How to Evaluate Corpus Fund Offers in Redevelopment Bids

A bigger corpus figure is not always the better offer — here is the test that actually matters.

Judge a corpus offer by what its interest earns, not by its size. A fair corpus should generate enough monthly interest to cover the higher maintenance of the new tower. Compare offers per square foot of carpet area, and check the developer's bank guarantee before treating a large figure as a win.

What is the corpus fund actually meant to do?

The corpus is a one-time amount the developer pays at possession. Its purpose is simple: a new tower with lifts, pumps, fire systems, generators and a larger common area costs far more to maintain than your old building did. The corpus is meant to bridge that gap so members are not suddenly paying two or three times their old maintenance.

So the honest test is not "how many lakhs per flat?" It is: if this money is parked safely, does the interest it earns cover the new monthly maintenance? Run your society's own figures through the corpus fund calculator — it shows corpus per sq.ft and whether the interest realistically covers maintenance. Never accept a rate quoted as a market standard; the right number depends on your plot, your scheme and your future outgoings.

Why should corpus be compared per square foot?

Lump sums hide differences. A flat amount per member quietly favours larger flats and makes two unequal bids look similar. Ask every developer to state corpus per sq.ft of existing carpet area, then compare like with like — that is also how the offer comparison tool scores competing bids alongside area, rent and timelines.

Can a large corpus still be a bad offer?

Yes. Before the number impresses the general body, check:

Is there a bank guarantee? The Section 79A directive dated 4 July 2019 contemplates a guarantee of around 20%.
Is the developer MahaRERA-registered, with the corpus written into the registered Development Agreement and PAAA — not a side letter?
Is payment tied to possession, with a clear, dated schedule?

A generous corpus from a weak or over-stretched developer is only a promise. Test that side of the bid with the risk checker before your society commits.

Work it out for your own society

It shows your corpus per sq.ft and whether the interest it earns would actually cover your new building's monthly maintenance.

Open the Corpus Fund Calculator

Common questions

Is the corpus fund paid to the society or to individual members?

It can be either, and the society must decide before signing. Many societies keep the corpus with the society so its interest funds common maintenance, which is the fund's intended purpose. If it is split among members, the maintenance gap stays unfunded. Whichever route you choose, record it clearly in the registered Development Agreement and the PAAA.

When is the corpus fund usually paid?

Most agreements link corpus payment to possession of the new flats, sometimes in stages around the occupation certificate. Avoid structures where the bulk falls due long after possession or depends on the developer selling his free-sale flats. Insist that the timing, amount and mode of payment are written into the registered agreement, not promised verbally at a meeting.

How do we know if the corpus offered is enough?

Estimate the new tower's likely monthly maintenance per flat, then check whether safe interest on the corpus covers it. Our corpus fund calculator does this for your own figures and shows the shortfall, if any. If the interest falls short, negotiate a higher corpus or a maintenance support period rather than accepting the gap silently.