Railways eye Rs 5,521 cr in lease rentals from 52 sites

The ministry of railways has shortlisted 136 sites, comprising a total area of 1,504 hectare, on railway land across the country for commercial development by Rail Land Development Authority (RLDA). This land is not required for operational purpose by the railways in the near future.

Of these, the ministry has identified 52 sites on railway land across India as amicable for commercial development and it has an ability to garner a lease premium of around Rs 5,521 crore, a senior official from RLDA told newspersons on Thursday. RLDA is an autonomous body of Indian Railways for undertaking commercial development of vacant railway land.

According to the official, the sites entrusted to RLDA are being studied for feasibility through consultants and will be awarded for development through an open bidding process. The authority has been following a lease premium model, in which the successful bidder makes an upfront payment of the lease premium or it is spread over a period of time.

"We are contemplating a revenue sharing model also in the future, depending on how favourable it is," says AK Gupta, member (real estate and urban planning), RLDA, addressing the Ficci Real Estate Summit in Mumbai.

He added, "This development will not only prevent the encroachment of railway land across the country, but also give additional revenue to railways and infrastructure to the cities." RLDA will be awarding land lease for 30-45 months for commercial development. However, for one site in Sarai Rohilla in Delhi, the lease period is 90 years for residential development.

The authority has currently fixed developers for five sites across India. These include 1.32 hectare in Gwalior, 1.01 hectare in Bangalore, 0.579 hectare in Gaya, 15.27 hectare in Sarai Rohilla, Delhi, and 0.12 hectare in Vijaywada. "The total premium receivable over a period of time for all the awarded projects will be R1,714 crore," he said.

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