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— Photo : Satish. H

Under the hammer: HUDA auction for Kokapet plots in progress.

For instance when HUDA auctioned plots in the Golden Mile project at Kokapet in Rajendranagar mandal in July 2006, the real estate boom was at its peak. Thanks to the marketing expertise displayed by the HUDA, several outside players participated in t he auction in good numbers.

The high turnout of participants had charged the atmosphere with intense competitive spirit and it was when the record Rs.14.5 crore per acre was quoted by one bidder for one plot. Of course, then 15 plots in the range of two to six acres were auctioned for multipurpose projects. The staggering amount quoted for one acre in the area with potential for development because of its strategic location close to the Outer Ring Road, Manikonda business district, Hi-Tech city, became talk of real estate circles then.

But when the ‘Golden Mile’ project subsequently ran into legal wrangles following a title deed dispute, it did affect HUDA’s reputation that its plots and lands were litigation free.

Though the High Court gave its verdict in favour of HUDA over Golden Mile and said it was Government land, and the Supreme Court also did not admit the appeal of the petitioners challenging Government’s ownership, the Thursday auction by HUDA for ‘Empire Project’ did not evoke expected response.

The real estate scenario has changed since Golden Mile auctions, with the boom giving way to correction and slump in transactions with people holding on to their real estate investments hoping for revival of market. Yet HUDA was confident that there would be no dearth of serious construction companies for the strategically located Kokapet lands.

That was the reason HUDA did not hesitate to fix an upset price of Rs.12 crore per acre for its latest auction of 100 acres, divided into four plots of 25 acres each for multipurpose use.

Though all the four bidders who participated in the open auction on Thursday, Omaxe from Delhi, M/S Subramanyam Constructions and Development Company, Bangalore, Prakruti Infrastructure and Development, Bangalore and Hruday Hitech Builders Pvt. Ltd., Delhi, were from outside the State, only Omaxe constructions successfully bid for one plot by quoting Rs.12.01 crores per acre, just Rs.1 lakh above the upset price.

Surprisingly the bid went unchallenged by other participants while there were no bids at all for the remaining three plots.

This indeed perplexed HUDA authorities for all the four bidders paid an EMD of Rs.7 crore for participating in the auction, an indication of their seriousness.

HUDA officials reason that perhaps the timing of the auction was not right and bidders needed more time to mobilise resources for such big extent of lands.

But the fact remains that Kokapet lands have clear Government title and it is just matter of time for sentiment to revive among investors.

HUDA Chairman D.Sudheer Reddy giving his personal opinion about not much response to ‘Empire’ auctions felt lesser upset price could have brought more participants to the auction venue. Once when there are good numbers, enthusiasm would build up and people would be quick to take decisions.

He indicated that auctions for the remaining three plots would be held again within a week to 10 days.

Meanwhile Sunil Goel, Joint Managing Director of Omaxe who successfully bid for one 25-acre plot was upbeat that it gave them an opportunity to enter South India.

A listed company with Rs.3,000 crore turn over and Rs.10,000 market cap, it had taken up projects in 50 cities in nine States, he said.

Aware of the controversy surrounding Kokapet lands, he however trusted that it was Government land, more so after the High Court verdict. “If anything were to go wrong, HUDA would return the EMD and not take remaining payments,” he said. The group plans to take up residential, commercial and IT units and hopes to start work in next two months once all procedures were completed.

Asked whether the price he quoted was reasonable, he said local people may perceive it as high but operating from Delhi we have a different vision. “I got the plot for a good price,” he said who would pay Rs.300.25 crores for the 25-acre plot.

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