Precarious market forces builders to stay away from the prime property; owners extend bidding period by 15 days
It appears that the city might retain some of its old school charm and hints of colonial rule after all as the owners of Gaiwadi and Tarabaug -- the city's two oldest settlements situated in South Mumbai -- haven't found a buyer yet.
According to the officials from the Shri Bombay Panjarpole Trust, the owner of the land, the last day of bidding was September 17 ('Another two bite the dust', August 19).
Still standing: Owners of Gaiwadi and Tarabaug said they would cancel
the auction for the land if they did not receive satisfactory bids
However, owing to unsatisfactory bids, the land is still in their possession.
"The bids weren't satisfactory and hence a grace period of 15 days has been given. Within the next eight days we are expecting new bids," said an office bearer of the trust, adding, "If the bids again aren't satisfactory we will cancel the sale. We do not want to sell our land at a throwaway price."
When MiD DAY probed further as to why the 14,458 sq metre and 4,385 sq metre plots of prime property were not being fought over by buyers, a market source attributed the non-sale of the land to the precarious real estate market. "For a builder to go ahead with such a big project he would need major financial support. But according to the current market scenario, most big players are suffering from a liquidity crunch, making purchase of land difficult. A builder to buy or invest in such a huge project is mostly dependent on private equity firms, but in the last few days, even private equity funds are on a back foot. The sellers have missed the bus for now," said Pankaj Kapoor, managing director, Liases Foras, a real estate rating firm.
Another reason for builders shying away from the land is presence of tenants, which means that any builder wishing to buy the land will have to provide compensation to the tenants.
"There are too many problems with such big projects. The mill land took ages to develop. The market is bad and there already exists a sort of over supply in this area of South Mumbai," elaborated Kapoor.