What is Fungible FSI?
Fungible FSI also known as Fungible Compensatory FSI allows a builder or developer to construct additional floors of a building beyond the permissible FSI or FAR based on certain conditions and payment of a certain premium.
Why is it called Fungible Compensatory FSI?
Mumbai has several old buildings which are due for redevelopment but due to various issues like low rent, landlord-tenant disputes etc. the redevelopment is stuck. Rent control aggravates the situation. Therefore to attract or incentivize the existing tenants / occupants to give up their premises for redevelopment, the builder / developer is given an additional FSI 35% for Residential and 20% for Industrial and Commercial building so that the occupants / tenants get a better deal. Only the existing / rehabilitated occupants can get the benefit for the tenements which are already existing and going to be rebuilt. It is not applicable to the Sale component or fresh sale units.
Which laws govern Fungible FSI?
The following pieces of law govern Fungible FSI:
- Government of Maharashtra Notification No. MH/MR/South-346/2011-13 dated 6-Jan-2012
- Development Control Regulations for Greater Bombay, 1991
Who pays for the Fungible FSI? What is the rate of Fungible FSI?
The builder / developer will pay for getting the benefit of the Fungible FSI. This maybe ultimately recovered from the tenant or occupants who are to be rehabilitated.