The Maharashtra government has resumed discussions to purchase the iconic Air India building at Nariman Point, with state Chief Secretary S J Kunte calling on Air India CMD Rajiv Bansal on 10 August 2021, to work on the underlying details.
Reportedly, the state government is looking to purchase the building at Rs. 1,400 crore, whereas Air India’s internal valuation pegs the value of the structure at approximately Rs. 2,000 crore.
The land on which the building is located stands is owned by the state, and therefore Air India needs to cough up approximately Rs 400 crore towards various outgoing liabilities. Due to this, the deal is likely to cost the state government nearly Rs 2,400 crore. It is believed, the state government has asked Air India to submit a copy of the valuation if it wants to proceed with the sale.
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In the face of mounting losses, the air carrier had decided to put up the building for sale of leasehold rights in December 2018. Interestingly, the previous BJP-led state government led by Devendra Fadnavis had also evinced interest in buying the building for housing its various offices scattered across Mumbai.
The state had placed a bid of Rs. 1,400 crore to buy the property. The offer was, however, Rs. 200 crore less than the reserve price pegged in 2019.
Notably, the Jawaharlal Nehru Port Trust (JNPT) and the Life Insurance Corporation (LIC) have also portrayed interest in buying the property with bids of Rs. 1,375 crore and Rs. 1,200 crore, respectively.
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Presently, the building stands vacated, with only the top floor is in the Air Carrier’s possession. The rest of the premises is presently rented out, which brings much-needed revenue to the airline.
