The monetisation of India Tourism Development Corporation (ITDC)’s prized property The Ashok alomg with its land parcels will likely kick off soon, and the government is keen on the conclusion of a leasing deal in FY25 to redevelop the asset in the heart of Lutyens’ Delhi.
Currently, the Centre owns 87.03% of ITDC while Tata Group’s Indian Hotels Company (IHCL) holds a 7.86% stake.
The proposed transaction is being structured as a public-private partnership (PPP) under which the hotel and land parcels will likely be leased out for the long term.
The monetisation of The Ashok and its vacant plots were estimated to be about Rs 7,500 crore, consisting of capital expenditure by the PPP concessionaire and upfront lease revenues to ITDC.
The redevelopment of the Ashok, which has been pending for the last couple of years, is part of the Rs 6 trillion National Monetisation Pipeline (NMP) in the four years through FY25.
“The property will be monetised in the current financial year,” an official aware of the matter told FE.
The integrated offering to the bidders –hotel and the land parcels—could include a leasing period of 60-99 years under an operation, management and development model.
The Ashok Hotel was built on 11.42 acres. It has a total inventory of 550 rooms, including 160 suites, barely a few hundred metres from the Prime Minister’s residence and the embassies. The winning bidder was estimated to invest about Rs 450 crore to refurbish the hotel on the lines of global iconic hotels like the Ritz (Paris), the Savoy (London) and the Taj Mahal (Mumbai).
A second land parcel (vacant) of 1.83 acres was earmarked for developing retail-cum-office space (mall) with a built-up area of 175,000 sq ft in an integrated building of 5/6 floors.
The third plot of 6.3 acres (vacant) was for building serviced apartments with a built-up area of 1.1 million sq ft, having 600-700 units.
Feedback Infra had held a roadshow in August 2022 to obtain the views of potential bidders on the models suggested in its feasibility report. Twenty-nine global and domestic reputed players from the hospitality, real estate development and investment spheres had participated in the roadshow. Taj, Leela, Hilton, Andaaz, JLL and DLF, among others, participated in the roadshow.
