Namma (Our) Metro Phase 2A will receive Rs.1000 crores out of private firm’s treasury through the “Innovative Funding” Model. This funding method is presented by Bangalore Metro Rail Corporation Limited (BMRCL) to generate funds for the metro construction in which the firms can monetize the land around their respective funded stations.
Leading property developer Embassy Group was the first private firm to sign a memorandum of understanding (MOU) with BMRCL to construct the upcoming Kadubeesanahalli Metro Station which is located just outside Embassy Tech Village. Embassy has agreed to pay Rs.100 crores to BMRCL to adopt the station. This is a great initiation from Embassy Group to contribute in the development of the urban infrastructure in the city.
Kadubeesanahalli Metro Station is part of the recently approved 17 km Namma Metro Phase 2A which links Central Silk Board to KR Puram. This North to South metro line has 13 stations on the Outer Ring Road (ORR) which is estimated to cost Rs.4,200 crores and BMRCL has introduced Innovative Funding, a new way to part-finance the total cost. The Corporation expects to raise a minimum of Rs.1,000 crores through this innovative financing model. The second corporate to join Embassy in this funding is IT Giant Intel, who has also signed an MOU with BMRCL to invest Rs.100 crores in Namma Metro Phase 2A. This investment from Intel is to adopt the upcoming Bellandur Metro Station.
Additionally, BMRCL is in discussion with few other companies including Goldman Sachs, RMZ Corporation, Prestige Group and Bagmane Group for such partnerships.
What are the benefits of the Innovative Funding for the corporate groups?
Namma Metro is offering the following benefits to them:
- Minor provision in positioning the station’s location
- Naming rights for the station
- Direct access to the investor’s private property through ramps and walkways
- Use predetermined spaces for advertisements
- Use leasable retails space in the station
All of the above rights can be availed for a period of 30 years*
A significant advantage experienced by a private firm is Mantri Developers. Soon after the launch of Mantri Square Sampige Road Station, Mantri Square Mall had witnessed 116% increase in the footfall. This station provides a direct walkway into the mall and was the first station built through public-private partnership (PPP) between BMRCL and Mantri Developers.
Due to these advantages, more companies including Infosys, Wipro and Biocon have shown interest in adopting metro stations of Namma Metro Phase 2- the 19km metro line that operates between RV Road and Bommasandra. In return, all the companies have to maintain the metro station according to specifications laid by BMRCL.
Bangalore has witnessed relatively lesser traffic congestion in and around the metro areas. Moreover, travelling by metro reduces journey time, cuts fuel consumption, reduces road accidents and decreases emission of greenhouse gases.
The 13 Stations of Phase 2A, namely Central Silk Board, HSR Layout, Agara Lake, Ibbalur, Bellandur, Kadubeesanahalli, Kodibisanahalli, Marathahalli, ISRO, Doddanakundi, DRDO Sports Complex, Mahadevpura and KR Puram, is covering the entire Eastern IT Corridor along the ORR line. This project is likely to benefit nearly 4.5lakh people working in numerous companies and Tech Parks- RMZ Ecospace, Manyata Tech Park, Embassy Tech Village and Bagmane Tech Park which houses IT /ITES Corporations such as Accenture, BOSCH, Cisco, Flipkart, HP, Cognizant, Microsoft and IBM. Needless to say, there will be an increase in productivity and efficiency of these employees as their travelling time is reduced to some extent.
*It may also vary depending on the MOU between the company and BMRCL.