Railways' 45-year lease could hit swanky station dream

The wait for the kind of well-appointed stations one sees in developed foreign nations for Mumbaikars might be a long one. The railway ministry has set the lease period for the ambitious station redevelopment project at 45 years. Its a time period that has not excited potential developers and real eatate firms in Mumbai for several years now.

As reported earlier by DNA, the developer lobby in Mumbai has for long been demanding that the lease period for Mumbai's railway land development projects be fixed at anything between 80-99 years. The higher costs of construction in land-starved Mumbai and therefore a longer time to recoup the investment are the main reasons the real estate lobby has been hankering for a longer lease period.

In an announcement made on February 8 by railway minister Suresh Prabhu, a total of 23 stations nationwide have been chosen to be redevloped. The stations chosen on Mumbai's railway network are Mumbai Central, Bandra Terminus, Borivali on Western Railway and Kurla Terminus and Thane on Central Railway.

For now the railways is adopting a 'wait and watch' policy. Speaking to DNA, Rajiv Chaudhary, adviser, station development, railway board, confirmed that a call on the lease period would have to be taken after a couple of rounds of tendering and meetings with potential developers. "This 45 year lease period has been stipulated by the Union Cabinet. After a couple of rounds, in case developers present a case for a longer lease period in the range of 80 years etc, the railways could approach the Union Cabinet for a rethink on the 45 year lease period," Chaudhary told DNA.

However he also added that in most cases the developer makes his money by the 30th year and so a 45 year lease period isn't something that is unfair on the developers.

"Moreover there might be a clause of Right of First Refusal to the developer when the land lease comes up for bidding again at the end of this period.

Chaudhary said that other issues particular to Mumbai- like the congestion around stations, as well as the low Floor Space Index can be turned into opportunities. "The congestion only means that the footfalls at these stations is high' he said.

Calling on developers to show ingenuity in design to utilise the available FSI in the best way, Chaudhary said that stations in Mumbai could see greater vertical construction in comparison to other cities.

As per a statement by the railway ministry earlier, what the state transporter is looking at redevelopment of stations that 'will improve passenger experience by providing amenities like digital signage, escalators, elevators, self ticketing counters, executive lounges, luggage screening machines, walkways, holding areas for passengers, grand and distinctive roofing and flooring, free and paid Wi-Fi etc. Moreover, the commercial development undertaken near the stations will become nerve centers of the city and provide quality retail, commercial and hospitality development.'

The program, with an overall area of 2200 acres of rail land, and monetary size of Rs 1 lakh crores, will benefit more than 100 cities and 16 million passengers per day nationwide, the railway contends.