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| Cost escalation makes Uttarpara township dearer by Rs 1,000 crore |
| Namrata Acharya / Kolkata Jul 06, 2009, 00:48 IST |
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Over-run due to rising raw material prices.
The promoters of Bengal Shriram Hi-Tech City, the proposed township project in Uttarpara in city outskirts, by Shriram Properties and private equity real estate firms, Walton Street Capital of Chicago and Starwood Capital of Greenwhich, will have to pitch in about Rs 1,000 crore more than the initial projected investment of Rs 5,000 crore, for starting the project.
The investment has been revised due to rise in raw material prices since 2007, when the project was conceived.
The construction for the project was to begin in January 2008, but was delayed due to government clearances and faced protests by CPI(M) backed trade union body CITU for giving land to the developers at a throw-away price of Rs 10.50 crore
Construction work for the project is finally beginning in the next two-three months, as the developers have acquired environment and other necessary clearances, according S Venkataraman, director, Bengal Shriram.
The central government has also notified the proposed T-ITES-cum auto ancillary software development in the area as a special economic zone (SEZ). "The investment had been projected upwards due to inflation, and all the promoters would contribute in proportion to their stake," said Venkataraman
The project is being developed on a 314 acre plot, part of 700 acres , which was previously occupied by a plant of the C K Birla Group automobile company, Hindustan Motors, in Uttarpara.
CITU had also raised the issue filling up the water bodies in 314 acres land earmarked for the project.
According to Venkataraman, the issue of water bodies being filled has been resolved, as the fisheries department in state has approved the plan.
Walton Street Capital and Starwood Capital had picked up a 33 per cent stake each in a special purpose vehicle, Bengal Shriram Hi-Tech City Pvt. Ltd, which was set up for the project.
In the first phase of the project, there will be 336 apartments. The entire project will take about six years for completion.
The project is of significance, as it is expected to kick-start activity the real estate market in Kolkata and outskirts, particularly after the exit of DLF from the Dankuni township project.
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