In a bid to regulate tenancy of thousands of traders who run businesses in Chennai Corporation shopping complexes, Chennai Corporation is set to increase the rent of its commercial spaces uniformly across the city by 15 per cent. The increase in lease rent will be implemented with effect from June 1, 2015.
The civic body’s initiative to rationalise the lease rent for shopping complexes is expected to facilitate the reconstruction drive proposed in the city. “Legal issues have hindered the reconstruction of shopping complexes. Many shopping complexes are dilapidated. Many complexes also have space for additional shops. Thousands of additional shops have to be built for promoting trade in the city. Rationalisation of the lease rent will be the first step,” said an official.
The five per cent difference in rates between old city and newly added areas will be removed after the increase of 15 per cent uniformly across the city.
Many of the tenants have not renewed the lease agreement with Chennai Corporation. The civic body generates just Rs.67 lakh per month as rent from the 6,190 business entities. “The increase in lease rent will generate additional revenue of Rs.1.2 crore for Chennai Corporation per year,” said an official.
Reconstruction of shops will also offer opportunity to new traders to start businesses.
Most of the traders have not renewed lease for the past few years because of litigation. The orders of the government have also been quashed by the court.
The government has decided to auction shops afresh after nine years. According to a recent order of the Supreme Court, the Chennai Corporation has to give priority to a tenant who is ready to pay the market rate even after nine years.
A new policy decision on such order is under consideration to prevent loss of livelihood for traders.
Chennai Corporation has started a survey of tenants who have legal rights and illegal occupants in shops. Following the survey, demolition and reconstruction of at least 10 shopping complexes in locations such as Salt Quarters, Kodambakkam High Road, Egmore Market and Chetpet Railway Station is expected to be implemented.
