Andhra Pradesh Housing Board too seems to have given away a chunk of prime properties for comm gains

May 27, 2012 - PRLog -- Much like APIIC and HMDA that are currently in the firing line for alienating government land to private parties, the Andhra Pradesh Housing Board (APHB) too seems to have given away a chunk of prime properties for commercial gains. Records show that APHB, during the real estate boom of 2004-2007, auctioned more than 500 acres of government land across the state to private developers and pocketed a whopping Rs 750 crore (approx) from the deal. In the process, the housing board ignored its primary objective of developing affordable housing for the 'aam aadmi'.

In Hyderabad, the board pocketed about Rs 600 crore by auctioning close to 300 acres of prime land spread across areas such as Kukatpally, Gachibowli and Bandlaguda. The real estate developers from both within and outside the state bid anywhere between Rs 50 lakh to Rs 14 crore per acre. "This was at least 25 per cent more than the prevailing market rate.

In some cases, it was 50 per cent higher," said an industry observer privy to the auctions. The land was bought by a dozen private developers including the likes of Manjeera Constructions, Delhi-based Parsvanath Developers, Indu Royal Homes Pvt Ltd, Ramky Infrastructure Ltd and DLF Commercial Developers Ltd.

Roughly 200 acres, worth around Rs 113 crore, in Visakhapatnam, Warangal and Khammam districts and Nandyal too were auctioned by APHB during this period. The land cost apart, APHB also collected 3-5 per cent of the sale proceeds from each of the developers as these were joint ventures between the board and the bidders.

"After paying such high rates, we discovered that many of those properties were ridden with problems," said G Yoganand, managing director of Manjeera Constructions alleging that the two parcels of land his firm bought were originally 'conservation' land. "It took us over two years to change its use to 'residential' as we could not have started work otherwise," he added. Litigation issues too followed the auctions with some bidders shelving their projects indefinitely, sources said. But while observers criticised APHB for such indiscriminate selling of government land to garner revenue, officials of the board believe they have done nothing wrong. Even as they agree that the board's core objective is far removed from conducting auctions, they maintain that these deals were inevitable.

"We were directed to mobilize resources for the government and we did just that," said Sanjay Kumar, vice-chairman, APHB. That none of these resources has not been used for any infrastructure development (another objective of the board) and instead diverted towards other 'ambitious' projects of the state, is another story.

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