By Pooja Thakur on June 25, 2012
Thousands of rent-controlled tenants in Mumbai paying $20 a month, and often less, are being turned into millionaires by developers tearing down crumbling colonial mansions to build luxury towers for the rich.
South Mumbai, including a stretch of prime land hugging the Arabian Sea, has about 500 dilapidated stone structures dating back to the early 1900s with a potential redeveloped value of about $40 billion, according to Pujit Agarwal, managing director at Orbit Corp. (ORB), a Mumbai-based developer that derives about 80 percent of its revenue from redeveloping old buildings.
“For generations, most tenants were living a hand-to-mouth existence, barely making two ends meet,” said Agarwal, whose firm is one of around 75 vying to oust Mumbai’s rent-controlled residents. “Now, with redevelopment, these tenants have become multimillionaires overnight as capital values of the properties they occupied soared.”
Home prices in Mumbai have climbed to a record 10,833 rupees ($200) per square foot, doubling in three years, according to Liases Foras Real Estate Rating & Research Pvt, a research company based in the city. Continue reading