Both developers and institutional investors were hoping for a recovery in housing sales this summer, but the virus outbreak and ensuing lockdown have raised new barriers. With the slowdown hitting the economy hard, these PE firms have now stepped up interaction with investee developers to help them deal with cash crunch and stalled construction activity.
All registered projects for which the completion date expires on or after 25th March, 2020, the registration and completion date is automatically extended by six months due to outbreak of COVID-19 pandemic. The authority also decided that the time limit for various compliances is extended up to June 30 without any payment of late fee.
Last week, Finance Minister Nirmala Sitharaman announced that a scheme will be implemented in states for industrial cluster upgradation of common infrastructure facilities and connectivity.
US-based News Corp-backed housing brokerage firm, in its report Real Insight Q4'2020, also highlighted that the share of completed apartments in the total housing sales grew to 20 per cent during the last fiscal from 15 per cent in the previous financial year.
“We have raised the matter on several platforms but nothing concrete has happened. Developers do not have the money to pay salaries if liquidity issue is not resolved. We are not getting loans since restructuring has not been done. After restructuring, the EMI should start a year later, since we are not going to get any money from sale,” said RK Arora.
Construction groups have received permission to restart work in the National Capital Region, after getting permission from local authorities and fulfilling government mandated conditions. The companies have imposed a ban on gutka, pan masala, pan and any form of tobacco at their sites to maintain hygiene.
However, developers fear that despite easing on construction ban, it will be difficult to convince workers to stay if they have the option of going back. They also say that projects may take some more time to effectively take off till sufficient workforce could be brought in.
The Centre is likely to initiate construction activities in ‘green’ and ‘orange’ districts—areas where there have been no Covid-19 cases for 14-28 days—in a staggered manner in June.
According to him, central and state government is planning to buy housing quarters for employees at large scale and if associations come forward with some plans that can be proposed to the government, it will certainly help the developer in liquidity and generate the economy.
Interstate movement of citizens has been barred and some states have enforced stringent measures even on interdistrict travel — for example, from a contaminated red zone to a virus-free green district and vice-versa. This is prompting local administrations to either transport labourers to work sites or instruct contractors to employ only those who are stationed near the sites.
The appellate tribunal also directed Jaypee Infratech's Interim Resolution Professional (IRP) Anuj Jain to constitute an interim monitoring committee, comprising representatives of the NBCC and its three main lenders IDBI Bank, IIFCL and LIC.
The business has also secured an order to construct a Technology Park in Trivandrum over a total built up area of 2.3 million square feet.
As part of the government's initiative to restart operations in a phased manner, RInfra has resumed toll operations at its road projects from midnight of April 20, the company said in a statement.
As some sectors of the country go back to work to Monday as part of an easing of the nationwide lockdown to arrest the spread of Covid-19 outbreak, implementation on ground, from social distancing to behavioural changes in labourers, remains a concern.
The lockdown was first announced by Prime Minister Narendra Modi on March 24 in a bid to combat the Coronavirus endemic. It was further extended till May 3. On Wednesday, the Home Ministry had announced a series of exemptions given to different people and services during the lockdown.
While speaking to ANI amid coronavirus pandemic on April 13, the Deputy Chief Minister of Uttar Pradesh, Keshav Prasad Maurya said, “Construction on government projects will resume from April 15 in Uttar Pradesh while maintaining norms of social distancing by workers.”
Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service