Mumbai:Corporate biggies put prime city properties on sale

Rajshri Mehta TNN  Mumbai: Sell when the going is good, that's what the pundits say. But a few corporates and multinationals are effecting a trend reversal of sorts by selling when property sales in Mumbai have dipped. Keen on consolidating their financial position, three big companies have put their flats and commercial properties in the market.      One of them, Bishopsgate, is a five-storeyed residential building co-owned by Standard Chartered and the Hongkong and Shanghai Banking Corporation Ltd in upscale Breach Candy. Located opposite the Breach Candy club, the building is spread over 2,075 sq metres or approximately 22,000 sq ft. Its market value: a cool Rs 300 crore. Senior bank executives, including the chairman of HSBC, currently reside in the 20-odd flats of 3,000 sq ft each.      Citibank, a leading USbased bank, recently put up for sale a 3,000 sq ft flat in Usha Kiran building on Altamount Road for an estimated price of Rs 18-20 crore. 'Renting a flat works out cheaper than buying it'  Mumbai: Property sources say Citibank is likely to put its 2,500 sq ft apartment at Il Palazzo on Malabar Hill back in the market later in the year. It may be recalled that former BJP MP and actor Vinod Khanna had quoted an astounding Rs 1.25 lakh per sq ft for the flat, but the deal fizzled out later.      HSBC and Citibank officials refused to comment on the properties that are being put on the block.      Property consultants are not surprised by the move. "The reason simply is to show a healthy balance sheet. There is no point in blocking assets worth crores of rupees in maintaining a property. In the current environment, renting an apartment works out to be much cheaper than outright purchase," said Pranay Vakil, chairman of Knight Frank. "It's the newer properties where one notices sluggish sales because of their high rates. We are noticing a trend of buyers looking at old properties with a substantial number translating into sales. Not surprising then that corporates who own flats in such good buildings are putting them in the market," said a veteran property broker in the area.      Hindustan Unilever Limited too has put on the block two seven-storeyed buildings: their former headquarters at Churchgate and Gulita, a training centre at Worli seaface. Three lending institutions—State Bank of India, Bank of Baroda and a large non-banking finance company—are said to be frontrunners for the Churchgate building. Spread over 1.54 lakh sq ft, the property is said to be worth approximately Rs 500 crore in the open market.      Worth about Rs 300 crore if sold in the open market, theWorli sea-face property is little under an acre at approximately 40,500 per sq ft. Ten to twelve well-known developers like Sheth, Peninsula, Wadhwa, Runwal, Lodha and Ajay Piramal are learned to have submitted bids for the property. In their bid document, HUL has proposed to sub-lease the property for anything between 30, 60 or 90 years. There is also an option to quote a price for outright sale.      Property consultants believe the HUL deal for Gulita will take a long time as the bid conditions are quite complicated. "This is a BMC leasehold land. Though leased on perpetuity, HUL will have to pay 50% of what it earns from the sale price to the civic body. It is a case similar to the Glaxo property which was purchased jointly by Vikas Oberoi and ICICI Ventures. HUL wants to avoid paying this sum and has therefore, come up with this unique sub-leasing concept which involves the successful bidder paying advance rent for a stipulated period," said a senior property consultant. Bishopsgate, at Breach Candy, is co-owned by HSBC and Standard Chartered Bank. The 5-storeyed building has a market price of nearly Rs 300 crore The market price for Gulita, a seven-storey building owned by Hindustan Unilever Ltd on Worli sea-face, is estimated at Rs 300 crore