Want to start a new promoting business
Javed Ali Khan
(Querist) 26 January 2014
This query is : Resolved
I am presently residing at Kolkata since 6 months. I was out of my native place for 10 years doing a job & now I want to start a business as a building promoter . My childhood friend, has a piece of vacant land measuring about 2000 sq. feet at Bright Street, park circus, kolkata which falls in ward no. 65 of Kolkata Municipal Corporation. I would like to know the following:
1. what is the per sq. feet cost for new construction in Bright street, park circus ( Ward no. 65) as of date?
2. what is the per square feet buy price of ready possession flats newly constructed in the same municipal ward ?
3. How much money I have to pay to my friend initially on signing the agreement to start the construction if the plan is G+4 ?
4. Since, my friend won't invest a single penny, what will be the share in this venture?
5. where to get a proforma of such agreement draft ?
--- Javed Ali Khan
ajay sethi
(Expert) 26 January 2014
you need to contact local lawyer for preparation of agreement . dont go in for ready made drafts . since your friend contribution is in form of land you would have to invest money for development of property . the share in profits has to be discussed with your friend
we cannot advise you on cost of construction in west bengal nor sale price as to flats .
Devajyoti Barman
(Expert) 26 January 2014
1 &2. The price of property in Bright Street is very costly not less than Rs.10,000/- per sq.ft. but I can not say the cost of construction.
3 &4. It would depend upon the terms of the Joint Development Agreement. Generally in Kolkata the terms are 50:50 with a token money as advance.
5. Engage an advocate.
Anirudh
(Expert) 26 January 2014
I think that you are completely new to this area of business.
Per sq.ft. of construction would not vary from place to place (except the cost of material and labour rate - from one city to another).
The cost will also depend upon the kind/quality of material being used, facilities being built etc.
Further more, as rightly advised by Mr. Ajay Sethi you have to have deeper discussions as to what exactly you want to do, whether you want to purchase the entire land and then build the flats, or you want to bring in money while your friend would bring in his land and then jointly construct the flats, sell to prospective buyers etc. etc.
For all this, you have to consult a local architect then lawyer to draft the agreements between you and your friend; between the prospective buyers etc. In case you are going to get buyers and get money from them even prior to the construction of the flats, then you have to get Service Tax Registration, VAT Registration etc.
All these initial arrangements itself would involve money.
Therefore, you would be advised to get in touch with architect, lawyer etc., before doing anything, as you will be putting in your hard earned money. (If you think that by consulting here and there and getting some draft agreement and then make corrections to it, you will be sadly mistaken. You will be committing a blunder.)
Rajendra K Goyal
(Expert) 27 January 2014
1,2 &3. Not a legal query. Contact local property dealers.
4. Depends upon your understanding.
5. Ready made formats are not supplied. Depends upon individual need. Contact a lawyer.
K.K.Ganguly
(Expert) 27 January 2014
1. The cost of construction will depend on the type of the construction & quality of the construction meterial used,
2. The current market price for ready made flat in Bright street is in between Rs.8K to Rs.9K per sq.ft. depending on the location & quality of the construction,
3.& 4. It depends on how much money your friend demands from you. Normally, the profit is shared on 50:50 basis where the land cost is high. It means that the land owner will offer his land only & will not invest any amount & the developer will make all investments to construct the flats. For starting the project, generally a token amount, may be Rs.10 lakhs in this case, is taken by the land owner,
5. Contact a local lawyer for making the development agreement for you.
T. Kalaiselvan, Advocate
(Expert) 27 January 2014
It is better to contact a local lawyer and get the matter set right as per the prevailing circumstances.
