many Sahara real estate projects still on drawing board

March 13, 2014 08:31 IST

Many Sahara real estate projects still on drawing board

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Raghavendra Kamath in Mumbai

Sahara City Homes, housing projects of the Sahara group’s real estate arm, have the tagline Jahaan Bassey Bharat (where India lives).

A look at the progress in many of these, however, presents a different picture.

Of the 10 projects under Sahara City Homes, at least four -- in Ahmedabad (Gujarat), Aurangabad and Pune (Maharashtra) and Bareilly (Uttar Pradesh) -- have either not taken off or are stuck.

“When I booked my flat in their project in 2003, they said it would be delivered in 2007. Then they said they would do it by 2011.

“For the past two years, the project has not progressed.

“Now, they are asking us to take the money back or wait for another two years,” said Minal Trivedi, a property broker who invested in Sahara’s Ahmedabad project.

“I think they have already taken bookings for 30 per cent of the project but delivery is nowhere in sight,” Trivedi added.

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Image: Sahara Chief Subrata Roy.
Photographs: Rupak De Choudhuri/Reuters

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Many Sahara real estate projects still on drawing board

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The project, on Ahmedabad’s Outer Ring Road, is spread on 104.10 acres and was planned to have about 4,000 houses.

Sahara’s 82-acre, 2,200-apartment project in Aurangabad, too, has failed to take off. Land for it was bought 10 years ago.

“We have not seen any construction on the plot,” said a local.

A source said the group was considering selling plots where construction hadn’t started. Also, the group hadn’t bought new land since June 2013.

A mail to the Sahara group did not elicit any response.

In June 2012, Sahara Infrastructure and Housing, the  group’s  real estate arm, launched 10 townships at Shubh Aagaman, a gala event on the occasion of Sahara chief Subrata Roy’s birthday, in Lucknow.

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Image: The Sahara Star hotel near Mumbai airport.
Photographs: Danish Siddiqui/Reuters

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This was followed by similar events at all the 10 sites, including Pune, Aurangabad, Jodhpur, Gwalior, Bareilly and Porbandar.

Spread on 900 acres, the 10 projects were to offer 25,000 houses with world-class amenities.

During the launch, Sahara said the projects were under construction at eight of the sites. Sahara said overall, it would have 76 housing projects in 2012-13.

According to local realty consultants, Sahara’s project in Indore (Madhya Pradesh) is yet to be completed; construction work for this was begun seven-eight years ago.

“We were told possession for many apartments was yet to be given,” said a realty broker. Sahara’s Jaipur project is also believed to have been delayed by a year and a half.

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Image: Sahara India Pariwar Ltd made an unsolicited $600 million offer to acquire the landmark Plaza Hotel.
Photographs: Lucas Jackson/Reuters

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Late last year, Sahara’s real estate interests had come to the fore following a contempt case filed by the Securities and Exchange Board of India against Sahara India Real Estate and Sahara Housing Investment.

The Sebi counsel said a plot in the Versova area here was ‘disproportionately overvalued’.

While Sahara had arrived at a valuation of Rs 19,000 crore (Rs 190 billion), based on future developments, Sebi arrived at a valuation of Rs 118 crore (Rs 1.18 billion).

Subsequently, in public notices in newspapers, Sahara said it would “submit title deeds relating to other properties of Sahara aggregating Rs 20,000 crore (Rs 200 billion), instead of debating further on the issue raised”.

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Image: Money stacked at a bank's teller counter.
Photographs: Reuters

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But Sebi questioned the valuation of 67 other plots of land, too, saying in some cases, land purchased in 2012-13 had been valued 16 times the purchase price.

Reportedly, Sebi has also said Sahara’s luxury township Aamby Valley, estimated at Rs 10,000 crore (Rs 100 billion), is overvalued.

It said Aamby Valley was under multiple litigation cases and lacked green clearances from the state pollution control board.

(With Hrishikesh Joshi in Pune & Siddharth Kalhans in Lucknow)


Image: The Supreme Court of India.
Photographs: Reuters
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