GVK leases out 5.5 acres of MIAL land to Oasis Realty for Rs580 cr

Mumbai International Airport Pvt Ltd (MIAL), a GVK-Led Consortium, today kicked off real estate development around the Mumbai International Airport Ltd (MIAL) with the lease of 5.5 acres (1.16 million square feet) near the Sahar international terminal to Oasis Realty Ltd for Rs580 crore.

This transaction is part of the process of overall commercial development of 22 million square feet of the airport in phases over a period of ten years, GVK said in a press release.

The transaction has been finalised at the rate of approximately Rs106 crore per acre, which translates to total of Rs580 crore for this parcel at approximately Rs5,000 per square foot of built-up area, it said.

"GVK SkyCity", a master-planned, mixed use development with state-of-the-art planning and architecture, urban design and landscape, is an ambitious project set to redefine the face of Mumbai, the company said.

GVK SkyCity includes luxury, first class, mid-market and budget hotels, serviced apartments, convention centre, entertainment centre, retail, office spaces, etc.

Announcing the award of the contract, GVK Reddy, executive chairman, MIAL said, "Our vision for GVK SkyCity is to develop a vibrant 24x7 business and leisure hub and a global convention and hospitality destination. It is located in heart of Mumbai and is well connected to all parts of Mumbai and Mumbai Metropolitan Region both existing and proposed high speed-high volume traffic system (Western Express Highway, Andheri Ghatkopar Kurla Link Road, Metro-1, Metro-3, etc).

GVK SkyCity aspires of being the most eco-friendly large scale development. "The tenants will be encouraged to value practices such as energy and water conservation, waste management and the improvement of indoor air quality,'' he further said.

The GVK-Led consortium took over CSI airport on 3 May 2006 under 'Operation, Management and Development Agreement (OMDA)' executed between GVK-Led consortium and Airports Authority of India (AAI) where operation, development, management, designing, construction, upgradation, modernisation and financing of airport is undertaken by GVK under a right of 30+30 years.

MIAL had last year called bids for land parcels measuring 10 acres. MIAL will lease out a total of 200 acres of airport land for hotels, offices and convention centres under SkyCity development.
 
MIAL's commercial development has been stuck until now because of delays in clearances, encroachments, and an extended slump in the realty market.
 
Industry sources say the real estate development can fetch MIAL around Rs18,000 crore. Reddy, however, refused to comment on that number. "This is speculative and I will not be able to comment," he said.