Collaboration

Make it pay you bulk amount as well as generate regular income through Collaboration.


What is Collaboration? Collaboration is an agreement between and builder and the property owner. It creates a win-win situation for both the owner of the property and the builder. Generally, the builder puts in money for construction, while the owner contributes land. As land prices account for about 60-80 per cent cost of a property in metro cities, the builder gets one out of four floors.


Through collaboration builder save precious capital as he does not need spend a huge sum on buying a land and therefore save cost, on the other hand owner is not required to spend money on development and thus he also save money. Builder recovers his cost and earns profit by selling one floor. Rest of the three floors remains with the owner which he may keep or sale. During the construction period of 12-18 months builder arranges for appropriate accommodation of the owner without any cost.

 

 

Compelling boosters of property value enhancement

 

  • Greater coverage through higher FAR- Old properties were built on quite lesser FAR allowed at time of their construction. Since then FAR has been gradually increased by successive governments and today more coverage is allowed and higher carpet area can be built on the same old property.
  • Great solution for car parking:It is not uncommon to find many properties facing parking menace on day to day basis as they were built without in house parking. Now the provision of stilt parking makes parking a breeze.
  • Modern Amenities:New construction comes with modern amenities which were unheard off at the time construction of the old properties. So a new construction equips a property with state of the art facilities.

 


How it empowers a property owner


Get bulk cash without selling entire property: Older a property lesser is its construction value. A 30-40 year old property almost loses all its construction value and typically carries only its land value. If an owner need a bulk amount of money the only option he would have is to sell the entire property. Supposing if the land value is 30 crore then such an old property will get same price if sold in the market. However through collaboration the landowner gets the liquidity in more than one ways. Apart from bearing the entire development and construction cost builders gives a signing advance to landlord which may vary depending upon overall valuation of the property. In the concerned case it could be Rs 2 crore. The property is developed into 4 units (Ground Basement, First, Second, Third with Terrace floors) where one unit is kept by the builder and 3 units are kept by owner. The average unit price (Being new and of superior quality construction) goes to Rs 11-12 crore. So without spending a penny owner can reap a benefit Rs 5-8 crore more than earlier value of Rs 30 crore if he wishes to sell all the three units. However if you need to keep one or two units for residence then you have the option of selling rest one or two units at Rs 11-12 crore each to get the desired bulk amount.


Increase regular income with higher rentals: Many times when you have a vacant land or a very old property the rental value that it fetches is almost 50% (half) of what a new property with same area fetches. So an old property with value of Rs 30 crore will give at best 0.75% rental yield that is Rs 23 lakhs approx in a year that too only if you have 4 units. If you have lesser units the income comes down correspondingly. If you have only one or one and half units which are just sufficient for your residence then there is hardly any scope of rentals. If you wish to generate higher regular income then there is no way you can generate additional cash through your property without investing a good amount on additional construction and renovation. However through collaboration you get three new units with state of the art construction and hence rental yield of property goes to 1.5%. So with 3 units of Rs 12 crore each you will get a annual rental Rs 18 lack for each unit and hence total annual rental income goes up to Rs 54 lakhs which quite higher than earlier case.

 


What value we bring in?


Property Gallery as a real estate advisory firm takes pride in facilitating value creating deals for many land owners through collaborations. As a collaborator we play the most significant role in the whole process of Collaboration. It starts from introducing the concept of collaboration to a landowner with its advantages and then introducing the landowner to a builder who is interested in developing the said building. We act as a facilitator and help owner and the builder to settle terms in the best interests of both which comprises negotiation about the consideration amount decision about allocation of the owner's and the builder's share in the building fine tuning the Terms and Conditions of the collaboration agreement. At next state we help in having the owner and the builder mutually decide the map of the proposed building and Floor Plans, Elevation of building. Once the basic plan is agreed we both builder and owner decide on the specification of fixture and fittings, materials to be used in the building till the completion of building in all respects. During the process we take care of legal aspects like arranging for General power of attorney, Special power of attorney, Affidavits, Will, and Possession Letter and so on. Thus Property Gallery plays as middlemen to ensure that no issues arise during the entire period of construction.


We also expertise in making arrangements for temporary relocation (till the completion of the new structure) of the owner in a rented premise within the agreed budget.


Property Gallery considers every business deal including that of a collaborator as an opportunity to develop a stronger bond with our clients and we put our client’s interest ahead of anything else. We take pride in providing a customized solution for each client and making available many options to choose from. We have professional relations with all the top builders of South Delhi and Lutyens Delhi. We have won praise of a number of satisfied clients who never hesitate to suggest our name to those who are looking for entering into collaboration. The fact that 50% of our collaboration deals are referral or though repeat clients demonstrate our reliability, professional ethics.

Give us an opportunity to serve and we will help you get best out of your property.

*Figures quoted are just for illustration and each case varies as per its valuation.

 

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