Century Textiles to develop Worli land

Century Textiles and Industries, part of the BK Birla Group, plans to start commercial real estate development at its Worli mill land and will float a separate division to control it, a senior executive told ET. Century Textiles is fighting a legal battle with the Wadias for control of 10 acre of land on the same Worli mill property. Century has 40 acre land in Worli, including the 10 acre leased to it by the Wadias. In an exclusive interaction with RK Dalmia, senior president, Century Textiles, said: “We have almost finalised the plan, which is expected to be approved within a month. We will develop commercial complexes that will be leased to banks, financial institutions and for other commercial purposes.” Century Textiles also has interests in cement and pulp and paper manufacturing businesses. Mr Dalmia said the initial estimated cost for the first phase of the real estate project will be over Rs 600 crore. “There will be no equity dilution by the company, as our banks are ready to lend money for our projects.” The pay back period will be two years, after which the company may start generating revenues, he added. The BK Birla Group flagship company is also expecting a robust growth from the new venture as rental prices have started looking up. “By the time the project is completed, rents may touch the level it was a year back,” said Mr Dalmia. Century had moved the Bombay High Court against Nusli Wadia, chairman of Bombay Dyeing, and member of the Wadia family, in the dispute over the use of leased land for real estate development. In 1898, the Wadias leased 10 acre of land to the BK Birla Group for textile manufacturing purposes. However, since BK Birla’s textile business didn’t function well, it closed its textile operations at Worli in 2007 and planned to unlock land value through real estate development. However, Mr Dalmia denied reports that Century would sell the land. The company has already obtained permission from state authorities to start work. It has also started rehabilitation of nearly 900 workers. “We have hired architectures and are in the process of floating tenders to select contractors for the construction work,” said Mr Dalmia. The move comes close on the heels of a recent move by Mumbai-based textile major Raymond that diversified into real estate. One of the major factors pulling textile firms into real estate business is that many of them have huge areas of land at places where prices are high and operations aren’t lucrative, said an analyst with a leading brocking firm.