Pagdi system explained: Why is redeveloping these buildings so difficult?

 Maharashtra’s Pagdi system uniquely allows tenants to enjoy long-term occupancy by paying a one-time premium and then minimal rent. Although landlords keep ownership, tenants benefit from robust protections under the Maharashtra Rent Control Act, 1999. The challenge arises when redeveloping older properties, often complicated by disputes. In response, the government has introduced a new framework to streamline this process, incorporating specialised FSI incentives and efficient dispute resolution to facilitate redevelopment. Maharashtra’s Pagdi system uniquely allows tenants to enjoy long-term occupancy by paying a one-time premium and then minimal rent. Although landlords keep ownership, tenants benefit from robust protections under the Maharashtra Rent Control Act, 1999. The challenge arises when redeveloping older properties, often complicated by disputes. In response, the government has introduced a new framework to streamline this process, incorporating specialised FSI incentives and efficient dispute resolution to facilitate redevelopment.