Developers like the Wadhwa Group, Oberoi Constructions, Godrej Properties, and industrialists like steel tycoon Mittal submitted their offers last week.
A severely cash-strapped Jet Airways that had bagged a 2.5-acre plot at Bandra-Kurla Complex for Rs339 crore back in 2006, is now seeking help to develop it. The plot is strategically located next to the Mumbai Cricket Club.
Developers like the Wadhwa Group, Oberoi Constructions, Godrej Properties, and industrialists like steel tycoon Mittal submitted their offers last week.
Oberoi has apparently made an offer of 2 lakh sq ft space, monetary compensation of Rs530 crore and an additional corpus of around 10% to the airline. Others have made similar offers.
The airline has taken the joint venture route as, according to rules framed by the Mumbai Metropolitan Region Development Authority (MMRDA) for BKC plots, the owner cannot sell the plot to a third party for five years after the commercial building has been constructed.
MMRDA rules also stipulate that Jet, who had bid for the plot in the end-user category, has to occupy 60% space of the original area, which comes to 2 lakh sq ft.
In view of the MMRDA rule, and the fact that the global floor space index at BKC has increased to 4 thereby, increasing developable area on the plot to roughly 13 lakh sq ft, the airline had asked developers to make offers involving both monetary and built-up area sharing options.
The airline had sought a monetary component in the proposed JV in order to pay off a loan of approximately Rs 400 crore taken from HDFC to purchase the plot.
Real estate experts say, technically, the JV could be termed a sale, but for all official and practical purposes, the airline is free to enter into an agreement to develop the property with a third party. “Only the land will remain in Jet’s name, a fact that the new developer has to bear in mind,” said a consultant.
M Shivkumar, Jet’s senior vice president (finance), confirmed the JV plans, saying the airline had already drawn up the building design. “We have not set any deadline for developers to present their proposals. Neither has a decision been taken nor a JV signed with any developer,” said Shivkumar, maintaining it was not a sale.
Though the plot — already excavated — had been marked for the airline’s corporate headquarters, no construction activity was undertaken in the last three years.
Also, despite the global economic recession, the airline, in 2008, had purchased another plot at BKC measuring 24,000 sq mt for an astounding Rs826 crore, claiming it needed the land for its corporate office. As the airline could not fulfil its commitment by September 2009, MMRDA commissioner Ratnakar Gaikwad said the plot would be auctioned.
Interestingly, MMRDA has since been dragging its feet on re-auctioning the plot and could stand to forfeit the earnest money of Rs10 crore deposited by the airline.
Shivkumar maintained that the airline would be taking a decision on the plot in some time.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
)
)
)
)
)
)
)
)
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}