Godrej Properties, Oberoi Realty may not place final bids for CSTM revamp

Godrej Properties and Oberoi Realty are unlikely to place final round bids for the project to redevelop the 133-year-old Chhatrapati Shivaji Maharaj Terminus, sources said.

Both have been shortlisted by Indian Railway Stations Development Corporation (IRSDC) for the final round, along with seven others, including Adani Railways Transport and GMR Enterprises.

Pirojsha Godrej, chairman, Godrej Properties, refused to comment on the matter, while a mail to Oberoi Realty did not elicit any response. Sources, however, said the companies might have withdrawn as it was a long-drawn project. “It would require significant resources and attention of the companies in the long term and hence they are not very keen (on the project),” sources said.

“Both Oberoi and Godrej are cash-rich and have strong execution and marketing capabilities and showed initial interest in the project,” the sources said.

Another real estate company, Rustomjee, also did not pursue the project for similar reasons after showing interest in the initial stages. “It is a long-term project. There are many opportunities in Mumbai for us,” said a senior executive of Rustomjee.

The project has long-term lease rights of up to 99 years for residential or mixed use and 60 years for non-residential formats.

The project involves redevelopment and management of the station and developing the adjoining land on DBFOT (design, build, finance, operate and transfer) basis at Rs 1,642 crore.

The project is part of the central government’s plan to convert the railway station areas into a ‘Railopolis’ or a ‘mini-smart city’ with mixed use — where one can live and work as well. According to the plan, railway stations will be on licence with the concessionaire for 60 years. 

The winning bidder will develop 2.73 million sqft of space.

According to experts, the winning bidder can expect residential sales of over Rs 10,000 crore from the project or an annual rent of Rs 800 crore from commercial buildings. 

However, developers are likely go for residential buildings given the current situation of the office market and that most large offices have already shifted to the Bandra Kurla Complex, experts said.