NTC’s floor space auction kicks off with three bidders

The three-day auction for sale of National Textile Corporation's (NTC) two lakh sq ft FSI (floor space index) began on Wednesday. The NTC is expected to earn Rs 220 crore through the auction.

The FSI is being sold at a high base price of Rs 11,000 per sq ft. By Wednesday evening, three bidders— Indiabulls Real Estate, Microtek Constructions Private Limited (Lodha Developers) and New Jet Printing Press— had logged in and the NTC received one bid atqu its oted base price. The final bid amount is expected higher.to be much

The NTC has a total FSI reserve of 4.94 lakh sq ft which it received in exchange of over 34,575 sq m of two mill plots handed over to the BMC. It also has around four lakh sq ft of TDR received after over 33,000 sq m of land was given to the Maharashtra Housing and Area Development Authority.

Only those developers who had purchased land from NTC in the first phase of its mill land auctions are eligible to purchase the FSI and load it on their projects. In 2005, the NTC received a whopping Rs 2,200 crore from Phase I auction of its five mill land plots in Central Mumbai. Two of these plots were sold to Indiabulls and one each to Kohinoor, DLF and Lodha Developers. A small one-acre portion of Mumbai Textile Mills was sold to its occupant New Jet Printing Press while the remaining land was picked up by DLF.

The base price of Rs 11,000 per sq ft is almost three times the premium charged by the state government for FSI. It is also way above the market rates of Transfer of Development Rights (TDR or floating FSI). While real estate sources are skeptical about the high pricing at a time when an oversupply situation in Central Mumbai is putting a downward pressure on realty rates, an NTC officialsaid, "Unlike TDR, which can be used mainly in the suburbs, our FSI can be used by developers on the five mill land plots in South Mumbai. Considering a conservative price of Rs 35,000 per sq ft for their completed flats, the developers will book tremendous profits by purchasing additional construction rights from the NTC."

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