MUMBAI: Realty major Lodha Developers has acquired development rights for a prime 4.3-acre land parcel that currently houses six bungalows and other structures in south Mumbai’s upscale Malabar Hill locality, with an estimated development potential of nearly Rs 2,800 crore.
The transaction involves an upfront payment along with a mix of monetary and non-monetary consideration to the land-owning trust after redevelopment.
The property, owned by the Sorabji Kanga Charity Trust, also houses a residential tower and a chawl. The residential tower, however, will not be part of the redevelopment exercise, according to persons aware of the development.
The developer will provide a security deposit of Rs 125 crore and a bank guarantee of about Rs 40 crore as part of the transaction structure. Property registration documents accessed through Propstack show the agreement to sell for development rights was executed on January 7.
Under the agreement, the trust will receive a separate and independent building with over 54,000 sq ft of RERA carpet area and a 42.5% revenue share, which works out to over Rs 1,407 crore. The arrangement ensures the trust receives both monetary consideration as well as non-monetary consideration in the form of constructed area.
The market value of the transaction for the development rights for the land in the Malabar & Cumballa Hill Division stands at around Rs 621.71 crore, on which stamp duty of approximately Rs 37.42 crore has been paid, the documents show.
The acquisition underscores Lodha Developers’ continued focus on premium and super-luxury housing in established micro-markets. The company has been actively replenishing its pipeline through outright acquisitions and development-right arrangements across Mumbai and the wider Mumbai Metropolitan Region amid sustained demand for high-end residences.
As per the Charity Commissioner’s order in October, the amount of monetary consideration, gross revenue as and when received by the trust from the developer will be invested in the manner laid down in section 35 of the Maharashtra Public Trusts Act.
The trust is expected to invest the entire gross revenue in prescribed instruments and cannot withdraw the principal without prior approval of the Authority. However, trustees may use the interest earned to meet the trust’s objectives.
ET’s email query the trust’s representative remained unanswered, while Lodha Group declined to comment.
Malabar Hill has historically seen limited fresh supply owing to land scarcity and tight development norms, with most additions coming through redevelopment of old buildings, institutional plots and trust-owned properties.
Large contiguous parcels in the area are rare and typically attract established developers with the balance sheet strength to execute premium projects. The locality commands some of the highest residential values in the country, driven by sea views, low density and proximity to key south Mumbai business districts such as Nariman Point, Churchgate, Worli and Lower Parel.
