Adani Group Wins Bid For Dharavi Redevelopment
Adani Group's real estate arm quoted Rs 5,069 crore to redevelop one of Asia's biggest slums.
The Adani Group has won the bid to redevelop Dharavi, one of Asia’s largest slums, taking the first step in the project that was planned two decades ago but faced multiple hurdles.
Adani Group's real estate arm quoted Rs 5,069 crore in its bid, SVR Srinivas, chief executive officer of Dharavi Redevelopment Project, told BQ Prime over the phone. While DLF Ltd. made an offer of Rs 2,025 crore, the Naman Group did not qualify in technical bidding.
The Dharavi authority will now place the bid before the Maharashtra government for approval, he said.
The project, expected to cost around Rs 23,000 crore, will be one of the largest redevelopments by a government agency in India through global tendering. Dharavi, a sprawl of shanties spread over 240 hectares in the prime Central Mumbai area, has a population of 8 lakh and over 13,000 small businesses.
Located on the northernmost tip of Mumbai’s island city, it was one of the original six koliwadas, or fisherfolk settlements, according to the website of Slum Rehabilitation Authority. Others began settling here, starting with potters from Saurashtra by the end of 1800s to leather tanners from Tamil Nadu and embroidery workers from Uttar Pradesh. As the city expanded, this one-time swamp transformed into a decrepit urban sprawl on government land with a flourishing economy.
The plan to give slum-dwellers homes was first mooted by architect Mukesh Mehta in 1997. The process started in 2003-04, when the state decided to redevelop Dharavi as an integrated planned township, and an action plan was approved in February 2004.
The government decided to cross-subsidise the cost of development by allowing developers to retain part of the land for projects to be sold at market prices outside the slum rehabilitation scheme.
The state notified it as an undeveloped area and appointed a special planning authority. According to the 2018 tender document, the selected lead partner through global biding has to create a special purpose vehicle with 80% equity (Rs 400 crore) and the Government of Maharashtra will hold 20% equity (Rs 100 crore).
The special purpose vehicle will construct free housing for eligible slum-dwellers, along with amenities and infrastructure mentioned in the terms and conditions of the bid document.
In lieu of that, the developer will be entitled to construct a free sale area to sell in the market. The project has a floor-space index—the ratio of saleable space to plot size—of 4, allowing a greater number of towers closer to each other.
The new Eknath Shinde-Devendra Fadnavis government invited fresh tenders in October after the previous bid was scrapped by the Uddhav Thackeray regime in 2019 over railway land acquisition.
Disclaimer: Adani Enterprises is in the process of acquiring a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.