Land deals expected to rise in Mumbai

As new developers are looking to purchase plots in Mumbai, property sales and land prices in the most expensive Indian city may spurt this year. A number of prime land parcels in the city are in the process of being put up for sale, either by inviting bids or through direct negotiations, even as property sales in the city remain subdued because of high prices and delays in project approvals, according to real estate consultants.

While many publicly traded developers are cautious about land purchases because of concerns related to funding and high debt, privately owned ones appear to be more aggressive about buying land even at a premium to the current market price, they said. Good land assets in Mumbai will always attract a premium and not lose value even in a dull market,” said Sanjay Dutt, Managing Director (South Asia) of Cushman and Wakefield India.

While property markets in south India are mostly defined by joint venture deals and land aggregation is popular in NCR (National Capital Region), Mumbai is defined by its prime land assets and a consistent demand for them through outright purchases. Cushman and Wakefield has recently got the mandate to sell the five acre Great Eastern Mills in Byculla that may fetch around Rs 600 crore.

Other property consultants with land sale mandates in Mumbai are also gearing up. Major land transactions this year include Runwal Group’s purchase of ABG Shipyard Ltd’s two acre parcel for Rs 245 crore in south Mumbai and the former entering a joint development deal with auto maker Premier for the latter’s 150 acres in suburban Dombivali.