The Kanakia group, from which Mapletree did the purchase, had bought the plot from India Tube Mills and Metal Industries for Rs 363 crore in 2018.
In one of the biggest land deals in the country this year, Mapletree Investments of Singapore has bought a 7-acre land parcel in the Vikhroli area of Mumbai for Rs 525 crore, said people in the know.
The Kanakia group, from which Mapletree did the purchase, had bought the plot from India Tube Mills and Metal (ITM) Industries for Rs 363 crore in 2018.
The price paid by Mapletree is fair, given that land prices in Vikhroli hover in the region Rs 50-55 crore an acre, consultants said.
Though the acquisition price comes to around Rs 75 crore per acre, the value is fully paid for.
This includes all the approvals, floor space index (FSI) rights, and so on, sources said.
Mapletree is planning to build a commercial project on the plot and the area would have around 2.2 million square feet of leasable space, sources said.
“It must have been a difficult decision to sell the prime piece of land but a sensible thing to do, given the current market situation,” source said.
An email to Mapletree did not elicit any response. Emails, messages, and calls to Kanakia did not receive any reply, either.
Mapletree has been active in buying real estate assets.
In 2018, it bought SP Infocity in Chennai from the Canada Pension Plan Investment Board and Shapoorji Pallonji’s private equity arm for Rs 2,400 crore.
It also owns Global Tech Park in Bengaluru and bought a land parcel in Pune from Vascon Engineers for Rs 170 crore in 2019.
Land deals that were stalled in the initial months of the pandemic and lockdown have picked up.
Godrej Properties and group companies are at the forefront of land buying in the country.
It bought a 20-acre plot in the Kalyan area of Mumbai recently.
Godrej Fund Management bought a piece of land in Bengaluru from Century Group for Rs 700 crore.
“We have acquired many land parcels and signed JDs. We have to launch them. We are looking at new opportunities,” Pirojsha Godrej, chairman of Godrej Properties, had said in August this year.
Karan Bolaria, managing director of Godrej Fund Management, said land valuations had come down by 10-20 per cent and the firm was looking to buy land parcels in many cities.
Mumbai-based Sunteck Realty picked up 50 acres in the Vasai (West) area of Mumbai for an undisclosed sum.
Hindustan Dorr Oliver last week sold a piece of land in Andheri, Mumbai, for Rs 60 crore.
Other cash-rich developers such as Hiranandani and Oberoi Realty are also looking to buy land parcels in Mumbai.
Oberoi Realty is looking to build a portfolio of residential, office, and mall properties in NCR and Bengaluru, apart from Mumbai, said Vikas Oberoi, chairman and managing director of the company, in a recent conference call with analysts.
“We are evaluating opportunities to buy land in Mumbai, the NCR, and Bengaluru. We are seeing how this (Covid-19) plays out. We will take a call later,” he said.
Somy Thomas, managing director (valuation and advisory), Cushman & Wakefield, said: “It is an interesting time to pick up land parcels because the number of stakeholders who can raise money to close a transaction is very few.
"The market has started picking up for residential and it will pick up for commercial in a year, so those who can close transactions will have a clear advantage,” he said.
Photograph: Mike Hutchings/Reuters