DLF feels the heat of CNBC's coverage

from moneycontrol.com

CNBC-TV18 learns that the company's Garden City project in Chennai is on shaky ground. CNBC-TV18 has access to e-mails of buyers of the project, including an online survey showing that over 50% of them want to pull out. The company started bookings last April and promised to sign the agreement within 45days. But nearly one year later, the project has not even got the necessary approvals.


Of the reported 1800 apartments sold in the project, nearly 53% of buyers want an out according to the survey citing delays in signing the buyers agreement. Other reasons including cost price, which DLF had hoped would be their USP has also gone against the company. At the
time of announcing the project DLF had quoted prices of 2800 per square foot, while the prevailing rates was around 3300 square foot. The prices now average between 1700-2700 per square foot and buyers are demanding that the company revise prices.


The final approval required is the stamping of the drawings by MSB panel. The panel meeting was completed on Jan 28, 2009 and we are expecting the final stamping approval anytime now. The price of Rs 2,800 per square foot is in itself the lowest price compared to prices charged by leading national and local brands and we are discussing this with an open view and are yet to take a decision.


When contacted, a DLF spokesperson said, ”The final approval required is the stamping of the drawings by MSB Panel. The panel meeting was completed on 28 Jan 2009 and we are expecting the final stamping approval anytime now. The price of Rs 2800 per square foot is in
itself the lowest price compared to prices charged by leading national and local brands. We are discussing this with an open view and are yet to take a decision.”


There are other issues as well; buyers want an Undivided Share Land clause to be signed by the company. Also; clubhouse facilities, which DLF claimed were exclusively for buyers' use, is now being thrown open to outsiders as well.


What are the options now available to the buyers? A minority section of say they might just re consider their decision to pull out if the company meets their demands. The others though say that they want their money refunded and have given the company till February 12 to do
so.