Construction flaws: More than 100 apartment owners accept the repurchase option from Godrej Properties in the Gurugram project

Construction flaws: More than 100 apartment owners accept the repurchase option from Godrej Properties in the Gurugram project

Godrej Properties anticipates that in the next months, 200 or so Gurugram apartment owners would choose to take advantage of the repurchase offer.

Godrej Properties estimates that the repurchase would cost between Rs 100 crore and Rs 200 crore.

More than one hundred homeowners in a Godrej Properties Ltd (GPL) residential property in Gurugram chose to accept a buyback offer from the firm after the discovery of several defects in the Godrej Summit project's building quality.

Our goal is to have the repairs finished by the end of the current year. Approximately 10% of our clients have chosen the buyback option so far, and we have already repurchased more than 100 units. We anticipate seeing GPLs "It will be approximately 200 in the coming months, based on current visibility," Executive Chairman Pirojsha Godrej said in the Q3FY24 earnings call.

Eleven buildings housing 1,100 residential apartments make up the project. The business had previously declared in August 2023 that the repair work may cost up to Rs 155 crore. In addition, it has declared a buyback for anybody who wanted to leave the initiative.

construct quality

Godrej Properties had engaged a third-party specialist to carry out an in-depth, impartial evaluation of the project's quality problems. According to the study, the project's concrete included chloride, which corrodes steel reinforcement when it comes into contact with water. The corporation disclosed this information in a 2023 regulatory file.

Following this, GPL said that it has set aside an approximate sum of Rs 155 crore for maintenance, customer claims, repairs, and other related expenses. The business said that it will next pursue payment from the building contractors.

The corporation has supplied information indicating that the repair work is ongoing and should be finished by the end of this year. According to Godrej, the business has already spent between Rs 20 and Rs 25 crore of the money that was allocated for the repairs.

The business estimates that it would spend between Rs 100 crore and Rs 200 crore on repurchase. Godrej said in November 2023, "But we think we will be able to recuperate completely the money spent as we can resell the apartments before the renovations are completed."

At that time, the firm said that it had purchased 60 units for Rs 50 crore. "We are making payments in accordance with the offer made at the time the owner's purchase price was announced, or the ultimate average price of flats sold in Godrej Summit, whichever is greater. Godrej has said in November 2023 that the average pricing and buyback now start at around Rs 6,000 per square foot.

Landlord discontent persists.

Furthermore, Godrej Summit house purchasers informed Moneycontrol that the business has to pay interest in addition to the buyback amount. Tower J resident of Godrej Summit, Vishal Gupta, told Moneycontrol that "the repair work is going on very slowly."

The developer had originally set a deadline of November 2023, which was pushed to June 2024, but it has now been extended to December 2024, he added. "The developer has not yet provided our company with the structural safety investigation of the towers, which was conducted by IIT Delhi."

Bajrang Jain, a Godrej Summit Tower E homeowner and another house buyer, voiced similar worries and said that the builder had missed the deadline for repairs.

Jain demanded that the builder provide the society's inhabitants some financial assistance in the form of a remission of maintenance fees, saying, "The developer is changing the deadlines."

the side of the developer

In the meanwhile, Godrej Properties said that the happiness and well-being of the inhabitants have always been their top priorities in an email statement to Moneycontrol. According to the firm, they are actively interacting with the Godrej Summit inhabitants to provide cooperative solutions and assistance all along the way.

Our goal is to conclude the continuing upgrade work at Godrej Summit as quickly as feasible, while taking into account any regulatory limitations that may have occurred up to forty days after the work began, such as the NGT limits in the National Capital Region. "We have proactively proposed to clients the repurchase of their units, with the option to reimburse the market value—that is, the average of the previous six months of the project—or the amount paid by the customer,” GPL said in an email. Makes offers.

"The best institute in the country, IIT Delhi, has been involved in assisting us with the project improvement process. A government-employed structural engineer is supervising the process as well." the statement said. We have sent around 200 personnel to Godrej Summit in order to fulfill our commitment to finishing the project as quickly as feasible. We want to reassure all of our clients that we would do all in our power to fulfill our commitment at the Godrej Summit.