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Home > News > High Cost Of Debt Delays Home Projects

High cost of debt delays home projects

Infrawindow News Bureau

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New Delhi

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Feb. 16, 2012, 12:43 PM

According to Jones Lang LaSalle, a property consultancy, 63 large home projects in the National Capital Region, with more than 40,000 apartments are delayed by over four years.

Projects that were launched in 2005-06 which were supposed to be handed over to the buyers in 2008-09 are still under construction. Nine large projects, including four projects of Parsvnath Developers, with 2,600 apartments, and one each of DLF (Belaire), Jaypee Group (Jaypee Greens), Ambience Group, BPTP and AEZ have been delayed for more than six years.  

"A number of these delays have been due to a lack of initial capital with the developer at the start of the project, hasty and unplanned launches, inefficient project management and issues of land acquisition," Santhosh Kumar, Chief Executive Officer, Operations at Jones Lang LaSalle India told Economic Times.

The cost of debt for the sector that has gone up to 15-16% from 12-15% in the last few years have created problems for real estate developers. Labor cost has increased 40-60% in the last one year, while steel and cement cost have gone up by nearly 30-40%.



Comments
Hiten Thakur 
 

2012-02-16 16:57:56

The government must implement some concrete action here. Delayed projects is a crime and must be treated on par with that. The problems caused to the consumer must be heard and compensated for by the builder and the judiciary.

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