Indian Railways to Generate ₹6k-Cr Revenue by Leasing Prime Plots in Mumbai
Mumbai: The Indian Railways (IR) has devised a strategic plan to lease out two underutilized plots in prime locations—Mahalaxmi and Bandra—to boost its revenue. The Rail Land Development Authority (RLDA), responsible for the commercial exploitation of IR’s vast land assets, has already invited bids for the Mahalaxmi plot. The tender for the Bandra plot is expected to be floated later this week, according to sources within IR.
The railways projects an impressive revenue of more than ₹993 crore for the 2.67-acre Mahalaxmi plot and ₹5,000 crore for the 10.6-acre Bandra plot over a 99-year lease period. Developers interested in leasing these plots for luxury residential or commercial projects will also be required to share a portion of their profits as per the lease conditions.
Hub of Luxury Projects
Mahalaxmi, once home to numerous textile mills and low-cost housing colonies for workers, saw a significant transformation in the 1980s. As the textile industry shifted to smaller towns, the area witnessed the development of numerous high-rise buildings with premium residential and commercial spaces. This transformation has made Mahalaxmi a luxury real estate hotspot.
The 2.67-acre plot in Mahalaxmi, largely facing Dr E Moses Road, is one of the few vacant land parcels in the otherwise well-developed area. It is secured by a boundary wall and currently houses some dilapidated old office buildings, godowns, and a weigh bridge. The plot is also home to 20-25 trees, including some Banyan trees. Located just 400 meters from Mahalaxmi railway station, the area is well-connected to major business districts such as Nariman Point, Lower Parel, and the Bandra-Kurla Complex.
On August 8, the RLDA floated a tender calling for bids for the Mahalaxmi plot, setting the base price at ₹993.30 crore and the last date for submission of bids as October 14. According to the tender document, the plot has a floor space index (FSI) of 4.05, and the successful bidder will be required to share at least 35% of their revenue with the RLDA. However, the exact terms and conditions, including the revenue-sharing arrangement, will be finalized during a pre-bid meeting on September 9.
“The pre-bid meeting to discuss the potential of the land parcel will be held at a well-known 5-star hotel in south Mumbai. We expect this land to be highly lucrative for developers, especially given the growing popularity of luxury housing in Mumbai,” said a railway official, speaking on condition of anonymity.
The developer who wins the contract may also secure higher FSI under the National Transit Oriented Development (TOD) Policy, which promotes compact, mixed-use development around public transit stations. This policy encourages high-density construction, allowing the developer to construct buildings up to 50 stories, similar to the luxury office and residential buildings in the area.
Meanwhile, the RLDA is expected to float a tender for the 10.6-acre plot in Bandra East later this week. This plot, adjacent to Bandra railway station, has been subject to encroachment over the years, making its redevelopment a significant opportunity for the railways and potential developers.
Conclusion
The Indian Railways' decision to lease these prime plots is a strategic move to capitalize on the booming real estate market in Mumbai. By leveraging these valuable assets, the railways aims to generate significant revenue while contributing to the city's urban development and infrastructure.
