15 , May , 2020
In a major set of measures announced for the aid of limping
real estate sector by Finance Minister, Nirmala Sitharaman shared that – 1. All deadlines for work being done by contractors for central agencies like railways will be extended by six months without any penalty to contractors. The government will also release bank guarantees to the extent of the contract completed to ease cash flows.
2. To de-stress real estate developers, the Ministry of Housing and Urban Affairs will advise States/UTs and their Regulatory Authorities to treat COVID-19 as an act of God under RERA. And hence asked them to extend the completion date of projects expiring on or after March 25, 2020, by another six month.
Both the above announced measures will increase the liquidity and de-stress the developers. Treating the Covid-19 pandemic as the act of god under RERA will give a dash of relief to developers as now they can extend the completion dates. The pro-active measures taken by the government in the Covid -19 relief package has been appreciated by the industry. Realty Dekho Team brings you what Industry Veterans have to say on this.
Yash Miglani, MD Migsun Group
The sector has been requesting the government for measures that can help maintain the good image of real estate that has emerged especially after this government came with RERA. The latest 'Act of God' would have wiped out all the positive efforts made by the developers towards streamlining. In this backdrop, the announcements made by the FM will help the sector save it’s hard-earned image.
Vijay Verma, CEO, Sunworld Group
Real estate sector has always been in a hustle of delivering projects within registered timelines, procuring timely approvals from authorities and departments. The lockdown bringing every sector to standstill added to the miseries of the property market. We are grateful for the government’s intervention with reduced repo rates, resuming of construction activities, the recent announcements of extended timelines for registered projects and an additional extension of 3 months for projects by RERA. They will be distressing the developers and providing assurance to the home-buyers for timely deliveries. A foresighted approach for issuing fresh ‘Project Registration Certificates’ automatically with revised timelines, reflects hope for a promising future.
Uddhav Poddar, MD, Bhumika Group
"We welcome the announcements made by Hon’ble PM and FM, and hope for the speedy implementation of all of these as the economy is already in the ICU state. Real estate is one of the largest employment generators, employing a large part of migrant labour population of the country welcomes the reliefs pertaining to extension of project completion deadlines, but the main concern today is of liquidity and for that there needs to be a direct push to banks and NBFC’s to lend to this sector. Overall very positive but quick implementation would be the key".
Harvinder Singh Sikka, MD, Sikka Group
COVID-19 has been a clarion call globally. We are very thankful for Govt. of India’s proactive support to the real estate industry. Declaration of COVID-19 as an ‘act of God’ under regulatory authorities, pushing the dates of registration and completion suo-moto by another 6 months for the projects expiring on and after 25th March, 2020 will prevent the developers from entering into defaulting. Even post-lockdown, the procurement of raw materials and presence of labour in full force will be certain setbacks leading to delay in work at construction sites. An extended timeline will provide an opportunity to developers and contractors for planning out the way forward upon understanding these situations closely.
Prateek Mittal, Executive Director, Sushma Group
We welcome the measures undertaken by the government to support the real estate sector amidst the ongoing crisis. With the infusion of Rs 30,000 crore to the NBFCs, liquidity crunch in the housing finance will be eased off to an extent. Apart from that, post giving the green flag to resume the construction activities, the extension of registration and completion date suo-moto by 6 months will certainly provide great relief to the developers, who have been struggling in coping up with the timelines due to covid19 lockdown.
Rajat Goel, JMD, MRG World
The recent announcements made by FM Nirmala Sitharaman under the Self- Reliant India Movement have eased the developments for the real estate sector in coming months. It has treated COVID-19 as an event of ‘Force Majeure’ under RERA, along with extension of registration and completion date suo-moto by 6 months for all registered projects expiring on or after 25th March, 2020 without any individual applications from the developers. The liberty of extending it by another 3 months is also given to regulatory authorities. We welcome the government’s measure for understanding our position in this difficult time and helping us maintain positive relations with our customers. Post- COVID scenario has been eased out for us, and we would be looking forward to complete our projects under this new timeline, with due support from RERA and Urban Ministry authorities.
