NBCC to auction 11 office towers in Delhi; likely to raise Rs 12,000 crore

THE state-run real estate entity National Building Construction Corp (NBCC) hopes to raise Rs 12,000 crore through e-auction of 11commercial towers in South Delhi, each part of redevelopment projects in place of low-rise government housing in prime real estate, to kick start the government’s ambitious land monetisation plan.
"The total project includes construction of 12 commercial towers out of which one has already been booked. Two more towers will be auctioned next week and the remaining in phases," Anoop Kumar Mittal, CMD, NBCC said, “We expect to raise Rs 12,000 crore...
through the entire exercise."
HDFC, SIDBI, Hindustan Petroleum (HPCL) and Power Finance Corp (PFC) have already booked an upcoming 10-floor commercial tower at Nauraji Nagar for Rs 1,100 crore.
Each has bought the property at about Rs 38,000/sq ft, much higher than prices ruling in Connaught Place, the capital’s premier real estate strip.
NBCC is a 75 percent government owned listed company executing this redevelopment. The company’s mandate is to raise capital for its redevelopment projects commercially.
The proceedings from this E-auction will go towards redevelopment of government colonies in Delhi, including high rise residential towers for government staffers at the existing colonies.
The project is expected to be ready in four years.
"It's a unique redevelopment model where we undertake revamp of a government colony and unlock the value of the land bank by going vertical. The funds are raised through commercial exploitation," he said.
The total available government colony land bank in Delhi can potentially raise Rs 50,000 crore through commercial exploitation. The funds left after redevelopment would go to the government.
The government decided to rebuild seven housing colonies to double the existing housing units from 12,970 units to 25,667 at a total cost of Rs 32,835 crores last year. NBCC would be developing four colonies in Sarojini Nagar, Netaji Nagar, Nauroji Nagar.
NBCC (India) Limited, formerly known as National Buildings Construction Corporation Ltd., is a Navratna PSU under the Ministry of Urban Development. NBCC is one of the few PSUs engaged in the business of project management consultancy services for civil construction projects (PMC), civil infrastructure for power sector and real estate development. NBCC has been executing many landmark projects as a PMC which contributes to about 85 percent of its annual revenue. The segment being the Company’s core strength, the areas covered under its umbrella include roads, hospitals and medical colleges, institutions, offices, airports, bridges, industrial and environmental structures etc.
The real estate segment of the PSU which came into being in 1988, mainly executing commercial real estate projects has undergone a sea change operation wise.
NBCC’s success in implementation of the government’s New Moti Bagh Re-development Project, has earned it a huge dividend in the form of awarding of another Rs.5000 crore project in similar lines, named - East Kidwai Nagar Re-development (New Delhi) to the Company which is under implementation at present.
Apart from redevelopment, the other category of the real estate also holds a great promise for the future of the PSU as it has about 30 residential and commercial real estate projects presently going on at various locations of the country and more are coming up with huge investments.
NBCC ventured into Overseas Operations in the year 1977, executing projects of diverse nature in countries like Libya, Iraq, Yemen, Nepal, Maldives, Mauritius, Turkey, Botswana. Presently, the PSU has its presence in Maldives, Turkey and Botswana implementing various projects and earning consistent revenue. Of late, NBCC has opened an office in Oman and also signed an MoU with Al Naba Services LLC in Oman in order to jointly explore and secure infrastructure projects in Sultanate of Oman & neighbouring countries.