Everything you need to know about Transferable Development Rights

TDR is a land development technique that separates the development potential of a specific parcel of land and allows it to be used elsewhere within the city’s defined zones. It enables the owner to sell the development rights to another party for a specific parcel of land. This entitlement is in addition to the standard FSI available for receiving plots under current laws and regulations, which entitles a landowner to build an additional built-up area on his existing building or vacant land.

TDR is removed from the zone and is tradable, distinguishing it from Accommodation Reservations. This is also commonly used for inner city redevelopment and reconstruction/redevelopment and has been tried out in a number of cities/states, including Bengaluru, Chennai, Mumbai, and Rajasthan. However, as a result of its implementation in various cities, it has its prospects and consequences. For example, unrestricted TDR pooling could harm urban form, TOD strategies, public space quality, and so on. As a result, it should be used with caution within a predefined spatial framework. States such as Karnataka and Rajasthan have taken steps to mitigate the effects.

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TDR can be viewed as a tool for controlling urban sprawl by concentrating on development. TDR is a legal mechanism used as a form of development control in some local government jurisdictions. TDR is also used in the United States to avoid constitutional takings issues caused by rezoning areas that would otherwise remove a significant amount of value from the property. The procedure provides financial incentives or bonuses to landowners for the conservation and maintenance of their land’s environmental, heritage, or agricultural values. TDR is based on the idea that with land ownership comes the right to use or develop the land.

Transferable development Rights programs compensate landowners who choose not to develop a portion or all of their property. In exchange for fair compensation, such owners are given the option of legally severing their development rights under municipal zoning. Landowners have the option of selling their rights to real estate developers or other owners. A restrictive covenant or conservation easement permanently protects the parcel of land from which development rights are severed. Furthermore, the development value of such parcels of land with transferable development rights is increased.

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In 2017, Ahmedabad was designated as India’s first World Heritage City by UNESCO. Today, the city government provides a one-of-a-kind variant of TDR, the ‘Tradable Development Right,’ as an incentive to owners of heritage structures listed in the heritage conservation plan. More than 2,500 heritage building owners can take advantage of the scheme’s benefits. These buildings/structures have been classified as ‘highest heritage value’ and ‘high and moderate heritage value’ by the government. TDR is offered on the basis of the FSI used for these buildings.

Summing Up the Transferable Development Rights 

1. It is a certificate obtained from the Municipal Corporation by a property owner indicating that his property is reserved for public utilities such as a road, garden, or school. The obtained certificate is equivalent to the reserved rights obtained by the owner upon surrendering his property to the Municipal Corporation.

2. It entails making available a certain amount of additional built-up area in place of the area surrendered by the landowner so that the extra built-up area can be used optimally by him.

3. These rights are typically transferred from fully developed zones to other zones in a city like Mumbai.

4. The primary goal of this transfer is to aid in the development of underdeveloped areas.

5. According to Explanation I to Rule 5 of the MAHARERA Rules, 2017, the TDR Acquisition Cost is included when calculating the land cost, which ultimately raises property prices.

6. It has emerged as a tool for urban development, resulting in haphazard congestion.

7. This concept arose when the government was acquiring land for the construction of roads, civic amenities, and so on. This certificate shortens the acquisition process by allowing the owner to transfer his rights with the help of this certificate.

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