NCLT approves Mantra Properties buyout of Mulund project

MUMBAI: The bankruptcy court in Mumbai has approved Pune-based Mantra Properties' acquisition of one of the projects of Nirmal Lifestyle (Mulund) spanning about four acres in Mumbai's eastern suburb of Mulund.

The project, with a total development potential of nearly Rs 1,900 crore, was launched by Nirmal Developers in 2017. The company has admitted liabilities of Rs 1,491 crore, whereas the bidder has proposed Rs 215 crore under the resolution plan.

"Approval of the resolution plan shall not be a ground for termination of any existing consents, approvals, licences, concessions, authorisations, permits or the like that has been granted to the corporate debtor or for which the corporate debtor has made an application for renewal, grant of permissions, sanctions, consents, approvals, allowances, exemptions, etc.," the division bench of judicial member Lakshmi Gurung and technical member Hariharan Neelakanta Iyer said while approving the revival plan.

The company entered corporate insolvency resolution process (CIRP) in July 2023 on a plea by Beacon Trusteeship Ltd. It has two secured creditors-Beacon Trusteeship with Rs 902 crore and 60.54% committee of creditors share, and Assets Care and Reconstruction Enterprise Ltd with Rs 589 crore and a 39.46% share.

Also Read: Net leasing of office spaces in NCR down 60 pc in Jan-Mar to 1.5 mn sq ft: JLL

"We will complete the Mulund project and address the interests of existing homebuyers. This marks its second project in Mumbai, after acquisition of an 8.5-acre project in Jogeshwari," said Rohit Gupta, managing director, Mantra Group.

Around 15 real estate developers had shown interest in the project, and the resolution professional had received three final resolution plans, including that from the successful bidder, Mantra Properties and Developers. The other two were received from Vasavi Realty and Sardarmal Prithviraj Constructions, in consortium with Dharmesh Sardarmal Jain, former promoter of the corporate debtor.

Also Read: Missing Link to reshape Mumbai-Pune corridor, boost prospects of Mumbai 3.0

Ruchi Khatlawala, partner at law firm Little & Co, said developers are always interested in acquiring a brownfield real estate firm with a good land parcel in Mumbai. "When the company is under the CIRP, the process of due diligence for their books, land records and lease agreements is very easy to conduct, and hence, developers are always looking at such cases with more interest," she added.

The project was planned with four towers spanning 754,000 sq ft, of which 114,000 sq ft had been sold to 235 buyers by the erstwhile developer, and they had paid Rs 50 crore against homes worth Rs 230 crore.