By Accommodation Times Bureau
The market for transferable development rights (TDR) -which permits additional construction rights to builders -is poised for a digital leap and this could bring bad news for real estate cartels.
Acting on a long-standing demand for breaking the alleged cartelization of TDR by powerful developers, the Karnataka government plans to digitize and dematerialize these certificates and develop a market on the models of stock exchanges. “In the next three months, we plan to introduce electronic format for automated development rights and open it up for online trading to prevent fake TDRs,” said V Ponnuraj, secretary , urban development department.
There are about 1 lakh square metres of TDRs in Bengaluru and Mangaluru, and another 1 lakh square metres of fake TDRs in both cities. TDRs are yet to take off in other cities of the state.
The government’s earlier effort to check this unethical practice didn’t yield results.
Ponnuraj said the government has received clearance from the state finance department to tie up with NCDEX eMarkets (NeML), an electronic web-based online commodities spot market and services company, to develop an electronic format for automated development rights to trade TDRs online. According to a proposal, NeML will develop a customized online solution that digitizes TDR (tranferable development rights) certificates and it will be integrated with the state government’s online platform.
This platform could be used by any city corporation in the state. It plans to work with NeML under one of the three models: revenue-sharing, individual fee structure and fixed fee.
Once this is done, Ponnuraj said that the entire data regarding availability and quantity of TDR and its holders would be available in public domain.
“Anyone aspiring to transact in TDR can access the data without relying on agents, liaison persons and civic or BDA officials. TDR holders will be asked to quote an estimate at which they plan to sell the development rights.
A prospective buyer will have the option of comparing all quotes before making a choice,“ he added.
T Pradeep Sanu, a developer, said, “It is a welcome move, promises to bring in more transparency . It will promote more generation and utilization of TDR reservation.