DMRC diversifying into building offices, complexes

With a target of Rs 2,505 crore, the Delhi Metro Rail Corporation (DMRC) is in a race to generate revenue to fund the phase III of the Delhi Metro network. Now, from building Metro tracks, it is diversifying into building offices and commercial complexes as well as residential projects. "We expect to generate around Rs 1,000 crore from six projects that we are undertaking this year," said S D Sharma, director of property development in Delhi Metro.

The urgency to make money-spinners stems from the Delhi Metro's inability to raise adequate funds in the previous phases. Till 2012, it had raised only Rs 230 crore—a massive shortfall.

The Delhi Metro's phase III target is Rs 1,568 crore, said Sharma, to which has been added the shortfall of Rs 891 crore from the previous phases. If Delhi Metro doesn't raise this revenue, the shortfall will have to be arranged from the Centre and Delhi government.

At present, it is banking on six projects to bail out the Delhi Metro. The projects are in Janakpuri, Jantar Mantar, Bhikaji Cama Place, Jasola, Malviya Nagar and Parmeshwari Wala Bagh. The three projects that are expected to come through this year itself are Jantar Mantar—where an office complex is being constructed by the Delhi Metro located right next to the monument, Janakpuri —where a 1.12 hectare residential project will come up, and another office complex at Bhikaji Cama Place. "The project at Jantar Mantar has already been cleared by both the National Monuments Authority and the Delhi Urban Art Commission. We are now awaiting NDMC approval," the Delhi Metro official added.

The residential project in Janakpuri is also going to take off this year. Spread over 14,405 sq m, the construction will be undertaken by the Delhi Metro and offer a lease of 30 years. "It will most likely be targeted at PSUs as the lease period granted is only 30 years as per the rules governing the Delhi Metro," said Sharma. The Bhikaji Cama Place project, meanwhile, is also expected to get a good response, said the official. The rest of the projects are all commercial projects, said Sharma and earmarked for "early 2016".

The Delhi Metro has been trying to make its property development viable for some time now. As part of the fund structure, the DMRC is supposed to generate Rs 1,568 crore towards phase III. However, it has not been able to get any of its property development projects off the ground for quite some time.

Source: Magicbricks.com