Bombay Dyeing’s Worli Property Fetches Mumbai’s Biggest Land Deal at Rs 5,200 Crore; Mumbai Region Tops India’s Land Deals in 2023 With A 30% Share

In a landmark development, the Wadia Group, Bombay Dyeing and Manufacturing Company (BMDC) has given the green light to a significant proposal by having agreed to sell a substantial 22-acre land parcel located in the prime area of Worli, Mumbai, to Goisu Realty, a subsidiary of the prominent Japanese real estate developer, Sumitomo.

This colossal transaction stands as Mumbai’s most substantial land deal in terms of monetary value; the entire deal with Sumitomo is slated to be executed in two well-defined phases.

The first tranche of a staggering Rs 4,675 crore will be exchanged, with the remaining Rs 525 crore to be received upon the fulfilment of specific conditions set by BMDC, along with the successful execution and consummation of the definitive agreements for the second phase.

The rationale behind this strategic move is the group’s decision to monetize this valuable land parcel, with the primary purpose of repaying an existing debt burden of Rs 3,969 crore; in the past year, the group has already made strides by repaying a substantial chunk of this debt, totalling Rs 900 crore.

In a visible shift, last week witnessed the relocation of the Wadia Group headquarters, Wadia International Centre (WIC); as part of this transition, the chairman’s office was moved to the Bombay Dyeing property located at Dadar-Naigaum. In addition, the Shilpa Shetty-owned Bastian restaurant, situated behind the former Wadia headquarters, was also closed down.

Under the mill land policy stipulations, Bombay Dyeing has voluntarily surrendered eight acres of land to the BMC to develop recreational spaces. Additionally, an additional eight acres have been allocated to the state housing authority, Mhada, for the creation of public housing.

As per a BMC official, the developer will be entitled to transfer development rights for over 82,000 square meters as compensation for this allocation to the BMC and Mhada. The housing authority has already constructed buildings for transit accommodation and homes dedicated to mill workers on its allotted portion.

The Japanese Connection
It is noteworthy that in 2019, Goisu Realty, a subsidiary of Japanese Sumitomo, secured a lease for a 12,141-square-meter land parcel in the prestigious Bandra-Kurla Complex from MMRDA for a substantial sum of Rs 2,238 crore.
Furthermore, last year, the Japanese corporation succeeded in winning a tender issued by the MMRDA for two land parcels situated in BKC, for an impressive amount of Rs 2,067 crore.

Sumitomo Corporation, boasting an extensive portfolio with 886 group companies, is deeply entrenched in diverse sectors, including the development and operation of office buildings, retail facilities, residences, logistic facilities, and real estate funds.

Before this, a public notice was issued by the law firm Wadia Ghandy, acting on behalf of its undisclosed client, expressing an interest in examining the right, title, and interest associated with the Bombay Dyeing and Manufacturing Co Ltd’s land, spanning over one lakh square meters in the Worli region.

Mumbai Region Tops India’s Land Deals in 2023 with a 30% Share

In the first eight months of 2023, a remarkable total of 59 distinct land transactions spanning over 2,018 acres have been successfully closed across India, according to data compiled by the Anarock Group.

This represents a substantial increase compared to last year’s period when approximately 51 land deals covering around 1,438 acres were finalized across various cities.

Of the 59 land deals in 2023, the Mumbai Metropolitan Region (MMR) emerges as the clear leader, accounting for 17 transactions, and these transactions collectively encompass just over 95 acres, primarily designated for residential development.

Notably, while last year’s deals were spread across various cities, only a few of them involved large land parcels. Anarock Group Chairman Anuj Puri stated that the three most extensive land deals took place in Ahmedabad, involving a total of 740 acres. At the same time, there was one deal each in Ludhiana and Bengaluru, each for 300 acres.

Residential real estate has been the primary driver of sheer transaction volume in the city of Mumbai itself; the most significant land deal of 2023 was concluded in February when the Bai Kabibai Hansraj Morarji Charity Trust sold 23 acres of land to Arogya Bharati Hospitals for 540 crores in Arogya Bharati Hospitals for 540 crores in Andheri (W)

Likewise, five deals encompassing 1,136 acres have been earmarked for township projects in cities such as Chennai, Ahmedabad, and Ludhiana.

Additionally, three separate land transactions spanning over 154 acres are dedicated to plotted developments in cities like Chennai, Raigarh, and Gurugram.

In terms of commercial development, three deals covering a combined area of 16.5 acres have been announced in NCR cities, including Delhi, Noida, and Gurugram.
Lastly, one substantial deal spanning over 300 acres has been allocated for manufacturing purposes in Bengaluru.

Noteworthy transactions in Mumbai include a hotel deal for a 5.5-acre plot valued at 71 crore rupees. On the other hand, Bengaluru claimed the most extensive deal of 2023, involving a massive 300-acre plot for manufacturing. In terms of the total land area transacted, Ahmedabad stands out, with approximately 740 acres changing hands in various deals this year.

In contrast, Hyderabad recorded two separate land deals covering a combined area of over 18 acres, contributing just one per cent to the overall land transactions between January and August 2023.
This includes nine transactions totalling 61.6 acres in Gurugram, three deals for over 19 acres in Noida, and one deal for nine acres in Delhi. Pune, meanwhile, witnessed five deals spanning approximately 44 acres.

The Last Bit, Despite concerns over the economy, the real estate market in India, with Mumbai at the forefront, indicates that the real estate sector is robust.
With prominent transactions in residential, commercial, manufacturing, and hospitality sectors, the real estate landscape in 2023 is undoubtedly winning big.