The iconic Air India building in Mumbai is set to be sold to the Maharashtra government for INR 1,601 crore, approved by the Centre. Facing space constraints at Mantralaya, the state plans to utilize the 23-story sea-facing building to relocate offices, with nine floors currently vacant. The landmark Nariman Point building was excluded from Air India's privatization and held by AIAHL. Designed by architect John Burgee, it was constructed in 1974 and put up for sale in 2018. Talks resumed last year, culminating in Maharashtra's increased offer. The acquisition addresses long-standing administrative space issues, preserving Mumbai's heritage while meeting practical needs.
The Centre has approved the sale of the iconic Air India building in Mumbai to the Maharashtra government for INR 1,601 crore. The Maharashtra Cabinet had earlier approved the INR 1,601-crore acquisition of the Air India building in November last year.
Facing a space crunch at Mantralaya and its annex, the state plans to relocate some offices to the 23-story sea-facing building near the secretariat. Nine floors are currently vacant in the Air India building. Three floors house GST offices while the Income Tax Department occupies eight floors. The ground and first floors still belong to Air India.
The landmark Nariman Point building was excluded from Air India's privatization. In 2019, AIAHL - a central government firm under the civil aviation ministry - was created to hold Air India's non-core assets and debt worth INR 14,718 crore, including land and property. In 2022, the government transferred Air India ownership to the Tata Group, except some of these non-core assets and debt.
Designed by architect John Burgee, the Air India building was constructed in 1974 on reclaimed land leased by the state. In 2018, after shifting headquarters to Delhi, Air India decided to sell the property as part of asset monetization. While Air India sought INR 2,000 crore, Maharashtra offered INR 1,400 crore. Other bidders were Jawaharlal Nehru Port Authority (JNPA) and the Life Insurance Corporation of India (LIC) at INR 1,375 crore and INR 1,200 crore respectively. But the process stalled.
Last year, talks resumed and Maharashtra government raised its offer to INR 1,601 crore and waived nearly INR 300 crore in dues like unpaid land rent and interest.
Following a major fire at the Maharashtra Mantralaya complex in 2012, a number of state government offices and departments were scattered across different areas of the city, some of which are far from the state secretariat and the state government has been paying hefty rent for these offices. With the acquisition of the Air India building, around 46,470 square metres of space will be available to the state government in close proximity to the Mantralaya.
In conclusion, the sale of the Air India building to the Maharashtra government will help address the government's long standing administrative space issues while also redeveloping an iconic Mumbai landmark. While the price agreed is lower than Air India's initial expectations, it ensures the building continues to serve the public as a government facility. The acquisition solves practical problems for the state government in a financially prudent manner, while also protecting an element of Mumbai's urban heritage for future generations.
Advertisement
Facebook
Whatsapp
