With public private partnership (PPP) catching on as a viable business model in the real estate sector in most states, can Tamil Nadu be behind? The Tamil Nadu Housing Board (TNHB) is opting for the PPP route to redevelop around 70 acres at Foreshore Estate, close to the sea front, barely a kilometre or two from the famed Marina Beach in Chennai. The board is all set to join hands with the Tamil Nadu Slum Clearance Board to jointly develop the land by associating with a private developer.

Both the players will soon invite expression of interest (EoI) from property developers across the country for the project. This will

be the first PPP project for housing in the state.

“It will be a mixed development of residential as well as commercial space. We have arrived at a broad idea of how to go about the whole exercise. We will soon work out the finer details of the project, including the percentage segregation of the developed space for both residential and commercial,” a state government official told FC Estate on conditions of anonymity.

This is also the first instance of Tamil Nadu’s Housing Board and the Slum Clearance Board joining hands for a redevelopment project.

“The idea is to develop a mix of high-end residential units, a fair amount of commercial space and also allot sufficient space for development of low-cost housing units, as the re-settlement of earlier tenements also has to be addressed,” a source privy to the development said.

Estimating the project to cost about Rs 1,500 crore, he said, it’s not every other day one gets the opportunity to develop around 70 acres of land well within city limits. Further, in order to avoid marketing issues from the high-end buyers, because of co-development of low-cost housing space, the two components are likely to be segregated in such a way so that the interests of the both the groups are handled with care, he added.

“There will be tremendous interest among buyers, especially since the high-end homes will come up on the sea front,” an HDFC official, who did not want to be quoted, said.

“It’s a good initiative from the government agencies to adopt the PPP route for this redevelopment project. It will turn out to be

good for both these agencies as

well as the private partners,” feels Kamal Lunawath, managing

director, Arihant Foundations & Housing, a listed company based out of Chennai.

City-based property developers seem to be gung-ho about the proposed project and are waiting for the formal invite to submit proposals. And what is driving them towards this project is the development and demand witnessed at the nearby MRC Nagar.

Though development started at MRC Nagar in bits and pieces over the past 10–15 years and solely through the private sector with no government intervention, it today stands tall as one of the most sought after locale, outside premium regions like the Boat Club and the Poes Garden in the city.

It houses premium residential units from the MAM Group (Rani Meyammai Towers), as well as that of Chaitanya. In addition, it has premium commercial development from True Value Homes (Bellacia Towers) and Image Auditorium from the Indian Bank. And the latest to join the list of top companies is Sun TV Network, which is constructing its corporate headquarters as well as studio facilities to create content for its bouquet of channels. It actually bought a large chunk of land parcel from Madras Stock Exchange through a public auction over a decade ago.

Besides, MRC Nagar will soon see big hospitality brands operating from the region. Construction of a Leela Hotel property as well as a J W Marriot is underway and they are expected to begin operations in a year or two. In addition, The Ascott of Singapore in association with the city-based garment exporter, Rattha Group, is promoting a large offering of serviced apartments.

“After that kind of chain development activity witnessed at MRC Nagar, the Foreshore Estate development opportunity throws up a big potential. It will be a unique location with a sea view,” Lunawath said. A breath-taking sea view, he gushed.

In addition to the large land parcel available for redevelopment, especially on the

shoreline, Foreshore Estate is an ideal location from where one could easily reach the most sought-after locations like Adyar, Besant Nagar, R A Puram, Alwarpet and Mylapore as well as the best of the hotels in the city, besides critical facilities like the airport, sea port and railway station within 10 to 30 minutes.

“It is the most spectacular location, especially near the shoreline, available for development anywhere in the city. With the current resale prices quoting at around Rs 13,000 – Rs 14,000 per sq ft for residential units at MRC Nagar, the Foreshore Estate redevelopment provides the industry a fantastic business opportunity,” says Nakshatra Roy, director, True Value Homes, Corporate Operations.

According to him, the decision by the government agencies to opt for the PPP route augurs well, both for the developers as well as the sector. “With most private players these days joining hands with international architects and landscape designers, the entire area could be carefully developed on international standards. It could be Chennai’s future Cuffe Parade, the most high-end and-sought after locale in Mumbai,” says Roy. The clock has started ticking.