Real Estate

... FSI guidelines

Development Control Regulation is an important instrument to regulate the city’s density, infrastructure, planning and development, among other factors.

Floor Space Index (FSI) is the ratio of the built-up space on a plot to the area of the plot. It is a regulation followed in the development control norms of many cities to control their densification and growth pattern. In many Indian cities, the FSI distribution is independent of land availability and densities. In general, FSI values of Indian cities are low when compared to other cities in the world, thereby keeping the per capita built space low.

FSI in other cities

FSI is a common variable in cities and results in varying pattern of development of the urban form and space. It is also a tool for planners to control the extent of built-up area on a given plot and also a valuation instrument in real estate market. In some large cities like Delhi, Bengaluru and Kolkata it is known as Floor Area Ratio (FAR) and in some cities like Mumbai and Chennai it is known as Floor Space Index (FSI).

URDPFI (Urban and Regional Development Plan Formulation and Implementation) 2014 draft regulations suggest establishing mixed-use zones and encouraging transit oriented development (TOD). And this can be done by unlocking land values as ‘high FSI’ in transit corridors (within the planning framework) to encourage public transport systems.

... FSI guidelines

Apart from the normally permissible FSI, there are other factors which affects the FSI norms such as

  • Transfer Development Rights (TDR)
  • Additional FSI
  • Premium FSI
  • Transit Oriented Development (TOD) influence zones
  • Redevelopment projects

These factors increase the FSI from normally permissible FSI.

For example, in the National Capital Region (NCR), the permissible FSI is between 1.2 and 3.5, as per the Delhi Master Plan 2021. However, it encourages higher FSI and height along 500m on both sides from the centre line of MRTS/major transport corridor earmarked as influenced zone. Redevelopment projects are also granted a maximum FSI value of 4. For residential plots in NCR, the FSI decreases as the plot size increases.

Bengaluru has also adopted TOD regulations for plots abutting 60m or more road width and within 150m radius of any transit hub, giving an additional FSI of 0.5 over and above normally permissible FSI. There is no difference in FSI variation in residential and commercial plots. The maximum FSI including the additional FSI in TOD zone can be achieved maximum up to four.

In Mumbai, for residential development, the FSI is uniform over entire zone irrespective of plot size and building activity. The FSI varies from 0.5 in the suburbs to 1.33 in the Island city. It also offers higher FSI up to 2.5 and 2.5 plus incentives for development and redevelopment of Maharashtra Housing Area Development Authority respectively. With the applicability of TDR and premium FSI, the FSI can be achieved up to 5.

In Hyderabad, the city has not put FSI restrictions. Specifically, high rises have a free FSI (no limit on FSI), in order to encourage developments in the city. However, as per the Andhra Pradesh building rules, the built up area in some cases such as stepped type, podium and tower buildings was being done at higher FSI of up to 5. The municipal administration and urban development (MA&UD) department is however considering reintroduction of floor space index (FSI) norm for high-rise buildings in Telangana.

Recent TN amendment

As per the recent order on October 26, the following amendments are applied to Second Master Plan for CMA, 2026:

  • FSI increase is only applicable to residential developments under ordinary building, special building, group development and multi-storey buildings category
  • Uniform FSI of 2.0 (an increase of 0.5 from 1.5 FSI earlier) for residential developments across Tamil Nadu
  • FSI of up to 3.25 (an increase of 0.75 from up to 2.5 FSI earlier) is permissible for residential developments with minimum plot extent of 1,500 sq.m. and minimum road width of 18m.
  • A premium FSI of 50%, 40% and 30% is allowed which was earlier 40%, 30% and 20% for road widths of 18m and above, 12m to below 18m and 9m to below 12m respectively
  • There is no change in FSI for non-residential/other developments

The enhanced FSI may not be achieved to the fullest in some cases due to set back norms and height restrictions. The following pointers demonstrate actual achievable FSI after set back and height norms on ordinary, special, group development and multi-storey buildings as specified in DCR:

Ordinary Building: A residential building with less than two floors, up to six dwelling units. The regulation is applied if the minimum plot extent is 80 sq.m. or below with 6m. of road width.

Impact: With the minimum allowed plot extent of 80 sq.m. to any large plot under ordinary building regulation, the achievable effective FSI is between 1.37 to 1.43. Hence no impact observed due to increase in FSI.

Special Building: A residential building more than two floors and six dwelling units. The regulation is applied if the minimum plot extent is 200 sq.m. or below with minimum road width of 9m.

Impact: With the minimum allowed plot extent of 200 sq.m. to 600 sq.m. the achievable effective FSI is below 1.5 due to the setback and height regulations. Hence no impact observed due to increase in FSI for plot sizes of 200 sq.m. to 600 sq.m. It would be effective for plot size of 700 sq.m. and above

Group Development: Accommodation for residential or commercial purposes, or a combination of such activities housed in two or more blocks of buildings in a particular site with minimum public road width of 10m.

Impact: With the minimum allowed plot extent 300 sq.m. upto 660 sq.m. the achievable effective FSI is between 1.0 to 1.18. Hence no impact due to increase in FSI for plot sizes of 300 sq.m. to 660 sq.m. It would be effective for plot size of 660 sq.m. and above.

Multi-storeyed Building: A building exceeding four floors or 17.0m in height. The permissible minimum plot extent is 1,200 sq.m. with minimum access road width of 12m. and frontage of 25m.

Impact on FSI: FSI of 2 and 3.25 can be easily achieved for a plot of 1,200 sq.m. and 1,500 sq.m. subject to height clearance. Hence, the increase in FSI would be advantageous for such plots.

Impact of FSI increase

The increase doesn’t pose any impact for smaller plots below 700 sq.m., subject to the applicability of setbacks, height restrictions in terms of number of floors. Since it is applicable only in the residential sector, land owners and developers will be keen to monetize land with residential developments. Further, more clarity is required for special buildings falling under category B and C respectively.

The new rules will make way for new and redevelopment projects, thus encouraging vertical growth. More FSI will impact land values and/or selling prices of developed assets. Developers/land owners who have already entered into development agreements or developers who have already purchased land for development will be immediate beneficiaries. Smaller land parcels are likely to have very minimal impact unlike larger ones. Since the FSI increase is focused on residential sector, developers are likely to concentrate more on development of residential projects than commercial assets and extract benefits. We could see unlocking of many potential land parcels, both at city centres and suburbs. The current physical infrastructure such as water supply, sewerage, carrying capacity of the roads, etc., including parking would require more augmentation as they could be strained mainly in city centres.

Way forward

It is an opportunity for developers to correct their prices and align with demand in this growing competitive market. The regulation could have a better impact if other parameters such as setbacks, height restrictions and infrastructures were addressed. Moreover, the government should emphasise more on augmenting infrastructure like in other metro cities that encourage higher FSI in key zones with excellent infrastructure such as TOD zones or areas along metro corridor, etc. This helps the private players contribute in development of infrastructure.

The writer is Chief Operating Officer, JLL India and Sri Lanka

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Printable version | Nov 27, 2021 1:14:36 PM |

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