Commercial Capital Of India : Is Mumbai Building Enough?

Mr. Himadri Mayank

Is Mumbai Building Enough?
- Mr. Himadri Mayank,  Jones Lang LaSalle India

According to the 2011 census, the MMR (Mumbai Metropolitan Region) has over 2.35 Crore people. To house this population on the ground floor, assuming a household size of 4 and dwelling units of 900 square  feet per family which are laid wall to wall, we would need 1,21,384 acres of contiguous land. If all these houses are built facing the street (for access), providing a frontage of 20 feet to each unit, the total length of the street would be 35,606 kilo meters.

Commercial Capital Of India..!
Being the commercial capital, the city not only attracts migrants from all parts of India but also has a high floating population which commutes to the city for work everyday. This high density calls for developments to be vertically stacked by design, with multiple functions layered one over the other.

Nevertheless, the proposal for increasing the FSI (Floor Space Index) in the Mumbai city (which would enable more construction over the same land area) has always met with stiff resistance on practical, sustainable and ethical grounds.


Compared to Global Destinations..!

Permissible FSI in South Mumbai is 1.33, while that in the suburbs has recently been increased from 1 to 1.33. Additionally, developers can purchase TDRs (Transfer of Development Rights) and construct up to a FSI of 2. However, this is low when compared to global destinations such as Singapore, New York and Hong Kong Island Urban Area, which have FSI of 5, 10 and 12 or above respectively within a radius of 10 kilometers from the city centre.

What does this imply for Mumbai real estate?
Real estate developmental density in Mumbai has not kept pace with the growth in population density. Due to the huge pressure on the city’s already scarce land resources, market forces have tended to circumvent the base FSI regulations and build more through ‘discretionary approvals’ in lieu of construction of civic amenities such as parking structures.

Also, certain construction features which were excluded from FSI  such as balconies, flower-beds, voids and niches – were manipulated so that they could be utilized as habitable spaces after construction. These innovative circumventions of building regulations could justifiably be called ‘creative feedback’ from the industry.

FSI calculation..!
Recently, the Government disapproved of these discretionary approvals for construction and came up with amendments in the Development Control Regulations. To increase transparency and remove layers of regulations, an all-in FSI calculation which includes the FSI - free design features has been stipulated. In lieu of lost volume of construction, developers can build 35% extra (as Fungible FSI) by paying a certain premium to the Government. This could keep the construction volumes nearly the same, as developers used to overbuild nearly 25% to 30% as FSI-free features.

However, developers would now be more inclined to include this extra 35% as usable carpet area in the properties, resulting in better efficiencies in terms of carpet area-to-saleable-area ratios. We could see more box-like residential towers which provide a maximum habitable area to the tenant, instead of lavish architectural projections such as balconies and other design features. The purge of discretionary approvals would also make the industry a more level playing field for developers.

Is Mumbai building enough?..!

The moot point to debate is – is Mumbai building enough? Should FSI be increased from its current level of 2 to 5 or 10? The issues are as much scientific and statistical as they are ethical.

Some points to ponder:

* Strategic densification through a differential FSI regime based on microzoning instead of the current uniform FSI system is the key for balancing densities with infrastructure.

* Construction volume depends directly on the carrying capacity of developed infrastructure in terms of water, roads and power. Hence, permissible FSI can be mapped with projected completions of infrastructural projects, leading to zones or corridors of high-density development.
   
* Urban renewal should not be blindly incentivized by higher FSI as it might lead to congestion in zones which have older properties
   
* Strategic densification of suburban nodes could be explored as development of infrastructure is convenient at low-density locations
  
*  Premium monies collected for higher FSI should be compulsorily ploughed back through investments in infrastructural development

About the author
Himadri Mayank is the Senior Manager, Research and Real Estate Intelligence Service for Jones Lang LaSalle in India.

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