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The Adani Group's real estate development company Adani Realty has emerged as the highest bidder for the redevelopment of the Maharashtra State Road Development Corporation's (MSRDC) 24-acre prime land at Bandra Reclamation close to the Bandra-Worli Sea Link, surpassing Larsen & Toubro, the only other eligible bidder in the bid process. The land parcel has a potential development area of 45 lakh square feet and is valued at around INR 30,000 crore.
MSRDC invited bids for the prime land parcel facing Mahim Bay and along the sea link approach road, which has a casting yard and the MSRDC office. This plot is allocated for commercial as well as residential use in the Development Control and Promotion Regulations 2034. The project promises to create jobs, boost the local economy, and redefine the city’s architectural landscape.
While 18 top players attended the pre-bid meeting — Adani Realty, Godrej Properties, JSW, K.Raheja Corp, L&T Realty, Lodha, Mahindra Lifespaces, Oberoi Realty, Phoenix Realty, Runwal, Sahana Group, Sattva, Sunteck Realty, Sumitomo, Wadhwa Group, and Wellspun, among others. The MSRDC had set stringent criterias, including a minimum consolidated net worth of INR 15,000 crore by March 31, 2023 and that the participation is limited to single entities. MSRDC noted that the criterion was necessary considering the developer's obligation to pay INR 8,000 crore to MSRDC over 9 to 14 years.
Due to these conditions, Adani Realty, L&T and Mayfair Housing were the only three bidders who were left in the fray. Both Adani Realty and L&T qualified in technical and financial capability rounds later. Adani Realty emerged as the 'preferred bidder' by offering the highest financial bid, providing 22.79% revenue to MSRDC. This surpassed L&T's bid of 18%.
After approval from the MSRDC board, Adani Realty will be responsible for bringing funds, handling clearances and permissions. As per the bid terms, Adani Realty will share the higher of either INR 8,000 crore or 22.79% of the gross revenue generated from the project with MSRDC. This revenue-sharing model ensures both parties have a vested interest in the project’s success, fostering a collaborative approach.
In Phase 1, the winning bidder will take up 6-7 acres of land where MSRDC is located for development. The bidder has to relocate the MSRDC office and provide them with a fully furnished 50,000 sq ft office within a five-kilometer radius of its present office, according to the terms of the bid.
The timeframe set for fulfilment of these conditions is 10 years from the handover of the land parcel to the developer. During these 10 years, the developer will be paying INR 2 crore per month to MSRDC.
In November 2022, the Adani Group had also won the INR 23,000 crore Dharavi Redevelopment Project to redevelop Asia’s largest slum cluster with a bid of INR 5,069 crore.
In conclusion, the conclusion of the bidding process of the Bandra reclamation project is set to redefine Mumbai's skyline. Adani's strategic win, following their success in the Dharavi Redevelopment Project, positions them as a key player in the transformation of Mumbai's real estate landscape. The collaborative approach between developers and MSRDC, with revenue-sharing and phased development, aligns with the government's focus on sustainability and efficiency of development initiatives.
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