RAJUK stops approving designs above 10 floors

Construction cos fear big losses, worried over investment
From The Financial Express
The authorities have stopped approving designs of buildings with more than 10 floors in Dhaka, triggering outcry from the real estate developers and virtually halting vertical rise of the city.
The capital development authority, better known as Rajuk, has not explained its position, but the private realtors have said they are “baffled, shocked and worried” about the future of their investment.
“The last one month, Rajuk has not okayed a single design of our projects that go beyond 10 floors,” Tanveerul Haque Probal, president of the Real Estate and Housing Association of Bangladesh (REHAB), said Saturday.
“We’ve invested tens of billions of taka in purchasing land for bigger projects. Yet, there is no clear decision from the authorities whether they would permit construction of high-rise buildings,” he said.
The past week, the REHAB which includes 589 private developers, met the state minister for housing and the chairman of Rajuk, seeking clarifications on the issue as the companies alleged that they are losing millions every day.
The FE could not contact the minister or the chairman for comments.
Mr. Probal said his association has sought immediate government intervention in the approval process, warning that a foot-dragging by the authorities could lead to ripple effects in the country’s housing industry.
Housing and real estate industry is a key component in the country’s construction sector that accounts for 12 per cent of the Gross Domestic Product (GDP).
REHAB says the realtors who have now expanded into major cities and districts towns across the country have created more than half a million direct and indirect jobs.
Mr. Probal said the realtors are constructing high-rise projects in line with the country’s building codes, leaving 30 per cent space unused. “But Rajuk still would not approve the projects. We don’t know why this is happening.”
He said the developers were told to set aside unused space and go vertically as the amount of land in the capital is depleting fast. “Besides, the price of land has unusually spiked in recent years, forcing developers to go sky-ward.”
Probal said the City Development Committee, which comprises officials of Rajuk, City Corporation, REHAB and BUET, was supposed to hold meeting every month to deal with issues related to city’s development and real estate business.
“But only two meetings were held since the government came into power. If the meetings were held regularly, we could have raised the issue and found a solution,” he said.
REHAB leaders said the latest setback comes at a time when the key economic sector is on the rebound after years of moribund growth.
The sector was dealt a big blow in early 2007 when the then caretaker government launched a crackdown on black money holders – major clients of posh flats in the capital.
High cost of land, construction materials and a delayed impact of the global recession have also affected growth, as many developers froze project works fearing slackening demand in the near future.
REHAB says its members construct 7000-10,000 flats a year while other non-member realtors account for another 3,000 apartments being built annually.

Courtesy of The Financial Express