New Delhi: Property prices of legal commercial space in south and east Delhi have skyrocketed in the past one month - a spin-off of the sealing of unauthorised commercial properties in the Capital.
The sharp increase in prices — by 70-100 per cent — was witnessed with the ousted businessmen now looking for space in authorised shopping areas as well as malls.
"There has been an increase of 70-100 per cent in property prices both for rent and lease. This is too steep a rise and not many people will be able to afford it," said Atma Prakash, a property consultant who provides financial assistance to buyers.
According to Prakash, the property prices in malls have peaked. "The middle class and lower middle class businessmen will be the biggest losers with the closure of their shops, as they will not be able to afford the steep prices of malls or the bigger markets," he said.
The Municipal Corporation of Delhi (MCD), as per a Supreme Court order, has started sealing over 44,000 commercial properties operating from residential areas in violation of the Delhi Master Plan.
The retailers and fashion designers whose properties were hit have started shifting out of their existing business locations.
"We are paying three times the price for a suitable place in a mall. I had to vacate my earlier shop because of the demolitions," said a leading fashion designer on condition of anonymity.
He said that earlier he was paying around Rs.60,000 a month as rent for his showroom in southwest Delhi, but now he has to shell out around Rs.200,000 a month.
"The prices have shot up because there are not many good places where designers can start a showroom. So we are being charged a hefty price for the space," he said.
"We are charging Rs.150 per square foot area for rent and Rs.500,000 per square foot in case of lease," said a senior manager of East Delhi Mall.
Taking note of the increasing prices, property dealers said the sealing operations would suffocate the small traders and put them out of business.
"Earlier, we were charging around Rs 120 per square foot area, but now it is fluctuating between Rs 250-300. We believe that with the sealing drive picking up and more businesses getting closed, property prices will shoot up further," said the manager of a leading shopping mall who did not want to be named.
He added that the sealing drive had forced businessmen to shift to areas suh as Noida, Faridabad and Ghaziabad, where the property prices are lower.
On Thursday, the MCD started sealing properties in the Moolchand area of south Delhi. The sealing squads are expected to move towards Ashram, Defence Colony, South Extension and Greater Kailash — all upmarket locations — during the day.
The MCD squads had on Wednesday sealed showrooms, general stores and guesthouses in several upscale residential colonies like Ashram, Safdarjung Enclave, Africa Avenue, Srinivaspuri and Maharani Bagh.
Similar drives were also carried out in Hauz Khas and South Extension-II. A total of 171 commercial establishments were sealed in the south and central zones.
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