Prestige Group inks DA to redevelop Worli project

MUMBAI: Bengaluru-based Prestige Group has entered into a development agreement with the Worli Shiv Shahi CHS Ltd to redevelop the prime property opposite Glaxo plant on Annie Besant Road in Worli for ₹578.37 crore.

The agreement was signed between Prestige Estate Private Ltd’s subsidiary Prestige Falcon Mumbai Realty Pvt Ltd and the Worli Shiv Shahi CHS Ltd was registered on March 17 and the purchaser paid a stamp duty of ₹29.11 crore to redevelop 13,284 sq m (1,42,987 sq ft) of land, showed documents accessed and shared by CRE Matrix, a real estate data analytics firm.

The Worli Shiv Shahi project has been awaiting redevelopment since 2009-10. Earlier, HBS Realtors had taken up the project, and demolished the buildings in 2014, but 2019 onwards, the developer stopped paying transit rent or displacement hardship allowance. In 2021, another prominent Mumbai developer had made an offer to redevelopment project. However, in October 2022, Prestige Group, which is aggressively expanding its footprint in Mumbai, was eventually selected by the society at a special general meeting to execute the project.

According to the documents, the developer will provide 1,025 sq ft homes to 192 families from 12 buildings and pay a hardship compensation of ₹1 lakh per month to each of them. The compensation which will start from July 2023 will increase every year and the developer will pay a total sum of ₹113.86 crore till July 2027. The agreement mentions that the society will be paid a corpus fund of ₹73.17 crore and additional corpus funds of ₹240.86 crore.

The agreement also states that the developer will produce 15 bank guarantees of varying sums including one of 150 crore, and settle arrears of property, water tax, and electricity directly with the MCGM and BEST. The agreement also stated that the residents’ society has agreed for a one-time settlement of a consortium loan of ₹100 crore taken by erstwhile developer and the proceedings initiated by a consortium of banks pending before the Debt Recovery Tribunal.

The MCGM, the original owner of the land, had given the land to MHADA on 999-year lease for building tenements for industrial workers. The Shiv Shahi building nos from 7 to 18 were built in 1950 and are just one of the five societies on this plot.