Transfer of Development Rights in Mumbai: Directed Research Project (Masters in Urban Planning)

Transfer of Development Rights (TDR) An assessment of its use as a planning and development tool for Mumbai Directed Research Project May 2021

Submitted by: Rithika Ravishankar | PG190766 Master of Planning (Urban Planning)

Faculty of Planning

2021 Ahmedabad, India

Guided by: Prof. Jignesh Mehta CEPT University

Copyright and Publications: The copyright for this report shall remain equally with the Guide, Student and CEPT University. All publications arising from this Directed Research Project will acknowledge the CEPT University, Center for Urban Planning and Policy (CUPP), CRDF and concerned members of the aforementioned organizations.

Center for Urban Planning and Policy (CUPP), CRDF may use the outputs of the Directed Research Project for dissemination and publicity after the consent from CEPT University and ensuring proper acknowledgment to the Student, Guide and CEPT University.

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Undertaking I, Rithika Ravishankar, the author of the DRP report titled “Transfer of Development Rights: An Assessment of Its Use as a Planning and Development Tool for Mumbai”, hereby declare that this is an independent work of mine, carried out towards partial fulfilment of the requirements for the award of Masters Degree at Faculty of Planning, CEPT University, Ahmedabad. This work has not been submitted to any other institution for the award of any Degree/Diploma.

Name of student : Rithika Ravishankar Roll No. : PG190766 Date : 25th May 2021 Place : Mumbai, Maharashtra

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Certificate This is to certify that the DRP report titled Transfer of Development Rights: An Assessment of Its Use as a Planning and Development Tool for Mumbai has been submitted by Ms. Rithika Ravishankar towards partial fulfilment of the requirements for the award of Masters Degree. This is a bona-fide work of the student and has not been submitted to any other university for award of any Degree/ Diploma.

Prof. Jignesh Mehta Programme Chair

Prof. Jignesh Mehta Guide

(MUP) Date : 25th May 2021

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Acknowledgments First and foremost, I thank my DRP guide, Prof. Jignesh Mehta, for his invaluable insights and encouragement throughout the course of the project. Working on a research subject this rich and complex, especially through a global pandemic, would have been unimaginable if not for his unending patience and motivation. Our discussions have always been inspiring and stimulating, and I shall carry them throughout my professional journey.

I am also extremely thankful to Prof. Vidyadhar Phatak, Prof.

Dr. Rutul Joshi, Prof. Dr. Subhrangsu Goswami, Mr. Avanish Pendharkar (CUPP, CRDF) and Mr. Hersh Bhasin (CRDF) for their wonderful insights and ideas to improve my research direction. I hope I have done justice to your expectations from the research and from me.

I also thank all my professors, teaching associates and the non-teaching staff at CEPT University.

I express gratitude to all my stakeholder interviewees who graciously contributed their time and industry knowledge for my research – Mr. Mallesham Kunta, Dy. Chief Engineer (B.P. department, MCGM), Ar. Ankit Jain, Mr. Kunal Chotalia (Developer), Mr. P.K. Tiwari (SRA) and Mr. S. Dhamankar (MHADA).

Our on-campus journey as a batch was short-lived, but I am extremely grateful to my chosen family for making it so memorable, both offline and online – Mr. Pratit Kumar Das, Ms. Divya Mehra, Ms. Tamanna Parvin, Mr. Palaash Roy and Mr. Akshay Kashikar.

Above all, I am deeply grateful to my Amma and Appa for their unwavering faith in my capability, and for all the love and support they have shown me throughout the testing phases of life.

You are my strength. :) Rithika Ravishankar

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Abstract

India is one of the fastest urbanizing nations in the world and, while newer urban centres are being developed, it is important to deal with the pressing urban issues in our existing cities. Local Area Plans are an effective planning instrument for such brown-field redevelopment and retrofitting. However, in compact, densified cities, the biggest challenge facing the planning authorities is making land available for public purpose. Land acquisition through monetary compensation proves expensive and time-consuming for the government, and thus, the concept of Transfer of Development Rights was introduced in India. This involves the award of virtual development rights to the landowner in lieu of the land surrendered. Presently, many Indian cities such as Mumbai, Ahmedabad, Hyderabad and Bengaluru have incorporated TDR as a statutory means of compensation – each with a different approach to the implementation of the mechanism.

This research aims to understand this mechanism in the context of Mumbai – the history of its inception, various purposes of TDR, legal framework, key stakeholders and the on-ground processes involved – and to assess its success and failure from the perspective of each stakeholder. For comparative analysis, Hyderabad’s TDR mechanism has been studied in brief to derive significant learnings for Mumbai.

Further, a set of recommendations for MCGM are proposed in its policies and institutional framework, in order to create a level-playing field for all the key stakeholders in Mumbai’s TDR mechanism.

Key words: Transfer of development rights, Mumbai, Municipal Corporation of Greater Mumbai, Road TDR, Reservation TDR, Heritage TDR, Slum TDR, Development Plan.

Word count:19,067

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Table of Contents Undertaking

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Certficate

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Acknowledgments

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Abstract

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Table of Contents

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Executive Summary

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List of Abbreviations

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List of Figures

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List of Tables

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List of Annexures

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Chapter 1: Introduction to the Research

Chapter 2: Introduction to TDR (Literature Review)

001

007

1.1.

1.2.

1.3.

1.4.

1.5.

1.6.

Background of the Study Need of the Study Research questions Aims and Objectives Research Methodology Scope and Limitations

2.1

2.2.

Traditional Planning Instruments associated with Local Area Planning A Conceptual Understanding of TDR

002 003 004 004 005 006

008 011

2.2.1. What is TDR?

011

2.2.2. Stakeholders Involved

012

2.2.3. ‘Sending’ and

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‘Receiving’ zones

013

2.2.4. What makes TDR work?

013

2.3.

TDR: Origins and Purposes at the Global Level

2.3.1. TDR in New York

014 014

2.3.2. Purposes of TDR in other

cities of the world 2.3.3. TDR in India

Chapter 3: TDR in Mumbai (Literature Review)

Chapter 4: Mumbai’s TDR mechanism

019

043

3.1. Definition and Concept of

TDR in Mumbai 3.2. Legal Provisions for the

TDR mechanism 3.3. A Timeline of TDR in Mumbai 3.4. Types and Share of TDR

4.1. Process of Applying for a DRC 4.2. Process of Utilizing TDR

014 016

020 021 023 036

044

from a DRC 4.3. TDR Transaction Studies:

How does the mechanism

vary from type-to-type?

4.3.1. Road TDR & Reservation TDR

046

4.3.1.1. Mechanism on Sending side

050

050 050

4.3.1.2. Mechanism on the

Utilizing Side

053

4.3.1.3. Assessing the types from

Stakeholders’ Perspective

4.3.2. Heritage TDR 4.3.2.1. Mechanism on Sending side

058 060 060

4.3.2.2. Mechanism on the

Utilizing Side

061

4.3.2.3. Assessing the types from

Stakeholders’ Perspective

062

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4.3.3. Slum TDR and Construction

Amenity TDR

064

4.3.3.1. What is Construction

Amenity TDR?

4.3.3.2. Mechanism on Sending side

064 064

4.3.3.3. Mechanism on the

Receiving Side

067

4.3.3.4. Assessing the types from

Chapter 5: Assessing the TDR mechanism in Mumbai

Chapter 6: Case Study: TDR in Hyderabad

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073

081

Stakeholders’ Perspective

5.1. Win-loss assessment

5.1.1. For TDR seller

5.1.2. For TDR buyer

5.1.3 For MCGM and the city 5.2. Social Justice 5.3 Advantages to stakeholders 5.4 Summary of Issues to Stakeholders 6.1. Definition and Purposes of

TDR in Hyderabad 6.2. Legal provisions for TDR mechanism 6.3. A Timeline of TDR in

Hyderabad 6.4. Mechanism for TDR generation 6.5. Mechanism for TDR utilization 6.6. Hyderabad’s Online TDR

Portal and TDR Bank 6.7. Assessing Hyderabad’s

TDR mechanism: Key

Learnings for Mumbai

069

074 075 076 077 078 079

082 083 084 085 086 087

088

Chapter 7: Conclusion and Recommendations

091

7.1. An Overview of the Study

and Issues 7.2. Recommendations

for Mumbai’s TDR mechanism

7.2.1. Type-wise recommendations

7.2.2. For Institutional Framework

7.2.3. For Regulations 7.3. Future Research Direction

092

093 093 095 097 098

References

100

Annexures

104

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EXECUTIVE SUMMARY

Executive Summary Transfer of Development Rights is an instrument which allows unused development potential to be granted to the land owner as virtual development rights in lieu of a land parcel or part thereof reserved for public purpose by the ULB. After transferring the unencumbered plot to the appropriate authority, he/she can utilize these rights on their own plot or trade in the open market for monetary gain.

This mechanism allows the government to circumvent the costly acquisition process and to involve the private sector in the provision of public amenities. TDR has been adopted by multiple cities across the world, such as New York, Hong Kong etc. In India, major cities like Mumbai, Ahmedabad, Hyderabad, Bengaluru and, recently, Indore have introduced this tool as part of their development regulations or as a dedicated policy.

In India, the Municipal Corporation of Greater Mumbai (MCGM) pioneered the use of TDR in 1991. Since then, multiple recommendations and changes have been made to the mechanism, which have had far-reaching consequences on the city’s growth. There is, however, a lack of impact evaluation that could inform policy decisions for the future.

This research gap can be addressed through the following research questions: To evaluate What was the intended purpose of TDR for Mumbai? Is it being served optimally?

Where and whom is the mechanism serving?

To rationalize Is there a need to improve the mechanism?

What needs to be done to improve it and make it work for the identified purposes in Mumbai?

Aims and Objectives

1 2

To study and understand the TDR mechanism, and the various purposes for which it is used To assess the existing TDR mechanism in Mumbai and suggest improvements such that it becomes more viable and desirable for all key stakeholders (TDR seller, buyer, the authority and the city in general)

Below are the key objectives of the research are:

a.

To understand the TDR mechanism, its various components and the purposes for which it is used

b.

To study and analyze the existing TDR mechanism in Mumbai and identify the issues from all stakeholders’ perspectives

c.

To conduct a comparative analysis with the TDR mechanism of another Indian city, (a) To assess their success and failure (b) To translate it into learnings for Mumbai

d.

To suggest recommendations for improvement in MCGM’s TDR mechanism to create a level-playing field for a wide range of stakeholders

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Methodology After establishing the aims, objectives and scope of the research, a thorough review of existing literature, regulations and policies followed. For understanding the on-ground challenges, key person stakeholder interviews were conducted. Real-life case studies of onground TDR transactions for each type of TDR were studied to understand its profitability for the stakeholders. For a comparative assessment, the TDR mechanism of Hyderabad was also studied and key learnings were derived for Mumbai. Finally, a set of recommendations were drafted for MCGM to create a levelplaying field for all the key stakeholders of the TDR mechanism.

Findings and Recommendations What was the intended purpose of TDR for Mumbai? Is it being served optimally?

The intention of introducing TDR in Mumbai was principled: to free up land for providing public amenities which would enhance the quality of life of its citizens. With road, reservation and heritage TDR, MCGM had a certain level of control on the supply side of TDR. With the introduction of slum TDR, however, MCGM became a spectator to the TDR market being flooded with millions of square meters of TDR. The supply and demand of TDR were now both completely in the control

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Executive Summary

of market forces. MCGM suitably liberalized its TDR policy in 2016, possibly in an attempt to allow for quicker consumption of existing TDR stock and to reinforce its initial intent of TDR as a planning instrument for provision of roads and public amenities. Presently, TDRs for road and reservation are fairly serving their purpose.

Active steps are required to revive heritage TDR and to revise the slum TDR incentives and regulations.

Where and whom is the mechanism serving?

TDR is a market-driven mechanism in Mumbai.

Large-scale infrastructure companies and developers benefit the most, since the present mechanism allows them to influence both the supply and demand side of the TDR market.

TDR is also a key source of funding for the implementation of DP 2034.The small-time sellers and buyers of TDR are the ones at a disadvantage due to the lack of transparency in the mechanism. This is due to the involvement of a few large developers in the TDR market, who purchase large shares of TDR from the market, partially monopolizing it. This also leaves a common citizen absolutely oblivious to the inner workings of the TDR market.

Additionally, the city is burdened by years of wanton use of TDR, without due consideration to the status of trunk infrastructure, transport systems and housing stock. The recurring issue is the lack of a transparent, level-playing field for stakeholders of all scales.

Recommendations A. For Institutional Framework

B. For Policies and Regulations

Creation of a TDR Cell in MCGM, for:

a.

Conducting periodic ward-wise assessments of TDR carrying capacity

b.

Planning TDR sending-receiving zones in conjunction with the Development Plan & Building Proposals department

c.

Processing DRC proposals and renewals

d.

Offering techno-legal support to citizens for the generation of TDR, especially for senior citizens

e.

Generating awareness among citizens about the advantages of TDR as the better means of compensation

f.

Monitoring transactions

g.

Assisting MHCC in scrutinizing heritage TDR proposals and determining quantum of TDR to be awarded

h.

and

recording

TDR

a.

Changes may be allowed in TDR regulations as and when the need arises, and not only when DP-DCPRs are being prepared (Flexible regulation)

b.

Sale and purchase of TDR may be permitted across MMR to create a larger demand for TDR

c.

Incentive for each type of TDR may be flexible to respond to DP project requirements so that faster implementation of the DP can be facilitated

d.

Type-wise recommendations as described in section 7.2.1 may be implemented to address individual stakeholders’ concerns

e.

A spatial plan of sending and receiving zones may be created on the basis of multiple factors such as:

Creating and monitoring an online TDR Exchange Bank: i.

i.

Adequate civic infrastructure to

absorb dense development ii. Locations where developers

(i.e., TDR buyers) find market potential iii.

Consistent with DP projects and initiatives

To facilitate transparent exchange of TDR on a common online platform.

ii. To reduce cartelization, red-tapism and the dependence on middlemen such as TDR brokers. iii. To act as a buyer of last resort in case a DRC holder is unable to dispose of their TDR within expiry duration.

f.

Promoting higher density along T.O.D. corridors by relaxing the cap on permissible TDR

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List of Abbreviations A

B

C D

F-G

H-L

M

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AH AO AR ASI ASR BDD BDPAC BEST BJP BP BUA CBRE CREDAI CDS DCPR DCR DP DRC DU FSI G.O.Ms. GDP GHMC GoM HMDA INTACH LAA LAP LLP LOI LOS MA & UD

Affordable Housing Assessing Officer Accommodation Reservation Archaeological Survey of India Annual Statement of Rates Bombay Development Department Bombay Development Plan Advisory Committee Brihanmumbai Electricity Supply and Transport Bharatiya Janata Party Building Proposals Built-Up Area Coldwell Banker Richard Ellis Confederation of Real Estate Developers’ Associations of India Cluster Development Scheme Development Control and Promotion Regulations Development Control Regulations Development Plan Development Rights Certificate Dwelling Unit Floor Space Index Government Order Manuscript Gross Domestic Product Greater Hyderabad Municipal Corporation Government of Maharashtra Hyderabad Metropolitan Development Authority Indian National Trust for Art and Cultural Heritage Land Acquisition Act Local Area Plan Limited Liability Partnership Letter of Intent Layout Open Space Municipal Administration and Urban Development

M

MCGB MCGM MHADA MHCC MMRDA MoHUA MR & TP MUIP MUTP NA N NBFC NDZ NGO NSDF OSD O-R PAP R&R RFCTLARR

S

T-U

RRR SDZ SPA SPARC SRA SRDP SRP SRS SSNS TDR TP ULB URDPFI

Municipal Corporation of Greater Bombay Municipal Corporation of Greater Mumbai Maharashtra Housing & Area Development Authority Mumbai Heritage Conservation Committee Mumbai Metropolitan Region Development Authority Ministry of Housing and Urban Affairs Maharashtra Regional and Town Planning Mumbai Urban Infrastructure Project Mumbai Urban Transport Project Natural Area Non-Banking Financial Company Non-Development Zone Non-Government Organization National Slum Dwellers Federation Open Space Deficiency Project Affected Persons Rehabilitation and Resettlement Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Ready Reckoner Rate Special Development Zone Special Planning Authority/Area Society for the Promotion of Area Resource Centers Slum Rehabilitation Authority Strategic Road Development Project Slum Rehabilitation Project Slum Redevelopment Scheme SPARC Samudaya Nirman Sahayak Transfer of Development Rights / Tradable Development Rights Town Planning Urban Local Body Urban and Regional Development Plans Formulation and Implementation

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List of Figures Chapter 1 Fig. 1(i) Fig. 1(ii)

: Urban issues which compromise quality of life : Research methodology

002 005

Chapter 2 Fig. 2(i) Fig. 2(ii) Fig. 2(iii) Fig. 2(iv) Fig. 2(v) Fig. 2(vi) Fig. 2(vii)

: : : : : : :

Comparing open space per capita across cities Map of India , highlighted cities with highest GDP share Urban issues requiring radical reforms through LAP TDR transaction between land owner and ULB as a means of compensation Key stakeholders in the TDR mechanism World map, highlighted cities with TDR Map of India , highlighted states having TDR programs

008 009 009 011 012 015 017

Key Stakeholders in Mumbai’s TDR program Notified areas under different SPAs Extent of Bombay’s reclamation Non-receiving zones for TDR Hutments at Dadar station (ward G) Island City Hutments beside the main water pipeline to downtown Bombay, Dadar Single-room tenement chawls built in the 1920–40s Slum locations identified in 1976 Land owning agency of slum settlements in 1976 Total slum TDR generated between 1997 and 2015 Lower land prices in areas with more PAP projects in 2000 Esplanade Mansion, Fort awaiting conservation repairs; Inset: Esplanade in the 1860s Timeline of key events pertaining to TDR in Mumbai DR generation and utilization statistics for Mumbai Ward-wise share of each type of TDR generated between 1993-2020 Ward-wise share of each type of TDR utilized between 2016-20

021 022 023 024 027 027 027 028

Chapter 3 : : : : : : : : Fig. 3(ix) : Fig. 3(x) : Fig. 3(xi) : Fig. 3(xii) : Fig. 3(i) Fig. 3(ii) Fig. 3(iii) Fig. 3(iv) Fig. 3(v) Fig. 3(vi) Fig. 3(vii) Fig. 3(viii)

Fig. 3(xiii) Fig. 3(xiv) Fig. 3(xv) Fig. 3(xvi)

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: : : :

028 031 031 033 035 040 041 041

Chapter 4 : : : :

Fig. 4(i) Fig. 4(ii) Fig. 4(iii) Fig. 4(iv)

:

Fig. 4(v)

:

Fig. 4(vi) Fig. 4(vii) Fig. 4(viii) Fig. 4(ix) Fig. 4(x) Fig. 4(xi)

: : : : : : : : :

Fig. 4(xii) Fig. 4(xiii) Fig. 4(xiv) Fig. 4(xv)

Zones for processing building proposals; each zone has its own BP office Sample of Slum TDR (Stage 3) DRC Sample of DRC with utilization and buyers’ details indicated Total road TDR generated between 1993 and 2020, subdivided into (a) 1993 to 2015 and (b) 2016 to 2020 Total reservation TDR generated between 1993 and 2020, subdivided into (a) 1993 to 2015 and (b) 2016 to 2020 Road TDR utilized between 2016 and 2020 Reservation TDR utilized between 2016 and 2020 Summary of 1 Road TDR D.R.C. Ward-wise estimation of per capita demand gap in public amenities Total heritage TDR generated Total Slum TDR generated between 1997 and 2020, subdivided into (a) 1997 to 2015 and (b) 2016 to 2020 TDR utilized between 1993 and 2000 Slum TDR utilized between 2016 and 2020 Trend of TDR generation between 2016 and 2020: Decline of slum TDR Ward-wise data of SRPs completed vs pending

047 048 049 051 052 055 055 057 059 061 066 068 068 070 071

Chapter 6 Hyderabad old city Original plot potential, without road widening Plot potential after road widening and award of TDR Usable TDR area calculator based on market values of generating site and receiving site Fig. 6(v) : Areas permitted to use TDR in Hyderabad Fig. 6(vi) : Processes related to TDR which can be executed using the GHMC TDR Bank portal Fig. 6(vii) : Snapshots of the TDR Bank and DPMS portal interface for

083 085 085

application, sale and use of TDR Fig. 6(viii) : Lakefronts, flyover projects and heritage areas in Hyderabad

087 089

Fig. 6(i) Fig. 6(ii) Fig. 6(iii) Fig. 6(iv)

: : : :

086 086 087

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Chapter 7 Fig. 7(i)

: Existing institutional framework in MCGM for all processes pertaining to TDR Fig. 7(ii) : Proposed institutional framework in MCGM for all processes pertaining to TDR Fig. 7(iii) : Proposed special TDR receiving zones along metro corridors Fig. 7(iv) : Map of MMRDA

095 096 097 098

List of Tables Table 1 Table 2 Table 3 Table 4 Table 5

: : : : :

Entitlement for TDR in lieu of land surrendered for road and reservation FSI distribution in Mumbai Entitlement for TDR for heritage conservation Advantages for stakeholders Issues for stakeholders

050 054 060 078 079

List of Annexures Annex. 1 : Re-estimating Ward wise land area demand and provision considering FSI for built up amenities Annex. 2 : Calculating incentive FSI for construction of sale tenements in a 33(10) slum rehabilitation project Annex. 3 : Hyderabad: Citizen Application process Annex. 4 : Hyderabad: TDR utilization process

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104 105 106 107

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Source: Johnny Collins Photography

1 Introduction to the Research

1.1 1.2 1.3 1.4 1.5 1.6

Background of the Study Need of the Study Research questions Aims and Objectives Research Methodology Scope and Limitations

1.1 Background of the study Cities of India are driving massive transformation at the global scale and, yet, public investments in urban infrastructure up-gradation fall short due to a paucity of financial resources at the local level of governance. While cities such as Mumbai induce large-scale rural-to-urban migration for employment, a majority of the workforce leads a sub-optimal quality of life due to the lack of provision and access to sound urban infrastructure. Planning for urban renewal is, therefore, the need of the hour in Indian mega-cities. This allows authorities to: a.

Upgrade and extend infrastructure networks b.

Provide essential public amenities c.

Create public open spaces d.

Conserve built heritage in the city’s

congested locales Urban Local Bodies (ULBs) have traditionally achieved these objectives through land acquisition. Through this mechanism, ownership of private land parcels identified for public use in the Development Plan (D.P.) are transferred to the government, with due monetary compensation to the original land owner. However, this process has exorbitant cost implications on the ULB. It also proves time-consuming due to litigation in ownership records and the landowner’s dissatisfaction regarding the compensation.

2

Introduction to the Research

Fig. 1(i): Urban issues which compromise quality of life

Thus, over the years, multiple alternatives have been developed by cities all across the world to unlock land for public purpose, without having to acquire them by coercion.

One such robust alternative is the mechanism of Transferable Development Rights (TDR).

What is TDR? TDR is the unused development potential granted to the land owner as virtual development rights in lieu of a land parcel or part thereof reserved for public purpose by the ULB. After transferring the unencumbered plot to the appropriate authority, he/she can utilize these rights on their own plot or trade in the open market for monetary gain. This mechanism allows the government to circumvent the costly acquisition process and to involve the private sector in the provision of public amenities.

TDR has been adopted by multiple cities across the world, such as New York, Seattle, Singapore etc. In India, major cities like Mumbai, Ahmedabad, Hyderabad and, recently, Indore have introduced this tool as part of their development regulations or as a separate policy.

This research aims to evaluate TDR mechanism and their practices in Indian cities, focusing on Mumbai, identify the issues and propose cityspecific recommendations for the mechanism to function optimally.

In India, the Municipal Corporation of Greater Mumbai (MCGM) pioneered the use of TDR in 1991 as a policy instrument to

allow acquisition of private lands for public purpose at practically no cost to the urban local body (ULB). Over the years, different kinds of TDR – road TDR, reservation TDR, slum TDR and heritage TDR – have been utilized to manage the density in the island city and generate growth in the northern suburbs of Mumbai. However, today, despite several attempts by MCGM to manage TDR transactions in an equitable manner, the scenario remains highly imbalanced and unorganized.

1.2 Need for the Research Why is it important to make TDR work?

Mumbai faces land scarcity due to geographical constraints, but the large number of properties due for redevelopment pose a great opportunity to unlock and extract the full potential of land in the city. This could not only alleviate the acute housing shortage, but also promote conservation of built heritage, and create public open spaces and other civic amenities in the congested areas of the city.

It is, therefore, crucial to address the shortfalls of the TDR mechanism and sustain its applicability to drive future developments in Mumbai. This research proposes to identify these shortfalls and develop solutions for their mitigation, such that the use of TDR becomes viable in Mumbai.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

3

1.3 Research Questions Since 1991, multiple recommendations and changes have been made to the TDR mechanism in Mumbai, which have had farreaching consequences on the city’s growth.

There is, however, a lack of impact evaluation that could inform policy decisions for the future rather than the current ‘putting out fires as they come up’ approach. This research gap can be addressed through the following research questions: To evaluate What was the intended purpose of TDR for Mumbai? Is it being served optimally?

Where and whom is the mechanism serving?

And to rationalize Is there a need to improve the mechanism?

What needs to be done to improve it and make it work for the identified purposes in Mumbai?

1.4 Aims and Objectives

1 2

4

To study and understand the TDR mechanism, and the various purposes for which it is used To assess the existing TDR mechanism in Mumbai and suggest improvements such that it becomes more viable and desirable for all key stakeholders (TDR seller, buyer, the authority and the city in general)

Introduction to the Research

The aim is dichotomized into the following objectives: To understand the TDR mechanism, its various components and the purposes for which it is used

To study and analyze the existing TDR mechanism in Mumbai and identify the issues from all stakeholders’ perspectives

To conduct a comparative analysis with the TDR mechanism of another Indian city, (a) To assess their success and failure (b) To translate it into learnings for Mumbai

To suggest recommendations for improvement in MCGM’s TDR mechanism to create a level-playing field for a wide range of stakeholders

1.5 Research Methodology The nature of the research topic and key research objectives require a mixed-methods approach, combining both qualitative and quantitative data for analysis. The methodology requires a thorough review of regulations and policies for qualitative analysis, as well as

insight into the on-ground TDR transactions and the quantifiable value it creates in terms of profit for the stakeholders. The research shall utilize both primary and secondary data sources of a descriptive nature to understand the cause-and-effect relationship between various events related to TDR. The step-wise methodology is as follows:

Fig. 1(ii):Research Methodology

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

5

1.6 Scope and Limitations The research will explore the TDR mechanism of Mumbai from its inception to the present situation majorly through a study of acts, policies and other secondary data. Gaps in research and assessment of onground implementation of the mechanism are obtained through primary sources – which includes interviews with representatives of stakeholders. Each type of TDR will be evaluated for its profitability to the seller through sample case studies extracted from MCGM records. The research also entails a comparative study of the TDR mechanism in Hyderabad from secondary sources. Based on the above learnings, recommendations specific to the city of Mumbai are proposed.

Due to time and safety constraints, it was not possible to gather raw data of TDR utilization prior to 2016. Prices of TDR for each ward of Mumbai was also not available as common knowledge, due to the influence of large companies in the market dynamics. Contact was attempted to be made with sellers of TDR, but the researcher received no response.

Since Mumbai poses a unique case, the scope of recommendations will be limited for MCGM, applicable in Greater Mumbai jurisdiction. They will not have universal application. It is not in the scope of this research to invalidate/replace other methods of acquiring land for public purpose.

6

Introduction to the Research

2 Introduction to T.D.R.

2.1

2.2.

2.3.

Traditional Planning Instruments associated with Local Area Planning A Conceptual Understanding of TDR TDR: Origins and Purposes at the Global Level

Source: Unknown

7

2.1 Traditional Planning

instruments associated

with Local Area Planning By the year 2030, it is estimated that the urban population of India will contribute up to 75% of the Gross Domestic Product (GDP), an increase from the current 63%. The joint report

by CBRE and CREDAI, however, also states that radical reforms would be required in terms of infrastructure up-gradation, since most Indian cities are challenged by the detriments of poor infrastructure – lack of affordable housing, overcrowding, traffic congestion, environmental degradation and air pollution (Gupta, 2019). While upcoming urban centers can address these challenges at the nascent stage, it is the existing Indian mega-cities such as Mumbai and Delhi which require carefully strategized public infrastructure interventions, since they run the risk of disrupting concentrated economic activities. A key aspect of livability is public open spaces and recreational areas, in which Indian cities are highly deficient. The URDPFI guidelines, 2014 prescribe 10-12 sq.m. of open space per capita. The existing scenario in Indian cities, however, is poor.

As a rapidly developing nation, it is imperative to enhance livability in the existing cities along with promoting urbanization, as these cities are major hubs for migration and are susceptible to infrastructure overload and subsequent failure. In such a scenario, unplanned sprawl is imminent, which not only compounds the issue of infrastructure service delivery but also gives rise to a host of other problems such as increased commute time and rapid growth of substandard housing to meet the surging demand.

For this purpose, the Local Area Planning approach proves effective. By the Smart Cities Mission of the Ministry of Housing and Urban Affairs (MoHUA), Local Area based Plans (LAPs) are the prescribed physical planning tools for redeveloping existing brown-field areas and enhancing public spaces and amenities (MoHUA, 2018). This is key for meeting the requirement of planned and serviced urban areas for systematic urbanization.

Lack of Public Open Spaces in Major Metropolitan Cities (area per capita) Fig. 2(i): Comparing open space per capita across cities

Data Source: Dhindaw & Mehta (2020)

8

Introduction to TDR

URDPFI 10-12 m2

Chennai 0.81 m2

Mumbai 1.28 m2

Bengaluru 2.0 m2

Fig.2(ii) Map of India , highlighted cities with highest GDP share Data Source: Business World, June 2017

Ahmedabad $ 68 bn

Delhi $ 294 bn

Surat $ 60 bn

Kolkata $ 150 bn

Mumbai $ 310 bn

Vizag bn

$ 44

Need Need Need Need for for for for Urban Urban Urban Urban Renewal Renewal Renewal Renewal

Pune $ 69 bn

GDP GDP GDP GDP contribution contribution contribution contribution 63 63 63 63 %%% %from from from from cities, cities, cities, cities, inin2019 inin 2019 2019 2019 Bengaluru $ 110

bn

1 1of 1of 1of 49 of 49 49 49

Hyderabad $ 75 bn GDP GDP GDP GDP contribution contribution contribution contribution %%%from %from from from cities, cities, cities, cities, byby by 2030 by 2030 2030 2030 Chennai $ 79 bn

75 75 75 75

HOWEVER, HOWEVER, HOWEVER, HOWEVER,

Radical Radical Radical Radical reforms reforms reforms reforms would would would would be be be required be required required required totoaddress: to to address: address: address:

Lack Lack Lack Lack ofofofof Lack of affordable affordable affordable affordable affordable housing housing housing housing housing

Poor Poor Poor Poor infra infra infra infra Poor infra systems systems systems systems and and and and systems and amenities amenities amenities amenities amenities

Traffic Traffic Traffic Traffic Traffic congestion congestion congestion congestion && &&& congestion overcrowding overcrowding overcrowding overcrowding overcrowding

Environmental Environmental Environmental Environmental Environmental degradation, degradation, degradation, degradation, degradation, airair air pollution air pollution pollution pollution air pollution

Fig.2(iii): Urban issues requiring radical reforms through LAP

Lack Lack Lack Lack ofofof public of public public public open open open open spaces spaces spaces spaces ininmajor inin major major major metropolitan metropolitan metropolitan metropolitan cities cities cities cities (area (area (area (area per per per capita) per capita) capita) capita)

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

9

Traditionally, the Land Acquisition Act of 1894 enabled city planning authorities to compulsorily acquire land for public purposes by awarding monetary compensation to the owner. Subsequently, this act was replaced with the ‘Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement’ (RFCTLARR), 2013 or, simply, the LARR Act. Apprehensions regarding the exacerbated cost implication of land acquisition on the planning and development authority led various states in India to devise alternate strategies for land procurement.

While instruments like Town Planning Schemes, which allow for voluntary surrender of land for pooling and readjustment, are in place for greenfield development, there are no standard guidelines or instruments for brownfield redevelopment as it is a relatively new concept in India. Hence, incorporating and mandating local area plans as a statutory level of planning has proven to be quite an uphill task, as compulsory land acquisition remains largely the only method to create space for providing public amenities. The LARR Act, 2013 introduced a level of fairness and transparency by enabling public participation through consultation – thereby reducing the coercive power of the Land Acquisition Act. However, it came with its own disadvantages for the ULB:

10

Introduction to TDR

a.

Costlier

process

due

to

increased

compensation factor – twice the market value in urban areas and four times in villages;

b.

Higher administrative costs associated with ownership litigation, public consultation and obtaining consent;

c.

Liability to provide rehabilitation to the project-affected persons at the ULB’s own cost;

d.

Strict stipulation of time period for mobilizing funds to construct the amenity, after which land would be de-reserved & returned to the original owner.

Due to the stringent norms involved in land acquisition, “more than 435 infrastructure projects have been delayed due to delay in getting timely possession of the land and delay in getting required regulatory approvals, as per a recent report submitted in the Parliament in December 2018,” (Pandey, 2019). Most of the ULBs in India possess neither the financial nor the institutional capacity to fund the acquisition of land as well as the provision of the required public amenity. Thus, there was a dire need for a non-monetary compensation mechanism that would not only allow for an easy, fair transfer of land to the government but also enable private involvement in the provision of public services. This was made possible through the Transfer of Development Rights (TDR).

2.2 A Conceptual

Understanding of TDR 2.2.1 What is TDR? Transfer of Development Rights (TDR) is a mechanism that allows the planning/ development authority to acquire private land parcels for public purpose and award virtual development rights in proportion to the area surrendered, as a means of compensation to the original land owner. TDR is used for a number of purposes such as environmental, heritage or agricultural conservation, or the provision of public amenities and infrastructure. It is also an important tool for planners to regulate development trends in different areas of the city by demarcating distinct zones for conservation or densification. The underlying legal assumption of TDR is that all land parcels have a bundle of property rights – right of possession, control, exclusion, enjoyment and disposition (Kenton, 2020). Each TDR program varies in the extent of property rights transferred to the local government.

Utilization on own plot

Section 3.2.3.4 of the URDPFI guidelines, 2014, of India define TDR as:

“… a technique of land development which separates the development potential of a particular parcel of land from it and allows its use elsewhere within the defined zones of the city. It allows the owner to sell the development rights of a particular parcel of land to another.

The entitlement is over and above the usual FSI available for receiving plot in accordance with the prevailing laws and regulations, which entitles a land owner to construct additional built-up area on his existing building or vacant land” (MoHUA, 2015).

Development rights

Sale in open market

Ownership Landowner

Urban local body Fig.2(iv): TDR transaction between land owner and ULB as a means of compensation

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

11

2.2.2 Stakeholders Involved TDR is a market-driven instrument, which is subject to the dynamics of supply and demand for real estate. The primary transaction which sets the wheels of the TDR mechanism in motion is between two key stakeholders: i) the seller of TDR: An individual / group of individuals / organization who are in possession of virtual development rights in lieu of fulfilment of any criteria which makes them eligible to be compensated with TDR ii) the buyer of TDR: An individual / group of individuals / organization who wish to purchase additional development rights for the use of the full plot potential The seller transfers their development rights to the buyer in exchange of monetary compensation. Depending on the design of the TDR program for a city, there are intermediaries or middlemen who become a part of the mechanism as facilitators of trade.

Landowner

The third stakeholder is this transaction is the iii) local government or planning authorities, who are the overarching supervisors of the mechanism:

a.

They demarcate zones which instruct sellers regarding their TDR generation potential and sanction TDR certificates

b.

They establish the framework in which TDR sale and purchase are conducted

c.

They lay down regulations for manner of utilization to adhere to for the buyer of TDR

The last key stakeholder is the city and its citizens in general. Any policy intervention has a tremendous impact on the quality of life of the citizens and thus, the needs of the city and its people must be taken into consideration.

Development Rights

Seller of TDR

Buyer of TDR

ULB and the city Fig.2(v): Key stakeholders in the TDR mechanism

12

Developer

Introduction to TDR

2.2.3 ‘Sending’ and ‘Receiving’ zones

2.2.4 What makes TDR work?

‘Sending’ zones are areas that are important to the city or local communities, and require to be protected from development. This includes agricultural lands, recreational spaces, public green spaces, water bodies or heritage precincts.

Sending zones also include areas marked by the local authorities in the statutory plans for public purposes like construction of roads or housing. Since TDR is often a voluntary option of compensation, the owner of a plot falling in the sending zone has the choice to enter into an agreement with the local authority which dictates the nature of development on their land parcel. Such an agreement makes the land owner eligible for the award of TDR in proportion to the area so relinquished to the government.

TDR is advantageous for the urban local bodies since it allows them to circumvent the financial burden and legal complications of land acquisition through monetary compensation. It also works for landowners because monetary compensation paid by local bodies is not always fair and, comparatively, TDR poses an opportunity to sell their development rights at market value. The time taken to obtain compensation is also far less. However, TDR programs are not always met with success. There are certain crucial factors which determine the success or failure of TDR programs, which vary from city to city. A few such factors are:

‘Receiving’ zones, typically, are demarcated in areas which are ready for high density development, in the sense of infrastructure capacity and economic activities. These zones are marked by local governments or planning authorities in a manner that allows the decentralization of development and expansion of the city limits. Buyers of TDR – developers, builders or individual plot owns – are generally motivated to purchase TDR if the basic development rights are limited. Thus, in receiving zones, they can use TDR to exceed the floor space permitted as per the local ordinance.

b. Public support and compliance for the use of TDR

a. An enabling legislative and regulatory framework

c. Whether the program is mandatory or voluntary d. A mechanism that responds to the prevalent land use pattern and demand e. Adequate demand for TDR and clear sending-receiving zones f.

Simplicity and cost efficiency of the program

g. Institution of TDR banks

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

13

2.3. TDR: Origins & Purposes at the Global Level New York City, NY

Across the world, TDR has been used in many urban centres for various purposes to achieve city-specific objectives. However, it was the city of New York which pioneered the concept of TDR in 1916, for the purpose of heritage preservation.

Washington DC

Seattle, WA

2.3.1 TDR in New York

King County, WA

TDR was first used conceptually in New York City as a zoning ordinance – a restrictive strategy for preserving heritage structures and open spaces. This required the unbundling of property rights, thereby allowing a lot owner to continue to possess and occupy the property, but to relinquish his rights to develop or modify the structure in any manner. The “air rights” so generated were allowed to be sold to adjoining lots within the zone, where high-density floor space was permitted. Over the years, TDR has primarily been used as a tool for preservation and not densification in New York, due to the high Floor Space Index (FSI) which eliminates the need to use TDR to add floor space.

Los Angeles, CA Need for Urban Renewal contribution 63% GDP from cities, in 2019

Ahmedabad $

68bn

$

$

$

Bengaluru

$

Fig. Map of India , highlighted cities with highest GDP share Data Source: Business World, June 2017

TDR programs have been practiced in over 30 states in the US since the 1960s, with 248 programs covering over 4400 sq.km.

14

Introduction to TDR

Traffic congestion & overcrowding

Environmental degradation, air pollution

Lack of public open spaces in major metropolitan cities

San Francisco, CA

44bn

(area per capita)

75bn

Chennai

110bn

2.3.2 Purposes of TDR in other cities

of the world

Poor infra systems and amenities

Hyderabad

69bn

INTRODUCTION

Cupertino, CA

Vizag $

Pune

$

HOWEVER, Radical reforms would be required to address:

150bn

Lack of affordable housing

310bn

$

294bn

Kolkata

60bn

Mumbai $

GDP contribution from cities, by 2030

Delhi

Surat

$

75%

1 of 49

79bn

URDPFI standards 10-12 m2

Montgomery County

REVIEW 4

Chennai 0.81 m2

Mumbai 1.28 m2

Bengaluru 2.0 m2

(Source: CBRE-CREDAI report)

TDR: USE AND VIABILITY IN LOCAL AREA PLANNING IN INDIAN CITIES | MUMBAI

Pine Lands, NJ

Alachua County, FL

of agricultural land, natural areas and open spaces (Nelson, et al., 2011). Successful TDR programs in New York include Montgomery County, Seattle and King County, the New Jersey Pinelands, Maryland and Collier

Road widening

Heritage conservation

Reservation for civic amenities

Community Revitalization

Fig. 2(vi): World map, highlighted cities with TDR; Data Source: Various

Vancouver, Canada

Taiwan, China

Hong Kong, China

Tokyo, Japan

Curitiba, Brazil

Germany-Belgium

Turkey

Need for Urban Renewal contribution 63% GDP from cities, in 2019 Ahmedabad $

GDP contribution from cities, by 2030

Sydney, Australia

Delhi

68bn

$

Surat $

75%

1 of 49

294bn

HOWEVER, Radical reforms would be required to address:

Kolkata

60bn

$

150bn

Agricultural farmlands

Rural Character preservation Lack of Poor infra

affordable housing

systems and amenities

Traffic management Traffic congestion & overcrowding

Construction of amenity

Environmental degradation, air pollution

cities County, Florida, to name a few (Harman, inetmajor metropolitan as illustrated in the map, above. Heritage al., 2015). With time, the concept spread to and farmland conservation are the most many European cities and was subsequently popular purposes of TDR globally. Some URDPFI standards implemented in many cities across 10-12 allm the innovative uses of TDR include community Chennai Mumbai Bengaluru 0.81 m 1.28 m 2.0 m continents, for a wide range of purposes, revitalization and traffic management.

Lack of public open spaces

Mumbai 310bn

$

Pune $

69bn

Bengaluru $

110bn

Vizag

$

(area per capita)

44bn

Hyderabad $

75bn

Chennai $

79bn

2

2

Fig. Map of India , highlighted cities with highest GDP share Data Source: Business World, June 2017

INTRODUCTION

REVIEW 4

2

2

(Source: CBRE-CREDAI report)

TDR: USE AND VIABILITY IN LOCAL AREA PLANNING IN INDIAN CITIES | MUMBAI

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

15

2.3.3 TDR in India

In India, TDR was introduced in 1991 for the city of Mumbai for the purpose of reserving land for public amenities – which was the biggest challenge faced by city authorities in Mumbai and many other Indian cities at the time. Based on the Mumbai model, rapidly urbanizing cities such as Ahmedabad and Hyderabad incorporated TDR as a compensation mechanism through their development regulations. Presently, numerous cities and states across the country have adopted TDR, primarily as an instrument to avoid monetary compensation for land acquisition.

TDR programs are provided for in different states and cities either in the building regulations or bye laws, a Town and Country Planning Act or a dedicated TDR policy, which is applicable for the entire state or at the individual ULB level. For instance, in 2016, Maharashtra Government enacted two different comprehensive TDR and AR policies – for Greater Mumbai and for the rest of the divisions in the state such as Pune, Nagpur, Nashik and so on. Of all the TDR programs in India, Mumbai, having spearheaded the concept, presents the most interesting case to assess the factors causing the success and failure of TDR. In the following chapters, the prevalent TDR mechanism for Mumbai is explored in detail.

16

Introduction to TDR

Punjab Haryana Rajasthan Bihar Jharkhand Madhya Pradesh

Rajastha

Gujarat Odisha

Gujarat

Maharashtra Telangana Andhra Pradesh Goa

Goa

K

Karnataka Tamil Nadu Kerala

Ker

Guwahati Assam

Ahmedabad Gujarat

Punjab Haryana

Nagpur

Maharashtra

an Bihar

Madhya Pradesh

Jharkhand

Odisha

Maharashtra

Telangana

Maharashtra

Pune Maharashtra

Hyderabad Telangana

Andhra Pradesh

Karnataka

rala

Mumbai

Bengaluru Karnataka

Tamil Nadu

Chennai

Tamil Nadu

Fig.2(vii):

Map of India , highlighted states having TDR programs Data Source: TDR guidelines, NITI Aayog (2020)

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

17

Source: Author

18

3 TDR in Mumbai

3.1.

3.2.

3.3.

3.4.

Definition and Concept of TDR in Mumbai Legal Provisions for the TDR mechanism A Timeline of TDR in Mumbai Types and Share of TDR

19

3.1 Definition and Concept

of TDR in Mumbai

To achieve the objective of acquiring land earmarked for public purpose in the Development Plan for Mumbai, there are three mechanisms:

Monetary Compensation

Accommodation Reservation

Transfer of Development Rights

As stipulated in the LARR Act, 2013, the appropriate planning authority can compulsorily acquire land reserved for a public purpose by paying monetary compensation of 2.2 times the Ready Reckoner Rate of the land to the owner/lessee.

In 1991, AR was introduced as a tool to incentivise the landowner to develop the reserved amenity on a land-sharing basis – thereby allowing the owner to continue holding the ownership of land and also developing the intended amenity.

However, this option has not yielded successful results in the past with regard to amenity implementation, which was in the range of 5-40% in the 1967 DP due to challenges in compulsory acquisition.

This, too, was not met with much enthusiasm by the landowners since they viewed any kind of reservation with a negative connotation, preferring the dereservation of their land parcel.

Along with AR, TDR was introduced in 1991 as part of the Development Control Regulations for Greater Mumbai. Of the three, TDR has been the most successful instrument for DP implementation by far.

TDR in Mumbai is defined as “compensation in the form of Floor Space Index (FSI) or development rights which shall entitle the owner for construction of built-up area subject to provisions in this regulation” (MCGM, 2016).

5%

80%

10%

of total land acquisition for DP 2034 proposed through monetary compensation

Acquisition of lands proposed with AR

Acquisition of lands proposed with TDR

Source: DP 2034 Report, MCGM 2016

20

TDR in Mumbai

3.2. Legal Provisions for the

TDR mechanism The manner and conditions of generation and utilization of TDR were stipulated in Regulation 34 and Appendix IV and VII of the Development Control Regulations, 1991 and, presently, in Regulation 32 of the Development Control and Promotion Regulations, 2034.

Apart from the DCRs, TDR for Mumbai is enabled by the following statutory acts: (i)

Section 22, Maharashtra Regional and Town Planning Act, 1966 modified in 1994 with retrospective effect, to act as the legal basis for TDR as a statutory means of compensation for land acquisition

(ii)

Section 3.2.3.4, URDPFI guidelines, 2014

(iii) Mumbai Municipal Corporation (MMC) Act, 1888

Awards TDR in exchange of ownership

The framework for TDR comprises of transactions between three key stakeholders (Fig. 3(i)) – the seller of TDR (Sending area), the buyer of TDR (Receiving area) and MCGM which is the overarching authority linking the buyer and the seller. The fundamental transaction is between the DRC holder in the sending area and the developer of a land parcel in the receiving area.

However, MCGM sets the gears of this transaction in motion by stipulating the provisions for award of TDR to the landowner in exchange of ownership rights. It also supervises the utilization of TDR through regulations and grant of approvals. The trade of development rights is also facilitated by MCGM, since it establishes the institutional and statutory framework for TDR transactions.

Sets regulations and permits use of TDR

MCGM

Establishes framework for transaction Development Rights

Plots from which TDR is generated

Sending area (Land owner)

Receiving area (TDR buyer)

Plots on which TDR is utilized

Fig.3(i): Key Stakeholders in Mumbai’s TDR program

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

21

There are multiple planning authorities which are permitted to use TDR as a compensation mechanism in Greater Mumbai, with their jurisdictions as indicated in Fig. 3(ii).

Some of these are: i) Municipal Corporation of Greater

Mumbai (MCGM) ii)

Slum Rehabilitation Authority (SRA)

iii)

Maharashtra Housing and Area Development Authority (MHADA)

iv)

Mumbai Metropolitan Regional Development Authority (MMRDA)

However, the authority to sanction the award and utilization of TDR lies solely with MCGM. It is also the sole authority that can dictate the sending and receiving zones in the city through regulations and spatial plans. The other authorities shall recommend the extent to which TDR is to be awarded to the landowner, through a letter addressed to the Municipal Commissioner and the Chief Engineer of the Development Plan department, MCGM. Areas under Special Planning Authorities (SPAs) jurisdiction Fig.3 (ii): Notified areas under different SPAs Source: EDDP 2034, MCGM, 2015

Authorities permitted to use TDR as a compensation mechanism in Greater Mumbai

22

TDR in Mumbai

Despite TDR being introduced in Mumbai in 1991, the foundation for its inception was laid as early as in the 1970s, when the need for a fiscally efficient mechanism for compensation was sought by the city authorities. TDR has a rich history in the context of Mumbai, marked with many significant events and policy changes which have had sustained impacts on the city’s growth. These key events are described in the section 3.3.

3.3. A Timeline of TDR

in Mumbai

I.

MR & TP Act is Enacted and Mumbai gets its First Development Plan

The history of Mumbai dates back to the 17th century, when a set of seven disparate islands under Portuguese control, populated by fishermen and small-time cultivators, was “transferred to the English Crown, as a treaty accompanying the marriage of Charles II and Catherine of Braganza” in 1661 (Riding, 2018). The islands were subsequently handed over to the East India Company, who spearheaded and completed the reclamation of the seven islands into one contiguous land mass by mid-19th century – the city as we know it today. There were no notable endeavors for city planning in Mumbai until 1898, when a massive outbreak of bubonic plague necessitated the creation of the Bombay City Improvement Trust. The Bombay Town Planning Act of 1915 was the first formal enactment of town planning legislation in India, which provided for: a.

Preparation of town planning schemes for new and built-up areas in the Urban Local Body’s jurisdiction, and

b.

Levying betterment charges on benefiting land owners, and other potential sources of revenue for the planning authority to fund the implementation process (Jiashal, 2013)

Fig.3(iii): Extent of Bombay’s reclamation Source: oldphotosbombay.blogspot.com

Post-independence, the need for city planning and an enabling legislative mechanism was sought to achieve holistic city development rather than the piecemeal planning which had resulted from the TP schemes under the Bombay Town Planning Act. This led to the revision of the Act in 1954, mandating the creation of Development Plans. After the separation of the Bombay Presidency into Maharashtra and Gujarat states in 1960, the Maharashtra Regional and Town Planning (MR & TP) Act, 1966 was enacted to achieve the following objectives mentioned in the Act’s Preamble:

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

23

a. “To make provision for planning the development and use of land in ‘regions’ established for the purpose and constitution of Regional Planning Boards b. To make better provisions for the preparation of Development Plans with a view to ensuring that Town Planning Schemes are made in a proper manner and their execution is made effective c. To provide for creation of New Towns by means of Development Authorities d. To make provisions for the compulsory acquisition of land required for public purposes in respect of the plans” (Jiashal, 2013), reinforcing the government’s eminent domain as stipulated in the Land Acquisition Act, 1894 Under the scope of the MR & TP Act, the Municipal Corporation of Greater Bombay (MCGB) rolled out the first statutory Development Plan for Mumbai (then Bombay) in 1967, along with the Development Control Regulations (DCRs). The 1967 DP, planned for a horizon period up till 1981, focused on the planned provision of amenities, decentralizing industries and shifting the population to the suburbs. Adopting the classical planning approach stipulated in the MR & TP Act, MCGB reserved 1876 plots of an area approximately equal to 1142 hectares (11.42 sq.km.) in the city for the creation of public and social amenities and infrastructure. At the time, it was estimated that the 1991 DP implementation would cost MCGM about ₹700 crores (Nainan, 2012).

24

TDR in Mumbai

II.

Introduction of TDR in Mumbai’s Development Plan 1991

During the existing situation study conducted for the preparation of the next development plan, the 1984 Report on the Draft Development Plan (Revised) 1981-2001 by MCGB revealed that until 1978, 38% of the estimated DP budget had been spent towards implementing a mere 20% of the 1967 DP (Nainan, 2012). The main reasons MCGB listed for this failure were: a. Financial constraints due to the absence of an inbuilt revenue generation mechanism for DP implementation b. Increased cost towards acquisition of reserved land parcels, due to a rapidly developing land market c. Procedural delays in the land acquisition process due to encumbrances on reserved lands and financial inability of MCGB to rehabilitate site dwellers d. No public participation in the DP process

Out of the 1876 plots reserved for amenities, only 712 plots could be acquired between 1978 and 1990; 413 under the Land Acquisition Act and another 299 under the Urban Land Ceiling and Regulation Act. To address the land acquisition challenge, MCGB’s report recommended three alternatives for generating revenue – i) modify the MR & TP Act to compensate the land owners at prevalent market rate, ii) allow MCGB to levy betterment charges on areas benefitted by a certain proposal in the DP which has increased property values, and iii) allow a Development Tax Cess to be levied by MCGB when land parcels undergo development.

TDR was introduced much later in the draft report “as a ‘policy to allow the owners of the lands reserved for various social amenities in the development plan to develop the said plots for combined uses thereby getting the reservation site developed for the amenity for which such land is reserved at the same time allowing the owner to get certain potential of the plot for his beneficial use’ (MCGB 1984, point 14.4.4.5 of chapter XIV)” (Nainan, 2012). This concept was also supported by a group of ‘pro-growth’ real-estate property developers aspiring to trigger rapid built development by restructuring the land market,

with the backing of certain bureaucrats and politicians. They argued that land acquisition was just the first step of creating amenities and that most of the designated amenities could not be developed on the acquired plots, resulting in the de-reservation of almost 1380 plots in the mid-1980s. The incentive for land owners was simply not adequate and, additionally, MCGB did not have an organized funding mechanism for developing amenities.

The use of TDR was further endorsed by the Bombay Development Plan Advisory Committee (BDPAC), also known as the D’Souza Committee of 1986 – who perceived TDR and AR as a way for the government to avoid the costs associated with mandatory acquisition. Such compensation would also be fairer, since it would allow them to utilize the due development potential of the plot. With due consideration to the recommendations of the D’Souza and the Afzulpurkar committees and the suggestions/objections received from the public consultations for the draft Development Plan of 1984, MCGB introduced Transfer of Development Rights as a statutory DP instrument for land acquisition and development in 1991, alongside monetary compensation and AR (Accommodation Reservation). This event marked the much-needed liberalization of the land market.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

25

Necessary amendments were made to the MR & TP Act to act as the legal basis for the implementation of TDR instrument. TDR was to be awarded for surrendering land for road widening, reservation, construction of designated amenities, and conservation of heritage areas/structures. The related regulations were detailed in Rule (34) and Appendix VII of DCR 1991. As a measure to avoid further congestion in the southern wards of the city, MCGM restricted the utilization of TDR to the ‘north of the generating plot’ and ‘outside the island city’. Additionally, certain areas of the city were disallowed from using TDR, as listed below: a.

“Between the tracks of Western Railway and Swami Vivekanand road on its west and the Western Express Highway on its east

b.

Between the tracks of Central Railway and Lal Bahadur Shastri road on its west and the Eastern Express Highway on its east

c.

On plots falling within 50 meters on roads on which no new shops are permitted

d.

Coastal areas, NDZs, industrial land and Tourism Development Zones

e.

In areas for which MMRDA or MHADA in the special planning authority

f.

26

For housing schemes of stum dwellers in which additional FSI is permissible In areas where permissible FSI is less than 1” (Chavan, 2006)

TDR in Mumbai

SV Road W.E.H. W/Rly LBS Road C/Rly E.E.H.

TDR Non-receiving zones: Railway corridors Coastal areas and NDZ Island City Fig.3(iv): Non-receiving zones for TDR Data source: Mehta, 1995

III.

The Rise and Fall of Slum TDR (1997-2006)

Mumbai’s industrialization and thriving mill culture attracted millions of migrants from across the country since the 1850s, which gave rise to the city’s chawls. By the year 1911, almost 80% of the city’s population lived in chawls (Sanyal, 2018) which were either mill-owned or provided by the colonial government (for e.g., the BDD chawls in Worli). However, the workforce population continued to cluster around the mills and the chawl housing supply rapidly fell short – leading to the creation of slum settlements.

Up until the 1970s, the Government resorted to an aggressive response to such ‘illegal’ settlements, by forceful demolition to clear the dwellers. However, this did not address the problem, as the dishoused migrants would construct their temporary housing elsewhere in the vicinity. 1970s onwards, slum structures were to be tolerated as a housing solution and by the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act of 1971, slums removed for public purpose had to be mandatorily relocated elsewhere by the city authorities. But, the cost of rehabilitation was enormous and, thus, MCGM sought a cross-subsidization mechanism that would allow them to engage the private sector in the provision of rehab housing. In 1995, the Shiv Sena-BJP (Bhartiya Janata Party) alliance rose to power as the ruling party in Mumbai.

Fig.3(v): Hutments at Dadar station (ward G) Island City; Source: G O’Hare

Fig.3(vi): Hutments beside the main water pipeline to downtown Bombay, Dadar; Source: G O’Hare

Fig.3(vii): Single-room tenement chawls built in the 1920–40s.; Source: G O’Hare

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

27

Around the same time, the Government of Maharashtra, accepting the Afzulpurkar Committee’s recommendations, amended the Maharashtra Slum Areas Act. This provided for the creation of a Slum Rehabilitation Authority (SRA) as a Special Planning Authority for Mumbai, with effect from 25th December 1995 (Department History, SRA).

The ruling alliance had committed to providing free housing to 40 lakh hutment dwellers in the Greater Mumbai jurisdiction in their ‘Vachan Nama’ (party manifesto). The responsibility of realizing this commitment was assigned to SRA (SRA GoM, 1997), through Slum Rehabilitation Projects (SRPs) approved under the Slum Rehabilitation Scheme (SRS), 1996. This was a mammoth undertaking, since it required not only the acquisition of land for slum / project-affected persons (PAP) rehabilitation but also the construction of close to a million rehab tenements. No urban local body or even state government could afford such a gargantuan fiscal burden.

Fig.3(viii): Slum locations identified in 1976 Source: Risbud (2003) 7% 7%16%

A study group was appointed to assess the on-ground situation, which showed that more50% than half of slum dwellers had occupied land belonging to the state or city government i.e., public land. The foremost recommendation of the committee was that slums should be redeveloped in-situ – which could be achieved

28

TDR in Mumbai

Central Government 16%

Central Government

State Government State Government

Municipal Corporation

50%

18%18%

9%

9%

Municipal Corporation

Housing Board Housing Board Private individuals

Private individuals

Fig.3(ix): Land owning agency of slum settlements in 1976; Source: Risbud (2003)

“in about 80 percent of cases where slums were located on land reserved for public amenities” (Burra, 2005). The committee also devised a financing mechanism through the grant of additional FSI. Quoting from the committee’s report – “There has to be a relationship between the square footage required for the rehabilitation of slum dwellers, including other items of expenditure such as transit camps, and off-site and on-site infrastructure development on the one hand, and the square footage to be made available for free sale on the other, to ensure that the project is self-financing”.

(Burra, 2005) In October 1997, Slum TDR was introduced in Mumbai by the addition of Appendix VII(B) to DCR 1991. This allowed for the award of TDR against the free provision of land and construction of 225 sq.ft. tenements for slum dwellers/PAP rehabilitation. Slum TDR was aimed at harnessing private sector participation on a voluntary basis as compared to the other types, which were dictated by DP reservations. This also meant that the onus of slum TDR generation (and, by extension, provision of rehab housing) rested mostly on big-ticket private players such as developers and builders, unlike other types of TDR where individuals could also own and

trade TDR – since it required a considerable amount of initial capital investment towards construction, rent/maintenance for the slum dwellers until the project was completed, and an infrastructure development charge levied

by MCGB. The introduction of ‘No Development Zones’ (NDZs) and protection of coastal wetlands in Mumbai stipulated in the 1991 DP decreased the developable land in the city. This was exacerbated by the low Floor Space Index of 1.33 and 1.0 in island city and the suburban areas respectively. The scarcity of naturally available development rights was conducive to the demand of TDR, since developers were now required to purchase TDR to utilize the full plot potential. With the introduction of slum TDR, the generation of TDR was also in the control of developers and thus, slum TDR became preferred over road and reservation TDR. There were two prime reasons for the rapid rise of slum TDR: Developers could construct the slum/ PAP rehabilitation in an area with low land prices (such as the eastern wards L, M/E and M/W) and utilize the generated incentive FSI in areas with high land prices and real estate demand (such as the western suburb wards H/W and K/W), thereby generating higher profits Slum TDR was the only type of TDR which was permitted to be used in the restricted corridors (arterial roads, railway corridors etc) and was cheaper to utilize

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

29

The benefit of rehabilitation was initially extended to “all slum and pavement dwellers who could establish that their names were on the electoral roll as on 1st January 1995” (Burra, 2005). Subsequently, this cut-off date was increased to January 1, 2000 by the State Government. At this point, there was massive opposition by a group of citizens, led by a non-profit judicial activist group called Janhit Manch, against the unrestrained use of TDR in the suburbs and the restricted corridors.

In their Public Interest Litigation filed in 2004, they argued that the ‘indiscriminate use of TDR will burden the suburbs without creating adequate infrastructure like open spaces, roads and drainage’ (Chinoy, 2006) and they proposed that the sanction of TDR be with due consideration to the carrying capacity of the receiving plot. The Mumbai High Court stayed the use of TDR in the corridors, but soon, this stay was vacated on grounds of large quantum of frozen TDR and pressure from the builders’ guild. The cut-off date for rehabilitation eligibility, however, was rolled back to 1995.

Another important reason for MCGM not curtailing the construction boom in the suburbs is the income from property taxes and other related fees. A large majority of the properties in the island city are rent-controlled, and property tax is levied on the rent and not the market value. There is resistance from the residents of island city – most of whom are multinational business houses and thus, powerful political

30

TDR in Mumbai

allies – to pay higher property taxes and thus, to pander to their demands, MCGM has used TDR as a “currency”, as Professor Vidyadhar Phatak (former Chief Planner, MMRDA) puts it.

These legal fluctuations caused a significant impact on the generation and demand for TDR. Between 1997 and 2005, almost 35.5 lakh sq.mt. of slum TDR had been generated (Nainan, 2012). In 2004 alone, 10 lakh sq.m. of slum TDR was sanctioned due to a surge of SRPs for rehabilitating slum dwellers affected by infrastructure projects under Mumbai Urban Transport Project (MUTP) and Mumbai Urban Infrastructure Project (MUIP) (Bharucha, 2018). The 2004 stay caused about 2 lakh sq.m. of TDR to be unused – a value which compounded to 4.2 lakh sq.m., worth ₹ 2000 crores after development, by 2006. Between 2009 and 2015, there was a major dip in the demand for TDR due to multiple reasons:

a. Stagnant property market: low sales, high unsold inventory

b. Confusion and delay in implementation of the new DP, no new projects

c. NBFC funding for builders withdrawn, builders facing liquidity crunch (Bharucha, 2018)

Dahisar R/N

Borivali R/CEN

Dahisar R/N

Charkop R/S Borivali R/CEN

Dahisar Malad R/N

P/N

Dahisar R/N

Borivali R/CEN

Charkop R/S

Goregaon Malad P/N P/S Borivali

Mulund T

Charkop R/S R/CEN

Malad P/N

Charkop

Andheri K/W

R/S Goregaon P/S

Malad P/N Goregaon P/S

Vile Parle K/E

Mulund T

Mulund T

Andheri K/WGoregaon P/S

Andheri K/W

Bhandup S

K/W

Kurla

Bhandup S

Ghatkopar N

Vile Parle ChemburL Kurla K/E Ghatkopar L M/W N Santacruz

Bandra H/W

Mahim Bandra Santacruz G/NH/W

H/E

H/E

Kurla L

Matunga F/N

Chembur Santacruz H/EM/W Mahim

Bandra Mahim H/W G/N

Matunga F/N

Parel G/S Walkeshwar F/S D Lower Parel Mandvi Byculla Parel G/S Fort B E F/S Byculla C Walkeshwar E

o o 0

1

0

1

2 2

Colaba Colaba A

o o

A

km 4

22

Deonar M/E

Legend: Legend

Slum_TDR_G

< 1 lakh sq.m. < 1 lakh m2 Slum_TDR_G 2 lakh sq.m.

1-2 lakh m<21 lakh sq.m.1 -Legend - 5 lakh sq.m.

2-5 lakh m1 2- 2 lakh sq.m.2 Slum_TDR_G Slum_TDR_G < 1 lakh sq.m.

5 - 15 lakh sq.m.

5-15 lakh m22- 5 lakh sq.m. < 1 lakh sq.m.

1 -- 27.5 2 lakh sq.m.

15 lakh lakh sq.m.

15-27.5 lakh m52- 15 lakh 1sq.m.

- 2 lakh sq.m.

Legend

Legend

2 - 5 lakh sq.m.

15 lakh - 27.5 lakh sq.m.

2 - 5 lakh sq.m.

km 4

0 0 11

Mandvi Walkeshwar Byculla Fort B D E Mandvi C Walkeshwar Fort B Colaba D Mandvi C A Fort B Colaba C A

Deonar M/E

Deonar

Chembur Matunga M/E F/N M/W

G/N

D

Deonar Ghatkopar M/E N Chembur M/W

G/N

Lower Parel Matunga Parel G/S F/N F/S Mahim

Lower Parel Byculla Parel Lower Parel G/S F/SE

Bhandup S

Kurla Bhandup Ghatkopar Vile Parle L S N K/E

VileSantacruz Parle Bandra K/E Andheri H/E H/W

Mulund T

km km 44

5 - 15 lakh sq.m.

Fig.3(x): Total slum TDR Fig.3(xi): Lower land prices in areas with 5 - 15 lakh sq.m.

15 lakh lakhsq.m.

- 27.5 lakh sq.m.

15 lakh - 27.5 generated between 1997 and 2015 more PAP projects in 2000 (Nainan, 2012)

The real question is, has slum TDR fulfilled its intended purpose as a cross-subsidization instrument for rehab housing? According to SRA’s records, a total of 1481 Slum Rehabilitation projects have been sanctioned since 1990, of which only 394 projects have been fully constructed, further of which only 112 have been handed over to SRA. In the 20 years of the SRS, only 10% of the city’s 12 lakh slum families (including PAP) have found new homes (“Boost for Controversial SRA Scheme”, 2019).

In contrast, over 75 lakh sq.m. of slum TDR has been used by developers to construct towers and redevelop housing societies in the suburbs. More than half of this has been utilized between Bandra and Andheri, areas with the most expensive real estate in the suburbs (Bharucha, 2018). Housing experts have criticized slum TDR, pointing out that the instrument has only benefited builders and developers, allowing them to construct luxury housing on slum lands under the pretext of slum clearance (Bharucha, 2018).

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

31

IV.

2016 Policy Modification Impact of the Relaxation

and

In 2015, there was a short-lived revival of the TDR generation market, when the new draft TDR policy was to be introduced. There were multiple radical changes to be introduced through the 2016 notification, significant ones being:

road and reservation TDR generation

a.

disincentives associated with generation

b.

c.

The stipulation that ‘TDR can only be used outside island city and towards the north of the sending plot’ was to be scrapped The amount of TDR awarded was to be linked to the Ready Reckoner Rate of the sending and receiving plot i.e., TDR would be indexed to implement a value-to-value transfer system TDR utilization was to be linked with the width of the road fronting the receiving plot – no plot with road < 9m width would be permitted to use TDR

Before these changes could be implemented, developers clamoured to purchase TDR since the new mechanism would result in greater TDR cost, implying greater project cost.

Additionally, since a large number of roads in the suburbs are narrow, more than 90% of the projects in the suburbs would be at a disadvantage due to reduced FSI (Kamath, 2015). Following the enactment of the 2016 TDR policy modification on 17th November 2016, the increased incentive for road

32

TDR in Mumbai

have boosted the demand for these types.

Presently, new projects in the island city as well as peripheral suburbs are utilizing reservation TDR on a larger scale. The lack of new slum/PAP projects as well as the and use have led to a slowdown in the slum TDR market. The on-going Covid-19 pandemic has affected real estate activities, causing an overall reduction in the demand for TDR. However, MCGM’s recent move to halve the expenses borne by developers towards various premiums is expected to have a significant impact on the TDR market dynamics as well.

V.

The Failure of Heritage TDR

There was another type of TDR in Mumbai which was languishing from a lack of conducive policy decisions. Heritage TDR was introduced in Appendix VII-A of DCR 1991 through a government notification (DCR/1090/3197/RDP/UD11 dt.

21.04.1995) to identify and protect heritage structures, neighbourhoods and precincts in the city. According to INTACH guidelines for listing of built heritage, heritage structures are categorized as follows:

I

National or historic importance, no structural changes allowed

II

Local importance, possessing special architectural/historic value

III

Buildings/precincts that do not normally qualify for permanent retention, but contribute to the character of the area

A&B

In 1999, a list of heritage buildings and precincts was prepared, categorized into three grades as given above. A Heritage Committee was established to review the development proposals related to the city’s heritage. However, around the same time, a redevelopment scheme was introduced to encourage redevelopment of dilapidated cessed buildings, exempting such buildings from having to take committee permission by paying a cess to the state housing board (Chandrashekhar, 2017). This marked the beginning of the expansion of heritage exemptions for Grade III buildings and precincts. In 2009, the 700 sq.ft. cap on maximum size of redeveloped flats was removed, promoting the development of larger, luxurious apartments in expensive areas. This proved to be a major incentive for developers to construct housing in the luxury segment. Adaptive reuse – i.e., redevelopment without demolition – of

Fig.3(xii): Esplanade Mansion, Fort awaiting conservation repairs; Inset: Esplanade in the 1860s Source: Mumbai Mirror, 2019

heritage buildings is rarely opted for, owing to the added need for design resources. There have been very few takers for Heritage TDR generation, due to the ambiguity in the design guidelines for conservation which have been issued but not notified. Opting for cessed building redevelopment yielded far greater development rights and proved to be more profitable than the measly incentive offered for conservation. Many owners feel irked by the autocratic restriction of development on their plots, considering their location in the most prime areas of Mumbai. These parameters culminated into the failure of heritage TDR and today, redevelopment activities continue to shrink the boundaries of the city’s heritage precincts.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

33

Slu introduced in

Quantum of TDR generated

Slum Redevelopment Scheme (SRS) sanctioned

Shiv Sena comes to power in Maharashtra TDR adopted in Mumbai as part of DCR 1991 for road and reservation TDR part of Draft Regulation bill Recommendation of D’Souza Committee MR & TP Act passed in Maha.

1912

TDR conceived in New York

34

1966

TDR in Mumbai

1st D.P. for Mumbai sanctioned

1967

1984

1991

1995

1996

10 lakh m2 Slum TDR generated in a single year 10 lakh m2

um TDR Mumbai

Excess supply of TDR, prices crash 8 lakh m2

Proposal to scrap ‘north of plot’ stipulation

TDR policy modification: 6 lakh m2 Relaxation in use, indexation MCGM considering levy of stamp duty on TDR transaction 4 lakh m2

2 lakh m2

1997

2004

2009

2015

2016

2020

2021

Fig.3(xiii): Timeline of key events pertaining to TDR in Mumbai from inception to present day, also indicating type-wise fluctuation in TDR generation

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

35

3.4 Purposes and Share

of TDR in Mumbai By the provision in the MR & TP Act and Regulation 32 of the Development Control and Promotion Regulations (DCPR), 2034, TDR is awarded in lieu of land surrendered for the following purposes:

a.

b.

c.

d.

e.

36

For reserved land in the draft or final DP to be acquired for public purposes, new roads, road widening or any other deemed reservation, as per the provisions of the MR & TP Act, 1966

f.

necessary by the Government and enforced through DCPR modification

g.

“If the owner of an unreserved accessible plot not falling in SDZ/ NA is willing to offer the land for

For lands proposed for the construction of new roads or road widening under the scope of Mumbai Municipal Corporation Act, 1888 For developing or constructing the buildable amenity for which the land is reserved

Any additional purposes as deemed

public purpose and the Municipal Commissioner, MCGM is of the opinion that such land is suitable for public purpose then such land shall be deemed to be a reservation and eligible for grant of TDR under this regulation.

h.

The TDR of lands owned by

For the conservation of any heritage structure or precinct against the loss of development rights borne by the owner/lessee due to restrictions imposed by the Heritage Committee

Central Govt./State Govt. and its

For the construction of rehabilitation housing for slum dwellers or PAP, in compliance with the standards and regulations enforced by the MR & TP Act, 1966

However, TDR shall not be eligible

TDR in Mumbai

undertakings and which are allotted by payment of market value & which are reserved in Development plan for public purpose shall be eligible. to the lands under reservations which are granted on lease at concessional rates by the Central Govt. and State Govt.” (DP Dept., MCGM, 2016)

Cases where TDR is not permitted as compensation

There are also certain cases where compensation in the form of TDR is not permissible. These are:

a.

For lands previously acquired for which the owner has already been compensated fully or in part by any means

b.

For lands whose award has been declared and is valid under the LAA, 1894 or LARR, 2013, unless the appropriate authority withdraws the award

c.

For plots with layouts sanctioned before DCPR 2034 and the layout roads have been incorporated as D.P. roads

d.

For lands whose lawful possession has been taken by mutual agreement /or contract

e.

For provision of required mandatory open space or L.O.S. as per regulation

f.

Incentive TDR awarded within 1,2,3 and 5 years of the 2016 notification are not applicable for deemed reservations, existing nalla, tanks and other water bodies (MCGM, 2016)

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

Source: Unknown

37

Road TDR 10.3% of total TDR generated

Reservation TDR 28.3% of total TDR generated

Heritage TDR 0.02% of total TDR generated

38

TDR in Mumbai

This type of TDR is awarded in lieu of land surrendered free of cost for the purpose of road widening and/or construction of new roads proposed in the Development Plan or under the Mumbai Municipal Corporation Act. This does not include private roads such as internal means of access.

This type of TDR is awarded in lieu of land surrendered unencumbered and free of cost, which is reserved in the Development Plan for public purposes (buildable and non-buildable amenities). Public purposes for which TDR is awarded include: Playgrounds, gardens & recreation grounds

Library, community wellness centers

BEST depot & staff quarters, Export Office

Reservoirs Fire stations

Municipal gardens and exercise grounds

Public housing (MHADA)

Primary and secondary schools

Public Parking lot

As stipulated in regulation 52 of the DCPR, the owner/lessee of any structure demarcated as heritage structure or part of a heritage precinct who suffers a loss of Development Rights due to restrictions imposed by MCGM, the State Government or any appropriate authority, is eligible for the award of Heritage TDR. The list of heritage structures/precincts is as notified by the State Government or Municipal Commissioner of MCGM, with the consultation of Mumbai Heritage Conservation Committee (MHCC).

Construction Amenity TDR

This type of TDR is awarded to any land owner/lessee/developer who makes land available for slum/PAP rehabilitation and also constructs the rehabilitation tenements on the plot. It is also awarded for the construction of amenities and/or transit camps for the slum dwellers. The instances that are eligible for the award of slum TDR are in accordance with regulations:

Slum TDR 61.4% of total TDR generated

33(7)

When a land owner / lessee develops or constructs the proposed amenity on the surrendered plot with the approval of the Municipal Commissioner, and hands over such a constructed amenity to MCGM free of cost, he/she is eligible for the award of this type of TDR in addition to the land TDR. The constructed amenity should meet the prescribed standards (under the MR & TP Act) to the satisfaction of the city authorities.

Reconstruction/redevelopment of cessed buildings in the Island City by Co-operative Housing Societies or of old buildings belonging to MCGM

33(8)

Construction of Affordable Housing in Special Development Zone (SDZ)

33(9)

Reconstruction or redevelopment of Cluster(s) of Buildings under Cluster Development Scheme(s) (CDS)

33(10)

Redevelopment for Rehabilitation of Slum Dwellers

33(11)

Provisions relating to Permanent Transit Camp tenements for Slum Rehabilitation Scheme

33

Development of AH/R&R on private plot or plot of authority other than Govt./MCGM/ Appropriate Authority

(20B)

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

39

Share of different TDR types Slum TDR is the most successful category of TDR in Mumbai, based on quantum. Despite it being introduced much after road and reservation TDR, it quickly surpassed them in numbers, as they gave developers control on the supply side of TDR as well.

Presently, it is also the most utilized TDR, followed by road and reservation TDR. Heritage TDR scores poorly overall due to the low incentives for generation. Due to the low availability of both slum and heritage TDR, these are the most expensive TDR types.

9000000

1600 1382

1400

7000000

1200 1001

6000000

1000 798

5000000

800

4000000

600

3000000

400

2000000 1000000 0

5

1

36.7L

13.2L

79.6L

2091

1800

Reservation

Road

Slum

Heritage

DCR 33(7)

TDR issued (sq.m.)

No. of DRCs

% generation of each type of TDR Res. Res.

Road Road

Slum Slum

Her. Her.

91% 91%

91% 91%

99% 99%

60% 60%

utilized utilized

utilized utilized

utilized utilized

utilizationofofeach eachtype typeofofTDR TDR %%utilization

Fig.3(xiv): TDR generation and utilization statistics for Mumbai

40

TDR in Mumbai

utilized utilized

200 0

Number of DRCs issued

TDR issued (Area in sq.m.)

8000000

R/N R/N

Charkop Charkop R/S R/S

Charkop Charkop R/S R/S

Malad Malad P/N P/N

Malad Malad P/N P/N

Goregaon Goregaon P/S P/S

Mulund Mulund T T

Dahisar R/N

Borivali Vile R/CEN

Parle Vile Parle K/E K/E

Andheri Andheri K/W K/W

Bhandup Bhandup S S Charkop Kurla Kurla R/S L L

Malad P/N

Santacruz Santacruz H/E H/E

Ghatkopar Ghatkopar N N

Andheri K/W Mahim

Matunga Matunga F/N F/N Bandra H/W

Lower Parel Lower Parel G/S G/S

Walkeshwar Walkeshwar D D

Parel Parel F/S F/S Byculla Byculla E E Fort Fort C C

Mandvi B B

Colaba Colaba A A

0

1

2

Mahim G/N

Deonar M/E

Fort C

Chembur M/W

Chembur Chembur M/W M/W

Deonar Deonar M/E M/E

Byculla Byculla EE Walkeshwar Walkeshwar D D Mandvi Mandvi Legend Legend Fort Fort BB CC TDR_Gen

Legend: TDR_Gen

300,000 300,000 Colaba

2 3,00,000 m Legend

o

TDR_Gen

Slum TDR

Reservation TDR Road TDR

km 4

Ghatkopar Ghatkopar N N

Santacruz Santacruz H/E H/E

Parel Parel F/S F/S

Parel F/S Byculla E Mandvi B

Kurla Kurla LL

Mahim Mahim Matunga G/N Matunga G/N F/N F/N Lower Parel Lower Parel G/S G/S

Matunga F/N

Colaba A

o

Ghatkopar N

Lower Parel G/S Mandvi

Walkeshwar D

km 4km 4

Bandra Bandra H/W H/W

Kurla L

Santacruz H/E

Bhandup Bhandup SS

Mulund T

Bhandup M/E S M/E

Chembur Chembur M/W M/W

Mulund Mulund TT

Andheri Andheri K/W K/W

Deonar Deonar

Vile Parle K/E

Mahim G/N G/N

Goregaon Goregaon P/S P/S

VileParle Parle Vile K/E K/E

Goregaon P/S

Bandra Bandra H/W H/W

Dahisar Dahisar R/N R/N

Borivali Borivali R/CEN R/CEN

Borivali Borivali R/CEN R/CEN

00

km Heritage TDR km

11

22

44

Colaba AA

Slum_TDR_G Slum_TDR_G 300,000 Res_TDR_G Res_TDR_G Slum_TDR_G Road_TDR_G Road_TDR_G Res_TDR_G Heri_TDR_G Heri_TDR_G Road_TDR_G

Legend Legend

TDR_Used Legend: TDR_Used 20,000 m2

20,000 20,000

Slum TDR Reservation TDR

Slum_TDR Slum_TDR Res_TDR_ Res_TDR_

Road TDR

Road_TDR Road_TDR

Heri_TDR_G

Fig.3(xv): Ward-wise share of each type of TDR generated between 1993-2020 (Data: MCGM, 2021)

Fig.3(xvi): Ward-wise share of each type of TDR utilized between 2016-20 (Data: MCGM, 2021)

The above maps indicate the share of each type of TDR generated from each ward. A geographical bias has emerged due to the higher generation of TDR in areas with low land prices, such as M ward. TDR generation in island city is low due to lesser reservations

and completed slum rehabilitation projects in these wards. The restrictions on utilization favoured densification in very specific parts of the city such as H/west and K/West wards, which are now the most expensive areas in suburban Mumbai.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

41

Source: MumbaiLive

42

4 Mumbai’s TDR mechanism Due to its complex history and various influential events and policies that have dictated the success and failures of TDR in Mumbai, each type of TDR has evolved with marginally different application processes for TDR generation. This chapter describes the on-ground TDR mechanism in Mumbai using real cases of transactions extracted from MCGM’s database. The statutory process of applying for a Development Rights Certificate (DRC) and utilizing it for a particular plot have also been described as per MCGM’s norms.

4.1.

4.2.

4.3.

4.3.1 4.3.2 4.3.3

Process of Applying for DRC Process of Utilizing TDR from a DRC TDR Transaction Studies

Road TDR & Reservation TDR Heritage TDR Slum TDR and Construction Amenity TDR

43

4.1. Process of Applying

for DRC When an individual’s land parcel is marked under any reservation for public purpose, the land owner is faced with three options: (a)

Opt for monetary compensation in lieu of land surrendered

(b) Opt for award of TDR in lieu of land surrendered (c) Opt for Accommodation Reservation

(AR), wherein the owner develops the

intended amenity on a land-sharing basis The flowchart alongside illustrates the general process to be followed by a private land owner for options (a) and (b). The most significant difference in both processes is that, on paper, the award of TDR in the form of a DRC is completed within 180 days of the land owner submitting the application.

Monetary compensation is accompanied by a host of challenges, including ownership conflicts, lack of funds for compensation and so on, which have been known to drag the process for many years in some cases.

Municipal Corporation of Greater M reservation/road/heritage protec

If an individual’s land pa Opt for monetary compensation in lieu of land surrendered What does MCGM do?

Express intent to acquire land to Collector

Collector issues a notification in a newspaper mentioning land details and purpose of acquisition How is the compensation value determined?

Land is measured, value decided based on ready-reckoner rate (2-4 times RRR, depending on nature and urgency of acquisition)

If owner agrees to the monetary compensation value, MCGM submits atleast 2/3rds of the compensation amount to the collector for the acquisition

Memorandum of Understanding signed between land owner and MCGM

Ownership of land transferred to MCGM

44

Mumbai’s TDR mechanism

What option land owner

Mumbai publishes list of lands under ction through Development Plan

arcel falls under this list,

ns does a r have?

Opt for Transfer of Development Rights in lieu of land surrendered What should the landowner do?

1 week - 3 months 1.5 - 2 months

Scrutiny

Application

Submit printed application for grant of DRC along with prerequisite documents and security fees Pay scrutiny fees to Development Plan department Pay legal charges to Legal department What does MCGM do for application scrutiny?

Joint Measurement (J.M.) survey of the land by City Survey Department

Land title clearance verification by Legal department

Public notice by D.P. dept., inviting objections from citizens w.r.t. land title If land title is found to be clear, owner clears land of all structures, levels and encloses site by 1.5m ht. wall

6 weeks

Compensation

Letter of Intent (LOI) of possession of land issued (15 days) Possession of land taken with approval of Deputy Chief Engineer, DP dept., Property Rate card issued in name of MCGM (7-15 days)

A DRC issued and signed by the Chief Engineer (DP) endorses in writing the FSI credit in square meters of the built-up area to which the owner/lessee is entitled, in figures and words. The DRC also holds details of the plot number, location and the ASR (Annual Statement of Rates) of the generating plot as given in the Stamp Duty Ready Reckoner Rate for the generating year (Rule 32, DCPR 2034). The DRC thus awarded is valid for a period of 10 years, post which it can be renewed for another 10 years. After a period of 20 years, the DRC is invalidated and the owner can no longer sell/utilize the unconsumed TDR. Across different types of TDR, the process of generation remains largely similar, except slum TDR, in which the award of TDR to the developer/land owner is endorsed by SRA/MHADA/MMRDA through a written recommendation addressed to the Municipal Commissioner and the Chief Engineer of Development Plan (DP) department, MCGM. The TDR is then sanctioned in stages in parallel with the completion of the Slum Rehabilitation Project (SRP). Heritage TDR, too, is awarded in stages which are described in section 4.3.2.2.

Original land owner is granted TDR in form of DRC

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

45

After TDR buyer tracks down DRC holders through TDR agents or brokers,

4.2. Process of Utilizing TDR

from a DRC

What does a TDR buyer do?

Enter into a notarized agreement for TDR sale deed with the DRC holder

46

Mumbai’s TDR mechanism

Application

Project Architect submits application for building plan approval proposing TDR utilization in prescribed format through AutoDCR portal

Scrutiny

Project Architect also submits original DRC and U-form (utilization form) to ASSESSING OFFICER (Development Plan) within 3 days of above submission Executive Engineer (Building Proposals) scrutinizes proposal, prepares report for further processing

AO (DP) verifies area, signature of DRC holder and validity of DRC

Report forwarded to Executive Engineer (Development Plan) as per generating ward Executive Engineer (DP) processes the proposal for approcal of Municipal Commissioner / Chief Engineer (DP) Approval

The purchase of TDR is mandatory for a developer to utilize the entire plot potential.

Thus, a prospective TDR buyer seeks the assistance of middlemen – property agents and/or TDR brokers, who facilitate contact between the seller and buyer for the transaction. The necessity of middlemen arises since, presently, there is no publicly accessible ledger of DRC holders for potential buyers. Until 2016, the selling price of TDR in Mumbai was arbitrarily determined, usually dictated by individuals/companies holding large quantities of TDR. Post the policy modification enforced in 2016, the price of TDR is expressed as a percentage of the Ready Reckoner Rate (RRR), and is influenced by a number of factors such as supply-demand and the rate of premium (chargeable) FSI. This has considerably reduced the direct influence of cartelization on TDR prices. After the developer (TDR buyer) identified the DRC holders, he/she has to follow the following process:

Pay stamp duty (3% of agreement value) towards certification of the TDR purchase

Asst. Engineer (DP) forwards copy of approval to E.E. (BP) E.E. (BP) attaches TDR utilization sanction to respective file online

Legend: Island City Western Suburbs-I Western Suburbs-II Eastern Suburbs

Fig.4(i): Zones for processing building proposals; each zone has its own BP office

The building proposals are processed through the AutoDCR portal by MCGM. The city is divided into 5 zones – City, Eastern Suburb, Western Suburb-I and II and BP Special Cell (all city awards). The approval for utilizing TDR requires the scrutiny report of the relevant Zonal Officer from the Building Proposals department. The quantum of TDR permissible on a receiving plot is linked to the width of the road fronting the plot, by the regulations in DCPR 2034. MCGM disallows the use of TDR for plots with road width less than 9m. However, to address the issue of narrow roads in the suburbs, MCGM has undertaken the task of converting all the DP roads of width less than 9m to minimum 9m and above, by the provisions in MR & TP Act and Mumbai Municipal Corporation Act (DP Department, 2017).

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

47

Name of Municipal Commissioner

Location of sending plot Land Use Zone

DRC number Name of DRC holder

FSI credit in words and numbers

Representative sample of a Development Rights Certificate

48

Mumbai’s TDR mechanism

Fig.4(ii): Sample of Slum TDR (Stage 3) DRC; Source: AutoDCR, 2021

Name and address of TDR buyer 1

Name and address of TDR buyer 2

Name and address of TDR buyer 3

Representative sample of a DRC with buyers indicated

Area deducted from DRC

Indexed area

Area deducted from DRC

Indexed area

Area deducted from DRC

Indexed area

Fig.4(iii): Sample of DRC with utilization and buyers’ details indicated; Source: AutoDCR

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

49

4.3. TDR Transaction Studies:

How does the mechanism vary from type-to-type?

The five types of TDR presently in use in Mumbai were not introduced at the same time in the TDR timeline. There have also been multiple policy changes which have influenced the generation and use of TDR.

This section focuses on those differences in practice across different types of TDR, illustrating the impact of regulations on the usability and viability of each type. Each type of TDR is further assessed using a consistent ‘Seller-Buyer-MCGM’ framework, which allows to examine how each type of TDR is working for each stakeholder of the TDR mechanism in Mumbai.

4.3.1 Road TDR and Reservation TDR 4.3.1.1 Mechanism on the Sending side Prior to the 2016 policy, the extent of TDR awarded for surrender of land for road and reservation was equal to the gross area of the reserved plot. This incentive proved insufficient to sustain the generation of TDR as compared to Slum TDR and, thus, the goal of DP implementation was not attained.

Subsequently, in 2016, the long-due policy modification stipulated that the quantum of B.U.A. awarded as TDR would be:

To speed up the process of DP implementation, additional incentive TDR to the extent of 20%, 15%, 10% and 5% of the surrendered land area shall also be awarded to the land owners who submit their application for TDR within 1, 2, 3 and 5 years from the date of the notification respectively. Any DRC so awarded can be sold to a single or multiple vacant plots, or to erect additional floors on lands which are developed partly or fully.

Table 1: Entitlement for TDR in lieu of land surrendered for road and reservation (GoM, 2016)

Figure 4(iv) illustrates the total amount of road TDR generated from 1993 to 2020, sub-divided into pre-2016 and post-2016 trends. Wards in the island city have either of two cases: the street layout planned in the colonial era has proven adequate to date (for instance, Fort and Colaba) or the presence of heritage structures and highly dense settlements hinder the potential to construct new roads or widen existing ones (for instance, Byculla). The concentration of road development projects such as the

Area Under Reservation

Entitlement for TDR

Mumbai City area

2.5 times the area of surrendered land (Maximum 2.5)

Mumbai Suburban/ Extended Suburbs

2.0 times the area of surrendered land (Maximum 2.0)

50

Mumbai’s TDR mechanism

Western Express Highway (2002) and Eastern Freeway (2013) is a possible reason for the larger amount of TDR being generated from the northern suburbs. Post 2016, road TDR has been widely used for increasing the number of 9m wide roads in the rapidly densifying suburbs which routinely face extreme traffic congestion.

Figure 4(v) illustrates the total amount of reservation TDR generated from 1993 to 2020, sub-divided into pre-2016 and post2016 trends. Between 1993 and 2016, there is no apparent pattern in the generation of reservation TDR. However, according to an Dahisar R/N

Charkop R/S

Malad P/N

Malad P/N

Vile Parle K/E

Ghatkopar N

Chembur Vile Parle K/E M/W

2

km 4

0

1

2

km 4

Deonar Ghatkopar M/E

Kurla L

E Walkeshwar D

Kurla L

Deonar M/E Ghatkopar N

oo 0

1

2

km 41 2

0

F/S

Fort C

Lower Parel G/S Colaba A

Colaba

Legend: Road_TDR_G

Legend Legend Road_TDR_G

Slum_TDR_G < 10000 sq.m. < 1 lakh sq.m.

Parel F/S

o 0

o

o

0

1

2

1

Legend

km 4

1.2 lakh - 1.74 lakh sq.m.

Parel F/S

o 1

2

Deonar M/E

Fort C

Mandvi B

RoadG_93to16 < 10000 sq.m.

o

30000 - 60000 sq.m. km sq.m.

90000 - 1.5 lakh

Colaba A

km 4

0

1

2

4

RoadTDR_G16 Legend: RoadTDR_G16 Legend

< 1000 sq.m.

sq.m. sq.m. < 1000 <1000 m2 1000 - 5000 5000 - 10000 sq.m.

2 1000 - 5000 sq 1000 - 5000 m 10000 - 20000 sq.m.

5000sq.m.

- 10000 s 5000 - 10K m2 20000 - 45000 10000 - 20000 10K - 20K m2 20000 - 45000 20K - 45K m2

Fig.4(iv): Total road TDR generated between 1993 and 2020, subdivided into (a) 1993 to 2015 and (b) 2016 to 2020

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

Colaba A

60000 - 90000 sq.mm.

Legend

<10000 m A 30000 - 60000 sq.m.

10000 - 30000 sq.m.

10 - 30K m2 60000 - 90000 sq.mm. lakh sq.m.

- 60000 sq.m.

30 - 60K m2 90000 - 1.530000 60000 - 90000 sq.mm.

60K - 90K m2 kmm2 90000 - 1.5 lakh sq.m.

90K - 1.5L 1 2 4

o

Byculla E Walkeshwar D

Mandvi Fort B C

2 10000 - 30000 sq.m. sq.m.

Colaba < 10000

0

Chembur M/W

Par F/

Legend

Legend

< 10000 sq.m.

0

D

C

RoadG_93to16 Legend: RoadG_93to16

Colaba A

Lower Parel G/S

Deonar M/E

Byculla E

Walkeshwar 60000 - 1.2Dlakh sq.m.

Mandvi

km Fort B 1.2 lakh - 1.74 lakh sq.m.

15 lakh sq.m.

2 lakh 4- 27.5

Ghatkopar N

10000 - 30000 sq.m.

30000 - 60000 sq.m.

5 - 15 lakh sq.m.

< <10000 m 2 10000 - 30000 sq.m.

10 - 30K mRoad_TDR_G sq.m. - 60000 sq.m.

30000 30 - 60K m2 < 10000 10000 - 30000 sq.m.

- 1.2 lakh sq.m.

60K - 1.2L m2 3000060000 - 60000 sq.m. kmm2 1.2- 1.2 lakh 1.74 lakh sq.m.

1.2L 1.74L 60000 lakh-sq.m.

0 1 2 4 Legend

Matunga F/N

Lower Parel G/S

Walkeshwar 2 - 5 lakh sq.m.

Mandvi Fort B C

Colaba sq.m.

10000 A

Colaba

A Byculla E

1 - 2 lakh sq.m.

Legend

2

Mahim G/N

10000 - 30000 sq.m.

Byculla E

Kurla L

Lower Parel Mandvi Fort Parel B G/S C F/S

Ma G

Deonar

F/N

Deonar M/E

B

Bandra H/W

Bhandup S

Santacruz ParelBandra H/E H/W F/S Matunga

Walkeshwar D

Ghatkopar N

Chembur M/E M/W

Matunga F/N

Byculla E

Walkeshwar

Mandvi D Fort B km 4 C

Mahim G/N

Lower Parel G/S

Deonar M/E

Mulund T Ghatkopar N

Chembur VileM/W Parle K/E

Mahim G/N

Chembur M/W

BycullaMahim

Santacruz Andheri K/W H/E

Bandra H/W

Deonar M/E

L

Santacruz H/E

Bandra H/W

Bhandup S

Chembur M/W

G/N Mandvi E Walkeshwar Fort B Matunga D C Mandvi Parel F/N

BycullaA E

Walkeshwar D

Parel F/S

Mandvi B

Lower Parel G/S

Chembur M/W Deonar M/E

Ghatkopar

Chembur Matunga M/W F/N

Goregaon Kurla P/S L Kurla

Ghatkopar N N

Chembur M/W

Bandra Santacruz Lower Parel H/W Parel H/E Matunga G/S F/S F/N Byculla

N

Byculla E

Fort C

Mahim Lower Parel Parel G/S G/N F/S

Santacruz H/E

Mahim G/N

Colaba A

o

G/N

K/E

T

Vile Parle Matunga K/E F/N Mahim

Bhandup S

Matunga F/N

Walkeshwar D

Santacruz H/E

Bandra Santacruz Andheri Mahim H/W K/W H/E G/N

Andheri K/W

Bhandup S

Vile Parle Malad P/N Vile K/E Parle

Ghatkopar N Mulund

Kurla Kurla L L

Malad P/N

Bhandup S

Charkop R/S

Andheri K/W

(b)

Mulund T

Borivali R/CEN

Andheri K/W

Bhandup S

Santacruz Goregaon H/E P/S

Bandra H/W

Mulund T

Bandra H/W

Matunga F/N

Colaba A

Mulund T

Goregaon Dahisar P/S R/N Goregaon P/S

Bhandup S

Charkop R/S

Vile Parle Malad Andheri P/N K/WK/E

Andheri K/W

Lower Parel G/S

Malad P/N

Mulund

Kurla

Byculla E

Charkop R/S

(a)

Bhandup T S

Goregaon P/S

Andheri K/W

Bhandup S Charkop R/S

Santacruz H/E

Mandvi Fort B C

Borivali R/CEN

Andheri K/W

Kurla Goregaon L P/S

Walkeshwar D

Mulund T

Mulund T

Charkop R/S

Vile Parle L K/E

Bandra H/W

Borivali R/CEN

Borivali R/CEN

Malad P/N

Mahim G/N

Charkop R/S

P/N

Borivali R/CEN

Parel F/S

Malad P/N

Goregaon Goregaon P/SP/S Dahisar R/N Malad

R/N

Lower Parel G/S

Dahisar R/N

Dahisar Charkop R/N R/S

Mulund T

Goregaon P/S Dahisar

Vile Parle K/E

Borivali R/CEN

Borivali R/CEN

Malad P/N

Bandra H/W

Dahisar R/N

Dahisar Borivali R/CENR/N

Charkop R/S

o

1

Dahisar R/N

Borivali R/CEN

Andheri K/W

existing situation study conducted for the preparation of DP 2034 (EDDP 2034), the high amenity demand gap in certain wards led to the reservation of greater number of plots in L, P/N, P/S and G/N wards (Annexure 1). The incentives for generation have boosted the quantum of reservation TDR in the above wards.

Additionally, since a lot of properties are undergoing redevelopment in the island city wards such as G/N, G/S and F/S, it has created the potential to reserve land for public purpose amenities in the congested locales and award reservation TDR as compensation.

51

m

Dahisar R/N

Dahisar R/N

Dahisar R/N

Borivali Dahisar R/CEN

Borivali R/CEN

Borivali Charkop R/CEN

Charkop R/S Malad P/N

Mulund T

Andheri K/W

Borivali R/CEN

Andheri K/W

Bhandup S

Kurla

Mulund

Kurla

Santacruz H/E

Chembur Vile Parle K/E M/W

Matunga F/N Bandra H/W

Lower Parel G/S

Mandvi B

1

2

Byculla E

Deonar M/E

oo 0

1

km 0 41 2 Legend

2

F/S

0

Fort C

Lower Parel G/S

Colaba A Colaba

Fort Ckm 4

o

2

Mahim G/N

Colaba < 10000 sq.m. Byculla A

o

Matunga F/N

Mandvi Parel Fort B C F/S

Slum_TDR_G

Lower Parel G/S

E 10000 - 30000 sq.m.

1 - 2Walkeshwar lakh sq.m.

30000 - 60000 sq.m.

2 - 5 lakh D sq.m.

Mandvi Fort B C

Parel F/S

0

Legend

0

Mandvi Fort B C

o

Colaba A

10000 - < 50000 sq.m.sq.m.

Colaba 10000 A sq.m.

50000 - 1 lakh

10000 - 50000 sq.m.

1 lakh - 2.5 lakh sq.m. km 2.5 - 5.1 lakh sq.m.

50000 -

0

1

2

4

Mahim G/N Matunga F/N Ghatkopar N

Deonar M/E

Lower Parel G/S

Chembur M/W

Fort C

< 10000 sq.m.

o

10000 - 30000 sq.m.

1 lakh sq.m.

1 lakh - 2.5 lakh sq.m.

2.5 - 5.1 lakh sq.m.

Mumbai’s TDR mechanism

Colaba A

30000 - 60000 sq.m.

60000 - 90000 sq.mm. kmsq.m.

90000 - 1.5 lakh 0

1

2

4

ResTDR_G16 Legend: ResTDR_G16 Legend

< 20000 sq.m.

<20000 m2 20K - 50K m2 50K - 75K m2 75K - 1 lakh m2 1L - 1.6L m2

20000 -<50000 sq.m.sq.m.

20000 50000 - 75000 sq.m.

- 50000 75000 -20000 1 lakh sq.m.

sq.m.

1 lakh - 50000 1.6 lakh sq.m.

- 75000

sq.m.

Case study

52

Mandvi B

RoadG_93to16

Fig.4(v): Total Reservation TDR generated between 1993 and 2020, subdivided into (a) 1993 to 2015 and (b) 2016 to 2020

Chandrakant D.A., the owner of a plot undergoing redevelopment in Asalpha (L ward), surrendered part of his land for proposed road widening to MCGM in 2018.

Of his plot area, 443.5 sq.m. of land was required by MCGM, for which Chandrakant submitted the application seeking grant of TDR. As per regulation, since his plot is in Mumbai suburbs, he was entitled to 2 times the area surrendered as FSI credit in the DRC. Additionally, since he submitted the application within 2 years of the notification, he received a surplus 15% of the land surrendered, as TDR.

Parel F/S

Byculla E Walkeshwar D

Deonar M/E

Legend

Legend

< 10000 sq.m.

<10000 m2 10 - 50K m2 50 - 1 lakh m2 1L - 2.5L m2 km m2 2.5L - 5.1L 1 2 4

o

Walkeshwar D

Mandvi

km 1 15 2 lakh 1.2 lakh - 1.74 lakh sq.m.

-4 27.5 lakh C sq.m.

ResG_93to16 Legend: ResG_93to16

Colaba A

Byculla E

- 1.2 lakh sq.m.

560000 - 15 lakh sq.m.

Fort B

Santacruz H/E

Legend

< 1 lakh sq.m.

A Byculla E

km 4

2.5 - 5.1 lakh sq.m.

Lower G/S Legend Road_TDR_G

Parel F/S

Legend

1

Byculla E

Legend

B

Kurla L

Bandra Santacruz Parel H/E H/W Matunga F/S

Walkeshwar D Parel

Bandra H/W

Bhandup S

F/N

Deonar M/E

Matunga F/N

< Colaba 10000 sq.m. <10000 m2 A 10000 - 50000 sq.m.

10 - 50K m2 Res_TDR_G sq.m.- 1 lakh sq.m.

50000 50 - 1 lakh m2 < 10000 10000 - 50000 sq.m.

1 lakh - 2.5 lakh sq.m.

1L - 2.5L m2 50000 - 1 lakh sq.m. km m2 2.5 - 5.1 lakh 2.5L - 5.1L 1 lakh - 2.5 lakh sq.m.sq.m.

1 2 4 0

Lower Parel G/S

Chembur M/W

Walkeshwar D

Mandvi B

Legend: Res_TDR_G

o

Deonar M/E

Mahim Byculla G/N

Mandvi E Walkeshwar Fort B Parel Mandvi C D

Byculla E

Walkeshwar D

Mandvi B

km 4

Lower Parel G/S

Chembur M/W

Parel F/S

Colaba A

o 0

Fort C

Parel

N

ChemburDeonar M/E M/W

Matunga F/N

Mahim G/N

Ku

Ghatkopar N Ghatkopar

Chembur Vile Parle M/W K/E

Mahim G/N

Deonar Ghatkopar M/E N

Kurla L

Mulund T

L

Santacruz H/E Santacruz Andheri H/E K/W

M/W

Chembur M/W

Matunga F/N

Bandra H/W

Andheri K/W Vile Parle K/E

Bandra H/W

Deonar Chembur M/E

Bandra Santacruz F/S H/E H/W Matunga Lower Parel Parel G/S F/N F/S

Walkeshwar D

Byculla E Walkeshwar D

Colaba A

Mahim LowerG/N Parel G/S

N

Matunga F/N

Byculla E

Fort C

G/N

N

Bhandup S

Goregaon P/S

Bhandup S Bhandup S

Goregaon Kurla P/S Kurla L

Ghatkopar N Ghatkopar

Kurla L

Chembur M/W

Vile Parle K/E

Matunga F/N Mahim

Santacruz H/E

Mahim G/N

G/N

Bhandup S

Deonar Ghatkopar M/E

Kurla L

Kurla L

H/E

Santacruz Andheri Bandra Santacruz K/W H/E Mahim H/E H/W

Bandra H/W

Andheri K/W

Walkeshwar D

Bandra H/W

T Ghatkopar N

Ghatkopar Mulund N T

Charko R/S Malad P/N

Mulund T

Charkop R/S

Andheri K/W Vile MaladParle P/N K/E Vile Parle K/E

Bhandup S

(b)

Dahisar R/N

Borivali Goregaon R/CEN P/S

Andheri K/W

S

Vile Parle K/E L Goregaon Santacruz P/S

Mulund T

Charkop R/S

K/E

Goregaon L P/S

Parel F/S

Goregaon P/S Charkop Vile Parle R/S

Borivali R/CEN

MaladGoregaon P/N P/S

Mulund

K/W

Mahim G/N

(a)

Bhandup T Bhandup S

Vile MaladParle P/N K/E Andheri

Malad P/N

Lower Parel G/S

Borivali R/CEN

Andheri K/W

Dahisar R/N

Borivali R/CEN

P/S

Malad P/N

Charkop R/S

Vile Parle K/E

Mulund T Mulund T

Goregaon Charkop Dahisar R/S P/SGoregaon R/N

Dahisar R/N

Borivali R/CEN

Malad P/N

Dahisar Charkop R/N R/S

Malad P/N

Goregaon P/S

Charkop R/S

Dahisar R/N

R/S

Malad P/N

Bandra H/W

Borivali R/CEN

R/N

Total Road TDR issued = (2 x 443.5) + (15% of 443.5) = 953.6 sq.m.

DRC no. : 774/Road DRC issued on : 13.12.2018 Plots affected : 161/A/2, 163/C/2, 163/20B to 163/27B, 163/38 to 163/40, 163/41B, 163/45B RRo in 2018 : ₹34800 / sq.m.

Towards the grant of TDR, Chandrakant paid MCGM the due legal fees and scrutiny fees at the rate of ₹38 per sq.m. of plot area surrendered, subject to a minimum of ₹5000 (DP department, n.d.).

75000 - 1 lakh sq.m.

1 lakh - 1.6 lakh sq.m.

4.3.1.2 Mechanism on the Receiving Side

The utilization of TDR has been geo-spatially liberalized since 2016 and, thus, all types of TDR are permitted to be used on any plot in the Greater Mumbai jurisdiction, irrespective of the land use zone. However, in order to curb the geographical bias of TDR generated in low-price areas being utilized in areas with high real estate prices, the quantum of TDR permitted on the receiving plot is governed by the following formula: I.

Indexation of TDR

TDRr = TDRo x (RRo / RRr)

where, TDRr : Permissible utilization of TDR

in sq.m. on the receiving plot TDRo : TDR debited from the DRC in sq.m.

RRr : Rate of land in ₹/m2 as per ASR

of receiving plot in generating year RRo : Rate of land in ₹/m2 as per ASR

of generating plot in generating year The indexation of TDR enables a value-tovalue transfer of TDR, which allows for a fairer compensation to the TDR seller and also mitigates the geographical bias arising from low price-area generation and high price-area utilization of TDR.

II.

Linking the road width with permissible TDR on receiving plot

The TDR utilization potential is computed considering the gross plot area (excluding area affected by reservations or deemed reservations) of the receiving plot. The extent of permissible TDR utilization on the receiving plot (or simply, the receiving potential) is approved based on the width of the road fronting the plot. The resulting FSI distribution is as shown in Table (2).

No plots fronting road widths less than 9m are permitted to use TDR. The intent of this regulation was to prevent further overcrowding of the congested locales in the city and reduce the load on public infrastructure systems.

However, for every other plot where highintensity redevelopment is promoted through TDR, requiring the up-gradation of civic infrastructure, MCGM levies Infrastructure Improvement charges on the TDR buyer, using the following formula: = TDR Area (sq.m.) x [5% of Construction cost as per prevailing ASR]

Additionally, MCGM levies TDR utilization scrutiny fees during the application process using the formula, = Proposed TDR utilization (sq.m.) x ₹59

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

53

Table 2: FSI distribution in Mumbai (Order of consuming FSI: Basic FSI + TDR + Premium FSI) Sr. No.

1

2

Areas

Island City

Addl.

Premium FSI

Admissible TDR

Permissible FSI

< 9m 9m < x < 12m Res/Com 12m < x < 18m 18m < x < 27m 27m <

1.33

0 0.5 0.62 0.73 0.84

0.00 0.17 0.45 0.64 0.83

1.33 2 2.4 2.7 3

Industrial

1.00

0

0.00

1

0

0

1.00

1.00

0 0.5 0.5 0.5 0.5

0.00 0.50 0.70 0.90 1.00

1.00 2.00 2.20 2.40 2.50

0.35 0.35 0.35 0.35 0.35

0.00 0.35 0.42 0.49 0.53

1.35 2.70 2.97 3.24 3.38

1.00

0

0.00

1

0

0

1.00

Zone

< 9m 9m < x < 12m Suburbs and Res/Com 12m < x < 18m Extended 18m < x < 27m Suburbs 27m < Industrial

III.

Price determination

Since TDR is a market-driven mechanism, the price of TDR is determined by the TDR seller and varies from area-to-area. On ground, the TDR buyer is quoted a purchase rate by the agent/broker as a function of the Ready Reckoner Rate (RRR), such as, for road and reservation TDR, the rate of purchase ranges between 28 – 35% of the ASR of the receiving plot (K. Chotalia, personal communication, February 17, 2021). This rate is highly volatile based on supply-demand and the concurrent rate of Premium FSI (competitive pricing).

The sequence of availing development rights on a receiving plot is: Zonal (basic) FSI, followed by the full or part utilization of maximum permissible TDR, after which chargeable premium FSI and fungible FSI are permitted to be purchased. The TDR

54

35% fungible FSI over and above TOTAL permissible FSI Permissible On FSI On Basic FSI Premium+TDR 0.47 0.00 1.80 0.47 0.23 2.70 0.47 0.37 3.24 0.47 0.48 3.65 0.47 0.58 4.05

Zonal (basic) FSI

Road width (in m)

Mumbai’s TDR mechanism

utilization potential of a receiving plot is calculated on the net plot area i.e. gross plot area excluding area affected by reservation/ road widening. All the above rules and regulations, except price determination, are consistent across all types of TDR. Fig. 4(vi) and 4(vii) illustrate the utilization trends of road and reservation TDR respectively post the 2016 policy modification. The higher quantum of TDR available in the market combined with the lower purchase cost have promoted the use of TDR in island city wards as well as the densifying peripheral suburbs.

Wards such as L, T and G/S, which are also sources of high TDR generation, have utilized reservation TDR to a great extent within the ward itself, possibly to reduce the impact of indexation on TDR bought and sold.

Dahisar R/N

Dahisar R/N

Borivali Dahisar R/CEN R/N

Borivali Dahisar R/CEN R/N

Borivali R/CEN

Malad P/N

Dahisar R/N

Charkop R/S

Malad P/N

Borivali R/CEN

Charkop R/S

Malad P/N

Goregaon P/S

Andheri K/W

Goregaon P/S

Andheri K/W

Bhandup S

Bandra Santacruz Bandra Santacruz H/E H/W H/E

Matunga Matunga F/N

F/N

Lower Parel

Lower G/S Parel G/S

Mahim G/N

Byculla E

Byculla Walkeshwar E D

Mandvi

o

o 0

0

1

2

1

km 4

2

km 4

o 0

1

2

Colaba A

Deonar Chembur Deonar M/E M/W

Santacruz H/E

C

Kurla L

Lower Parel G/S

Lower Parel Parel

Byculla E Walkeshwar D

Mandvi Fort B C Walkeshwar

Matunga Matunga F/N F/NDeonar M/E

o

Road_TDR_U Legend

km Legend <0 1000 sq.m.

Legend: 1 2 4

o

Lower Parel G/S

km 4

Fig.4(vi): Road TDR utilized between 2016 and 2020

o

Low

Walkesh D

Legend

Mandvi Byculla Slum_TDR_G Fort B E < 1 lakh sq.m.

C Walkeshwar Mandvi 1 - 2 lakh sq.m.

D Fort B Mandvi 2 - 5 lakh sq.m.

C Fort B 5 - 15 lakh sq.m.

C Colaba 15 lakh - 27.5 lakh sq.m.

A

Colaba 1000sq.m. sq.m. < 1000 m2 3000 <- 6500 < 1000 sq.m.

A 2 1000 3000 sq.m.

1000 - 3000 m 6500 - 10000 sq.m.

1000 - 3000 sq.m. km 3000 - 6500 sq.m.

3000 - 6500 sq.m.

- 18000 sq.m.

3000 - 6500 m2 0 10000 1 2 4 6500sq.m.

- 10000 sq.m.

6500 - 10000 6500 - 10000 m2 km sq.m.

10000 - 18000 km 10000 - 18000 10000 - 18000 m2 0 1 2 sq.m.

4 0 1 2 4

Deonar M/E

Parel F/S

1000 - 3000Road_TDR_U sq.m.

o

M/E

Walkeshwar Colaba DA

Road_TDR_U

Colaba A

Deonar DeonarChembur M/E M/W

Matunga F/N

Byculla E D

Legend

Mahim G/N

Parel

ParelF/S F/S

Byculla E

Ghatkopar N

Santacruz Bandra Chembur Chembur H/E H/W M/W M/W

M/W

Matunga F/N

Deonar M/E

Byculla

L

Ghatkopar N

Mahim Mahim G/N G/N Chembur

Mahim G/N

M/E

Parel F/S

WalkeshwarFort B E D C Mandvi Walkeshwar D Fort B Mandvi C Fort B Colaba A

Kurla L

LowerF/S Parel G/S G/S

Lower Parel G/S

Vile Parle Ghatkopar K/E N Ghatkopar N

H/W

Bandra H/W

Matunga F/N

Parel F/S Parel F/S

Ghatkopar N

Bhandup S

Kurla L Kurla

Bhandup S Vile Parle Santacruz Bandra K/E Bandra Santacruz H/E H/W H/E

Santacruz Bandra Chembur Chembur H/E H/W M/W M/W

Mahim Mahim G/N G/N

VileMulund Parle Andheri K/ET K/W

Andheri K/W

Kurla L

H/W

Mulund T

Bhandup S

Vile Parle K/E

Goregaon P/S

Vile Parle K/E Ghatkopar N Ghatkopar N

Kurla

Mulund T

Goregaon Bhandup P/S S

Andheri K/W

Bhandup S

L Kurla L

Malad P/N

Andheri K/WCharkop R/S Malad P/N

Vile Parle Andheri K/E K/W

Mulund Charkop R/S T

Goregaon P/S

Borivali R/CEN

Mulund T

Bhandup S

Vile Parle K/E

Goregaon P/S

Dahisar R/N

Mulund T

P/N

Borivali R/CEN

Charkop R/S

Malad P/N

Mulund Charkop R/S T

Goregaon P/S Malad

Dahisar R/N

Borivali Charkop R/CEN R/S

Colaba A

o

Legend

Res_TDR_U Legend

> 15000 sq.m.

Legend: Res_TDR_U

< 15000 m2 15K - 30K m2 30K - 45K m2 45K - 60K m2 60K - 85K m2

0

1

2

Legend

> 15000 sq.m

30000 - 45000<s

15000 - 300 10 45000 - 60000 s

30 30000 - 450 60000 - 85000 s

65 45000 - 600

10 60000 - 850

Fig.4(vii): Reservation TDR utilized between 2016 and 2020

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

km 4

Road_ 15000 - 30000 sq

55

Case study To assess the viability of the DRC of road TDR, we shall examine the transaction of the DRC discussed in the previous sub-section, i.e., 774/Road. M/s Olphin Developers purchased 250 sq.m. of TDR from Chandrakant D.A. at 28% of the ASR of receiving plot, through a TDR agent in June 2019.

Receiving plot ward: H/E RRr : ₹99,100 / sq.m., as per DRC

generating year, 2018 RRo : ₹34,800 / sq.m., as per DRC

generating year, 2018 TDRo : 250 m2 TDRr : 85 m2, after indexation TDR purchase cost (i.e., Chandrakant’s earning) = 28% of 99100 x 85 = ₹ 23.6 L M/S Olphin Developers have to pay MCGM their due TDR utilization scrutiny fees and infra improvement charges, Scrutiny fees = 85 x 59 = ₹ 5015 Infrastructure Improvement Charges

= 85 x 5% of ₹ 30250 = ₹ 1.28 L Including the cost of construction, the approximate total purchase cost of 85 sq.m. of TDR for the buyer = ₹ 0.51 crore.

Market price of residential floorspace in the area in 2019 = ₹3.5 lakhs / sq.m. Thus, the TDR buyer would have earned ₹2.98 crore against his/her expenditure of ₹0.51 crore, amounting to ~ 6 times the purchase cost.

56

Mumbai’s TDR mechanism

Dahisar R/N

Borivali R/CEN

Cha R Malad P/N

Goregaon P/S

Andheri K/W

Vile Parle K/E

R

Bandra H/W

R

Santacruz H/E

Mahim G/N

953.6 sq.m.

Matunga F/N

Lower Parel G/S

DRC area issued

Byculla E Walkeshwar D Fort C

1

2

Mandvi B

Colaba A

o 0

Parel F/S

km 4

1 | 85 sq.m. | H/E Chandrakant earns: ₹ 23.6 lakhs Olphin pays: ₹ 50.6 lakhs Olphin earns: ₹ 2.98 crore

arkop R/S

2 | 25 sq.m. | M/W

R

Mulund T

Chandrakant earns: ₹ 6.7 lakhs V.R. Medicare pays: ₹ 14.6 lakhs

Bhandup S

e

S

Kurla L

V.R. Medicare : ₹ 45 lakhs Ghatkopar N

R

Chembur M/W Deonar M/E

3 | 200 sq.m. | T

350 sq.m.

Indexed area sold

Chandrakant earns: ₹ 38.2 lakhs Balaji Developers pays: ₹ 1.02 crore Balaji Developers earns: ₹ 3.39 crore

Legend

Mum_Wards_Fin

4 | 40 sq.m. | H/W Chandrakant earns: ₹ 30.8 lakhs Krishnanjay Developer pays: ₹ 44 lakhs Krishnanjay Developer earns: ₹ 3.71 crore Fig.4(viii): Summary of 1 Road TDR D.R.C.

The above figure illustrates the multiple transactions between Chandrakant D.A. and various TDR buyers across different wards in the city. Based on the ASR of the receiving plots, Chandrakant would have earned ₹ 2.11 crore from a single DRC, between 13.12.2018 to 21.08.2019.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

57

4.3.1.3 Assessing the types from

Stakeholders’ Perspective For the TDR seller

a.

Compensation through sale of TDR was ₹2.11 crore. If Chandrakant had sold the deducted 443.5 sq.m. of his plot in the open market at ASR (34800/sq.m.), he would receive a compensation of ₹1.54 crore. If he had sold it at average market value (₹1.31 L/sq.m.), he would receive ₹5.8 crore.

b.

The TDR generation incentive makes the sale of TDR more profitable than sale in the open market.

c.

However, the price is linked to the Ready Reckoner Rate of the plot which, despite being updated annually, does not necessarily meet the average market value. Thus, the seller stands the risk of being under-compensated.

d.

58

Compensation for land surrendered for road setback on developed plot is low, considering the nuisance factor. It may impede the process of widening all roads to minimum 9.0m.

Mumbai’s TDR mechanism

For the TDR buyer

a.

The purchase cost of 85 sq.m. was ₹0.51 crore for the buyer. If he/she had opted for premium FSI which is charged at 50% of the ASR of the receiving plot, the purchase cost would have escalated to ₹0.68 crore.

b.

Thus, TDR is cheaper than premium FSI and has a lower impact on project cost. According to a developer, TDR accounts for 5-10% of the project cost and cost towards premiums constitute almost 25-30% of the project cost (K. Chotalia, personal communication, February 17, 2021).

c.

The volatility of TDR prices affects small-time developers.

Dahisar R/N

Borivali R/CEN

For MCGM and the city

Charkop R/S

MCGM

a.

b.

c.

d.

MCGM’s revenue from various fees is ₹5.5 lakhs. Additionally, avoiding land acquisition cost saved the ULB, = 2 x ₹34800 x 443.5 = ₹3.08 crore.

Goregaon P/S

Malad P/N

o

2

0

1

Mulund T

Kurla L

Andheri K/W

Mulund T

Goregaon P/S

Ghatkopar Bhandup NS

Santacruz Vile Parle Andheri H/E K/E

Bhandup S

K/W

Vile Parle K/E Ghatkopar N

Chembur

Kurla M/W L

Mahim G/N

Bandra H/W

Santacruz H/E Matunga

Deonar Kurla M/E L

F/N

Lower Parel G/S

Parel F/S

Walkeshwar D Fort

Colaba C A

Matunga F/N

km 4

1

2

Lower Parel G/S

km 4

Deonar Chembur M/E M/W

Parel F/S

Deonar M/E

o

Legend

Legend: 0

Byculla E Walkeshwar D Fort C

Mandvi B

km

Amen_DemPC 1 2 4

Exceeds de Exceeds demand 2 0 - 1 sq.m.

0 - 1 mAmen_DemPC 2 1 - 2 sq.m.

1-2m Exceeds demand - 3 sq.m.

2 - 3 m2 0 - 12sq.m.

Road_ - 4 sq.m.

3 - 4 m2 1 - 23sq.m.

2 - 34sq.m.

2 - 6 sq.m.< 4-6m Legend

Legend

Colaba A

o 0

Mahim G/N

Matunga F/N

Mandvi B

Colaba A

Ghatkopar N

Santacruz Bandra Chembur H/W M/W H/E

Mahim G/N

Byculla LowerEParel Parel G/S Walkeshwar F/S D Mandvi Fort B Byculla C E

km 4

2

Bhandup S

Malad P/N

Vile Parle

A major drawback for the city, however, is the blanket incentive factor for reservation TDR. As illustrated in the map alongside, the per capita demand gap for amenity areas (i.e., the per capita gap between proposed and existing area under amenities) varies from ward-toward and is apparently higher in the suburban wards as compared to the island city. The incentive factor does not seem to necessarily take this data into consideration.

1

Charkop R/S

Goregaon K/E P/S

Bandra H/W

Mulund T

Borivali R/CEN

Charkop R/S

Andheri K/W

All reservation-based DP projects can be executed in record time as observed in this case.

0

Dahisar R/N

Borivali R/CEN

TDR helps eliminate the burden of monetary compensation for land acquisition on the exchequer.

o

Dahisar R/N

Malad P/N

3 - 4 sq.m.

10

4 - 6 sq.m.

30

Fig.4(ix): Ward-wise estimation of per capita demand gap in public amenities (Data source: RDDP 2034, MCGM, 2016)

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

59

65

10

4.3.2. Heritage TDR 4.3.2.1 Mechanism on the Sending side Heritage TDR is one of the least successful types of TDR in practice in Mumbai, as evident from the number of Heritage DRCs issued since its introduction. It is, therefore, important to examine the sending side regulations and assess its shortcomings.

As per Regulation 52 of DCPR 2034, the Government of Maharashtra, in conjunction with the Municipal Commissioner, MCGM, shall periodically notify a heritage list (referred to as Listed Heritage Buildings/ Structures/Precincts /Sites) as earmarked for conservation. The city’s heritage committee, known as Mumbai Heritage Conservation Committee plays a significant role in the determination of criteria for inclusion in the heritage list as well as in the award of TDR. As per Table 12A, Regulation 32 of DCPR 2034, any owner/lessee who submits his structure/ plot for conservation by the owner himself is eligible for compensation in the form of TDR to the extent as stipulated below: Table 3: Entitlement for TDR for heritage conservation (MCGM, 2016)

Area Under Reservation

Entitlement for TDR

Mumbai City

2.5 times the unconsumed plot area as per Zonal (basic) FSI (Maximum 2.5)

Suburbs / Extended Suburbs

2.0 times the unconsumed plot area as per Zonal (basic) FSI (Maximum 2.0)

60

Mumbai’s TDR mechanism

The grant of TDR is “subject to a contract between the owner/lessee and MCGM which binds the owner/lessee to conserve the heritage structure in the manner prescribed

by MHCC and approved by the Municipal Commissioner” (MCGM, 2016).

Heritage TDR is awarded in 2 stages:

Stage

1

After the plans for conservation of the heritage structure submitted by the owner are approved by the Municipal Commissioner, MCGM on the recommendation of MHCC, an appropriate % of the eligible TDR is awarded as a DRC

Stage

2

After the owner/lessee obtains the completion certificate for the conservation of the heritage structure from MCGM/any other appropriate authority and on the recommendation of MHCC, the residual TDR is granted by the Municipal Commissioner.

Post the award of DRC, the potential of the plot shall be reduced in perpetuity, frozen to the extent of the existing B.U.A. of the structure. Figure 4(x) illustrates the wards that have generated Heritage TDR between 1991 and 2020. Only 2 wards, A and D have generated a sum of 5 Heritage DRCs. These are some of the most expensive areas with respect to real estate in the city.

Dahisar R/N

Borivali R/CEN

Charkop R/S

Case study

Malad P/N Dahisar R/N

Guruprasad Rangnekar, trustee of Shri Parshuram Temple in Banganga (D ward), submitted his proposal to conserve the heritage structure in 2006. This was the last heritage TDR DRC issued to date. Prior to 2016, a different formula was used by MCGM to compute the extent of TDR to be awarded, which was: = (BUA as per zonal (basic) FSI + Area of plot on which heritage structure exists) – BUA consumed by the Heritage building (Simply put, Area of plot + Unutilized BUA) As per above regulation, he was awarded 256 sq.m. of Heritage TDR. DRC no. :5 DRC issued on : 24.11.2006 Plots affected : 81, 6 1/82, Malabar Hill

Goregaon P/S

Borivali R/CEN

Malad P/N

Prior to 2016, heritage TDR was the only type of TDR permitted to be used in the island city wards. It was to be used to a maximum of 40% of the net plot area of the receiving plot i.e., the FSI of the plot was permitted to be exceeded by 0.4 using Heritage TDR (MCGM, 1995). Low TDR generation, however, drove the purchase cost of heritage TDR to almost ₹ 18000 per sq.ft., whereas all other types ranged between ₹4000-6000 per sq.ft. (Babar, 2015).

Presently, all utilization regulations are the same as mentioned in section 4.3.1.2.

Charkop R/S

Andheri K/W

Mulund T

Goregaon P/S

Kurla L Santacruz H/E

Andheri Bandra K/W

H/W

Vile Parle K/E

Mahim G/N

Bandra H/W

Santacruz H/E

Byculla E

Bhandup S

Kurla L

Ghatkopar N

Walkeshwar D

Chembur M/W

Matunga F/N

Walkeshwar D

1

Mandvi Colaba Fort B A C

Colaba A

0

km 4

2

1

Low

Bycul E

C

km 4

0

1

2

km 0 41 2 Legend

km 4

Legend: Res_TDR_G

< 10000 sq.m. <10000 m2 10000 - 50000 10 - 50K m2 50000 - 1 lakh 50 - 1 lakh m2 1 lakh - 2.5 lakh 1L - 2.5L m2 Heri_TDR_G 2 2.5 - 5.1 lakh sq 2.5L - 5.1L m No H-TDR generated Legend

850 - 1300 sq.m.

Fig.4(x): Total heritage TDR generated

Case study Considering the 2015 selling rate of Heritage TDR, the TDR buyer would have paid Guruprasad = ₹18,000 x 10.76 x 256 = ₹4.9 crore in 2015. The author was unable to retrieve the records of the actual transaction and spatial details of heritage TDR utilization, hence the above calculation is speculative.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

Colaba C A

oo

0 - 850 sq.m.

2

Ma

Walkeshw Fort D B

Deonar M/E

Byculla E

o

Lower Parel G/S

Deonar M/E

Walkeshwar Lower Parel Parel DG/S Mandvi F/S Fort B C

o

Band H/W

Ghatkopar N

Chembur M/W

Matunga F/N

Lower Parel Parel G/S Mahim G/N F/S

And K/W

Bhandup S

Vile Parle K/E

0

4.3.2.2 Mechanism on the Receiving side

Malad P/N

Mulund T

61

4.3.2.3 Assessing the types from

Stakeholders’ Perspective For the TDR seller

a.

Heritage TDR has a convoluted history in Mumbai, and consistently low incentives have made it a poor choice for owners/lessees of heritage properties. Thus, on the generation side, heritage TDR has suffered.

b.

The extent of permissible BUA under cessed building redevelopment policy, far exceeds the BUA awarded as heritage TDR, making the former more viable.

c.

Absence of clear guidelines and misconceptions regarding conservation discourage owners/lessees from submitting their proposal plans for conserving their structure.

d.

The multi-stage release of Heritage TDR is an impediment – the low demand for heritage TDR makes it difficult for the owner/lessee to generate funds for executing the conservation works as per MHCC’s guidelines. This blocks the 2nd stage award of TDR.

62

Mumbai’s TDR mechanism

For the TDR buyer

a.

The potential to utilize all types of TDR across the city is advantageous for TDR buyers, since the demand for TDR is perpetual. However, the virtually non-existent supply and higher prices of heritage TDR make it less viable for buyers.

b.

The quantum of TDR per DRC is low in the case of heritage TDR; thus, buyers would require to collect a large number of DRCs to accumulate adequate TDR, involving a larger number of agreements.

For MCGM and the city MCGM

a.

The intent of introducing heritage TDR remained unmet due to the inability to generate demand for this type of TDR and the availability of alternate, more rewarding options.

b.

Today, many precincts previously tagged as heritage are being untagged due to developmental pressure and general confusion related to conservation guidelines.

c.

There have been numerous litigations related to heritage TDR due to differences in MHCC and ASI certification criteria.

d.

There is a lack of techno-legal assistance to the individual/communities involved in the conservation of the heritage building/precinct. Unlike road and reservation TDR, this involves a much more active response and participation from the owner’s end, for which the incentive is just not adequate.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

63

4.3.3. Slum TDR and

Construction Amenity TDR 4.3.3.1 What is Construction Amenity TDR?

4.3.3.2 Mechanism on the Sending side: Land, Rehab and Construction Component

Section 4.2, Regulation 32 DCPR 2034 (MCGM, 2016)

The process of slum TDR generation begins with the declaration of a Slum Rehabilitation Project in a Slum Rehabilitation Area, considered by SRA for approval when 51% or more eligible hutment/pavement dwellers

In order to involve the private sector in the provision of public amenities, the government has incentivized the construction and of buildable amenities through Construction Amenity TDR. Upon handing over the developed/constructed amenity free of cost to MCGM along with the reserved amenity plot, the owner is eligible for the award of TDR (in addition to land TDR) to the extent of : Construction Amenity TDR in sq.m. = A/B * 1.5* B.U.A. where, A = Construction cost per sq.m. in

rupees as per the ASR for the

year in which construction of

amenity is commenced, which

is ₹30,250 for Greater Mumbai as

per Registration department B = Land rate per sq.m. for the year

in which construction of amenity is commenced B.U.A. = Built up area of constructed

amenity(MCGM, 2016)

64

Mumbai’s TDR mechanism

agree to partake in a rehabilitation scheme.

The developer / society / NGO on a plot of land for which an SRP is sanctioned is eligible for TDR in the following components:

Land Component BUA to the extent of the zonal (basic) FSI is awarded as TDR for the surrender of land for insitu slum rehabilitation.

Rehab Component

SRA compensates developers of SRPs through incentive FSI for sale tenements against the construction of rehabilitation tenements and their associated common areas , welfare

Stage 2 The balance is granted upon completion of the total rehabilitation component.

1 week - 3 months

Application

What does the landowner do?

Submit printed application to SRA/ MHADA for grant of DRC along with prerequisite documents and security fees Pay scrutiny fees to Town Planning department Pay legal charges to Legal department

1.5 - 2 months

Scrutiny

How is the application scrutinized?

Joint Measurement (J.M.) survey of the land by City Survey Department, SRA

Land title clearance verification

by Legal department, SRA

Public notice by T.P. dept. for inviting objections from citizens w.r.t. land title If land title is found to be clear, Chief Executive Officer, SRA endorses the grant of TDR through a letter to the Municipal Commissioner & Ch. E. (D.P.), MCGM

6 weeks - 2 months

Stage 1 The grant of TDR not exceeding 50% of the eligible B.U.A. is allowed post the construction of the framework for one complete building in rehabilitation component, or when the construction of 10% of the rehabilitation component is completed.

Private land owner voluntarily offers to surrender land for Slum/PAP (Project Affected Persons) rehabilitation in exchange of TDR

Compensation

centres, balwadis etc. This incentive FSI for free sale component depends on the area of the Scheme and developed land rate and construction rate as per the ASR of the year in which LOI is sanctioned (Annex. _).

Thus, the total sanctioned B.U.A. for a SRP is the sum of the rehabilitation B.U.A. and incentive B.U.A. However, by regulation 33(10) of DCPR 2034, the maximum permissible FSI for any slum site is 3.0 for plots with access road width between 9m and 13m, and 4.0 for plots with access road width greater than 13m.

The rehab component TDR awarded to the SRP developer is the difference between the sanctioned FSI and the in-situ utilized FSI, as explained in the flowchart alongside. The developer is also permitted to take in full or part thereof, the area sanctioned for sale tenements as TDR to be utilized elsewhere. The sanction of TDR is recommended by SRA and approved for award by MCGM, in stages.

Possession of land taken with approval of D/y Ch. Er., DP dept., Property Rate card issued in name of MCGM Original land owner is granted Slum TDR in form of Development Rights Certificate (DRC) Land component

Const. Am. component

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

Rehab component

65

km 4

Construction Amenity Component

Figure 4(xi) illustrates the total amount of slum TDR generated from 1997 to 2020, sub-divided into pre-2016 and post-2016 trends. The earlier area-to-area transfer of TDR encouraged developers to undertake SRPs in wards with low real estate prices such as L, M/E and M/W, as is apparent in the 1997-2016 spatial concentration

For the construction of any buildable amenity on the amenity plot of the SRP site, the developer is awarded additional TDR to the extent of 1.35 times the TDR generated as per the formula for computing Construction Amenity TDR. Dahisar R/N

Malad P/N

Bhandup S

Vile Parle K/E

Matunga F/N

o 0

1

2

Kurla L

Bhandup S

Deonar

Byculla E Walkeshwar D

Lower Parel G/S

Chembur M/W

oo 0

Byculla E

1

2

km 41 2

0

BycullaMahim

G/N Mandvi E Walkeshwar Fort B Matunga D C Mandvi Parel F/N

F/S

Lower Parel G/S Colaba A

Legend: Slum_TDR_G

o

o

Legend

0

1

2

66

Deonar M/E Legend Legend Road_TDR_G

Slum_TDR_G < 10000 sq.m. < 1 lakh sq.m.

o

Mahim G/N Matunga F/N

1 - 2 lakh sq.m.

Lower Parel G/S

30000 - 60000 sq.m.

0

1

Parel F/S

D

C

SlumG_93to16 Legend: SlumG_93to16 < 1 lakh sq.m.

o

2 1 lakh - 2 lakh sq.m. sq.m.

Colaba < 1 lakh

1

2

km 4

Parel F/S

Byculla E Walkeshwar D

Deonar M/E

Fort C

Mandvi B

RoadG_93to16 < 10000 sq.m.

o

30000 - 60000 sq.m. km sq.m.

90000 - 1.5 lakh

Colaba A

Colaba A

60000 - 90000 sq.mm.

0

1

2

Legend

< 1 lakh m A 2 lakh - 5 lakh sq.m. lakh - 2 lakh sq.m.

1L - 2L m2 5 lakh - 151lakh sq.m. lakh sq.m.

2 lakh - 5 lakh sq.m.

2L - 5L m2 15 lakh - 27.4 5 lakh - 15 lakh sq.m.

5L - 15L m2 kmm2 15 lakh - 27.4 lakh sq.m.

15L - 27.4L 0 1 2 4

o

Chembur M/W

Mandvi Fort B C

Legend

0

Lower Parel G/S

Deonar M/E

Byculla E

Walkeshwar 60000 - 1.2Dlakh sq.m.

Mandvi

km Fort B 1.2 lakh - 1.74 lakh sq.m.

15 lakh sq.m.

2 lakh 4- 27.5

Matunga F/N Ghatkopar N

10000 - 30000 sq.m.

Walkeshwar 2 - 5 lakh sq.m.

5 - 15 lakh sq.m.

C Mahim G/N

Legend

10000 - 30000 sq.m.

Legend

Colaba A

Colaba

A Byculla E

Santacruz H/E

M/W Kurla L

Lower Parel Mandvi Fort Parel B G/S C F/S

Bandra H/W

Bhandup S

Santacruz ParelBandra H/E H/W F/S Matunga

Walkeshwar D

Kur L

Ghatkopar N

Deonar Chembur M/E

Matunga F/N

Byculla E

Mandvi Fort B C

Ghatkopar N

F/N

Chembur M/W

Byculla E

km 4

Mumbai’s TDR mechanism

Lower Parel G/S

Deonar M/E

Parel F/S

<1 < 1 lakh m 2 1 - 2 lakh sq.m.

1L - 2L mSlum_TDR_G 2 -sq.m.

5 lakh sq.m.

2L - 5L m2 < 1 lakh 1 - 2 lakh sq.m.

5 - 15 lakh sq.m.

5L - 15L m2 2 - 5 lakh sq.m. kmm2 lakh 15L - 27.5L 5 - 15 15 lakh sq.m.- 27.5 lakh sq.m.

0 1 2 4 Colabasq.m. lakh A

Mahim G/N

Mulund T

Chembur VileM/W Parle K/E

Mahim G/N

Deonar M/E Ghatkopar N

Legend

2

Santacruz Andheri K/W H/E

Bandra H/W

Bhandup S

L

Santacruz H/E

Bandra H/W

Deonar M/E

B

Vile Parle K/E

Goregaon Kurla P/S L Kurla

Ghatkopar

Walkeshwar

Mandvi D Fort B km 4 C

15 lakh - 27.5 lakh sq.m.

km 4

Fort C

Colaba

BycullaA E

Walkeshwar D

Parel F/S

Kurla L

Andheri K/W

K/E

Ghatkopar N N

Bandra Santacruz Lower Parel H/W Parel H/E Matunga G/S F/S F/N

Ghatkopar M/E N

Deonar M/E

Matunga F/N

Mahim Lower Parel Parel G/S G/N F/S

Chembur M/W

Chembur M/W

G/N

Matunga F/N

Chembur M/W

Goregaon P/S

Bhandup S

Vile Parle Malad P/N Vile K/E Parle

T

Vile Parle Matunga K/E F/N Mahim

Santacruz H/E

Mahim G/N

Colaba A

Santacruz H/E

Malad P/N

Bhandup S

Charkop R/S

Andheri K/W

Charkop R/S

(b)

Mulund T

Borivali R/CEN

Andheri K/W

Ghatkopar N Mulund

Kurla Kurla L L

Bandra Santacruz Andheri Mahim H/W K/W H/E G/N

Bandra H/W

Chembur Vile Parle K/E M/W

Mandvi B

Mulund T

Goregaon Dahisar P/S R/N

Bhandup S

Santacruz Goregaon H/E P/S

Bandra H/W

Mulund T Ghatkopar N

Andheri K/W

Fort C

Borivali R/CEN

Goregaon P/S

Bhandup S

Charkop R/S

Vile Parle Malad Andheri P/N K/WK/E

Santacruz H/E

Byculla E

Malad P/N

Mulund

Kurla

Bandra H/W

Borivali R/CEN

Charkop R/S

(a)

Bhandup T S

Goregaon P/S

Andheri K/W

Charkop R/S

Kurla

Walkeshwar D

Borivali R/CEN

Vile Parle L K/E

Mahim G/N

Dahisar R/N

P/N

Goregaon L P/S

Colaba A

Mulund T

Mulund T

Charkop R/S

Malad P/N

Lower Parel G/S

Malad P/N

Charkop R/S

Borivali R/CEN

Andheri K/W

Borivali R/CEN

Mandvi Fort B C

Dahisar R/N

Goregaon Goregaon P/SP/S Dahisar R/N Malad

R/N

Vile Parle K/E

Borivali R/CEN

of Malvani Aagar slum settlement in Malad).

Dahisar Charkop R/N R/S

Mulund T

Goregaon P/S Dahisar

Walkeshwar D

clusters (for instance, rehabilitation of residents

Charkop R/S

Malad P/N

Parel F/S

Dahisar R/N

Borivali R/CEN

Malad P/N

Lower Parel G/S

an area-based response to the location of slum

Dahisar Borivali R/CENR/N

Charkop R/S

Bandra H/W

shifted towards the northern suburbs, indicating

Dahisar R/N

Borivali R/CEN

Andheri K/W

of slum TDR. Post 2016, however, this trend has

4

SluTDR_G16 Legend: SluTDR_G16 Legend

< 10000 sq.m.

sq.m. sq.m. < 10000 <10000 m2 10000 - 20000 20000 - 30000 sq.m.

2 10000 10K - 20K m 30000 - 40000 sq.m.- 20000 sq.m. sq.m.

20000 - 30000 sq.m.

20K - 30K m2 40000 - 54500 30000 - 40000 sq.m.

30K - 40K m2 40000 - 54500 sq.m.

40K - 54.5K m2

Fig.4(xi): Total Slum TDR generated between 1993 and 2020, subdivided into (a) 1997 to 2015 and (b) 2016 to 2020

The island city wards and the suburban wards of H/W and K/W are the lowest generators of slum TDR – possibly due to the lack of adequate incentive to construct SRPs in such areas which have higher demand for luxury housing. The concentration of cessed buildings in the area makes it a more financially viable decision for developers to undertake redevelopment under 33(7) rather than 33(10). Additionally, unlike in SRA projects, rehabilitation and incentive FSI can both be utilized in-situ with no maximum FSI limit in the case of cessed building redevelopment.

Case study M/S. Sigma LandCon LLP undertook the construction of an amenity – Municipal Market for an amenity plot of a Slum Rehabilitation Project in Goregaon (P/S ward) in the year 2020. The B.U.A. of amenity so constructed was 3285 sq.m, at a cost of ₹9.94 crore to the developer.

DRC no.

DRC issued on Plots affected

Area of amenity RRo in 2020 TDRo

: SRA/1372/Const : 31.01.2020 : 77, 77/1, 2, 8, 9, 10, 11, 12, 13, 18, 19, 20 and 78 : 3285 sq.m. : ₹80,500 / sq.m. : 2500 sq.m.

4.3.3.3 Mechanism on the Receiving side Apart from the regulations for utilization of TDR as mentioned in section 4.3.1.2, slum TDR has an additional regulation in the form of a minimum and maximum cap.

It is mandatory for all TDR buyers to purchase a minimum of 20% of the total TDR utilized from the slum TDR DRCs. However, they cannot use slum TDR exceeding 50% of the total TDR utilized.

For the use of slum TDR, the TDR buyer has to pay a relaxation premium to MCGM to the extent of 10% of the normal premium while condoning deficiencies in open spaces.

Slum TDR in Mumbai was infamously hoarded by a number of large builder-developer and infrastructure companies, who influenced not only its market prices but also the quantum of slum TDR supplied in the real estate market.

The price of slum TDR was therefore extremely volatile. Post 2016, however, barely 1% of the total slum TDR generated is available for utilization and there are no new PAP projects to boost generation. Thus, slum TDR is more expensive than road and reservation TDR (referred to in layman terms as General TDR), with prices ranging from 45-60% of the ASR of the receiving plot (K. Chotalia, personal communication, February 17, 2021).

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

67

Dahisar R/N

Borivali R/CEN Dahisar R/N

Malad Dahisar P/N

Borivali R/CEN

Borivali R/CEN

R/N

Dahisar R/N

Borivali R/CEN

Charkop R/S

P/S

Charkop R/S

Mulund T

Mulund T

Malad Goregaon P/S P/N

Andheri K/W

Goregaon P/S

Vile Parle Bhandup S K/E

Andheri K/W

Andheri K/W

Kurla L

Ghatkopar N

Mahim G/N

Bandra H/W

Lower Parel G/S

Chembur M/W

Deonar M/E

Deonar M/E

Matunga F/N

Walkeshwar D Fort C

Walkeshwar D

Colaba A

o

Lower Parel G/S Byculla

Legend:

Byculla E

0

Mandvi Fort B C

1

o 0

1

Mandvi B

oo o

Colaba

A

1000 - 3000 sq.m.

3000 - 6500 sq.m.

2.75L - 3.25L m

2

6500 - 10000 sq.m.

km2 4

1

km 4 10000

0

1

2

Legend

km sq.m.

- 18000 4

Mahim G/N

Lower Parel G/S

Deonar M/E

Slum_TDR_G

< 1 lakh sq.m.

Walkeshwar D

Fort C

5 - 15 lakh sq.m.

D

Mandvi Fort B C

Colaba A

Parel F/S

Byculla E

Parel1 - 2 lakh sq.m.

F/S 2 - 5 lakh sq.m.

Byculla E

San

Deonar M/E

Matunga F/N

Mandvi B

15 lakh - 27.5 lakh sq.m.

Colaba A

o

Legend

Legend: Slum_TDR_U

Legend

< 1000 sq.m.

A Colaba

2L - 2.75L m2 km 4

Lower Parel G/S

Road_TDR_U

1.75L - 2L m2

Mumbai’s TDR mechanism

Fort C

Legend

Matunga F/N

Parel F/S

B

Bandra H/W

Chembur Deonar M/E M/W

Mahim G/N Chembur M/W

Byculla Walkeshwar Mandvi E

Fort Walkeshwar DC

50000 - 1L m2

Fig. 4(x) and 4(xi) illustrate the trend of total TDR utilization from 1997 to 2000 and slum TDR utilization from 2016 to 2020. As discussed in the history of TDR, area-to-area transfer of TDR enabled developers to use TDR generated in lowprice areas of the city in areas with expensive property rates and high real estate demand.

H/W and K/W became the most desirable

68

Walkeshwar D

< 50000 m2

0 2 3.25L - 3.8L m 0 1 2 Fig.4(xii): TDR utilized between 1993 and 2000

2

E

km 4

2

1L - 1.75L m2 Colaba A

Parel F/S

Ghatkopar N

N

Mahim G/N

Lower Parel G/S

Parel F/S

Kurla L

Santacruz BandraChembur Kurla H/E Ghatkopar H/W M/W L

Matunga F/N

Mandvi B

Andheri K/W

Bhandup N S

H/E

H/W

Byculla E

G

Vile Parle K/E Ghatkopar

Kurla L

Santacruz Vile Parle H/E K/E

Mahim G/NSantacruz Bandra

Parel F/S

Bhandup S

Chembur M/W

Matunga F/N

Santacruz H/E

Mahim G/N

Ghatkopar N

Andheri K/W

Santacruz H/E

Malad P/N

K/W Kurla L

Bandra H/W

Bhandup S

B

Mulund T

Mulund T

Goregaon Andheri P/S

Vile Parle K/E

Bhandup S Vile Parle K/E

Lower Parel G/S

P/N

Malad P/N

Goregaon P/S

Mulund Charkop R/S T

Borivali Goregaon R/CEN Malad

Charkop R/S

Malad P/N

Bandra H/W

Dahisar R/N

Charkop R/S

0

1

2

km 4

Legend

Road_TDR_U

Slum_TDR_U 2 < 15000 sq.m. < 1000 sq.m < 15000 sq.m.

2 15000 30000 300 15000 - 30000 sq.m. 1000 -sq.m 230000 - 45000 sq.m.

3000 -sq.m 650 30000 - 45000

< 15000 m 15K - 30K m 30K - 45K m sq.m. 6500 - 100 45000 - 60000 sq.m 45K - 60K m245000 - 60000 60000 - 77000 sq.m. 10000 - 180 2 60000 - 77000 sq.m 60K - 77K m

Fig.4(xiii): Slum TDR utilized between 2016 and 2020

western coastal wards in the suburbs. However, since 2016, the utilization is visibly higher in K/E and K/W wards and the peripheral suburbs S and T wards, possibly used in the same ward o reduce the impact of indexation on usable TDR and its purchase cost. It would be financially unviable for developers to use slum TDR in island city, due to the exceptionally high prevailing land rates.

4.3.3.4 Assessing the types from

Stakeholders’ Perspective

Case study M/s Oberoi Constructions purchased 2500 sq.m. of TDR through a TDR agent from M/S Sigma LandCon at 54% of the ASR of receiving plot, in 2020.

For the TDR seller

Receiving plot ward: T RRr : ₹69,600 / sq.m., as per DRC

generating year, 2018 RRo : ₹80,500 / sq.m., as per DRC

generating year, 2018 TDRo : 2500 m2 TDRr : 2890 m2, after indexation

a.

Compensation through sale of slum TDR was ₹10.9 crore. If Sigma LandCon had sold the constructed floorspace at market rate (₹80,500 / sq.m.), they would have earned ₹26.4 crore.

TDR purchase cost for the developer (i.e., M/S Sigma LandCon’s earning) = 54% of 69,600 x 2890 = ₹ 10.9 crore

b.

Construction of amenity for SRPs on plots with high land rates appears to reduce the yield of TDR. Even though the developers recovered the construction cost and made a marginal profit, it is still extremely nonviable considering the market value of the constructed floorspace.

c.

Indexation of TDR has negatively impacted the generation of slum TDR.

d.

Due to the requirement of initial capital investment for generating slum TDR, the supply side control tends to be restricted in the hands of large developers and builders, thereby making slum TDR prone to cartelization. SRA’s initial intent of involving the slum dwelling communities in the rehabilitation process has not achieved fruition.

M/S Oberoi Constructions have to pay MCGM their due TDR utilization scrutiny fees and infra improvement charges, Scrutiny fees

= 2890 x 59 = ₹ 1.7 Lakh Infrastructure Improvement Charges

= 85 x 5% of ₹ 30250 = ₹ 1.28 L Relaxation premium for OSD

= 10% of (50% of ASR) = ₹87 lakhs Including the cost of construction, the approximate total purchase cost of 85 sq.m. of TDR for the buyer = ₹19.75 crore. The market price of residential floorspace in the area in 2019 = ₹1.95 lakhs / m2. Thus, the TDR buyer earned ₹56.2 crore against his/ her expenditure of ₹19.75 crore, amounting to ~ 3 times the purchase cost.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

69

e.

f.

The positive aspects of slum TDR are the high quantum of TDR per DRC which would allow the DRC holder to accrue higher profits.

The stipulation of minimum utilization also ensures perpetual demand.

For MCGM and the city MCGM

a.

Revenue from scrutiny and other fees = 1.26 crore

b.

Slum TDR has been misused due to the absence of demarcation of sendingreceiving zones. Considering the scale of SRPs and extent of TDR generated, MCGM should have conducted a carrying capacity assessment to mark receiving zones, such that DP zoning could be implemented successfully.

c.

Increased costs of slum TDR and the Open Space Deficiency Premium escalate project costs tremendously, causing areas with expensive property rates to become increasingly (and irreversibly) unaffordable.

d.

Pre-2016 use of slum TDR, especially in the restricted corridors has strained infrastructure systems in the suburban areas of the city – such as transport networks, roads and other civic amenities.

For the TDR buyer

a.

b.

c.

The purchase cost of 2500 sq.m. was ₹19.75 crore for the buyer. If they had purchased the same as premium FSI, which is charged at 50% of the ASR of the receiving plot, the purchase cost would have reduced to ₹17.6 crore.

Due to demand-supply dynamics and inflexible regulations, slum TDR is currently the most expensive type of TDR in use.

The mandatory 20% use stipulation has a higher cost implication, which is ultimately transferred on to the buyer of the floorspace.

Fig.4(xiv): Trend of TDR generation between 2016 and 2020: Decline of slum TDR 300000 250000

Slum TDR

Road TDR

Reservation TDR

Heritage TDR

200000 150000 100000 50000 0 2016

70

2017

Mumbai’s TDR mechanism

2018

2019

2020

Dahisar R/N

Borivali R/CEN

Charkop R/S

Charkop R/S

Malad P/N

Malad P/N

Dahisar R/N

Mulund T

Dahisar R/N

Goregaon P/S

Borivali R/CEN

Borivali R/CEN

Bhandup Malad S Charkop

Charkop R/S

Andheri K/W

Bhandup S Vile Parle K/E

P/N

Mulund T

Ghatkopar N Goregaon Mulund P/S T

Goregaon P/S

Kurla L Bandra H/W

KurlaAndheri K/W Bhandup L Bandra H/W

S

Santacruz H/E

M/W

G/N

Bandra H/W

Lower Parel G/S

Matunga F/N

Chembur M/W

F/SMahim

Walkeshwar Lower Parel D

Matunga F/N

G/S

Byculla E Walkeshwar D

2

o 1

2

Mandvi Fort B C

km 4

o 0

1

2

Fort C

Colaba A

o

Legend

Amen_DemPC

1

57

2

0 - 1 sq.m.

1 - 2 sq.m.

2 - 3 sq.m.

3 - 4 sq.m.

Legend: SRS_projeckm

4 - 6 sq.m.

4

57

Legend

SRP completed 57 SRP pending

Legend

Road_TDR_U SRS_Const

SRS_pend < 1000 sq.m.

SRS_Const

Fig.4(xv): Ward-wise data of SRPs completed vs pending

SRS_pend

km 4

Mandvi B

Legend

SRS_projec

Colaba A

Parel F/S

Byculla E Walkeshwar D

0

Walkeshwar D

Deonar M/E

Exceeds demand

Parel F/S

Byculla E

Colaba A

km 4

0

Colaba Mandvi Fort B AC

Lower Parel G/S

Deonar M/E

Deonar Matunga F/N M/E

Parel F/S Lower Parel

Mandvi G/S Fort B C

Ghatkopar N

Chembur M/W

Mahim G/N

G/N

Chembur M/W

H/E

H/W

L

Mahim G/N Matunga F/N

Kurla L

Ghatkopar N

Santacruz H/E

Ghatkopar N

Deonar Santacruz Bandra M/E Kurla

Santacruz H/E Parel

Byculla E

Bhandup S

Vile Parle K/E

Vile Parle Chembur K/E

Andheri K/W Mahim

Mulund T

Goregaon P/S

VileR/S Parle K/E

Malad P/N

Andheri K/W

o

1

Dahisar R/N

Borivali R/CEN

(Data source: SRA, 2021)

1000 - 3000 sq.m.

3000 - 6500 sq.m.

6500 - 10000 sq.m.

10000 - 18000 sq.m.

Despite there being many SRPs proposed in the western suburbs, the rate of completion is much lower than in the peripheral wards of M/E, M/W and T. Thus, there is potential for generation of slum TDR but an indication that with increasing construction costs, a higher incentive may be required for developers to undertake these projects.

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

71

Source: Unknown

72

5 Assessing the TDR mechanism in Mumbai

5.1 5.1.1 5.1.2 5.1.3

5.2

Win-loss Assessment

For TDR seller (Sending zone) For TDR buyer (Receiving zone) For MCGM and the city

Social Justice : An unattained but

desired goal of Mumbai’s TDR mechanism

5.3 Summary of Type-wise Advantages 5.4 Summary of Type-wise Issues

73

5.1 Win-loss Assessment 5.1.1

For TDR Seller (Sending zone)

Since the incentive factor multiplies the land surrendered by a large amount, the compensation through TDR sale is higher than sale in open market at Ready Reckoner Rate.

TDR is still a voluntary mechanism in Mumbai, and landowners can opt for alternative options too. It is also a faster compensation process on paper.

Due to its fungibility (i.e., tradeable good whose value fluctuates with market dynamics), a DRC can be retained by the holder until it generates maximum profit from sale.

74

Assessing the TDR mechanism in Mumbai

Sellers with low quantities of TDR have lesser control on the supply side of the market and, therefore, no control on the sale prices.

TDR is a market-based mechanism, so it cannot be sold as and when needed. It doesn’t work as an asset for DRC holders.

The process of obtaining a DRC is complex, often exceeds the stipulated 180 days. The market for TDR fluctuates a lot in the process.

Cost of amenity construction varies across types (like schools/hospitals), incentive factor does not necessarily take it into account Types with high market value have very low generation incentive presently.

For TDR Buyer (Receiving zone)

5.1.2

Small-time developers have very little negotiation power for TDR prices despite it being a buyer’s market.

Due to supply incentives, certain types of TDR are less expensive than chargeable FSI, decreasing the overall impact of TDR purchase on project cost

Since 2016, TDR pricing has been linked with RRR of the sending-receiving plots, increasing transparency and curbing the control of cartels on TDR supply

Since there is no platform for direct transaction with DRC holders, sellers have to rely on middlemen like TDR brokers to buy TDR Since 2018, the TDR receiving potential of a plot is calculated on the net plot area (gross plot minus reservations), reducing the extent of usable TDR Process of buying premium FSI is easier, and doesn’t require upfront payment there is a 3-year instalment option for premium FSI Since TDR is mandatory to consume, low supply affects project costs adversely

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

75

5.1.3

For MCGM and the city

MCGM

The responsibility of providing public amenities and infrastructure can be fulfilled at practically no cost, and the land so obtained is free of encumbrances and litigations

The socio-cultural intent of slum TDR and heritage TDR remained unachieved due to inadequate incentives and as a result, the city suffers Absence of a dedicated TDR cell increases the load on the DP-BP departments, processing time of TDR applications increases A strong locational bias has emerged in the city due to the absence of clearly demarcated sending-receiving zones

The process of implementing DP projects and reservations is quicker and a positive outcome is assured

The wanton densification of suburban wards using TDR has led to the gradual failure of significant city infrastructure systems Real estate divide in the city has become more pronounced due to high project costs

76

Assessing the TDR mechanism in Mumbai

5.2 Social Justice - The Unattained

but Desired Goal of Mumbai’s TDR mechanism

On the face of it, MCGM introduced TDR in Mumbai with an honorable intention - to increase the quality of life for its citizens with the aid of market forces. One such key instrument was to be Slum TDR, which could potentially house lakhs of the migrant workforce of the city. However, the tool soon transformed from people-centric to profitcentric, as procedural delays, red-tapism and opaque transactions became the order of the day. Areas with conducive real estate demand thrived with the added FSI credit from TDR, and the property prices escalated - further deepening the divide among various income classes in housing affordability.

On the other end, many slum rehabilitation projects have been abandoned even after construction due to the SRA not taking possession of the tenements. The few projects that have achieved completion are unlivable, due to the dilution of building regulations which have translated to suffocating building margins - blocking daylight and ventilation.

The displaced slum dwellers, thereafter, turned to the disused non-development zones to create unauthorized housing clusters. The long history of TDR in Mumbai has led to the scales of social justice tilting against the weaker sections of society. TDR is, today, only a “currency”, and not the development tool it was envisioned to be by MCGM.

Source: Johnny Miller

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

77

5.3 Type of TDR

Summary of Type-wise Advantages Extent of TDR awarded

Table 4: Advantages for stakeholders

Advantages

Use Potential

TDR TDR TDR TDR TDR TDR TDR TDR TDR TDR TDR TDR Type Type Type Type ofType of Type ofofofof Generation Generation Generation Generation Generation Generation Utilization Utilization Utilization Utilization Utilization Utilization TDR TDR TDR TDR TDR TDR potential potential potential potential potential potential potential potential potential potential potential potential

For TDR Seller (Sending zone)

TDR TDR TDR TDR seller TDR seller TDR seller seller seller seller

For TDR Buyer (Receiving zone)

Advantages Advantages Advantages Advantages Advantages Advantages

For MCGM and the city

MCGM TDR TDR TDR TDR buyer TDR buyer TDR buyer buyer buyer buyer MCGM MCGM MCGM MCGM MCGM MCGM and and and city and city and and city city city city

Island Island Island Island city: Island Island city: city: 2.5 city: 2.5 city: city: 2.5 2.5 2.5 2.5 Sale Sale Sale of Sale of Sale TDR Sale of TDR ofTDR ofof more TDR TDR more TDR more more more moreCheaper Cheaper Cheaper Cheaper Cheaper Cheaper than than than than than than Less Less Less burden Less burden Less Less burden burden burden on burden ononon on on times times times times area times area times area area area area profitable profitable profitable profitable profitable profitable than than than sale than than sale than sale in sale in sale sale in in in premium in premium premium premium premium premium FSI FSI FSI FSI FSI FSI exchequer exchequer exchequer exchequer exchequer exchequer and and and assured and assured and and assured assured assured assured surrendered, surrendered, surrendered, surrendered, surrendered, surrendered,50-80% 50-80% 50-80% 50-80% 50-80% 50-80% ofof ofofofof open open market open open market open market market market market currently, currently, currently, currently, currently, currently, lower lower lower lower lower lower implementation implementation implementation implementation implementation implementation ofofDP of DP ofDP ofof DP DP DP Suburbs: times Suburbs: Suburbs: Suburbs: Suburbs: Suburbs: 2 2times 2 2times 2times 2times times total total total total total total open Road Road Road Road TDR Road TDR Road TDR TDR TDR TDR impact on project cost impact impact impact impact on impact onproject on project on project on project cost project cost cost cost costreservation reservation reservation reservation reservation reservation area surrendered permissible area area surrendered area area area surrendered surrendered surrendered surrendered permissible permissible permissible permissible permissible inslum slum TDR Lull Lull inLull in Lull slum Lull in slum inTDR in slum TDR slum TDR TDR TDR Subsequent TDR Subsequent Subsequent Subsequent Subsequent Subsequent TDR TDR TDR TDR TDRLull generation generation generation generation generation Source Source Source Source Source of ofrevenue of revenue ofrevenue ofof revenue revenue generation Source revenue setback: setback: setback: setback: setback: setback: Equal Equal Equal Equal to Equal Equal to totototo further increased further further further further increased further increased increased increased increased land land land surrendered land surrendered land land surrendered surrendered surrendered surrendered utilization utilization utilization utilization utilization utilization ofof ofofofof Island Island Island Island city: Island Island city: city: 2.5 city: 2.5 city: city: 2.5 2.5 2.5 2.5 road/reservation TDR road/reservation road/reservation road/reservation road/reservation road/reservation TDR TDR TDR TDR TDR 50-80% 50-80% 50-80% 50-80% 50-80% 50-80% ofof of of ofof times area times times times area times times area area area area Reservation Reservation Reservation Reservation Reservation Reservation total total total total total total surrendered, surrendered, surrendered, surrendered, surrendered, surrendered, TDR TDR TDR TDR TDR TDR permissible permissible permissible permissible permissible permissible Suburbs: times Suburbs: Suburbs: Suburbs: Suburbs: Suburbs: 2 2times 2 2times 2times 2times times TDR TDR TDR TDR TDR TDR area surrendered area area surrendered area area area surrendered surrendered surrendered surrendered Land: Land: Land: Land: Equal Land: Land: Equal Equal Equal to Equal Equal to totototo area surrendered area area surrendered area area area surrendered surrendered surrendered surrendered Yields Yields Yields Yields Yields high Yields high high quantum high quantum high high quantum quantum quantum quantum Rehab: Rehab: Rehab: Rehab: Rehab: Equal Rehab: Equal Equal Equal to Equal Equal to totototo ofofTDR of TDR ofTDR ofof TDR TDR TDR difference difference difference difference difference difference per perDRC per DRC per per DRC per due DRC DRC due DRC due todue tolarge due due to large tolarge toto large large large between max. between between between between between max. max. max. max. max.

Min. Min. Min. 20% Min. Min. 20% Min. 20% 20% scale 20% 20% scale scale of scale scale of scale rehab of rehab ofrehab ofof rehab projects rehab projects rehab projects projects projects projects allowable allowable allowable allowable allowable allowable FSI FSIFSI FSI FSI FSI mandatory, mandatory, mandatory, mandatory, mandatory, mandatory, andand consumed utilization and consumed and and and consumed consumed consumed consumed max. max. max.

50% max. max.

50% max.

50% of 50% of 50% 50% Minimum ofMinimum ofofMinimum ofMinimum Minimum Minimum utilization utilization utilization utilization utilization Slum Slum Slum Slum TDR Slum TDR Slum TDR TDR TDR TDR FSIFSI stipulation ensures FSI FSI FSI FSI total total total total total totalstipulation stipulation stipulation stipulation stipulation ensures ensures ensures ensures ensures Construction: continued demand Construction: Construction: Construction: Construction: Construction: permissible permissible permissible permissible permissible permissible continued continued continued continued continued demand demand demand demand demand 1.35 x(1.5 (1.5 1.35 1.35 x1.35 1.35 1.35 x x(1.5 xx(1.5 x(1.5 (1.5 x xxx TDR TDR TDR TDR TDR TDR Cost of Cost Cost of Cost Cost Cost ofofofof construction construction construction construction construction construction x x x xxx BUA /BUA RRR of BUA BUA /BUA BUA RRR / RRR / of /RRR /RRR RRR ofofofof land) land) land) land) land) land) 1.5 1.5x1.5 xCost 1.5 1.5 Cost x1.5 xCost xof Cost xof Cost Cost ofofofof 50-80% 50-80% 50-80% 50-80% 50-80% 50-80% ofof ofofof ofIncentive Incentive Incentive Incentive Incentive Incentive factor factor factor factor factor factor Construction Construction Construction Construction Construction Construction construction total construction construction construction construction construction x x x xxx total total total total total encourages encourages encourages encourages encourages encourages land land land owner land owner land land owner owner owner owner Amenity Amenity Amenity Amenity Amenity Amenity BUA /BUA RRR of BUA BUA /BUA BUA RRR / RRR / of /RRR /RRR RRR ofof permissible ofpermissible of permissible permissible permissible permissible to to also to also to also to construct to also construct also also construct construct construct construct the the the the the the TDR TDR TDR TDR TDR TDR land) land) land) land) land) land) TDR TDR TDR TDR TDR TDR amenity amenity amenity amenity amenity amenity Island Island Island Island city: Island Island city: city: 2.5 city: 2.5 city: city: 2.5 2.5 2.5 2.5 times times times times times times Increased Increased Increased Increased Increased Increased incentive incentive incentive incentive incentive incentive 50-80% 50-80% 50-80% 50-80% 50-80% 50-80% ofof ofofofof unconsumed plot factor toconserve conserve the unconsumed unconsumed unconsumed unconsumed unconsumed plot plot plot plot plot factor factor factor to factor factor toconserve to conserve toto conserve conserve the thethe the the total Heritage Heritage Heritage Heritage Heritage Heritage total total total total total area, heritage premises area, area, area, area, area, heritage heritage heritage heritage heritage premises premises premises premises premises permissible TDR TDR TDR TDR TDR TDR permissible permissible permissible permissible permissible Suburbs: times Suburbs: Suburbs: Suburbs: Suburbs: Suburbs: 2 2times 2 2times 2times 2times times TDR TDR TDR TDR TDR TDR unconsumed plot unconsumed unconsumed unconsumed unconsumed unconsumed plot plot plot plot plot area area area area area area

78

Assessing the TDR mechanism in Mumbai

Mobilizing Mobilizing Mobilizing Mobilizing Mobilizing Mobilizing private private private private private private sector sector sector sector in sector sector inthe in the in provision the inprovision in the the provision the provision provision provision ofofslum/PAP of slum/PAP ofslum/PAP ofof slum/PAP slum/PAP slum/PAP rehab rehab rehab rehab rehab rehab Housing Housing Housing Housing Housing Housing

MCGM MCGM MCGM MCGM MCGM MCGM obtains obtains obtains obtains obtains obtains constructed constructed constructed constructed constructed constructed amenity amenity amenity amenity amenity amenity atat atatatat practically practically practically practically practically practically nonocost no cost no no cost no cost cost cost

Potential Potential Potential Potential Potential Potential totoconserve to conserve toconserve toto conserve conserve conserve city heritage city city city heritage city heritage city heritage heritage heritage atat atatatat practically no cost practically practically practically practically practically nonocost no cost no no cost cost cost

5.4 Type of TDR

Summary of Type-wise Issues Extent of TDR awarded

Use Potential

TDR TDR TDR TDR TDR TDR Type Type Type ofof of Generation Generation Generation Utilization Utilization Utilization TDR TDR TDR potential potential potential potential potential potential

Table 5: Issues for stakeholders

Issues For TDR Seller (Sending zone)

TDR TDR TDR seller seller seller

For TDR Buyer (Receiving zone)

Advantages Advantages Advantages

TDR TDR TDR buyer buyer buyer

For MCGM and the city

MCGM MCGM MCGM MCGM and and and city city city

Island Island city: 2.5 Island city: times 2.5 city: times 2.5 times Island Island Island city: city: city: 2.5 2.52.5 Sale Sale Sale ofCompensation ofTDR of TDR TDR more more more Cheaper Cheaper Cheaper than than than Blanket Less Less Less burden burden burden on ononof of area surrendered, area surrendered, area surrendered, Compensation Compensation TDR TDR TDR Blanket assignment Blanket assignment of assignment times times times area area area 50-80% 50-80% of 50-80% of of Suburbs: Suburbs: 2 times Suburbs: 2 area times 2 times area area for road for road TDR TDR TDR for road profitable profitable profitable than than than sale sale sale in in in premium premium premium FSI FSI FSI exchequer exchequer exchequer and and and assured assured assured surrendered, surrendered, surrendered, 50-80% 50-80% 50-80% ofof of total total total Road TDR Roadsurrendered Road TDR surrendered TDR surrendered setback setback on developed oncurrently, developed incentive incentive factor factor incentive factor setback on developed open open open market market market currently, currently, lower lower lower implementation implementation implementation of of DP of DP DP permissible permissible permissible Suburbs: times Suburbs: Suburbs: 2 2Subsequent times 2 times total total total setback: Subsequent setback: Subsequent setback: low,is low, without without ward-wise ward-wise without ward-wise plot is plot low,isplot Road Road Road TDR TDR TDR TDR TDR TDR impact impact impact on on project on project project cost cost cost reservation reservation reservation area surrendered permissible area area surrendered surrendered permissible permissible assessment Equal Equal to landEqual to landto land considering considering assessment assessment of of of considering the the the Lull Lull ininslum in slum slum TDR TDR TDR Subsequent TDR Lull Subsequent Subsequent TDR TDR requirement nuisance factor surrendered surrendered surrendered nuisance nuisance factorfactor requirement requirement generation generation generation Source Source Source ofofrevenue of revenue revenue setback: setback: setback: Equal Equal Equal toto to further further further increased increased increased land land land surrendered surrendered surrendered Island Island city: 2.5 Island city: times 2.5 city: times 50-80% 2.5 times 50-80% of 50-80% of of No designated No designated No designated utilization utilization Reservatio Reservatio area Reservatio surrendered, area surrendered, area surrendered, total utilization total total ofof of receiving receiving receiving zone, may zone, zone, may may Island Island city: city: city: 2.5 2.5 2.5 road/reservation road/reservation road/reservation TDR TDR TDR nIsland TDR n TDR Suburbs: n TDR Suburbs: 250-80% times Suburbs: 2 area times 2 permissible times area permissible area permissible 50-80% 50-80% ofof of adversely adversely impact adversely impact infraimpact infra infra times area times times area area surrendered surrendered surrendered TDR TDR TDR systems systems in congested systems in congested in congested Reservation Reservation Reservation total total total surrendered, surrendered, surrendered, areas areas areas TDR TDR TDR permissible permissible permissible Suburbs: times Suburbs: Suburbs: 2 2Land: times 2 times Land: EqualLand: Equal to areaEqual to areato area TDR TDR TDR surrendered surrendered surrendered No new Noprojects, new Noprojects, new projects, Presently, Presently, one Presently, ofone the ofone Policy theof the Policy is notPolicy flexible is not is flexible not flexible area surrendered area area surrendered surrendered Rehab:Rehab: Equal Rehab: Equal to Equal to Min.to20% Min. 20% Min. 20%generation generation side side most expensive most expensive to respond to respond toto respond to generation side most expensive to

Land: Land: Land: Equal Equal Equal totodifference to between difference difference between mandatory, between mandatory, mandatory, slowdown slowdownTDR types TDR types dip in and TDR dip ingeneration TDR slowdown TDR and types and dip in generation TDR generation area surrendered area area surrendered surrendered Yields Yields Yields high high high quantum quantum quantum extremely Mobilizing Mobilizing private private private extremely low supply max. allowable max. allowable max.FSI allowable FSI max.

FSI 50% max.

50% max.

50% low extremely supply lowMobilizing supply Slum TDR Slum Slum TDR TDR Multi-stage and consumed andFSI consumed FSIof total FSIof total of total Multi-stage releaserelease of release of of Demarcation of of of Rehab: Rehab: Rehab: Equal Equal Equal to toandtoconsumed of of TDR of TDR TDRMulti-stage sector sector sector inDemarcation inthe in theDemarcation provision the provision provision 20% stipulation sending-receiving Construction: Construction: Construction: 1.35 x 1.35 permissible xper 1.35 permissible xDRC permissible TDR TDR TDR 20% stipulation 20% stipulation sending-receiving sending-receiving difference difference difference per DRC per DRC due duedue to tolarge to large large ofofslum/PAP of slum/PAP slum/PAP rehab rehab rehab project cost,zones absent – developers to (1.5 x (1.5 Costxof (1.5 Costxof Cost ofTDR TDRdeters TDRdeters deters developers developers impacts to impacts toproject impacts cost,project cost,absent zones zones absent – – between max. between between max. max.

Min. Min. Min. 20% 20% 20% scale scale scale ofofrehab of rehab rehab projects projects projects Housing Housing Housing which is ultimately Expensive real-estate slum rehab construction construction construction x BUAx/BUA x /BUA / undertake undertake undertake slum rehab slum which rehab is ultimately which is ultimately Expensive Expensive real-estate real-estate allowable allowable allowable FSI FSIFSI mandatory, mandatory, mandatory, on DUonbuyer areas are becoming projects RRR of RRR land) of RRR land) of land) projects projects loadedloaded on DU loaded buyer DU areas buyer are areas becoming are becoming andand consumed and consumed consumedmax. max. max.

50% 50% 50% ofof Minimum ofMinimum Minimum utilization utilization utilization increasingly increasingly increasingly Slum Slum Slum TDR TDR TDR unreachable Indexation Indexation has Indexation reduced has reduced has No reduced negotiation No negotiation No power, negotiation power,power, unreachable unreachable FSIFSI FSI total total total stipulation stipulation stipulation ensures ensures ensures incentive incentive incentive since price sinceand price since even and priceeven and even Construction: Construction: Construction: permissible permissible permissiblecontinued continued continued demand demand demand Prior-2016 toup take PAP up supply PAPsupply is determined supply is determined Prior-2016 Prior-2016 use of use slumofuse slum of slum to take PAP is determined Constructi Constructi 50-80% 50-80% of 50-80% of oftouptake 1.35 (1.5 xx xCost 1.35 1.35 x x(1.5 x (1.5 xConstructi TDR TDR TDR 1.5 1.5 xofCost 1.5 xof Cost of projects projectsby cartel by cartel TDR leaders has TDR strained has TDRstrained has infrastrained infra infra by leaders cartel leaders on on on total total totalprojects construction construction construction x BUA x / BUA x / BUA / Cost Cost Cost ofofAmenity of Amenity systems systems in suburbs systems in suburbs in suburbs Amenity permissible permissible permissible RRRxof RRR RRR land) of land) construction construction construction xland)of toRestricted largeto large to large TDR TDRx TDR TDR TDRRestricted TDR Restricted BUA / RRR BUA BUA / RRR / RRR ofof of scale developers scale developers scale developers   Prone Prone to cartels Prone to cartels to cartels land) land) land) 1.5 1.5x1.5 xCost Cost x Cost ofof of 50-80% 50-80% 50-80% ofof of Incentive Incentive Incentive factor factor factor MCGM obtains obtains obtains Construction Construction Construction New incentive New incentive New factor incentive factor Presently, factor Presently, one Presently, ofone the ofone No theMCGM of clear the NoMCGM heritage clear No heritage clear list heritage list list construction total encourages construction construction xx x total total encourages encourages land land land owner owner owner constructed constructed constructed amenity amenity amenity attill at 2012, at needs to needs be compared needs to be compared to be compared most expensive most expensive was available was available was tillavailable 2012, till 2012, most expensive Amenity Amenity Amenity BUA / RRR permissible BUA BUA / RRR / RRR ofof of permissible permissible to to also to also also construct construct construct the the the practically practically practically no no cost no cost cost TDR types and with the with previous the with previous the one previous one TDR one types and TDR types litigations and litigations due litigations to due to due to TDR TDR TDR land) land) land) TDR TDR TDR extremely low supply extremely low extremely supply low difference supply difference indifference MHCCin MHCCin MHCCamenity amenity Island Island city: 2.5 Island city: times 2.5 city: times 2.5 times amenity Multi-stage Multi-stage releaserelease of release of of Multi-stage unconsumed unconsumed unconsumed plot plot50-80% plot50-80% of 50-80% of of

ASI certification ASI certification ASI certification

H-TDR: H-TDR: Lower H-TDR: Lower Low Lower Heritage Low Heritage Low TDR Heritage per TDR per TDRcriteria per criteria criteria Island Island Island city: city: city: 2.5 2.52.5 Heritage Heritage area, Heritage area, area, total total total demand demand and demand high andprice high andDRC, price high price buyer DRC,DRC, will buyerhave buyer will have will have toto times times times Increased Increased Increased incentive incentive incentive Potential Potential Potential conserve to conserve conserve TDR TDR Suburbs: TDR Suburbs: 2 times Suburbs: 2 times 2permissible times permissible permissible 50-80% 50-80% 50-80% ofof of Lack of awareness mean that mean the mean that owner the that owner isthe to owner issource toissource multiple to source multiple multiple Lack of Lack awareness of awareness unconsumed unconsumed plot plot TDR plot TDR TDR unconsumed plot unconsumed unconsumed plot plot unconsumed factor factor factor to to conserve to conserve conserve the the the city city city heritage heritage heritage at at at generation less likely less to likely less be able likely to betoable toDRCs betoable totoaccumulate DRCs to accumulate generation generation and and and DRCs to accumulate total Heritage Heritage Heritage total total area, area, area, area area area heritage heritage heritage premises premises premises practically practically practically no nocost no cost assistance to the generate generate funds generate for funds funds for adequate for TDR adequate TDR assistance assistance to the to thecost adequate TDR permissible TDR TDR TDR permissible permissible Suburbs: times Suburbs: Suburbs: 2 2times 2 times individual/communitie conservation from from from conservation conservation individual/communitie individual/communitie TDR TDR TDR s in the heritage marketmarket forces market forces forces s in thes heritage in the heritage  2nd  2nd 2nd unconsumed plot unconsumed unconsumed plot plot structure/precinct stage TDR blocked stage TDR stage blocked TDR blocked structure/precinct structure/precinct area area area

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

79

Source: Ride with VJ, 2021

80

6 Case Study: TDR in Hyderabad

6.1.

Definition and Purposes of TDR in Hyderabad 6.2.

Legal provisions for TDR mechanism 6.3 A Timeline of TDR in Hyderabad 6.4. Mechanism for TDR generation 6.5. Mechanism for TDR utilization 6.6. Hyderabad’s Online TDR Portal and TDR Bank 6.7.

Assessing Hyderabad’s TDR mechanism: Key Learnings for Mumbai

81

6.1. Definition and Purposes

of TDR in Hyderabad The TDR mechanism in the city of Hyderabad, Telangana, has been lauded by NITI Aayog as one of the best practices for land acquisition for development works, worth emulating in other states of India. Greater Hyderabad Municipal Corporation (GHMC) has issued over 800 TDR certificates valued at ₹3095.5 crore, since the introduction of TDR in 2006 (“New TDR policy”, 2021). The greatest success of Hyderabad’s TDR mechanism lies in the speedy acquisition of land for several road infrastructure projects such as flyovers, road over bridges and under bridges etc., under its Strategic Road Development Plan.

According to the GHMC TDR bank website (http://tdr.ghmc.telangana.gov. in:8080/), TDR is the means for making a specific amount of B.U.A. available in lieu of land surrendered by the owner, which they can utilize themselves or sell it to another in requirement of additional floor space.

There are three main purposes for which TDR is used in Hyderabad:

82

Case study: TDR in Hyderabad

Road TDR For the surrender of land towards execution of Master Plan roads / projects in the Road Development Plan, landowners are awarded TDR to the extent of 400% (i.e., 4 times) of B.U.A. of the area surrendered. Apart from TDR, the owner has two options: construct an additional floor of B.U.A. equal to the land surrendered subject to safety regulations, or to avail concessions in plot setbacks for greater ground coverage. In the case of monetary compensation, the owner would be entitled for 200% of the registration value.

Since all of these alternatives yield relatively lower incentives for the landowner, road TDR has gained precedence over them.

115 DRCs have been issued for SRDP projects, 83 for Link Road construction and 504 for miscellaneous road widening projects across the city, saving GHMC about ₹2500 crores in acquisition cost (“Pandemic cloud”, 2021).

Greenery Reservation TDR The owner who surrenders land for the conservation and development of recreational buffers and water bodies such as lakes and

nalas is entitled to TDR to the extent of 200% of B.U.A. of the area surrendered. About 65 DRCs worth 539 crore have been issued for tank beautification projects and 40 DRCs for nala widening, saving GHMC ₹580 crore in acquisition cost (“Pandemic cloud”, 2021).

Heritage TDR Since Hyderabad is known for its rich heritage in the older areas of the city, heritage conservation is also an important goal for the local body. 100% of the B.U.A. of the site area where heritage buildings and precincts are maintained with adaptive reuse is awarded as TDR to the owner of the property. This type of TDR has, however, not met with success since there is no evident share of heritage TDR in the DRCs issued by the authorities.

After Telangana was formed in 2014, the TDR policy was revised through a Government Order Manuscript (G.O.Ms.) 330, dt. 28.12.2017 to increase the TDR incentive.

The following statutory acts and regulations form the legal basis for the TDR mechanism in Hyderabad:

a.

s/585 read with 592, Greater Hyderabad Municipal Corporation Act, 1955

b.

s/14, 32, 46, 58, Telangana Urban Areas (Development) Act, 1975

c.

s/56 (1), Hyderabad Metropolitan Development Authority Act, 2008

d.

s/18, Telangana Municipal Corporations Act, 1994

e.

s/326, Telangana Municipalities Act, 1965 amended in 2019

6.2. Legal provisions for TDR mechanism TDR as a concept was introduced in Andhra Pradesh in 2006, and made part of regulations through Rule 17 of the Building Rules, 2012 issued by the Municipal Administration and Urban Development (MA & UD) department.

Fig.6(i): Hyderabad old city; Source: Satyanarayana, 2020

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

83

84

Case study: TDR in Hyderabad

In February 2020, another landmark initiative was undertaken by GHMC – the launch of an online portal for TDR transactions and TDR bank. This website brought about tremendous transparency in the transactions between DRC holders and potential buyers of TDR.

2017

This policy was subsequently amended in 2012 through G.O.Ms. 168, whereby the incentive was doubled to 200% and 100% respectively. However, citizens of Hyderabad were still wary of the mechanism due to misinformation and preferred to obtain monetary compensation, as the returns were immediate and assured.

TDR finally gained popularity as a compensation mechanism in 2017, when the TDR incentive was further doubled to 400% and 200% respectively. The local body intended to make TDR a competitive compensation alternative against monetary compensation, and to encourage voluntary surrender of land for the speedy implementation of SRDP projects. At the time, only 115 DRCs had been generated till 2019. However, the new policy encouraged more and more land owners to opt for TDR and between 2019 and 2021 alone, 765 DRCs have been awarded.

2020

2006

The concept of TDR in Hyderabad is relatively recent, but GHMC has made great strides with the use of TDR in their objective of infrastructure development, in a short span of time. TDR was introduced in Andhra Pradesh in the year 2006 through the Revised Common Building Rules, for very similar reasons as it was in Mumbai – challenges due to land acquisition for public purposes. At the time, the incentive for Road and Greenery Reservation TDR was 100% and 50% respectively of B.U.A. of the area surrendered

2012

6.3 Timeline of TDR in Hyderabad

The entire process from application for TDR, verification of documents, award of DRC and sale of TDR are all facilitated on a single platform – thus reducing hassle for all stakeholders involved in the mechanism. To date, 890 DRCs for an area of 15.47 lakh

Fig.6(ii): Original plot potential, without road widening

m2 have been applied for and are in various

stages of verification presently (http://tdr. ghmc.telangana.gov.in:8080/).

6.4 Mechanism for

TDR generation The regulations for generation are fairly straightforward for all the prevailing types of TDR. To understand the incentive to the landowner, a sample case study of Road TDR on the GHMC TDR portal is discussed below.

Case study A plot measuring 450 sq.m. (30 x 15m) in area is presently abutting an 18m wide street, which is proposed for road widening to 30m.

An area of 90 sq.m. is deducted for road widening from the above plot.

Therefore, quantum of TDR awarded

= 90 x 400% = 360 sq.m.

The usable ground cover decreases to 155 sq.m. Therefore, total permissible BUA including TDR,

= (155 x 4) + 360 = 980 sq.m.

155 out of 360 m2 for 1 addl. floor TDR for sale: 205 m2

As per the 2012 Building Rules, Number of permissible floors =4 Front setback = 4m and others = 2.5m, leaving 235 sq.m. of usable ground cover.

Therefore, the total permissible B.U.A.

= 235 x 4 = 940 sq.m.

Fig.6(iii): Plot potential after road widening and award of TDR

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

85

6.5 Mechanism for

TDR Utilization Hyderabad has strict regulations regarding building height and setbacks. In case of TDR utilization as well, the receiving potential is determined by the plot area and building height. Without requiring additional setbacks, TDR is allowed for the construction of:

a.

b.

1 additional floor for plot area < 1000 sq.m. and building height < 15m 2 additional floors for plot area > 1000 sq.m. and building height > 15m

After the owner utilizes TDR on their own plot, they are permitted to sell the unused TDR in the open market. Similar to Mumbai, TDR is subject to indexation for use in Hyderabad based on the land value of sending and receiving areas. Each TDR transaction has to be accompanied by an agreement between the seller and buyer on non-judiciary stamp paper worth ₹100, which is also recorded by a designated registrar of the TDR sanctioning authority.

TDR is allowed to be utilized on any plot within the Outer Ring Road in HMDA planning jurisdiction. TDR is permitted to be utilized for new constructions on vacant land or for additional floors on developed land. However, it cannot be used to regularize or legalize any unauthorized construction.

86

Fig.6(iv): Usable TDR area calculator based on market values of generating site and receiving site

Case study: TDR in Hyderabad

HMDA jurisdiction GHMC jurisdiction Outer Ring Road

Fig.6(v): Areas permitted to use TDR in Hyderabad

6.6 Hyderabad’s Online

TDR Portal &TDR Bank For greater transparency and ease of exchange of TDR, GHMC launched an online TDR portal named ‘TDR Bank’ in February 2020 (“GHMC Launches TDR Bank”, 2020). The portal, developed by Pune’s Softech Engineers Pvt. Ltd., allows citizens to perform various activities related to grant, sale and utilization of TDR and to view the ledger of all TDR certificates. Existing DRC holders have also been instructed to digitize their hard copies in order to be allowed to sell their balance TDR. The following flowchart illustrates the process of application, approval and utilization of TDR through the online portal: Applying for DRC

1

Approval of DRC

2

Utilization of DRC

Hyderabad is the first city in India to introduce an online portal for TDR trading.

This had added a significant amount of credibility among landowners and made the process more citizen-friendly.

TDR, in the form of a DRC, is awarded after the particular land parcel is transferred to GHMC or HMDA as a registered gift deed. The authority to certify DRCs is vested with GHMC, HMDA and Telangana State Industrial Infrastructure Corporation. Hyderabad is divided into 18 administrative zones termed as ‘Circles’, and the process of verification and approval for granting TDR is executed at the Circle level.

(Annex.3 and 4 for detailed process)

3

Citizen registers and uploads documents

Online scrutiny of documents

Buyer attaches list of DRCs for use on the building proposal portal

After approval of DRC, citizen submits ownership of land as a gift deed to GHMC

Entire verification process from circle to zone level through the portal

DRC holder gets a notification to approve the sale

Uploads DRC for sale using login credentials

Register of TDR transactions maintained online

Price based on market value

Fig.6(vi): Processes related to TDR which can be executed using the GHMC TDR Bank portal

Fig.6(vii): Snapshots of the TDR Bank and DPMS portal interface for application, sale and use of TDR

TDR: Assessment of Its Use as a Planning & Development Tool for Mumbai

87

6.7 Assessing Hyderabad’s

TDR mechanism: Key

Learnings for Mumbai the TYPE of TDR, whether road, reservation or heritage. It is linked to the market value of the sending plot (add image of ledger transaction), and the amount of usable TDR on receiving plot is derived by indexation. Such a mechanism ensures equal demand for each type of TDR and thus, the landowners have a greater motivation to apply for TDR in lieu of their land.

The TDR mechanism in Hyderabad is at its nascent stage, yet the implementation strategy is noteworthy and holds many lessons for the case of Mumbai. Assessing the positives of Hyderabad’s mechanism:

a. The

major takeaway is the online portal for TDR transactions, which has boosted the viability of TDR in Hyderabad and has enhanced the simplicity of the process.

The simpler the process, the more likely is it to be used.

d.

De-linking TDR policy from the development plan timeline and modifying TDR incentives in a need-based manner has allowed GHMC and HMDA to develop public purpose infrastructure much faster. Flexibility in a TDR policy is crucial.

e.

The artificial scarcity of land created in an otherwise land-rich city, by limiting the use of TDR within Outer Ring Road, has increased the demand for TDR, thereby enabling densified development in the intended areas.

b. A TDR bank, i.e., a common platform that facilitates TDR sale and purchase, allows every DRC holder to have a levelplaying field to sell their TDR, irrespective of the quantum of TDR they hold. There is no scope for middlemen in the transaction and cartelization can be avoided.

c.

88

In Hyderabad, TDR generated from every zone is not differentially priced based on

Case study: TDR in Hyderabad

Among the negatives in the TDR mechanism is GHMC’s sanction of approximately 400 DRCs in the city’s most congested areas such as Himayathnagar, Narayanguda and Kukatpally (Deekshith, 2019).

This has aggravated traffic snarls and infrastructure shortfalls.

According to the city’s town planning experts, GHMC had not sought expert or public consultation before the implementation of the revised TDR policy.

It is recommended to conduct a carrying capacity assessment in the city to determine which areas have the necessary infrastructure for the added population density.

Such areas should be demarcated as receiving zones.

Heritage TDR has been unsuccessful even in Hyderabad.

The primary causes for this are lack of information and inadequate compensation. It is crucial to advertise information about the TDR mechanism for sustained TDR generation and utilization.

Fig.6(viii): Lakefronts, flyover projects and heritage areas in Hyderabad (Source: Ride with VJ, 2021)

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Source: Ride with VJ, 2021

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7 Conclusion

7.1 7.2 7.2.1 7.2.2 7.2.2

7.3

An Overview of the Study Recommendations for Mumbai’s TDR mechanism

Type-wise recommendations For Institutional Framework For Policies and Regulations

Future Research Direction

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7.1 An Overview of the Study

and Issues From the deep-dive literature review and analysis of the TDR mechanism for each type of TDR in Mumbai, answers to the initial research questions have emerged.

To evaluate What was the intended purpose of TDR for Mumbai? Is it being served optimally?

The intention of introducing TDR in Mumbai was principled: to free up land for providing public amenities which would enhance the quality of life of its citizens. With road, reservation and heritage TDR, MCGM had a certain level of control on the supply side of TDR. With the introduction of slum TDR, however, MCGM became a spectator to the TDR market being flooded with millions of square meters of TDR. The supply and demand of TDR were now both completely in the control of market forces.

MCGM suitably liberalized its TDR policy in 2016, possibly in an attempt to allow for quicker consumption of existing TDR stock and to reinforce its initial intent of TDR as a planning instrument for provision of roads and public amenities. Presently, road and reservation TDR are fairly serving their purpose. Active steps are required to revive heritage TDR and to revise the slum TDR incentives and regulations.

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The research also identified the issues and advantages from each of the key stakeholders’ perspective.

Where and whom is the mechanism serving?

TDR is a market-driven mechanism, which has evolved to favour the buyers in Mumbai.

Large-scale infrastructure companies and developers benefit the most, since the present mechanism allows them to influence the supply and demand side of the TDR market. MCGM and other planning authorities has saved on immense financial expenditures, aside from the various administrative costs for sanction of TDR. TDR is also a key consideration in MCGM’s DP funding strategy for 2034.

The small-time sellers and buyers of TDR are the ones at a disadvantage due to the lack of transparency in the mechanism.

This is due to the involvement of a few large developers in the TDR market, who purchase large shares of TDR from the market, partially monopolizing it. This also leaves a common citizen absolutely oblivious to the inner workings of the TDR market. Additionally, the city is burdened by years of wanton use of TDR, without due consideration to the status of trunk infrastructure, transport systems and housing stock. The recurring issue is the lack of a transparent, levelplaying field for stakeholders of all scales.

7.2 Recommendations for Mumbai’s TDR mechanism 7.2.1

Type-wise recommendations

The type-wise issues discussed in section 5.4 require targeted interventions to improve the viability for each of the key stakeholders - the seller of TDR, the buyer of TDR, and the city as an administrator and as a societal entity.

These recommendations are directed towards the planning and development authorities to incorporate in future policy modifications.

Road TDR For acquiring land under road setback on developed plots, the incentive factor may be increased, considering the nuisance caused to the existing residents.

As part of the DP 2034 initiatives, MCGM intends to widen all DP roads to a minimum of 9m width.

The incentive for road widening can be varied on a priority basis.

Plot owners along streets which are prone to forming bottlenecks or congestion hotspots may be awarded TDR with a higher incentive factor, for quicker implementation of widening.

Reservation TDR

Incentive for surrender of land may be increased to compete with market value compensation.

Currently, the incentive factor does not take into consideration the actual deficiency in amenity demand per capita, or the proposed addition in road area.

MCGM

To bridge the gap between supply and demand, the incentive factor may be varied ward-wise so that quicker provision of public amenities can be facilitated in wards with the highest demand.

Heritage TDR

MCGM

The incentive factor may be increased and linked with the existing built-up area rather than unconsumed plot area. This will allow owners of large heritage structures to receive TDR in proportion to the extent of conservation works that are to be executed.

A clear set of conservation guidelines may be published to expedite conservation proposals.

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Heritage TDR

Slum TDR

Since there is an apparent lack of demand for H-TDR, certain zones can be demarcated for use of heritage TDR with incentives for utilization - thereby creating a market for the same.

Since many in-situ rehabilitation projects are on private properties, the incentive for land component may be increased.

There are a number of heritage properties which are owned by senior citizens. MCGM may identify such owners and offer techno-legal support in the form of consultants for conservation and statutory procedures which would otherwise require active participation from the sellers’ side. This would encourage more such owners to surrender their property for conservation.

Another key reason for the heritage TDR generation slowdown is the availability of more profitable alternatives like cessed building redevelopment.

The incentives may be increased to be comparable and competitive with any other such alternative.

For structures compulsorily requiring conservation, heritage TDR may be stipulated as the only means of compensation.

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Conclusion

MCGM

There are numerous not-forprofit building developers such as SPARC Samudaya Nirman Sahayak (SSNS) who provide slum dweller communities with technical and financial assistance to construct rehabilitation tenements. Such initiatives can be supported by engaging public partnership through sale of stakes in development financing.

This reduces the scope of slum TDR being concentrated with a few large-scale companies or developers. Cartelization can be curbed and slum TDR sale price determination would be a more transparent process.

Considering the scale of slum rehabilitation projects and the rate of completion, MCGM may increase the number of stages of award of TDR. This would allow a controlled amount of TDR to be floated in the market. More significantly, it would increase

MCGM

accountability among SRP developers to complete the project in a timely manner.

The incentive for constructing slum rehab projects in wards with high-price areas may be increased to encourage developers to undertake such projects. This could help restore some level of real estate affordability in the prime areas of the city.

7.2.2

For institutional framework

CELL, MCGM

Establish a dedicated TDR cell for quicker, more transparent processing of TDR proposals

MCGM

The existing institutional framework for all activities pertaining to TDR are as illustrated in the following flowchart:

The eligibility criteria of slum dwellers may be cut off at 1995, until the said individuals are not allotted housing.

Construction Amenity TDR The formula for calculating award of TDR is complex and not an adequate incentive. It may be simplified as cost of construction multiplied by a suitable factor.

This factor can be varied based on the scale of the amenity to be constructed.

Across all categories, introducing a transparent platform for tracking DRC holders and for purchase cost negotiation would address the buyers’ issues with the mechanism

Fig.7(i): Existing institutional framework in MCGM for all processes pertaining to TDR

The primary responsibility of this department is to prepare, modify, publish Development Plan and Town Planning Schemes and issue DP/TP remarks. The DP department is also required to: a.

Implement Development Acquisition Area

b.

Acquire public purpose reservation and roads as per MRTP, LAA, DCPR

c.

To sanction the utilization of T.D.R. as per the provisions of Reg. 32, DCPR

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Plan:

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d.

Maintain the list of heritage structures/ precincts and monitor their repairs and conservation

e.

Assist MHCC in conservation proposals ...among other duties

scrutinizing

In order to decrease the processing time of TDR proposals and to function as a more efficient mechanism, it is recommended that a separate TDR cell be established in parallel with the DP and BP departments, as shown.

c. Monitoring and recording TDR transactions d. Act as a buyer of last resort if seller fails to dispose of TDR within the expiry period Conducting regular wardwise assessments of TDR carrying capacity based on infrastructure Planning sending and receiving zones in conjunction with DPBP departments Assisting MHCC in scrutinizing heritage conservation proposals and determining quantum of TDR to be awarded Providing techno-legal support to citizens for generation of TDR, generating awareness

Fig.7(ii): Proposed institutional framework in MCGM for all processes pertaining to TDR

The proposed responsibilities which may be assigned to the TDR cell would include: Create an online TDR Exchange Bank portal for: a. Processing and sanctioning grant and utilization of TDR b. Processing and sanctioning DRC renewals and transfers

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Conclusion

This would increase the ease of applying for grant and use of TDR for TDR sellers and buyers. The reduced red tapism would also decrease the scope of corruption and cartelization. TDR buyers would not have to rely on middlemen to track DRC holders.

They would have a better understanding of price determination. The citizens would also understand and be encouraged to opt for TDR rather than monetary compensation. This would expedite the DP implementation with due consideration to the infrastructure status.

7.2.3

For policies and regulations

Changes may be allowed in TDR regulations as and when the need arises, and not only when DP-DCPRs are being prepared (Flexible regulations) Learning from the example of Hyderabad, where the incentive for each type of TDR was increased based on the priority of the project - for instance, the quadrupling of road TDR incentive in order to quickly acquire land for SRDP. In Mumbai, the TDR regulations have been revised 3 times in the 30 years of its use.

By keeping the TDR regulations open to periodic and frequent changes, MCGM’s response to TDR market trends can be immediate, prudent and such that the intent of TDR is fulfilled.

Since Mumbai has immense T.O.D. potential along the upcoming Metro lines, certain areas may be permitted to use TDR without cap for higher density development There are 11 lines in Mumbai metro – 1 of which is operational and 10 in various stages of approval. Using the TOD approach to Local Area Planning, higher built density can be incentivized along these metro corridors.

This serves 2 purposes: a.

Generate high demand for TDR b.

Increase ridership on metro

A spatial plan of sending and receiving zones may be created on the basis of multiple factors such as: a. b. c.

Adequate civic infrastructure to absorb dense development Locations where developers (i.e., TDR buyers) find market potential Consistent with DP projects and initiatives

This facilitates public co-operation in the implementation of TDR regulations and offers clarity to potential generators of TDR.

Fig.7(iii): Proposed special TDR receiving zones along metro corridors

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Sale of TDR may be permitted across the MMR region, to achieve decentralization and create a much larger market as an incentive for landowners in TDR sending areas To facilitate development at the regional level and unburden Greater Mumbai’s civic infra systems, TDR generated in the city may be sold to any of the districts in the MMR region, subject to indexation.

Sanction of use of TDR may be by the respective Municipal Corporations. The fees levied on use of TDR may be collected by the local authority with jurisdiction on the receiving plot - as revenue to fund infrastructure development in the area.

7.3

Future Research Direction

a.

Primary surveys for TDR prices across different wards in the city and understanding the logic behind the pricing of different types of TDR needs to be conducted. The fluctuation in TDR prices and the resulting speculative nature of the TDR market can be mitigated in this manner.

b.

From personal communication, it emerged that MCGM is currently working on an online TDR portal along the same lines as Hyderabad.

The status of the portal as well as the challenges in implementing it should be examined.

c.

Detailed study of initiatives planned for city in DP 2034 and MMR’s Regional Plan 2036 can help explore additional ways in which TDR can be used as an incentive.

d.

Certain NGOs such as SPARC, NSDF and Mahila Milan are engaged in the construction of slum rehab housing using slum TDR. Conversations with them can reveal further shortcomings in the slum TDR mechanism, which can be addressed through policy changes.

Fig.7(iv): Map of MMRDA (Source: Wikipedia)

***************************************************************************

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Conclusion

END OF REPORT

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The Economic Times. Retrieved from https://economictimes.indiatimes. com/news/economy/policy/ maharashtra-government-to-amendheritage-transferable-developmentrights-rules/articleshow/46036340. cms?from=mdr Bharucha, N. (2004, September 13). Slum TDR rates go into free fall. The Times of India. Retrieved from https:// timesofindia.indiatimes.com/city/ mumbai/Slum-TDR-rates-go-intofree-fall/articleshow/848713.cms Bharucha, N. (2018, December 17). Mumbai: Decline in slum TDR sharpest in 20 years. The Times of India. Retrieved from https://timesofindia.indiatimes. com/city/mumbai/mumbai-declinein-slum-tdr-sharpest-in-20-years/ articleshow/67120509.cms Boost for controversial SRA scheme, bigger flats on offer in Mumbai. (2019, November 29). The Times of India. https://timesofindia.indiatimes.com/ city/mumbai/boost-for-controversialsra-scheme-bigger-flats-on-offer-inmumbai/articleshow/72287257.cms

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Real Estate News. Retrieved from https://propertyadviser.in/news/ real-estate/ghmc-launches-transferof-development-right-tdr-onlineportal-hyderabad-659 Gupta, P. (2019, August 7). Three-fourth of India’s GDP to come from urban population if these reforms are made. Financial Express. Retrieved from https://www.financialexpress. com/economy/three-fourth-ofindias-gdp-to-come-from-urbanpopulation-if-these-reforms-aremade/1668629/

Kamath, N. (2015, February 18). Mumbai: TDR rate hits record high of Rs. 6000 a sq.ft. Hindustan Times. Retrieved from https://www.hindustantimes. com/cities/mumbai-news New TDR policy earns praise from Niti Aayog. (2021, April 10). The New Indian express. Retrieved from https://www.newindianexpress. com/cities/hyderabad/2021/apr/10/ new-tdr-policy-earns-praise-fromniti-aayog-2288263.html

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Chavan, P. (2006, June 30). Market Analysis of TDR: A Case of Mumbai (Master’s Thesis). Faculty of Planning and Public Policy, CEPT University, Ahmedabad, India. Retrieved from http://hdl. handle.net/20.500.12725/13463

Pandemic cloud: TDR turns lifeline for major projects. (2021, April 10).

The Times of India. Retrieved from https://timesofindia.indiatimes. com/city/hyderabad/pandemiccloud-tdr-turns-lifeline-for-majorprojects/articleshow/81994979.cms

Gill, G. (n.d.). TDR: Spatial Segregation and Displacement in Mumbai. Conflict Urbanism: InfraPolitics. Retrieved from http://infrapolitics.c4sr. columbia.edu/studentProjects/Gill/ index.html#intro

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Harman, B. P., Pruetz, R., & Houston, P. (2015).

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Special correspondent. (2020, February 7).

Now, TDR Bank to facilitate online transactions. The Hindu. Retrieved from https://www.thehindu.com/ news/cities/Hyderabad/nowtdr-bank-to-facilitate-onlinetransactions/article30755905.ece

Jiashal, M. (2013). Provision of Town Planning Act Maharashtra (Unpublished post-graduate dissertation). Sardar Vallabhbhai National Institute of Technology, Surat. Retrieved from https://bit.ly/2RxRKfg

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Nainan, N.K.B. (2008, May 24). Building Boomers and Fragmentation of Space in Mumbai. Economic & Political Weekly, 29-34. Retrieved from https://www.researchgate.net/ publication/241883925 Nainan, N.K.B. (2012, June 1). Lakshmi Raj: Shaping spaces in post-industrial Mumbai: Urban regimes, planning instruments and splintering communities (Doctoral Dissertation).

Retrieved from UvA-Digital Academic Repository, University of Amsterdam https://dare.uva.nl/ search?identifier=a0312018-b5f046fa-9266-544acb866e8a Nelson, A. C., Pruetz, R., & Woodruff, D. (2011). The TDR Handbook: Designing and Implementing.

Transfer of Development Rights Programs. Island Press.

Riding, T. (2018). ‘Making Bombay Island’: land reclamation and geographical conceptions of Bombay, 1661– 1728.

Journal of Historical Geography, 59, 27-39 (ISSN 03057488). Retrieved from https://www. sciencedirect.com/science/article/ pii/S0305748816301529 Sanyal, T. (2018, n.d.). The Chawls and Slums of Mumbai: Story of Urban Sprawl (Master’s thesis).

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Stanridge, N. & Pruetz, R. (2009). What Makes Transfer of Development Rights Work?

Journal of the American Planning Association, Vol. 75, 78-87. Retrieved from h t t p s : / / w w w. r e s e a r c h g a t e . n e t / publication/233080169

Blogs and website articles: Dhindaw, J. Mehta, P. V. (2020, May 19).

Reconfiguring public spaces within the new normal. WRI India. Retrieved from https://wri-india.org/blog/ reconfiguring-public-spaces-withinnew-normal#:~:text=While%20 global%20studies%20indicate%20 a,unsurprisingly%20well%20 below%20this%20norm.

Kenton, W. (2020, October 30). Bundle of Rights. Investopedia. Retrieved from https://www.investopedia. com/terms/b/bundle-of-rights. asp#:~:text=A%20bundle%20of%20 rights%20is,The%20right%20of%20 possession&text=The%20right%20 of%20enjoyment

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Development Plan Department, MCGM. (2017). Guidelines for implementation of the Notification no. TPS-1813/3067/ CR-122/MCORP/12/UD-13 dt.

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Development Plan Department, MCGM. (2020). Policy guidelines for grant of TDR in case of existing amenities/ existing roads in DP 2034. Circular no. CHE/DP/140/GEN 2020-21.

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Annexures Annexure 1 Re-estimating Ward wise land area demand and provision considering FSI for built up amenities (Source: RDDP 2034, 2016)

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Annexure 2 Calculating incentive FSI for construction of sale tenements in a 33(10) slum rehabilitation project (Source: Rule 33(10), s/s 3.2, DCPR 2034)

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Annexure 3 Hyderabad: Citizen Application process (Source: GHMC TDR bank portal)

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Annexures

Annexure 4 Hyderabad: TDR utilization process (Source: GHMC TDR bank portal)

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Master of Urban Planning | Spring 2021 CEPT University, Ahmedabad, India