To unlock value from some of its real estate properties, Transport Corporation of India (TCI), plans to develop them into residential or commercial spaces.
MUMBAI: To unlock value from some of its real estate properties, Transport Corporation of India (TCI), plans to develop them into residential or commercial spaces.
The cargo transportation and cargo logistics company is exploring possibilities of either selling the land, self development or partnering with real estate majors.
To attribute costs and revenues better, TCI has constituted a separate division for the real estate activities.
It plans to utilise the revenues generated through this division for its ongoing capex plans and to retire some of its debt, although the revenue utilisation plan is still under consideration.
The company has roped in land consultancy firms for feasibility studies on some properties. It is still in the process of getting the basics in terms of reports and statutory permissions in place and expects to start development on some of its properties this fiscal.
Vineet Agarwal, executive director, TCI, said, “The project is still in a preliminary stage, but we plan to start development on our Delhi and Chennai property this year and expect to start getting some returns this fiscal.”
If the company looks at selling some of the property, Agarwal feels it would take at least 12-18 months for that.
TCI has about 220 properties that were bought at a book value of Rs 93 crore. These were on the outskirts of cities and were acquired for logistics activities. But now, due to city expansion, these properties are within city limits and unusable for warehousing. The company is looking to get some returns from these partially lands, which have a much better valuation now.
“We do not have value for all of our properties, and as and when they are ready for development, depending on the location, we will go ahead,” Agarwal said.
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