The Central government has given its nod for the transfer of the Air India building in Mumbai from Air India Assets Holding Company Limited to the Maharashtra government. The company, established by the Ministry of Civil Aviation in 2018 to oversee properties owned by Air India nationwide, will transfer the property at a valuation of Rs 1,601 crore. Additionally, the Maharashtra government has agreed to waive DIPAM dues amounting to Rs 298.42 crore, which would have been obligatory for the AI Assets Holding Company Ltd, as stated by the Department of Investment and Public Asset Management (DIPAM).
The recent development follows months after the Maharashtra government's resolution to procure the renowned Air India building situated in Nariman Point, Mumbai, at a price of Rs 1,601 crore. This resolution was made during a cabinet meeting presided over by Chief Minister Eknath Shinde. Additionally, it was decided to waive approximately Rs 250 crore in unrealized income and interest related to the property. Notably, the land was leased to Air India for 99 years in 1970. To expedite the transaction, the cabinet has chosen to waive transfer fees and penalties.
This move is expected to save the government around Rs 200 crore per year in rent. Constructed in 1974 on land owned by the state government, the building will be utilized for its office space. Nearly 46,470 square meters will be available for government offices in the 23-storey building owned by AI Assets Holding Company Limited. Current occupants of the building, including tax departments and government-run undertakings, will have to vacate.
Commencing in 2018, negotiations initially proved fruitless but were reinitiated in 2021. A conclusive agreement was ultimately reached in 2022 when the Maharashtra government put forth a final offer of Rs 1,600 crore. Deputy Chief Minister Devendra Fadnavis held discussions with Civil Aviation Minister Jyotiraditya Scindia regarding the state's proposal. Additionally, reports suggested that the Reserve Bank of India expressed interest in acquiring the building.
Fadnavis emphasized the requirement for additional space within the state administration. In 2018, Air India, grappling with debt, attempted to sell the building but encountered tepid interest. Erected on land owned by the state government in 1974, the sea-facing Air India tower stands as one of Mumbai's iconic structures. The tower was designed by John Burgee, a renowned architect from the New York-based firm Johnson/Burgee, recognized for his advancements in post-modern architecture.