The iconic 58-year old Cadbury House in south Bombay's Mahalakshmi area, which has been on the block for the last six months, has finally been sold to a diamond merchant for approximately Rs 350-400 crore.
Even though real estate developers like Lodha Group, Oberoi Realty and Peninsula Land were among those who had shown interest in acquiring the property for redevelopment, the new owner Dilipkumar Lakhi- a prominent diamond trader in the city- emerged as the top bidder and is reportedly acquiring the property for personal use.
According to CNBC-TV18, this marks the biggest deal for self consumption.
The deal valuation slightly lower than what analysts had expected. Most experts had pegged the deal at Rs 450 crore since flats in the area currently quoted at Rs 60,000 per square foot. But given the sluggishness in the sector and the fact that luxury real estate is not finding buyers,Lakhi was the highest bidder even with a bidding amount of Rs 350 crore.
Last year, the US Consulate sold Washington House, its three-storied residential building at Altamount Road, in South Mumbai, to Lodha Group for Rs 375 crore.
The entire land parcel is 1.1 acre and the saleable area is around 62,000 square feet. In other words, thedeal is valued at Rs 57,000 per square foot.
Under the new rules, thee total development potential of the premises, which is located right opposite Mahalaxmi Temple on Peddar Road, is about 100,000 sq ft under new rules.Flats in the area are currently quoted at around Rs 60,000 per sq ft.
Cadbury House is the headquarters of Cadbury India, the Indian subsidiary of Mondelez International, which was earlier known as Kraft Foods.
It is prime real estate as it is located between Altamaont Road where industrialists like Mukesh Ambani, Gautam Ambani and Kumar Mangalam Birla have plush houses, and the iconic Haji Ali shrine.
Cadbury will get an extended lease of eight to nine months to finally move out from the premises as it also includesthe eight-storey Bournville Apartments that houses top officials of the company.According to an Economic Times report, the deal is likely to take around three months to conclude.
Cadbury has identified a new location in north Mumbai for its headquarters.Given the company's growth in the last few years there had been an exponential increase in the number of new employees to 500 from 300 at the end of 2010 leading the company to look for a new location.
It currently has threeoffices in Mumbai - Mahalaxmi, Lower Parel and Powai. In Thane, it has a factory and a new upcoming R&D centre. Cadbury's decision to relocate is in line with the trend set by many corporations seeking to monetize their assets and relocate to the suburbs.