Bhushan Steel-Essel set to acquire plot for Rs 1,530 Cr

Land in Navi Mumbai to be used for building Bollywood theme park. In the largest ever property deal in over 18 months, Bhushan Steel and Subhash Chandra-promoted Essel Group are set to acquire a 250-acre plot in Kharghar (Navi Mumbai) for Rs 1,530 crore. The Bhushan Steel-led consortium beat nearly 100 other bidders to acquire the land from City and Industrial Development Corporation of Maharashtra (Cidco). Indiabulls came in second with a bid of Rs 1,059 crore, while a consortium of GVK group and HCC came third with a bid of Rs 808 crore, according to sources involved with the transaction. Future City Properties, the company floated by Bhushan Steel and the Essel group, has proposed the development of a Bollywood theme park. Indiabulls and GVK-HCC had proposed knowledge and leisure-based theme parks, respectively. When contacted, a Cidco official confirmed that the Bhushan Steel-led consortium had emerged as the highest bidder. “We have opened the bids today. The highest bid has to be cleared by legal authorities,” the official said. In the term sheet, 70 per cent weight had been assigned to the financial bid and the rest to technical parameters. The project entails an allocation of 60 per cent (around 150 acres) for the development of a theme park on the Kharghar Hill Plateau, while the rest can be used for real estate development. The project has a floor space index (FSI) of one. The transaction, if cleared by the authorities, will become the largest in Mumbai. Boom times again High-value property transactions in the country have seen an uptick over the last few weeks after a prolonged slowdown in the property sector since mid-2008. Last week, the Wadhwa group announced the acquisition of an 18.18-acre plot in Mumbai’s central suburb of Ghatkopar in a Rs 571-crore deal. “It looks like a boom symptom to me. Since the markets have picked up, such deals are happening now,” said Akshaya Kumar, CEO of real estate consultant Park Lane Property Advisors. A deal similar in size to the latest one was struck in August 2009, when the Indiabulls group won a bid for the development of the Mantralaya complex in south Mumbai for Rs 1,376 crore. Three years before that, in 2006, Mukesh Ambani’s Reliance Industries bought 18 acres in the Bandra-Kurla Complex for Rs 1,104 crore, for the construction of an exhibition centre. Some mega deals that failed There have been mega deals that became big failures too. BPTP, a Delhi-based developer, which bought a 95-acre plot in Noida for Rs 5,006 crore in early 2008, had to surrender a major portion of the land to the local authorities after the global financial crisis severely affected the real estate sector. In Mumbai, land deals involving Sunteck Realty and Jet Airways and the Mumbai Metropolitan Region Development Authority in 2008 were mired in controversy due to payment issues.