Chennai Metropolitan Development Authority has
given the green light to the proposal by Confederation of Real Estate
Developers’ Associations of India (CREDAI) to convert such buildings,
sources told Express. The authority had recently held a detailed
discussion on the request from CREDAI.

The buildings are likely to be converted into malls, banks or offices, builders said.

Such buildings were constructed due to incentives given by the State government to builders to promote the IT sector.

The
relaxation of floor space index (FSI) for IT buildings was another
encouragement for the builders. While the FSI for normal buildings was
1.5, it was 3.75 for IT buildings.

Now many of these buildings are lying vacant due to lack of tenants.

Sources
said the CMDA, during the meeting held last month, resolved that such
conversion of use may be permitted provided the additional FSI availed
of by developers at the time of obtaining earlier approval may be
treated as premium FSI on a case by case basis.

However, the
measure would not be beneficial for the State exchequer as the authority
has decided that the premium FSI charge may be collected at the rate of
guideline value that was prevailing at the time of obtaining earlier
planning permission.

“This could result in huge loss to the
exchequer. The CMDA should charge as per the existing guideline value
instead of the old one,” said a town planner. He also demanded that the
government abolish the concept of granting premium FSI.

The
proposal to convert IT buildings was made following slump in the IT
sector. It is believed the city has over five million square feet of
commercial space in IT buildings.

CREDAI Hails Move

The
former president of CREDAI and Chief executive officer of Akshaya
Private Limited T Chitty Babu said the move by CMDA authorities is a
welcome one. “It will help government get more revenue,” he said.

He also said that the buildings would now be converted to banks, malls, hospitals, schools and institutions.

Former national president of Builders Association of India, Radhakrishnan also welcomed the move.

“This move will be beneficial for promoters to convert the IT buildings to non-IT purpose,” he added.

However,
he said that it will be difficult to convert the IT buildings to
residential ones. These could be used for other purposes like banks,
malls or office accommodation, he added.

He also justified the
decision by CMDA’s move to charge premium FSI charge at the rate of
guideline value that was prevailing at the time of obtaining earlier
planning permission. “It is a win-win situation for both government and
builders. They are at least getting revenue from the building,” he said.

Meanwhile,
small builders say that if the government can relax rules for CREDAI
why not it consider the same for builders under the regularization
scheme. “I have built a building when the guideline value was at
previous rate and now they are charging the current rate. This is
discriminatory,” a builder said.