Cash-strapped Air India puts iconic tower at Nariman Point on the block

In a bid to raise funds, Air India (AI) has put the iconic tower located at Nariman Point on sale. A tender for the same was issued by the national carrier, on Monday. Only Government Entities are allowed to participate in the bid to buy the leasehold rights of the land and the iconic tower, spread over 23 floors. The reserve price for the building hasn't been decided by AI. The last date for submitting the bid is December 31. The building is built on a plot admeasuring 7512.60 sq metre. The land was leased from Mumbai district collector on a 99-year lease. It has two basements. The total built up area of the tower is 4.99 lakh sq ft. Bids can be downloaded from Tuesday till December 29.

Out of the 23 floors of the building, 17 floors have been rented out. AI gets a rental income of Rs 107 crore per annum. AI will retain approximately 5,000 sq ft on the 22nd floor for its own purpose and no rental/compensation shall be paid for this area. The new bidder will not be allowed to change the name of the building and the AI logo on top.

An AI spokesperson said that the building can only be sold to a government entity as per the lease agreement. "This is being done to generate cash."

The successful bidder will have to deposit 20 per cent of bid value within 30 days from the date of issue of acceptance letter. Balance 80 per cent of bid value along with other duties taxes will have to be paid within 90 days. If the bidder fails to give the 80 per cent, it may lead to forfeiture of initial 20 per cent. Air India had tried to sell the building earlier but the attempt failed.

While the bidder will have to pay the property tax for the entire building, AI will pay the property tax, maintenance, electricity and other charges for the 22nd floor and for the logo. The typical floor built up is 13,363 sq ft, while the usable area is 10,488 sq ft.