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Mumbai airport’s realty development takes off with Rs 580 cr deal

Mumbai airport’s real estate development has got off the ground, with Mumbai International Airport Ltd leasing 5.5 acre land parcel near the international terminal at Sahar to Oasis Realty Ltd for Rs 580 crore.
Last year MIAL had called bids for land parcels measuring 10 acres. MIAL will lease out 200 acres of airport land for hotels, offices and convention centres under SkyCity development.

“We had called bids for four plots. Bids of two plots have been finalised and we will conclude the deal for other two by the year end. We are in discussions with developers and there is lot of interest,” said GVK group vice chairman Sanjay Reddy.

MIAL’s commercial development was stuck till now because of delays in clearances, encroachment and slump in realty market.

Reddy explained that Rs 350 crore (of Rs 580 crore) is the deposit amount and will be used as project finance for airport modernisation and the balance Rs 230 crore is lease rent. The two land parcels awarded today have been sub leased for a period of 23 years and are extendable for another 30 years.

About Rs 1,000 crore collected from the real estate development will be used as project finance.

MIAL said the awarded land parcel will have a potential for commercial development of 1.16 million square feet. This is part of the process of overall commercial development of 22 million square feet in phases over a period of 10 years, it said.

According to sources, real estate development can fetch MIAL around Rs 18,000 crore.

Reddy refused to comment on this sum. “This is speculative and I will not be able to comment,” he said.

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