Moneycontrol PRO

Vijay Mallya’s Kingfisher House goes unsold for fifth time

The Mumbai property failed to attract bidders even after lowering the reserve price to Rs 93.50 crore.

May 31, 2017 / 10:06 PM IST

For the fifth time, bankers failed to auction Kingfisher House, the erstwhile headquarters of Vijay Mallya-owned and now defunct Kingfisher Airlines, despite a 38 percent drop in its reserve price since it was first auctioned.

The 17-lender consortium led by State Bank of India had lowered the reserve price of the property by 10 percent to Rs 93.50 crore from Rs 103.50 crore in the previous auction held in March. In December, the reserve price was set at Rs 115 crore.

Lenders had first tried to auction the property in March 2016 with a reserve price of Rs 150 crore and later in August at Rs 135 crore.

"There were lot of enquires for the property from buyers but none of them deposited the bids in today's auction," a banker told PTI.

The financially troubled airline, grounded since 2012, had taken loans worth nearly Rs 7,000 crore from banks and financial institutions and now owes Rs 9,000 crore including principal, interest and service tax dues.

Multiple attempts to sell Kingfisher House, located near the Mumbai airport in Vile Parle with a 2,400 square meter area, have failed. The commercial property has four floors with permission for construction of fifth floor.

Brand strategy expert Harish Bijoor said, “Generally, such properties under litigation are seen as negative properties and buyers are skeptical to take it. Also, given the real estate prices and the property that it is, buyers will use tactics to suppress its prices and buy it at the lowest possible price.”

In April this year, banks had managed to sell Mallya’s luxurious Kingfisher Villa in Goa through a private treaty for Rs 73.01 crore after three failed auctions.

The sea-facing property situated at Condolim in north Goa was sold to Sachiin Joshi of Viiking Media & Entertainment, for Rs 73.01. The villa was sold after three failed auctions.

Mallya, who has been declared a wilful defaulter, fled to the UK in March last year since his passport has been impounded and is wanted by the government and legal agencies.

first published: May 31, 2017 05:26 pm