MSRTC may lease out land in Pune, Nagpur
By Girish Kuber, TNN |
Highlights
MUMBAI: RIL has won the rights to develop land owned by MSRTC in Borivali. The deal reveals a bit of RIL���s gameplan for its retail rollout at a time when real estate prices are soaring.
RIL, by pursuing this BOT model on surplus land belonging to the MSRTC in the suburbs, is trying to ensure two things. Firstly, reduce real estate costs by not going after property in South Mumbai. Secondly, the proximity to the bus station and the fact that Borivali is a densely populated, growing suburb will also ensure enough footfalls.
���We received a dozen bids. But the one by RIL was the highest,��� MSRTC joint MD AD Kale told ET. He, however, refused to discuss other bids. A Reliance spokesperson also declined to comment. RIL seems to be keen on pursuing this strategy in other towns and cities as well.
The group has submitted bids for developing property along similar lines in Solapur and Nagpur, sources said. MSRTC has received special government permission to develop its bus depots across the state for commercial purpose. The exercise is aimed at raising capital for the loss-making corporation, one of the largest fleet owners with 16,000 buses that ferry 58 lakh passengers daily on 17,000 routes.
RIL has paid Rs 25 crore for the development of the Borivali property, including Rs 2 crore for a new 18,000 sq ft bus station. In return, RIL will get 70,000 sq ft of land to be developed for commercial usage. ���The company can build a shopping complex or anything else it wants,��� sources said.
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The MSRTC will sign a 30-year lease with RIL for the land. The deal received the state government���s nod after it was cleared by the MSRTC board, a corporation official added. ���The company has submitted the bank guarantee of the said amount,��� he said. He also made it clear that considering the sensitivity of the issue, the corporation has made it clear that under no circumstances, will the land ownership be changed.After Borivali���s success, the MSRTC is working on leasing out other such depots in the state. Pune, Solapur, Aurangabad and Nagpur along with other major district places, are on top of the list. ���We have bus stations and major depots in almost every city of the state. It is an attractive proposition to utilise the unused land for raising capital since all our depots are centrally located and can fetch huge money,��� a state government official said.
The MSRTC is sitting on 800 such plans to develop unused land around its 570 bus stations and 247 depots all over the state. ���It���s not that every piece of it is on offer at one go. We will develop it in a phased manner,��� an official spokesperson for the MSRTC said.
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