India Inc is selling its surplus land with a vengeance to cash in on the spiraling real estate prices in Mumbai. The price of commercial property in and around the city is estimated to have shot up by 20-25 per cent over the last six months.
According to real estate sector estimates, land put up for sale already could be around 400 acres. This is set to increase sharply as more companies are planning to join the queue.
Real estate sources said among companies sell their excess land included GlaxoSmithkline Pharma, Bombay Dyeing, NRC Ltd, Raymond and Premier Auto.
A source close to the GP Goenka group, promoters of NRC Ltd, said the company was trying to sell its excess land at Kalyan. "Some buyers have expressed interest in buying out the property. A deal is expected shortly," he added.
Real estate sources said NRC Ltd had put up nearly 100 acres of land at Kalyan for sale while GlaxoSmithkline Pharma was close to signing a deal to sell its 19 acres of land at Mulund.
The property will fetch the company a sum above Rs 200 crore (Rs 2 billion). A bid of Rs 180 crore (Rs 1.8 billion) was rejected last week, they added.
Sources close to Bombay Dyeing said the company had been trying to utilise 59 acres of land at its Dadar and Worli units. They added, the proceeds of the sale would be utilised to pay off what the company owed to banks and also to finance the retirement scheme of workers.
However, they were not sure whether the Nusli Wadia-controlled textiles company would develop the property on its own or go for an outright sale.
Only recently, Premier Auto sold its 36 acres of land in Kurla to Kohinoor Planet Constructions, a realty developer promoted by Manohar Joshi. The deal had fetched Premier Auto Rs 110 crore (Rs 1.1 billion) after four years of negotiations.
The sources also said some local real estate tycoons had made presentations to the Singhania family-controlled Raymond to buy out the company's land at Thane. The valuation of the property could be around Rs 100 crore (Rs 1 billion), they added. A Raymond spokesperson, however, had denied this.
Real estate sources said textile mills in Mumbai were putting up another 130 acres of land for sale. Going by the valuation of the Jupiter Mills land, which attracted the highest bid of Rs 276 crore (Rs 2.76 billion) for an 11-acre plot (the floor price was Rs 120 crore) at Elphinstone, 130 acres of prime land in Mumbai should fetch around Rs 3,000 crore (Rs 30 billion).
"There is no uniform logic for the rates being offered. The buyers are quoting the price, based on their plans with the property," said a real estate analyst.
Three units of private textiles mills and seven units of the National Textiles Corporation have put up a combined area of nearly 130 acres for sale.
Public sector NTC has decided to sell all its seven units -- Jupiter at Lower Parel (11 acres), Tata Mills at Dadar (8 acres), Elphinstone Mills at Elphinstone Road (8 acres), New Hind Mills at Reay Road (8 acres), unit II of India United Mills at Cotton Green (16 acres), unit VI of India United Mills at Dadar (12 acres) and unit III of Indian United Mills. The sale proceeds will be utilised for settling VRS and dues to financial institutions and banks.
