Let’s drift out of Dhaka | The Daily Star
12:00 AM, February 12, 2009 / LAST MODIFIED: 12:00 AM, February 12, 2009

Real Estate

Let’s drift out of Dhaka

Suggests Concord chairman to fix the housing crunch

SM Kamaluddin

In a bid to cut housing pressure on Dhaka, the government should earmark some areas and develop lands around the capital to build satellite townships, says the chief of a real estate giant.
“Housing-sector problems will not be resolved unless the supply is increased," says SM Kamaluddin, chairman of Concord Group.
"But it is the government that can develop facilities such as infrastructure and communications to enable private developers to venture into more housing projects,” he says in a recent interview with The Daily Star.
“The government has made an ordinance to restrict developers to take up new projects. But it should take some other necessary steps to develop the sector before enforcing the law,” says Kamaluddin, a BUET graduate.
Upon graduation, he joined an engineering firm and gathered experience for about eight years. He then established Concord Engineers and Construction Ltd in 1972.
“The government should prioritise the development of areas adjoining Dhaka. If future infrastructure and road links are mapped out, developers will have a clear idea about the areas available for development,” he says.
If the government follows these guidelines, he believes, the number of housing products will increase manifold, as developers will kick-start new projects without hesitation, Kamaluddin says.
Builders will be able to invest money if they know about future infrastructure development of the location, says the Concord boss.
The major setback developers face is the absence of area demarcations. "No-one knows when and from where new roads will be constructed in a particular area, in the next few years," he says.
On the living standards of the general mass in Dhaka, Kamaluddin says: “The awful living conditions of Dhaka residents will not improve unless the government shifts a portion of the population outside. Equally, people will only move out when they know that commute to and fro Dhaka will be accessible,” says the Concord boss.
Concord had built a number of projects, at home and abroad, including the 750 feet tall Telecom Tower in Singapore, National Monument in Savar, the Prime Minister's Office, Zia International Airport, Janata Bank Headquarters, Jiban Bima Tower, Bangladesh Shilpa Bank building and the Islamic Development Bank building in Agargaon.
Concord is presently running 47 construction projects and has so far handed over about 5,000 apartments. It directly employs over 3,000 employees.
To ensure housing facilities in the capital, the supply of apartments needs to be increased, Kamaluddin says. But there remain some bottlenecks that hinder the expected supply of apartments. He identifies inadequate roads and highways, infrastructure, an absence of integrated plans and high land prices as the main reasons behind the condition.
However, Kamaluddin is optimistic that land and apartment prices will fall in the next decade. With infrastructure development taking place outside Dhaka, development projects will not be concentrated upon a few areas in the capital, he says.
Kamaluddin debunks the common notion that the price hikes of construction materials, such as rod, brick and cement, are the main contributor to high apartment prices.
He attributes the high prices of apartments solely to the scarcity of land in the capital.
Kamaluddin reasons: "When apartments are sold at Tk 10,000 per square feet, rod accounts for only Tk 200 of the price tag. Then why are apartments priced so high? Increasing land prices contribute to rising apartment prices."
In the 1980s, Concord sold flats at Tk 1,600 to Tk 1,800 per square feet. As the availability of land is now low, apartment prices have shot up.
The out-of-reach apartment prices in Dhaka prompted Concord to venture into the Lake City Concord project, offering apartments at affordable prices.
Another Concord project at Khilkhet in Dhaka consists of more than 3,000 apartments, sized between 558 to 1,445 square feet.
Kamaluddin is against the construction of small flats to keep prices within reach the reach of the mass. He suggests a reduction in construction prices to make apartments cheaper.
The use of modern construction technologies is an ideal way to cut construction prices, he says.
Most buildings in Bangladesh are built with bricks in walls and partitions -- a trend he says is an "offence" in developed countries.
"This is because brick walls collapse even in moderate earthquakes, wreaking havoc on lives."
The substitute for bricks is reinforcement blocks, which generally do not collapse in earthquakes. Kamaluddin says Concord uses such tremor-resilient hollow blocks in their projects.
On ventures outside Bangladesh, he says his company completed three projects in the Middle East and one in Singapore. He finds Bangladesh's least developed country status as a barrier to construction works abroad.
"We faced quite a few difficulties in implementing the project in Singapore. Developers require the support of the government to implement projects outside the country,” he adds.
Concord's venture into entertainment and the amusement sector, such as the establishment of Fantasy Kingdom in Ashulia, has increased land prices by more than 300 times and increased economic activity in the neighbourhood.


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