Godrej Properties to develop Jet Airways's land in Mumbai

Jet Airways and Godrej Properties today signed a deal to develop one of the two plots owned by the airline in the premium Bandra-Kurla Complex (BKC) central business district here.

The deal involves Godrej Properties, the real estate development arm of the diversified Godrej Group, making an upfront payment of Rs 135 crore to Jet to compensate it for the expenses it had already incurred, besides taking on the Rs 350-crore debt the airline has on the 2.5-acre at C-68, G-Block, BKC plot.
The Naresh Goyel-promoted airline has another 1.5-acre plot in the BKC, but it is locked in a legal dispute with the Sahara Group. The Jet-Sahara case is pending at the Bombay High Court, which will come up for final hearing next Monday.
During a conference call with analysts after the release of first quarter results late last month, the airline had said it would sell off this plot once the court verdict was out.
That apart, Godrej Properties will also sell to Jet Airways 1,61,460 sqf of carpet area at development cost, where the Naresh Goyal promoted airline will move its headquarters on completion, the developer said in a release here.
Jet Airways' senior vice-president for finance Shiv Kumar could not be contacted for comments. 
Godrej Properties will develop an approximately 1 million square feet of office space on the plot which will be completed in three years, the company said. Godrej Properties and Jet will share profits from the development in 50:50
ratio, the release said.
Leading architects Skidmore, Owings, & Merrill, which has designed many outstanding developments across the world, including the world's tallest building the Burj Khalifa in Dubai, has been signed on as lead architect.On the deal, Godrej Properties Executive Director Pirojsha Godrej said, "We are happy to have partnered with Jet on this project".
Jet Airways Group chief executive Nikos Kardassis said, "We have been looking for a right partner to develop this property for long. The development of our BKC plot is a strategic decision and we are delighted to be associated with Godrej Properties".
Jet had originally bought the plot for Rs 399 crore from the Mumbai metropolitan Region Development Authority in a public auction in 2006 and had plans to shift its headquarters there, from the existing SM Centre at Andheri. However, the global economic slowdown made it change its plans.
Jet, the country's leading airline with 25.5 per cent share in the domestic passenger market, has over Rs 1,3000 crore debt on its book as of end June and is planning to retire Rs 1,000 crore annually.
Meanwhile, Godrej Properties has also signed a development agreement with Magic Info Solutions to develop a residential group housing project in Gurgaon, NCR. The project, spread over 22 acres will have a total saleable area of around 2 million sq ft, the company said in release said.