Sion slum development rights sold for Rs 300cr

MUMBAI: Hotelier-cum-builder Sudhakar Shetty has sold the development rights of a slum property in Sion Koliwada for around Rs 300 crore to Sheth Creators. Jitendra Sheth of Sheth Creators confirmed the transaction, which happened over a month ago.
Sheth, who split with his brother, Ashwin Sheth of Sheth Developers, said the over two-acre plot has a development potential of about five lakh sq ft. Sources said that Sheth would hand over 30% of the total built up area to Shetty once the project is complete. The 9,000 sq m comprising Shivaji nagar, Koliwada and Motamai chawls is located near Cinemax theatre in Sion.
The project is believed to be funded by a Pune-based developer with an interest in Mumbai's real estate. However, Sheth denied he was financially backed by this developer, who is known to be close to the state's political leadership.
Slum redevelopment schemes are the most lucrative as they offer huge incentives to builders in the form of incentive floor space index (FSI). Slum projects are also considered to be a "messy proposition" with only certain types of developers entering such projects. Builders get the encroached land virtually free of cost. They are mandated to procure consent of 70% of slum residents before they can start the project. Each slum family is rehoused free of cost by the developer in a new 269 sq ft tenement. A portion of the plot is then utilized to build residential towers which the developer can sell in the open market.