Tuesday, January 12, 2016

Absconding Builders & Abandoned Housing Projects in Pune

Tips for Pune property buyers who are planning to visit CREDAI Pune Metro Housing Festival 2016 - Mega Property Exhibition on 15th, 16th & 17th January at SSPMS Ground:


CREDAI Pune Metro Housing Festival 2016 - Mega Property Exhibition on 15th, 16th & 17th January at SSPMS Ground

Tip No. 1: A builder may abandon a project:


When you book a flat - you know that - builders do not give possession in time. But, it never comes to your mind that the builder may abandon your project and vanish into thin air.

Yes! Truth is - for various reasons - builders abandon projects!!

And there isn't anything unnatural about it.

If a mother can abandon her baby - what is unnatural about a builder abandoning a housing scheme?

After all, for a builder - a housing scheme is just a venture - an adventure - an expedition - an experiment - an idea - a new year resolution! And, we all know that - most of the experiments & new year resolutions fail. So, failing is obvious. Succeeding is an exception.

Isn't it wise to abandon the adventure when you know that you can not succeed - you can not complete?

What is the point in keeping on trying when you know that you are not going to succeed in losing weight - passing UPSC Exam - climbing Mount Everest?

Point is, when you visit Mega Property Exhibition of CREDAI Pune Metro, keep in mind that any builder can abandon the project & vanish into thin air. And take a risk of booking a flat only if you are prepared to suffer.

To know how the flat buyers suffer when the builder abandons the project, please, visit Aura City at Shikrapur.

October 2011: Aura City at Shikrapur, Joint Venture of Jalan & Maple Group, Launched!


October 2011: Aura City at Shikrapur, Joint Venture of Jalan & Maple Group, Launched!

The collapse of Lehman Brothers in 2008, triggered the world financial crisis. The salaried workers of Pune - Auto, IT and all industries - suddenly realized that they could lose their jobs at any point of time & stopped booking flats. Obviously, Pune real estate market went down.

Exactly at that point, when all salaried people had lost hope of becoming prosperous, Mr. Vijay Jalan came into the picture. "Even not so prosperous can own a home" - was the message of Mr. Vijay Jalan. In June 2010, Mr. Jalan - along with Maple Group - launched Aura County at Ubale Nagar, near Kharadi Jakat Naka on Nagar Road.

For the salaried young IT professionals in Kharadi, who were feeling cheated by the recession, Aura County was a hope of becoming a homeowner & living a prosperous life. Just like their senior managers & team leaders - who had became homeowners before the world financial crisis. Aura County received instant bookings & was a huge success.

Aggressively advertised compact budget flats with long list of amenities at undeveloped but convenient location - was the modus operandi of M/S Jalan & Maple Group. Risk addicted property investors & prosperity addicted salaried young couples who were craving for home ownership were their target market.

For the next 2 years - from 2010 to 2012 - Jalan & Maple Groups were in top form. From Neo City at Wagholi to Eco Valley at Kanhe Phata - one after another they went on launching new projects. Every project went on receiving huge response. Aura City at Shikrapur was one of them.

A 1 BHK Flat (373 sq.ft. Carpet) for Rs. 10 Lakh (Actually all inclusive property price was around 12 Lakhs) & a 2 BHK Flat (487, 517, 551 sq.ft. Carpet) for Rs. 12.5 Lakh Onward (Actually all inclusive property price was around 18 - 20 Lakhs) was the offer of Aura City. 1,000 plus units in 4 story buildings with lift on 16 acre plot of land at Shikrapur, convenient for the workers in Ranjan Gaon & Sanaswadi industrial belt on Nagar Road was the description of Aura City. Luxury of a clubhouse & swimming pool was the bait to catch the buyers. Maximum returns on investment & Best Amenities is equal to Luxury LifeStyle were the promises of M/S Jalan & Maple.

The greedy & foolishly optimistic stupid property investors & the naive low salaried industrial workers found Aura City quite tempting. On the day of launch, 1st October 2011, the site of Aura City was looking like a vegetable market. Without knowing what exactly they were doing - people were booking flats as if they were buying potatoes & onions. Actually, they were not booking flats - but investing in one more venture of M/S Jalan & Maple. Unaware about the reality that they may be rewarded for their contribution - only if M/S Jalan & Maple do not fail.

Jalan Group Abandons Aura City at Shikrapur:


Jalan Group Abandons Aura City at Shikrapur

On that day in October 2011, I remember, along with Aura City at Shikrapur, 2 more projects were launched - Darode Jog Properties' Liviano at Kharadi & Suyog Development Corporations' Nisarg at Wagholi.

Curious to know whether the builders succeeded or failed - recently - I visited Aura City at Shikrapur & Suyog Nisarg at Wagholi. You know what I found at Aura City Shikrapur? M/S Jalan & Maple have abandoned Aura City. The people who have paid their hard earned money have not received their rewards - the flats.

M/s Jalan & Maple have not completed the construction of Aura City. Maple & Jalan have spilt. Mr. Sachin Agarwal told me that Maple Group is out of Aura City. They have dissolved the partnership & retired. Now, Aura City is with Jalan Group.

To recover the loan, State Bank of India has given notice to confiscate the land & unsold flats in Aura City.

Result is, Aura City has already started decaying.

When I visited Aura City, for a few moments, Aura City looked like a ghost city.

A few buildings looked ready & occupied. But most of the buildings were incomplete. For a stretch, there was no one on the cement concrete roads. Stray dogs were roaming. Wild grass, bushes & construction debris, drainage pipes, cement blocks were lying here & there. Drainage lines were left open. A couple of wide & deep pits by the roadside were left open. Electrical lines were dangling between the buildings.

I felt relieved when I saw a couple of children playing at the far end. I went there and asked them - "Do you live here? Are your parents at home?"

"Yes! My mother is at home," pointing at a flat one kid said.

I decided to meet his mother & started climbing the staircase. The staircase was dirty. Dog poop was on every landing. Lift was not installed. Lift well was covered with ply board. I didn't see a single electrical meter. I rang the bell but no one answered. So, I went up. Most of the flats were locked. I guess, out of 40 only 4 - 5 flats were occupied. So, I went down and went on roaming around.

At last, I could talk to a few residents. They told me how all of them are suffering. Some are suffering because they have received the possession. Some were suffering because they haven't received the possession. For over two years, construction of Aura City has stopped. Mr. Jalan - the builder - has gone into hiding. He has become inaccessible. He was not paying salaries to the security guards. Not even replacing the bulbs in the staircases. The dark approach road, thieves & unsocial elements, stray dogs, snakes, hard non potable water, power cuts, muddy roads had made their life miserable. The flat buyers in Aura City told me. Feeling sorry for them I returned.

Jalan Group is Down but Not Out - Mr. Sameer Jalan:


Jalan Group is Down but Not Out - Mr. Sameer Jalan

After coming home, I called Jalan Group. Mr. Vijay Jalan gave me an appointment. But he didn't meet me. Mr. Sameer Jalan met me. Mr. Sameer is an architect by qualification. Sameer told me that he is aware about the issues of Aura City. Jalan Group is on the path to recovery. Restructuring of debt is going on. Sameer is confident that Jalan Group will overcome financial troubles.

Henceforth, I am going to look after Aura City. Mr. Sameer Jalan told me.

"That's a good news!," I said.

Let us hope for the best!

Look at these photos of Aura City and please, pray for the flat buyers.


Related Stories:


4) Launch of Aura City Flickr Photo Album

3) Aura City Shikrapur, Pune 412 028 - Love & Reality Bites!

2) Brochure of Aura City Shikrapur, Nagar Road, Pune 412 208

1) 1 BHK for 10 & 2 BHK for Rs. 12 Lakhs Onward!

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16 comments:

  1. All are white collar sharks its high time customers should unite and take bulls by their horns in solidarity jai hind

    ReplyDelete
    Replies
    1. Awaiting your video. Please ask Ravi to do so by 26th Jan, our republic day !

      Delete
  2. Gharkul In chikhali (JNNRUM Constructed )sarkari flats are way more better than this

    ReplyDelete
  3. The great Indian investors from all over the world should see these pictures and then decide weather they want to invest in Pune properties. Pune builders are cheating the buyers 70% of time so there in no assurance of returns in property investment but there are chances of loss of capital itself. Indian real estate business is not regularized and builders have 100 ways to cheat a buyer so investing in such options can be a big mistake.

    ReplyDelete
  4. " To recover the loan, State Bank of India has given notice to confiscate the land & unsold flats in Aura City. "

    - Builders are bankrupt, some are fully bankrupt & others are on verge of bankruptcy. Even so called big players like KUL, Marvel are in same category. Another major builder has still not paid salaries for December.
    And all this is happening just due to sheer greed of builders & investors who wanted to make quick buck in least time & buyers who took very long duration & heavy loans and bought flats thinking that rates will keep increasing and they will then not be able to buy later. All this created a cocktail for financial bankruptcy in real estate.

    " When I visited Aura City, for a few moments, Aura City looked like a ghost city."

    - Several projects across Pune look like ghost projects including big townships which were launched with much fanfare. Most buyers who bought in newer phases are in even worse situation as builders are unable to sell off older phases leading to stoppage of work of newer phases.

    The only solution for buyers to be safe, both financially as well as in terms of possession is to stay on rent till property prices crash by atleast 50% & then buy ready for possession flat with completion certificate. This is the only method as of now to own headache free flat. It can be seen from data below -

    http://img.etimg.com/photo/50053343/artha1.jpg
    http://img.etimg.com/photo/50053351/artha2.jpg

    ReplyDelete
  5. To protect yourself from such cheating, a good option would be to buy ready possession property only where all amenities are already put in place

    ReplyDelete
  6. BEWARE Of the Builder"S---At all point we as a customers get CHEATED BY the BUILDERS ,But we all keep quiet and do nothing about it, So builders take advantage of our situation as we don"t get connected and UNITE WITH OUR FELLOW CITIZENS Its high time all buyers should unite and ask for there fundamental rights to HAVE A ROOF OVER HEAD ITS A SUPREME COURT JUDGEMENT.
    As i have been cheated by the builder of PUNE.When i went to the Pune Municipal Corporation to check my status of My flat A-1001 in survey no 21/22 mohamedwadi project i was given a plan TRUE copy showing as plan passed up to 11th floor (Having TRUE COPY FROM PMC dated 3rd March,14th March 2011 And 18th December 2013 ) And when i DEMANDED CLEAN AND CLEAR TITLE OF THE FLAT WITH BASIC AMENITIES LIKE WATER ,I was send a threat sms "ANY MORE MSG TO ME YOU MAY NOT GET YOUR FLAT AS WELL"& i was forced to quit The project.When I wrote letters to the highest Authority The President of India I got the below mentioned reply From the PMC, that the plan was passed up to ground + 4th floor.
    So my question Friends you can see how the common men like you and me can be CHEATED and when The President Of India sends inquiry to the PMC sends the below mentioned letter
    Height of CORRUPTION IN INDIA
    This information is SHARED in the interest of a common men like you & me
    In Solidarity Jai Hind
    ‪#‎Marvel‬
    ‪#‎KoregaonPark‬

    ReplyDelete
    Replies
    1. The Unitech case has jolted real estate developers on the need to speed up delivery of office and residential property after the company's directors spent a night in jail on the orders of a court before they obtained bail.

      The sharp slowdown in the realty sector has piled misery on home buyers across the country and within NCR.

      By some estimates, handover of 3 lakh houses are delayed by up to eight years.

      http://timesofindia.indiatimes.com/business/india-business/Unitech-case-jolts-builders-gives-hope-to-home-buyers/articleshow/50554472.cms

      Buying under-construction flat in current time is like throwing money in sewer.

      Delete
  7. All this points to a big change in the near future. People are slowly preferring ready to move flats (completion cert, property tax, electric bill in place). This will cause resale flats to suddenly rise in resale value and very few new projects shall show up. This will again fuel price rise in the real estate sector till people "break" and start buying in new projects again. Maybe that point has in time is already here who knows !

    ReplyDelete
    Replies
    1. Agree & disagree.
      Agree that people will prefer ready flats.
      Disagree that resale prices will rise for the simple reason they are already very high. It's no wonder then you will find lot of locked unsold investor flats in & around Pune. And if price is not right, renting is always an option. And flats depreciate with time, so older the flat becomes, lesser is the price commanded. Bank gives less loan to older flats compared to new, which means less loan amount. This puts more pressure on investor & builders to sell off the flat as very few can buy without loan.

      Good part will be fly-by-night builders, builders who are just fronts of politicians to divert black money (these are ample in Pune), gunthamantris who became builders just because they owned land will be out & only those who really want to remain in this field will sustain.

      Delete
  8. Thank sir
    For visiting in Auracity. As you see here is too many problem which is not solved by builder due to theirs own personal problems.
    And if problems not solved due to economic essues its ok but for delays it needs to take custumer into trust. But they dont think thats necessary. Here i have seen some peoples who make theirs 100% payment at the time of booking but till date they did not got passation.

    ReplyDelete
  9. Shame on these builder statergy which playing with our dreams and hard earned money..... i am also victim of it. I suffered lot in mental,financial(day to day) and social.

    Thanks Ravi sir for your kind words on our issues and pune real estate. It must help to new dream home buyer in pune real estate.

    ReplyDelete
  10. Very good effort Ravi. Please continue your good work for the benefit of people and home buyers and make them aware of such fraudulent builders.

    ReplyDelete
  11. Ravi can you please share Sameer Jalan's number... i guess i can pull out entire Jalan group from this mess and start good projects once again... this will help both the Jalan Group and the flat owners/ potential buys as well.

    I am unable to reach out to them on the numbers given on their website...

    ReplyDelete