Anil Ambani to lease or sell seven lakh sq ft Santacruz HQ for about Rs 3,000 crore

Anil Ambani to lease or sell seven lakh sq ft Santacruz HQ for about Rs 3,000 crore

July 1, 2019 in Reliance industries

MUMBAI: Troubled tycoon Anil Ambaniwill be leasing out or selling the Santacruz group headquarters as part of a debt-trimming exercise, people directly aware of the matter said. The group has mandated property consultancy firm JLL to advise on a transaction that, if it’s sold, could fetch up to Rs 3,000 crore. The recently built, 7-lakh-sqft HQ is located on nearly 4 acres along the Western Express Highway in Mumbai.

Last week, TOI reported that Japanese giant Sumitomo bid Rs 2,300 crore for a three-acre plot in Bandra Kurla Complex.

Ambani will move his group office back to Reliance Centre at Ballard Estate in south Mumbai, which is lying vacant currently. Anil Ambani gained the Ballard Estate office in mid-2005 after he and his elder brother Mukesh divided the Reliance empire among themselves. It was from the basement cafeteria of this property that the younger sibling announced the demerger formula for his set of companies from Reliance Industries (RIL), the last step in the split of the energy-to-telecom conglomerate built by their father.

A Reliance Anil Dhirubhai Ambani Group (ADAG) spokesperson confirmed the development, but declined to share details at the moment.

Ambani, who has vowed to repay lenders through a massive de-leveraging exercise, would prefer a long-term leasing out of the property, though the option of an outright sale wouldn’t be ruled out in the event of an attractive offer. Sources said strong, long-term lease agreements were imperative for better capital valuation in case of a sale.

The latest move is aimed at making Reliance Infrastructure, which owns the property, almost debt-free. The infra developer that executes power, toll roads and metro rail projects has a debt of just under Rs 5,000 crore. The overall group debt is estimated at about Rs 75,000 crore.

The plot came into the Reliance fold following the acquisition of BSES, a power distribution utility operating in Mumbai and Delhi. The original BSES hub was torn down and all Reliance Anil Dhirubhai Ambani Group companies moved into the newly constructed building in February 2016.

The total FSI potential of the building is 11.2 lakh sqft, though the current leasable area is around six lakh sqft. The proposal from Reliance has met with good response from banks and insurance companies, sources said.

As the younger Ambani makes Reliance Centre the HQ again, one thing that will help him will be saving on travelling time as his residence Sea Wind isn’t far from Ballard Estate.

Sources: realty.economictimes.indiatimes.com

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