Land prices in Calcutta are all set to cross the magical Rs 1-crore-per-cottah mark.
With real estate majors in a mad rush to lap up land in the city, the government has decided to raise the price bar to an unheard-of height. For a 50-cottah plot at Bedi Bhavan, near Gol Park, which will be put under the hammer, it has fixed a reserve price of Rs 50 crore, which translates to Rs 1 crore per cottah.
“We have a 68-cottah plot, of which we will sell 50 cottahs. As the land is located in a prime spot, we expect a lucrative amount for it,” said chief secretary Amit Kiran Deb, adding that the government will soon invite bids for the land.
The decision to sell the land, a property of the land reforms department, was taken at the highest level. There was a plan to use the plot for a joint venture project. But senior state government officials persuaded the chief minister to sell it, citing the example of the Calcutta Metropolitan Development Authority, which has sold land off the EM Bypass for a hefty sum.
The existing land rate in the Gariahat-Ballygunge-Gol Park area is about Rs 45-50 lakh per cottah. By setting a reserve price of Rs 50 crore, the government expects to at least double the rate. It will, however, retain the remaining 18 cottahs of the land to build a circuit house.
“At that rate, the land price will be around Rs 6,000 per sq ft for the buyer. By adding cost of development and mark-up for the builder, the selling price will not be less than Rs 10,000 per sq ft, which is unheard-of till now in Calcutta,” pointed out developer Pradeep Sureka.
The price tag, according to him, will take land rates in the city closer to rates in Mumbai, where real estate prices have shot through the roof.
“It is a very high price by Calcutta standards… In Mumbai, Rs 10,000 to Rs 12,000 per sq ft is not a big deal, but selling property at those rates will not be easy in the city,” warned Yogesh Verma, chief executive officer, DLF. In July, the Delhi-based realty major scooped up a 5.54-acre plot for a hotel project off the Bypass by coughing up Rs 154 crore.
And six months ago, Emaar-MGF, a Delhi-Dubai real estate joint venture company, made history by paying Rs 56 lakh per cottah for a six-acre plot on the Bypass.
However, Rs 1 crore per cottah might prove too hot to handle even for a sizzling real estate market in resurgent Calcutta. “Such rates are feasible for players in the retail business. But then, the space is going to be grossly inadequate for any retail venture. I don’t see such a price tag working for Calcutta at this moment,” said Rahul Saraf, who has developed Forum on Elgin Road.
And that’s why the government is trying to sweeten the deal for the developers. It will impose no condition on land use.
“I am eagerly waiting to know the kind of interest the plot generates among developers,” added Saraf.