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In a move that supports Mumbai's ongoing coastal road project and unlocks exciting future possibilities, DB Realty, recently rebranded as Valor Estate Limited (effective March 8, 2024), has announced a significant land lease agreement with the Brihanmumbai Municipal Corporation (BMC) on March 11, 2024.
Valor Estate Limited has leased out approximately 186.52 acres of land, part of a larger 254.99-acre holding, adjoining Mira Road Railway Station on the western side. This vacant and undeveloped land parcel will be temporarily handed over to the BMC on a leave and license basis for three years, commencing March 11, 2024, with the option for an extension of two additional years. The total lease period could reach five years.
During this time, the BMC will utilize the land for casting yards and allied works essential for the construction of the coastal road project. Valor Estate Limited will receive an average annual rent of approximately INR 248 crore, totaling a significant sum over the lease period. This figure highlights the value of the land, with the current residential capital value estimated at INR 20,000 per square foot of carpet area.
The most intriguing aspect of this agreement lies in the future potential of the leased land. While the immediate focus is supporting the coastal road project, the 186.52-acre area possesses immense development potential exceeding 50 million square feet. This translates to a significant opportunity for Valor Estate Limited in the long run.
The land's strategic location near Mira Road Railway Station further enhances its value. The upcoming coastal road project is expected to significantly improve overall connectivity in the area, making it even more attractive for future residential development. Once the coastal road is complete and the necessary infrastructure is in place, Valor Estate Limited has the potential to transform the leased area into a thriving integrated township. This could include residential complexes, commercial spaces, and other amenities, creating a self-contained community.
This land lease agreement presents a win-win scenario for both parties involved. The BMC acquires crucial land to expedite the construction of the coastal road project, a vital infrastructure initiative for Mumbai. Valor Estate Limited secures a steady income stream while unlocking the long-term development potential of its land holdings. The completion of the coastal road project will not only improve traffic flow in Mumbai but also pave the way for the creation of a new integrated township in Mira Road, potentially shaping the future of the area.
This agreement has the potential to significantly impact Mira Road's real estate market. With the current residential capital value at INR 20,000 per square foot, experts predict a rise in property values due to the improved connectivity brought by the coastal road and the possibility of a well-planned integrated township. While a timeline for development after the lease period is yet to be announced by Valor Estate Limited, the project is sure to raise environmental considerations. Hopefully, Valor Estate Limited will prioritize sustainability measures during development. Additionally, with a potential rise in residents, incorporating well-developed public transport options within the township would be crucial to minimize traffic congestion and promote a car-light lifestyle.
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