Air India's Rs 80-cr-a-year ghost town

Mumbai: At a time when Air India is reeling under losses to the tune of a few thousand crores, one would imagine that the airline would be leveraging all its assets to lessen its debt burden.
MiD DAY has learnt, however, that the national carrier is passing up on an opportunity to earn nearly Rs 80 crore per year (after taxes and expenses) from leasing out the unused portions of the iconic Air India building at Nariman Point.
And now for the real shocker not only is the airline giving up the chance of making money, it is actually paying out nearly Rs 22 lakh per month, or a whopping Rs 2.64 crore a year, from its own coffers for the upkeep of the centrally air-conditioned structure.
The ground-plus-22 storey structure has only one tenant an IT consultancy firm and the airline itself uses less than seven floors. This means that 15 floors are lying vacant in the most iconic building of what is, arguably, the country's most important and expensive business district.
Sanjay Dutt, CEO (Business), Jones Lang LaSalle, a global real estate services firm, said, "Air India owns collector lease hold rights to the most strategically located and prominent building measuring approximately 220,000 sq ft (ground floor-plus-22 storeys), which can earn the airline up to Rs 80 crore of rental per annum.
This is calculated on the basis of a rent of Rs 300 per sq ft, post maintenance and property taxes. If the building is monetised (sold), it can fetch the airline Rs 800 crore.
04/06/11 Vinod Kumar Menon/MiD DAY

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Categories: Air India Jun 2011