MUMBAI: After months of dilly-dallying, the
cash-strapped Air India is closer to improving its working capital by monetizing its prime
properties across India. The national carrier, which has accumulated losses of
about Rs 20,000 crore, is all set to appoint a global property consultant to
help it raise over Rs 5,000 crore by selling and leasing its prime properties
measuring roughly 76.30 lakh sq ft or 175 acres in Delhi, Mumbai and Chennai.
Jones Lang Lasalle has emerged as the frontrunner among three other bidder
consultants like DTZ and Cushman and Wakefield to advise the airline on the
sale process.
The national carrier is also contemplating selling a 25,000-sq-ft commercial building it owns on Poyle Road in London and two flats admeasuring nearly 3,000 sq ft in Tokyo. In Mumbai, the airline owns approximately over 20 lakh sq ft, of which 14 lakh sq ft is in Nerul, housing AI staff quarters. The balance area is divided into six residential plots used also used as staff quarters at Kandivli, a prime residential building in Bandra and a Lonavla holiday home. The airline is set to open bids to lease approximately 2 lakh sq ft spread across 12 floors in the iconic 22-floor Air India building in downtown Nariman Point.
In Delhi, the national carrier wants to monetize over 11 lakh sq ft used as residential quarters for its officers at Vasant Vihar. It also plans to sell its city terminal office spread across 1.7 lakh sq ft at Baba Kharak Singh Marg in New Delhi. In Chennai, it has put its sports stadium spread across 6.9 lakh sq ft on the block along with the 8.3 lakh sq ft Indian Airlines Housing Colony at Mennambakkan and 1.2 lakh sq ft commercial building at Unity Complex. S R Joshi, general manager (properties and facilities) in Air India said the airline would finalize the consultant in a few weeks time and also decide then which properties to finally sell.
The national carrier is also contemplating selling a 25,000-sq-ft commercial building it owns on Poyle Road in London and two flats admeasuring nearly 3,000 sq ft in Tokyo. In Mumbai, the airline owns approximately over 20 lakh sq ft, of which 14 lakh sq ft is in Nerul, housing AI staff quarters. The balance area is divided into six residential plots used also used as staff quarters at Kandivli, a prime residential building in Bandra and a Lonavla holiday home. The airline is set to open bids to lease approximately 2 lakh sq ft spread across 12 floors in the iconic 22-floor Air India building in downtown Nariman Point.
In Delhi, the national carrier wants to monetize over 11 lakh sq ft used as residential quarters for its officers at Vasant Vihar. It also plans to sell its city terminal office spread across 1.7 lakh sq ft at Baba Kharak Singh Marg in New Delhi. In Chennai, it has put its sports stadium spread across 6.9 lakh sq ft on the block along with the 8.3 lakh sq ft Indian Airlines Housing Colony at Mennambakkan and 1.2 lakh sq ft commercial building at Unity Complex. S R Joshi, general manager (properties and facilities) in Air India said the airline would finalize the consultant in a few weeks time and also decide then which properties to finally sell.
According to sources, a proposal to sell the
properties was considered in 2011 but deferred because of serious differences
within the top management. Those opposed to the sale argued against relocation
of the staff residing in the properties and also said the cash garnered would
not be enough to resolve the financial woes of the national carrier.
Air India hopes to earn nearly Rs 100 crore per year from leasing 2 lakh sq ft space in its Nariman Point building. Currently, the airline is paying Rs.2.64 crore per year from its own coffers for the upkeep of the centrally air-conditioned structure.
The building's security was beefed up after the 1993 serial bomb blasts in which it was a target. In 1995-1996, the airline's management wanted to generate additional revenue and increased the rentals. Many companies left instantly; some had to be persuaded and others left after protracted legal battles. The last tenant left two years ago. Air India uses less than seven floors in the building which now has only one tenant, an IT consultancy firm. Fifteen floors are lying unused as Air India has not taken a call on renting them out. Air India reportedly needs a cash injection of Rs10 crore a day.
Air India hopes to earn nearly Rs 100 crore per year from leasing 2 lakh sq ft space in its Nariman Point building. Currently, the airline is paying Rs.2.64 crore per year from its own coffers for the upkeep of the centrally air-conditioned structure.
The building's security was beefed up after the 1993 serial bomb blasts in which it was a target. In 1995-1996, the airline's management wanted to generate additional revenue and increased the rentals. Many companies left instantly; some had to be persuaded and others left after protracted legal battles. The last tenant left two years ago. Air India uses less than seven floors in the building which now has only one tenant, an IT consultancy firm. Fifteen floors are lying unused as Air India has not taken a call on renting them out. Air India reportedly needs a cash injection of Rs10 crore a day.
No comments:
Post a Comment