NHB Conference

Plan Sanctions

for

Affordable Housing PPP Projects

Ramesh RamanathanChairman

Janaadhar Constructions

About Janaadhar Constructions (P) Ltd.

Janaadhar Constructions Pvt. Ltd. is a for-profit affordable housing development company, focused on bringing well-designed, quality homes for the urban under-served LIG population.

The majority stake in Janaadhar is held in a Section 25 not-for-profit company Janalakshmi Social Services (see below)

About Janalakshmi

Janalakshmi (literal translation, ‘People’s Wealth’), is a ‘social business’. It embraces market principles while pursuing a social objective. To accomplish this, Janalakshmi has been designed

in a 2-tier structure: for-profit operating companies for investors; and a (Section 25) not-for-profit holding company called Janalakshmi Social Services - in which promoter stakes are held.

Funds in Janalakshmi Social Services can only be used to address social issues. This 2-tier structure addresses one of the key criticisms about the social business sector that has arisen in India - about promoters generating wealth from the success of their initiatives. In Janalakshmi’s case, while investors can get the returns that they deserve for putting up capital, all promoter

stakes are held in the Section 25 company, thereby ensuring that there is no personal enrichment for promoters.

Contents

• Background and Context

• RAY and its implications

• Bangalore Case Study

• Challenges in Plan Sanctions for Affordable Housing

• Streamlining Plan Sanctions for Affordable Housing PPP

• What it can look like

• Benefits of Affordable Housing Plan Sanction Process

• Suggested next steps

Bangalore Case Study – Agencies and Statutes

Level Agency

National level MoEF

State level KSPCB

BIAAPA

Fire Department

Para-statals BMRDA, BDA

BESCOM

BWSSB

City Level BBMP

Relevant Statutes

National Building Code of India 2005

Karnataka Town and Country Planning Act, 1961

Karnataka Municipal Corporations’ Act

BDA Act

Bangalore Metropolitan Region Development Authority Act 1985

Environment (Protection) Act 1986

Air (Prevention and Control of Pollution) Act 1981

Karnataka Fire Department Statutes

Agencies involved in plan sanction stages

BMRDA Bangalore Metropolitan Region Development AuthorityMoEF Ministry of Environment and ForestsKSPCB Karnataka State Pollution Control BoardBESCOM Bangalore Electricity CompanyBWSSB Bangalore Water Supply and Sewerage BoardBIAAPA Bangalore International Airport Area Planning Authority

AH Developer [scheme preparation &plan submission]

MoEF and KSPCB: [plan evaluation and approval]

BMRDA /MoEF/KSPCB

Bangalore Case Study – Timeline of sanction events

Apr ’09 May Jun Jul Aug Sep Oct Nov Dec Jan ‘10 Feb

Plan Version: A B C DE F G A B C

Plan Version: A B C

95 days 94 days 120 days

Note: These steps begin AFTER land acquisition has taken place – an independent process that takes anywhere between 12 – 24 months

Bangalore Case Study – Details of activities

Submittal Date RemarksMeeting between client/architect on project brief

09-Apr-09

Final Scheme Presentation to Client 30-Apr-09 40 days required for preparing sanction drawings

Development Plans Submitted to BMRDA: Version-A

08-Jun-09Phase-01,02 - S+G+3 and Phase 3-B+G+8 Commercial Block (Area of 50,000 Sft) Facing Road

Version-B 07-Aug-09S+G+3 floors only, Outline of Commercial revised (area reduced 50,000 Sft T0 15,000 Sft = 3%). Unclear Guidelines.

Version-C 13-Aug-09S+G+3, Distribution of Commercial space in 2 location, demarcation of visitors car parking. Arbitrary Decision

Version-D 15-Sep-09S+G+3 floors, Area Calculation format revised for CA, Open spaces etc. No Standard Format Available.

Version-E 25-Sep-09S+G+3 floors, Area Calculation format revised for CA, Open spaces etc.,

Version-F 05-Oct-09Nala profile as per tippany. Refer back to village records. Civic amenities, green open spaces relinquished to BMRDA on October 3rd 2009. 25% of site?

Version-G 23-Nov-09 Revision of Visitors car park location. Arbitrary Decision

Version-H (Submitted with commercial space separation)

25-Nov-09Commercial space separated from Residential and earmarked as landscape area. BMRDA denied accepting this earlier.

Signed copy development plan received from client

22-Dec-09

 

Submittal of Detailed Floor plans to BMRDA  

Version-A 31-Dec-09 Floor plan revised as per approved Development Plan

Version-B 28-Jan-10 Area statement revision. No Standard Format Available.

Version-C 15-Feb-10Demarcation of 2 wheeler parking in Stilt floor, Section/Elevations for all Blocks. Not required as per by-law

Signed copy of floor plans received from client 02-Mar-10 Plan sanctioned only for G+ 3 floors

Challenges in Affordable Housing Plan Sanction• Complexity of rules

Faulty urban planning and by-laws, restricting FAR and building height

• Ambiguity in interpretation Ill-defined zoning laws, resulting in fragmented

design/approval process and sub-optimal outcomes

• Time delays Multiple agencies/iterations/ambiguity causes enormous

delays

• Uncertainty Overall uncertainty in the process has two consequences

– Reduced risk-appetite from Developers to enter this space– Increased desired returns to offset uncertainties

Making PPP in Affordable Housing a reality

• Improve access to clear land for developers Crucial element to address

Not discussed in this presentation

• Streamline the Plan Sanction Process Strategic Issues

Tactical Issues

Operational Issues

• Simplify access to subsidies JNNURM/RAY subsidies on capital/interest not easily

available to private developers

Not discussed in this presentation

Streamlining Plan Sanctions – Affordable Housing Development Plan (AHDP) Sanctions• Strategic Issues

Densification– Community perspective– Min/Max persons/hectare standards based on location/

context/climate– Diversity of unit types– Allow for incremental growth– Open / Built space ratio based spatial / temporal standards

Integrated Use– Land use should permit Live/Work/Play/School/Leisure

automatically– Community needs oriented mixed use models– Create participative communities

Sustainable Development– Low or zero carbon developments– Passive & Active climate oriented design to optimize energy

consumption– Reduce, Reuse, Recycle philosophy in the design– Meet Griha standards

Streamlining Plan Sanctions – Affordable Housing Development Plan (AHDP) Sanctions

• Tactical Issues

Single Window Approvals for Plan Submissions

Simplified access to subsidies and other benefits (e.g. Carbon credits etc)

Examine self-certification

• Operational Issues

Rationalise building regulations like set-backs/parking/road-width etc to reflect EWS/LIG requirements

Establish SLAs for turnaround times for sanction processes

What it can look like – Total Cycle time of 18 months

• 2-Step AHDP Sanction Process

Step 1: Qualifying criteria for AHDP window– Project details/Financials/Construction details etc

Step 2: AHDP Sanction window– Layout Plan with unit sizes etc.– Plan for Civic Services

Month1 Month2 Month3 Month4 Month5 Month6…………… Month 15 – 18

AHDP* Plan Sanctions completed

Land Acquisition completed

Construction Phase

Delivery completed

• Benefits of the proposed AHDP Sanction process

Removes Uncertainty

Reduced Timelines

Improves Economics and Market Functioning

WIN-WIN-WIN-WIN

– For Affordable Housing Clients

– For the AH PPP Developer

– For Union/State/Local governments

What it can look like – Total Cycle time of 18 months

Thank You!

Background and Context –Rajiv Awas Yojana

• Support provided by MoHUPA under RAY

Financial support

– Existing slum-based support

– Surveys/maps/slum-free city plans/training

– Part 2 State plans for preventing new slums

Capacity building/tools

• Admissible components

Integrated development of existing slums

Development/improvement/maintenance of services

Convergence with other schemes and connectivity infrastructure

Creation of affordable housing stock, including rental housing

Bangalore Case Study – Environmental Clearances

Submittal of plans & documents to MOEF Date   Remarks

Version-A06-Jun-

09 Phase -01, 2 G+3 floors Phase -03 B+G+8

Version-B09-Sep-

09load calculation, Design brief, UG Sump, OHT, Water balancing

Version-C12-Dec-

09Central Ground Water Board-Water Availability, NOC from Deputy Commissioner

Final acceptance copy received from MOEF/KSPCB Mar '10  

Environmental Clearance from MoEF required if

1.Project involves developing more than 20,000 sq. metres2.Project serves 1,000 persons or above 3.Discharges sewage of 50,000 litres per day or above4.With an investment of Rs. 50 crores or above

Bangalore Case Study – Timeline of sanction events

Step Statute(s) Agency Time

Scheme Presentation to Client by Architect

- AH Developer

1 Month (April 2009)

Submittal of Plans to Airport Authority

BMRDA Norms, BIAAPA Norms

BIAAPA May – June 2009(1.5 months)

Submittal of Plans to Fire Department

Fire Department Rules, NBC Rules

Fire Dept.

June – August 2009(3 months)

Submittal of Plans to KSPCB, MoEF for Env. Clearance

Environment (Protection) Act 1986)

KSPCB, MoEF

June– March 2010(8 Months)

Submittal of Plans to BESCOM, BSNL

BESCOM, BSNL

August- September 2009 (1 month)

Submittal of Plans to BWSSB BWSSB

Submittal of Plans to BMRDA for Sanction

BMRDA Act 1985, National Building Code of India 2005

BMRDA June 2009 – March 2010