Best practices in real estate: Development of a region

[ecis2016.org] Together with planning, the most important factor in the development of a region, is the adherence to timelines

Policy-makers are at the center of the real estate industry, as the planning of development of a region is governed by them. Together with planning, the most important factor is the adherence to timelines.

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This includes:

• Timely set up of physical infrastructure.
• Timely allotment of land for industrialisation and business set up.
• Timely set up of social infrastructure for human resource set up and above all, the audit of above.

Steps involved in the development of any region

1. The state government is bestowed with the responsibility of enhancing the economy of the state, thereby, meaning creating an ecosystem of helping the industry grow, which leads to employment, revenue generation and hence, a comfortable livelihood with developed social infrastructure.

2. The Town and Country Planning (T&CP) Department is responsible for the master plan of a region, based on government policies which attract investors – industrialists to create a business enterprise. T&CP dedicates zones as industrial, residential, commercial, institutional, etc .

When industrial or commercial zones are demarcated, the government and policyholders should ensure that physical infrastructure, viz, roads, electricity, sewerage, water, etc., are set, before even the first industrial establishment is allowed to venture in.

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Various funding models for developing physical infrastructure can be used like BOT (build-operate-transfer), PPP (public-private partnership) and others. This way, the government does not have to spend from its pocket and yet, be able to create physical infrastructure.

The other advantage is that once the physical infrastructure is made and the land is allocated for industrial development, the time gap of commissioning is reduced and hence, the finance deployment for establishing the enterprise to it becoming productive is reduced. The businesses are more feasible and attractive.

3. Next is the set up of human resource ecosystem and addressing their needs of food, shelter and social infrastructure like schools, hospitals, malls, retail shopping, police stations, post offices, etc.

Housing is a very important factor and the authority must study the population growth of the area, thereby, studying the extended demand because of industrialisation and migration. On the basis of this, the appropriate size of the residential zone should be allotted to developers, for construction.

If the physical infrastructure is established and the industrial and business ecosystems are set, the housing will be very meaningful and financial institutions will be safe, when funding to developers and consumers and the chances of default at both ends will more or less be removed.

Other factors to consider

While the above is the theoretical way of development of an area, there are some more key observations :

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a) T&CP must ensure that when zoning is done and land is made available for industrial, commercial and residential zones, certain permissions should be a part of the land allotment and a duplicate requirement should not stand as a hurdle in time, to the process of development. This could include mining permissions, environment clearances, height restrictions and others. As many clearances that can be made available, should be a part of the deal. Single-window clearance is much sought-after.

b) Time-bound completion in terms of business establishments should be mandatory. We all know that housing and commercial activities follow business and job creation. Hence, it should be mandatory that people buying land for industrialisation, should set up businesses within the stipulated time.

The concept of ‘Smart City’ deserves praise

Migration into metros, from the rural areas, for employment, education, or healthcare over the years, has stretched the physical infrastructure of metros and hence, the concept of smart city is much warranted.

If we can have tier-2 and tier-3 cities converted into model townships, with clean water, clean air, good roads, sewage systems, uninterrupted power supply, good telecom and internet infrastructure, established transportation systems, healthcare and education, then, industrialists will not be required to buy expensive land in metros for business growth and there will be homogeneous growth in the economy.

(The author, Sanjeev Kathuria, is a real estate expert and speaker and COO, CRC Group)

Source: https://ecis2016.org/.
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Source: https://ecis2016.org
Category: Lifestyle