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Indian Real Estate News : Mumbai
Runwal Group to take over Birla property
Source: Aug 06, 2012
Runwal Group, has reportedly purchased Neosym Industry Ltd, a metal manufacturing company located on LBS Marg in Bhandup owned by Kolkata industrialist C K Birla's family. Neosym, formerly known as The Indian Smelting and Refining Co Ltd, is a 14 acres property. Sources close to the development say the deal has been struck for over Rs 350 crore. Sandeep Runwal, Director of Runwal Group, and the transaction adviser to the deal, global property consultant JLLI refused comment. Industry sources say a formal agreement between Runwal and Birlas is expected to be signed soon as the arbitration proceedings with the government on the quantum of stamp duty is almost over.Nevertheless, the transaction may run into hurdles. Since the factory is still operational-the deal is on 'as-is-where-is' basis-there is an issue of about 300 workers and their compensation. The property's acquisition cost is then expected to go over Rs 500 crore. Industry observers say the new owner-be it Runwal or Birla-will have to compensate the workers, like the Raymonds deal. The Singhanias, who share a love-hate relationship with their employees, are having a hard time offering a fair compensation package to their workers for the past six years after they decided to commercially exploit their factory land in Thane. Realty experts say the developer, after adding construction costs, will be able to sell flats at over Rs 10,000 per sq ft after a few years. The Neosym deal is a land sale and in tune with a common trend of developers purchasing defunct or operational factories. Earlier Kalapatru had purchased a 35-acre plot of Clairant Chemicals Ltd in Thane two years ago after the company decided to relocate or close down some of their operations. Ten years ago, Runwal purchased an old factory and constructed their retail outlet, R-Mall.
Tag: Indian real estate, property in india, Real estate in mumbai, property in mumbai
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