Rs30-cr flat flattens Khannas

Vinod Khanna was in the news a month ago for buying a flat in Il Palazzo, a landmark building on Malabar Hill, at Rs30 crore. It created ripples in the property market because the deal worked out to Rs1.20 lakh a square feet, an all-time high. Now, it seems the deal might be scrapped.

Khanna apparently has objected to the bidding process where a vested group of buyers had quoted a higher bid. As Khanna and his wife were keen to have another flat in this complex, they ended up quoting a higher rate than what they had estimated, claimed a real estate source. 
The actor has taken up the matter with Citibank, the flat owner and CBRE, global property consultants which handled the flat sale on behalf of Citibank. He has apparently asked them to renegotiate the deal.

It is rumoured that the request was not accepted and deal has been cancelled. Rajesh Pandit, the western head for CBRE, however, refused to comment. So did a Citibank spokesperson. “We never comment on such issues. In fact, we did not even comment when the auction took place,” he said.

Khanna’s wife Kavita too was not forthcoming. She termed it private and said, “We will stick to the commitment as long as the terms and conditions laid down in the bid process are followed. Neither my husband nor I have ever backed out of any commitment. And we don’t intend to do so in the future,” she said.

Property experts say it won’t be surprising to find the deal cancelled because the bid amount was artificially hiked. “This is a common practice in auctions where interested parties have their own supporters quoting rates which increase the bid value,” said a property consultant.

“In this case too it could have happened. It is also possible that somebody purposely quoted a higher rate because he/she did not want the Khannas to buy the flat. Or a higher rate could have been quoted to ensure the deal fails to prevent the flat owners in the complex from paying higher wealth tax. Will anyone want to pay a 2% tax that runs into crores.”

Local brokers say the property can fetch Rs20 crore even after considering the building’s exclusivity. “Khanna paid an exorbitant price and it is not sustainable,” said a broker.

The sea-facing Il Palazzo flat, 13B, has a large living room, spacious bedrooms and a separate servant’s quarter. Several among the bidders were residents of Il Palazzo. And they get the first preference to buy the flat if they can match the highest offer.

Il Palazzo, built in 1972, has several prominent residents such as stock broker Rakesh Jhunjhunwala who bought a duplex for Rs25.25 crore from American Express bank in 2006 and Venugopal Dhoot, chairman of Videocon group, who owns two flats.