Delhi's Taj Mansingh, two other premium hotels put up for auction
09 December 2017
The national capital will soon see the auction of three premium hotels, including the iconic Taj Mansingh, after the New Delhi Municipal Council (NDMC) decided to grant licence for the properties for a further 33 years.
The minimum reserve price for Taj Mansingh has been fixed at Rs32.2 crore, while the reserve prices for Hotel Connaught and Asian Hotel have been fixed at Rs49 lakh and Rs9.9 lakh, respectively.
The long overdue decision to auction the licence for the hotels was taken at meeting of NDMC which met in September under chief minister Arvind Kejriwal.
The lease period of the hotel properties had expired in 2011 and, according to NDMC vice chairman Karan Singh Tanwar, the expiry of the lease period had led to a legal battle with the owners as the council wanted to put up the hotels for auction.
The decision to auction Taj Mansingh was taken after the end of a six-year-long battle between NDMC and Tata Group. However, no action was taken on auctioning the property as the NDMC was entangled in a legal battle with Tata Group's Indian Hotels Company Limited (IHCL).
Taj Mansingh was given to Tata Group's Indian Hotels Company Ltd (IHCL) on a lease and had operated the hotel for 39 years. The company had since approached Delhi high court when NDMC decided to auction the hotel.
"The company's plea was dismissed last year," said Tanwar. IHCL moved Supreme Court last year against the order. "The court asked us to review our decision and we decided to auction the hotel," said Tanwar.
The lease period of Hotel Connaught had expired in 1995 and NDMC had sealed the property in May 2016. The lease of Hotel Asian had expired in 2007 after which its lease was extended temporarily.
As per norms, the council revises the license fee after the licence period of 33 years.
As per the NDMC, the minimum reserve price for bidders is decided on the basis of 17.25 percent of the gross revenue of the hotel.
NDMC expects some serious bidding for the iconic Taj Mansingh Hotel located in Delhi's prime location Lutyens area.
Hotel Asian was auctioned in January with final bid fetching Rs45 lakh as the monthly licence fee. But, the deal couldn't be finalised, leading to fresh auctioning of the property. The lease of Hotel Asian expired in 2007 after which the owner got a temporary extension. In May 2016 NDMC had sealed Hotel Connaught whose lease had been terminated in 1995 after it was found to be violating the terms of the lease.