This article covers society redevelopment and cluster development, In Mumbai, these are covered under regulations 33(7) & 33(9) of DCPR 2034.

Society redevelopment and cluster development, the need for this arises from the aspiration of the residents and the citizens of the neighbourhood. Society redevelopment offers an opportunity for the residents to upgrade the neighbourhood to keep up with the pace of the world. The buildings that are being constructed are getting outdated faster. With the advent of different construction technologies, new and innovative amenity offerings by real estate developers and builders, and service-related innovations the residents of the societies feel the need to re-develop their residences to be in pace with the developments. Common examples of such outdated offerings could be, slow-speed lifts, below-par STPs, space and design for home offices, kids’ play equipment and amenities etc.

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Types of society redevelopment are as follows:

1. Self-development
2. Joint venture development

The society redevelopment can be done by the existing society or with a builder. Even while self-redevelopment offers a better return for the society members in terms of the new carpet areas of the redeveloped society, and control on the sale areas or units in the redeveloped society. However, self-redevelopment requires the society residents to input their capital and time, and procure contracts and approvals for the project. This requires some level of expertise. However this can be outsourced to a PMC and Architect, however, the society needs to be hands-on with the development and arrange capital for the development as the need arises. Unlike self-redevelopment, a developer or builder-based development, the builder invests the capital for the development. The builder has expertise in approval, design, and execution. However, here in this case the society members are at the mercy of the builder. There could be various malpractices being done by the builder in the approvals, design, and construction or the builder may be engaging the society managing committee members for various favours or decisions for the benefit of the builder.

Guidelines for redevelopment are as follows:

 Revised redevelopment direction dated 4th July, 2019, issued u/s 79A of the MCS act, 1960

1. Old directive guidelines dated 3rd January 2009 under section 79(A) of the Maharashtra Co-operative societies act 1960 to all the co-operative housing societies in the state of Maharashtra.
2. Guidelines for self-redevelopment to give impetus to the self-redevelopment of the registered cooperative housing societies in the state dated 13th Sep 2019.

Some of the benefits of self-redevelopment that are offered by the authorities as per the Government Resolution, September 2019 are as follows. 

1. 10% additional FSI over the prescribed FSI by the development control regulation.
2. The society will get a 50% concession on the premium required to be paid to BMC for TDR
3. The society can obtain a 4% interest subsidy on the financing obtained for the redevelopment of the project. The agreement will be a tripartite agreement between the lender, society & contractor.

Refer to our article – How to calculate FSI in Mumbai? for a detailed understanding of FSI calculation.

Self-redevelopment of the society under the Pradhan Mantri Awas Yojna (PMAY)

Pursuant to the guidelines in the PMAY, if the concerned registered cooperative housing society is ready to build 35% flats of the sale units for the beneficiaries of economically weaker sections then as per the scheme a sum of 1.5 lacs per EWS unit shall be made available from central assistance.

The summary of the regulation of redevelopment as per DCPR is as follows.

Regulation 33(7) is concerned with the redevelopment of the cessed buildings. And regulation 33(9) is concerned with cluster development.

Under 33(7) the redevelopment of a society can be undertaken for society subject to repair cess being levied under MHADA act 1969-1971. The following types of societies are to be included.

1. Societies paying repair cess as on date.
2. De-cessed buildings previously paying repair cess, and thereafter due to ownership or formation of society have now been de-cessed.
3. Building of corporation existing prior to 1969 MCGM – municipal tenanted plots.

Regulation 33(9) states plots in the city of 4000 sqm and suburbs of 6000 sqm may consider allowing for cluster development on a plot having access from the existing 12.0 mt road depending on the availability of 18.30 m arterial road within the vicinity of 500 m from the scheme. The cluster development requires the consent of the tenants in the following provisions.

1. 51% of residents of each building or
2. 60% overall of the scheme is involved in the cluster development scheme.

The minimum area of the residential tenement shall be increased from 27.88 sqm to 35 sqm in the cluster development scheme.

To summarize, the above detail is a short introduction to the regulation and the provision of society redevelopment and cluster development. Kindly drop in your thoughts and comments below, and feel free to reach out in case you wish to develop or redevelop. 

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