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LIC Housing Finance Ltd (LICHFL) has sold the Agora City Centre in Vadodara to CFM Asset Reconstruction Private Ltd for INR 250 crore, marking the resolution of a distressed loan of INR 711.2 crore. Initially a luxury development under PMAY, the project faced numerous controversies, including lack of permissions, construction within Vishwamitri River boundaries, and encroachments linked to city floods. The death of Manav Infrastructure chairman Ashish Shah further exacerbated its financial woes. Agora City Centre, once an ambitious real estate venture, has now transitioned under ARC control, highlighting ongoing challenges in balancing urban development and financial stability.
LIC Housing Finance Ltd (LICHFL) has classified the Agora City Centre, located on Mangal Pandey Road near VUDA Circle, as a stressed asset and has sold it to an asset reconstruction company (ARC). Despite being one of the most ambitious luxury real estate projects in the city, the development has been surrounded by controversies. Advertisement
Developed by Manav Infrastructure under the Pradhan Mantri Awas Yojana (PMAY), the project was built on the land where the Sanjaynagar slums previously stood. The slum residents were offered homes in high-rise buildings constructed on part of the land. While the buildings were completed and the houses handed over to beneficiaries, the remaining portion of the land was earmarked for the Balaji City Centre project, which would include retail, commercial, and residential spaces, along with a high-end clubhouse and other luxury amenities. This was initially promoted as a unique development in the city.
However, the project encountered multiple issues from the start. It was alleged that the Agora City Centre was launched without the necessary permissions. Construction also faced challenges, with accusations that a retaining well was being built inside the boundaries of the Vishwamitri River. Further complications arose over the project's height, resulting in the removal of several floors. The project was again thrust into the spotlight after the floods, when the Vadodara Municipal Corporation (VMC) identified encroachments obstructing the river flow and demolished the project's clubhouse.
The situation worsened following the death of Ashish Shah, the chairman of Manav Infrastructure, who had been the key driving force behind both the company and the Agora City Centre. Shah passed away from dengue in Ahmedabad in 2022.
In response to the mounting financial troubles, LICHFL issued a notice last month to find an agency to take over the stressed loan. The developers owed a total of INR 711.2 crore. Following the bidding process, the asset was sold to CFM Asset Reconstruction Private Ltd (CFM ARC), which paid INR 250 crore to LICHFL. This sale marks a significant step in the recovery process, indicating the project's financial distress.
The sale of Agora City Centre to CFM Asset Reconstruction marks a pivotal moment in its financial restructuring. Despite being a luxury project, it has struggled due to multiple setbacks. The ARC's involvement highlights the ongoing efforts to resolve the financial crisis and recover the outstanding loan.
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