MUMBAI: The Maharashtra cabinet on Wednesday cleared the plan to buy the iconic, sea-facing Air India Building in Nariman Point to house government offices. As part of the deal, the state will pay Rs 1,601 crore to Air India Assets Holding Ltd, which was formed by the Centre and vested with several AI-owned properties before selling the airline.
The acquisition makes available 46,470 sq m of space across the 23-storey tower, considered one of Mumbai’s landmarks.Officials said the government will save around Rs 200 crore in annual rent if all offices housed in private properties are moved to the Air India Building.
Once occupied by Tata Consultancy Services and other private companies apart from the airline itself, the tower currently houses offices of tax departments under the ministry of finance apart from some government-run undertakings. The current occupants would have to vacate the property. The structure which has the symbol of a centaur on its roof was designed by American architect John Bugee and completed in 1974.
The land on which the building stands is on a 99-year lease given to Air India in 1970. The cabinet has decided to waive transfer fees—
amounting to about one-eighth of the market value—to be paid by the lease-holder and some penalties so that the deal can be expedited and the state can take possession of the building soon. “Air India had sought a waiver of this payment as a special case, which has been approved,” an official said.
When negotiations first began in 2018, Air India officials had informed the Maharashtra government that the building was valued at more than Rs 2,000 crore. “The state quoted a price of Rs 1,450 crore, but it offered Rs 1,100-1,200 crore because the government had to recover dues from Air India of around Rs 300 crore. Talks did not make headway then. They resumed in 2021 under the MVA but no deal was finalised. In 2022, Maharashtra made a final offer of Rs 1,600 crore which was agreed to by AI Assets Holdings Ltd,” the official said.
In 2022 deputy chief minister Devendra Fadnavis met civil aviation minister Jyotiraditya Scindia and urged him to consider the state’s bid favourably. Apart from Maharashtra government, the Reserve Bank of India was said to be in the fray to buy the building.
Fadnavis had said the state administration was facing a space crunch and needed to find space in addition to Mantralaya and its annexe to bring all offices under one roof. “We gave this proposal when I was Chief Minister…that was withdrawn. After that we corresponded again. Currently, both Reserve Bank and Maharashtra government have demanded this space,” he had said in a tweet.
Debt-ridden Air India had also floated tenders for the sale of the 23-storey building in 2018, but it failed to evoke a good response.
The acquisition makes available 46,470 sq m of space across the 23-storey tower, considered one of Mumbai’s landmarks.Officials said the government will save around Rs 200 crore in annual rent if all offices housed in private properties are moved to the Air India Building.
Once occupied by Tata Consultancy Services and other private companies apart from the airline itself, the tower currently houses offices of tax departments under the ministry of finance apart from some government-run undertakings. The current occupants would have to vacate the property. The structure which has the symbol of a centaur on its roof was designed by American architect John Bugee and completed in 1974.
The land on which the building stands is on a 99-year lease given to Air India in 1970. The cabinet has decided to waive transfer fees—
amounting to about one-eighth of the market value—to be paid by the lease-holder and some penalties so that the deal can be expedited and the state can take possession of the building soon. “Air India had sought a waiver of this payment as a special case, which has been approved,” an official said.
When negotiations first began in 2018, Air India officials had informed the Maharashtra government that the building was valued at more than Rs 2,000 crore. “The state quoted a price of Rs 1,450 crore, but it offered Rs 1,100-1,200 crore because the government had to recover dues from Air India of around Rs 300 crore. Talks did not make headway then. They resumed in 2021 under the MVA but no deal was finalised. In 2022, Maharashtra made a final offer of Rs 1,600 crore which was agreed to by AI Assets Holdings Ltd,” the official said.
In 2022 deputy chief minister Devendra Fadnavis met civil aviation minister Jyotiraditya Scindia and urged him to consider the state’s bid favourably. Apart from Maharashtra government, the Reserve Bank of India was said to be in the fray to buy the building.
Fadnavis had said the state administration was facing a space crunch and needed to find space in addition to Mantralaya and its annexe to bring all offices under one roof. “We gave this proposal when I was Chief Minister…that was withdrawn. After that we corresponded again. Currently, both Reserve Bank and Maharashtra government have demanded this space,” he had said in a tweet.
Debt-ridden Air India had also floated tenders for the sale of the 23-storey building in 2018, but it failed to evoke a good response.
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