Rs 1000-cr bonanza for MMRDA in BKC

The authority has decided to increase the FSI here and also plans to sell extra built-up area

    Tall buildings will soon dot the Bandra-Kurla Complex skyline. Giving in to demands by private and government organisations, and financial concerns, the Mumbai Metropolitan Region Development Authority (MMRDA) has now decided to increase the Floor-Space Index here from the current 1.5 to 3 for residential buildings and from 2.5 to 4 for commercial structures. 

    MMRDA also plans to sell extra built-up area. This means that builders who shell out the cash can build more floors on pre-existing structures. 
    MMRDA's Metropolitan Commissioner Rahul Asthana said the government body already 31 applicants lined up, requesting that they be allowed to build more floors on their existing plots. 
    Of these six have already paid the extra charge which has come up to Rs 
120 crore and another 18 have paid 20 per cent of the charge, amounting to Rs 397 crore. Asthana added that through the sale of extra built-up area, the agency will earn almost Rs 1,000 crores in four years. 
    Many developers wanted to purchase the extra built up on their existing plots but wanted more time from the body to book their pleas. Now that the executive committee has approved the proposal they have time till March 31, 2012. 
    According to ready reckoner rates, developers currently have to pay Rs 93,300 per square metre for extra built-up areas. Last year, this rate was Rs 71,800. 
    The increased FSI is applicable only for G Block which is the hub of activity in BKC with offices of major firms such as the Regional Passport Office, ING Vaisya Bank, the Income Tax Department, Oriental Bank of Commerce and State Bank of India. Many of these firms also have their own residential quarters here. 
    With an FSI of 4, MMRDA now has commercial space amounting to 19,10,950.40 square metres up for sale in BKC. The residential space, with an FSI of 3, comes up to 2,38,744.89 square metre. 
    At present, the residential and commercial rates at BKC stand at Rs 40,000 per square feet. Which means that a 1,000 square ft flat costs a minimum of Rs 4 crore. 
    The MMRDA move, to increase FSI, will only benefit developers. Home buyers will not, in any way, get relief from this. 
MMRDA GETS OUTSIDE HELP 
REALISING THAT IF it sells all the land it has in its kitty, its infrastructure projects will be affected, the MMRDA has hired a private firm for assistance. Asthana said, "We are planning to make the sale process systematic so that while we earn the maximum from our lands, we don't run out of plots." 
    To this end, MMRDA is also trying to build city-level Infrastructure so that rates at BKC increase, thus earning the agency more money from fewer sales.

The increased FSI is applicable only for G Block

India Least Favoured among Rising Markets

Fund managers overweight on EMs, but fear a sell-off if Euro zone crisis deepens

MUMBAI 

    India is among the five least preferred emerging markets, according to the BofA Merrill Lynch Survey of Fund Managers for September. In overall terms, fund managers are overweight on emerging market equities. However, if the banking crisis in Europe spirals out of control, emerging market equities will be vulnerable to further sell-offs, the survey report said. 
"Sixty-eight percent of survey respondents now view the eurozone debt crisis as the largest of risks, up from 43% in June and 60% in August. Sentiment towards European banks is at its lowest since the beginning of this survey," the BoFA ML Survey said. The BoFA ML survey was done on a sample size of 286 money managers with $831 billion of assets under management. 
While global investors have lowered their growth expectations for China, emerging market (EM) remains a consensus overweight. A net 30% of investors (fund managers who were surveyed) report being overweight on EM, up from 27% in August. 
Over 40% respondents sounded extremely bullish on Brazil, which recently underwent a 50-bps rate cut that bolstered sentiment towards equity assets. Overseas investors have trimmed their overweight positions in Indonesia, while adding more to Russia and China in September. Taiwan, Malaysia, Colombia, Poland and India are the least favoured markets in September. 
In terms of sectoral allocations, EM investors remain focused on consumption-related businesses and technology. Overseas fund managers are maintaining underweight positions in utility, materials, healthcare and engineering & industrial companies in September. 
Though foreign investors are finding 'value pockets' in emerging markets, investors' risk aversion has soared to levels last seen in March 2009 in the wake of the global financial crisis. A net 45% of respondents are taking lower risk than normal relative to their benchmarks, up nearly 20% points from August. Cash holdings remain notably high at an average 4.9% of portfolios, with more than onethird of investors overweight cash. 
India Survey Sees Sensex at 20-22k by Dec 
MUMBAI An India investor survey report prepared by JPMorgan Asset Management - Value-Notes expects benchmark Sensex to trade between 20,000 and 22,000 by end of this year. According to the report, the investment sentiment is affected by concerns such as recession, frequent hikes in interest rates and volatility in the domestic investment environment. Despite witnessing a 4.2-point decline from the last quarter, the 'Retail Investor Confidence Index' ranks the highest at 137.5 points. Retail investors' activity in mutual funds has improved 11% since the last quarter, it said.