Industrialists looking for a trophy asset have managed to push up property prices in New Delhi's most precious area, Lutyens' Delhi, by eight-fold in the last 10 years, so much so that dilapidated, torn out properties in the area are costlier than prime property in New York, London and Lisbon at current valuations.
Of the 1,000 bungalows in the zone, only 65 are privately owned and the rest are owned by the government. However, the value of the privately owned portion (approximately 255 acres) has gone up from Rs 6,100 crore in 2003 to Rs 49,000 crore now, while the value of the government landhas grown from Rs 24,000 crore to Rs 1,92,000 crore, said an Economic Times report today.
The residential heart of New Delhi is known as Lutyens' Bungalow Zone (LBZ) after Sir Edwin Lutyens, New Delhi's master architect. The zone hosts whitewashed bungalows amid rolling lawns surrounded by tall trees. However, New Delhi's most expensive residential zone is for the benefit of a tiny elite - politicians and senior bureaucrats with a select class of business tycoons. It hosts the official residences of the President of India, the Prime Minister and all other Union ministers, members of Parliament, senior members of the judiciary, high ranking officers of the armed forces and the civil services, as well as senior bureaucrats of the Central and Delhi governments. The old bungalows are spread over three to four acres of land with large tracts being used as lawns and gardens.
Last year, the highest bid for 38, Amrita Shergill Marg, built over 3,450 square yards, was Rs 165 crore in an auction. Sunil Bharti Mittal, chairman of Bharti Enterprises, had bought 9,680-square-yard19, Amrita Shergill Marg on the same street in 2002 for Rs 38 crore. Besides, the price is decided by the cost of the property last sold on that street or in the neighbourhood. Though the official circle rates are much lower, the market price is three to four times higher. The latest entry into the LBZ market was 13 Prithviraj Road, a bungalow earlier leased by the Mexican ambassador, which went on sale for a mind-numbing Rs 600 crore or $110 million.
Another interesting fact about LBZ is that properties available for sale are never advertised. The news of properties being bought or sold are circulated purely by word-of-mouth. Sometimes buyers are even politicians and black money is often exchanging hands in order to avoid taxes. Once the house is bought it either requires extensive renovation or is pulled down to build another stately mansion.
And in order to ensure efficient land use in Delhi's most coveted zipcode, private property owners here may now be allowed to add a basement level to their existing homes while large plots owned by senior politicians may be bulldozed and cut into smaller plots to make way for more such houses. The government plans to shrink the LPZ area so that more floor area ratio, increased height and basements can be allowed in select localities.
According to the ET report, the government bungalows around Sunehri Bagh Road in the LBZ are already being redeveloped - here 19 bungalows were built on 4-5 acres of land each, which will now give way to 16 additional bungalows to be built on 1-1.5 acres of land each.
Updated Date: Dec 20, 2014 18:10:04 IST