Bringing much respite to the commercial real estate developers, the Reserve Bank of India has recently announced its decision to extend date of commencement of commercial operations (DCCO) of project loans for commercial real estate, by one year without downgrading the asset classification.
“It has been decided to permit extensions of date of commencement of commercial operations (DCCO) of project loans for commercial real estate, delayed for reasons beyond the control of promoters, by another one year without downgrading the asset classification, in line with treatment accorded to other project loans for non infrastructure sector”, the RBI said. The officials have revealed that the detailed instructions would be issued shortly in an upcoming circular.
Out of the Rs 25,000 crore Alternative Investment Fund (AIF) proposed by the government in November 2019, Rs 10,000 crore would come directly from the central government. In addition, the RBI would upload the draft revised regulations for Housing Finance Companies (HFC) on its website by February-end 2020 to receive feedback from the public.
In August 2019, the RBI gained the authority and regulation over the operation of HFC, previously undertaken by the National Housing Bank (NHB). The apex bank had then said that it would carry out a review of the extant regulatory framework for HFCs and issue revised regulations in due course, and until then, HFCs shall continue to comply with the directions and instructions issued by NHB.
Tech Park developers in Bangalore will benefit directly from this move by the RBI which will ease them Bangalore has booming tech park construction with the likes of ITPL in Whitefield, Manyata Tech Park in Nagwara and many more.