NTC’s mill land auction phase II to kick off soon

NTC officials said five mills totalling a massive 55 acres in the heart of the city will be auctioned after IDS 2 is sanctioned. These include Kohinoor Mills 1 and 2 in Dadar,India United Mills 4 in Kalachowky,Jam Mills in Lalbaug,Sitaram Mills in Chinchpokli and Madhusudan Mills in Worli.

NTC chairman and managing director K Ramachandran Pillai said IDS 2 is awaiting the BMC’s approval for two months now. “We had a meeting with state government officials in February,but the approval is yet to come through. Once that is done,we will start auctioning the five mill land plots one after the other,” said Pillai. Unlike previous times,when the NTC had set ambitious revenue targets for its prime plots,this time,Pillai said,they do not want to speculate right away since the realty market in Mumbai is down by 10-20 per cent.

After phase 1 of its auction in 2005,the textile corporation was richer by Rs 2,100 crore by selling five mill land plots totalling 48 acres. Just last year,the NTC had filled its coffers with another

Rs 1,979 crore after Indiabulls bought its 10-acre Bharat and Podar Mills in Worli.

While NTC auctions are known to attract aggressive bids,realty analysts feel that with the state government scrapping the parking FSI policy,the 55 acres will earn the textile corporation only about Rs 2,000 crore. According to Pankaj Kapoor,CEO of Liases Foras,the parking FSI of four was brought in to rescue developers such as DLF,Indiabulls,Lodha and Kohinoor,who had bought land at extremely high rates during the 2005 auction and later found their projects unviable.

“With the parking FSI gone for a toss and the government coming down hard on inflated super-built up areas,there is a huge regulatory risk involved in quoting high bids for a regular FSI of 1.33. A realistic price for central Mumbai would be about Rs 6,000 per sq ft,which will not come to more than Rs 2,000 crore for the entire 55 acres,” said Kapoor. With a flux of residential properties in central Mumbai,Indiabulls was recently forced to reduce the rates of its Sky suites project on NTC land in Lower Parel from Rs 23,000 per sq ft to Rs 16,500 per sq ft.

As part of the land-sharing agreement in IDS 2,the NTC will hand over 15,000 sq metres of land at India United Mills 4 to MHADA to build houses for retrenched mill workers. The BMC’s share is 9,100 sq metres.

The total land due to BMC from the two-phase auction is 44,000 sq metres. “Since projects on our land are denied permission unless we part with the land meant for the BMC,we decided to hand over an undivided 61,000 sq metres land in India United Mills 1 and 2 to the civic body during IDS 1. This land has now been earmarked for the textile museum and the BMC is reluctant to return the 17,000 sq metres of land due to us,” said an NTC official. Pillai said the issue will be sorted out at the highest levels.