Air India building sale: Crisis-hit airline may seek stand of new govt in Maharashtra on iconic Nariman Point tower

  • The previous Devendra Fadnavis government had evinced interest to buy the tower for Rs 1,400 crore

  • The JNPT and the LIC had quoted Rs 1,375 crore and Rs 1,200 crore, respectively, for the Nariman Point tower

  • The building served as the corporate headquarters for Air India until 2013 when the head office was shifted to New Delhi

Amid the privatisation efforts of the ailing Air India, the national carrier may approach the Maharashtra government to know its stand on the airline's iconic building at Nariman Point in Mumbai, said a news report.

Air India may seek the stand of the new Shiv Sena-led government in the state that if it is still interested in taking over the 23-storey Air India building in South Mumbai, said a report in The Economic Times.

After the previous state government had expressed interest in the building last year, Air India had deferred the plan to sell the landmark building but it reportedly suffers a loss of about Rs 45 lakh per month in the form of rent from a single floor of the building, the report said.

 Air India building sale: Crisis-hit airline may seek stand of new govt in Maharashtra on iconic Nariman Point tower

Representational image. Reuters.

“We could not lease the space earlier as the Maharashtra government was supposed to take over the building. With the new government in place, we don’t have any clarity yet, so it is better to rent out the space on short-term lease,” the report said quoting an Air India official.

Air India has a debt burden of around Rs 60,000 crore and the government is still working on the modalities of disinvestment.

In May 2019, the BJP-led state government had offered the national carrier Rs 1,400 crore to take over the Air India property when it was put up for sale in December 2018, said a report in The Indian Express.

Despite state government’s offer was Rs 200 crore less than the reserve price the state-run airline had set, it had decided to go ahead with the offer, the report said.

The Jawaharlal Nehru Port Trust (JNPT) and the Life Insurance Corporation (LIC) had quoted Rs 1,375 crore and Rs 1,200 crore, respectively, for the Nariman Point tower.

In January last year, Maharashtra government, for the first time, had expressed interest to buy the Air India building, reported PTI.

The tower on Marine Drive was the national carrier’s headquarters till 2013 when it was vacated as part of asset-monetisation plans.

The state government had submitted a bid for the premium property which has 5 lakh square feet of space in the building.

The building served as the corporate headquarters for Air India until 2013 when the head office was shifted to New Delhi.

The Air India building, which is spread over 220,000 sq ft has several vacant floors overlooking the Arabian Sea which have been rented out to the directorate general of shipping, State Bank of India, and Tata Consultancy Services Ltd.

Last week, Civil Aviation Minister Hardeep Singh Puri said that the bid to privatise the ailing Air India was going ahead well even as the government's efforts in the past to find a suitable buyer for the crisis-hit airline did not succeed.

With PTI inputs

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Updated Date: Jan 01, 2020 16:05:56 IST