Auction of Jet Airways’ BKC office piques buyers’ interest – ET RealEstate

File photo

MUMBAI: Despite the impact of Covid-19 on the real estate sector, the approaching auction of the Jet Airways office located in the Godrej BKC building in Bandra Kurla Complex has been stirring interest.

Several corporate companies, a leading private bank, a prominent real estate fund and a global asset management firm have made enquiries for possible bids, sources said.

The third and fourth floor office mortgaged to HDFC Ltd is scheduled to be e-auctioned on June 26 as part of the corporate insolvency resolution process underway before the National Company Law Tribunal (NCLT). According to a public notice issued by the NCLT-appointed resolution professional Ashish Chhawchharia, the approximately 1,69,983 sq ft saleable area on the third and fourth floor of the building will be put on the auction block.

The reserve price has been finalised at Rs 490 crore, and prospective bidder will have to pay an earnest money deposit of Rs 25 crore along with the bid document on or before June 24. An inspection of the property has been scheduled on Friday between 11am and 1pm.

Karan Singh Sodi, regional managing director, JLL India said, “The Jet Airways floors should generate a good level of interest even in these uncertain times as the base price issued is way below the recently concluded sale transactions for Grade A assets in BKC. The reserve price is approximately 25 per cent below the average prevailing prices for Grade A assets”.

The reserve price translates to a value of Rs 28,900 per sq ft, while the last big transaction in Godrej BKC was closed at Rs 36,000 per sq ft. Market sources said Grade A assets like Godrej BKC have been witnessing a healthy increase in rentals from 16 per cent to 21per cent in the last 12 months.

“This exponential jump was driven by three fundamental factors. Firstly, no new Grade A supply has come to the BKC micro market. The Grade A vacancy percentage has reduced from two digits in 2018 to below 7 per cent in the last two quarters. Lastly, there has been a steady demand from occupiers especially in the BKC micro market,” Sodi said.

Godrej BKC, developed by Godrej Properties Ltd on land owned by Jet Airways, has witnessed rents increase from Rs 235 to 240 per square foot (psf) in the last quarter of 2018 to Rs 270-275 psf level in recent months. A similar increase has been seen in rents in other Grade A buildings including One BKC, First International Finance Centre and Maker Maxity in the last 12 months.

JLL had concluded the sale of the IDBI Bank building of approximately 3 lakh sq ft to Securities Exchange Board of India for over Rs 900 crore at Rs 30,000 per sq ft as well as the Citigroup Centre that fetched over Rs 400 crore at capital value of Rs 36,500 per sq ft.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *