Maharashtra govt takes over iconic Air India building at Mumbai's Nariman Point

MUMBAI: Three years after the cabinet approval, the iconic Air India building at Nariman Point was taken over by the Maharashtra govt on Tuesday. CM Devendra Fadnavis presided over the registration of the agreement of the Air India building.

“It will not only save the rent but also bring offices together,” CM Fadnavis told TOI. In 2023, the state cabinet had cleared the plan to buy the Air India building in Nariman Point to expand Mantralaya and house state govt offices there.

The cabinet had taken the decision to waive all Unearned Income from and other penalties of Air India, so that the state govt can take possession of the iconic building soon. The state govt has paid around Rs.1601 crore for the building. With the acquisition, 46470 square meters of space will be available for govt offices in this 22 storied building.

Officials said that the state government will save around Rs 200 crore in annual rent if all the offices currently housed in private buildings are moved to the Air India building.

Officials said that it will take more than 6 months to make the building usable since the lifts are not working and a lot of interior work will have to be carried out. Even the central air conditioning system is not functioning since the building is over 50 years old.

In 2022 then DCM Fadnavis had met then Union Civil Aviation Minister Jyotiraditya Scindia and urged him to give preference to get the building. Apart from the Maharashtra govt, the Reserve Bank of India (RBI) was said to be in the fray to buy the building.

Fadnavis had said that the state govt was facing a space crunch to house government offices in Mantralaya and the annexe building. “Met Union Minister Jyotiraditya Scindia in New Delhi and requested to give the Air India building in Mumbai to the state government.

At present, even with the Mantralaya and an annex building, the space for government offices is insufficient, hence the demand for this building. We had given this proposal when I was Chief Minister.

But in the meantime, that proposal was withdrawn. After that we corresponded again. Currently, both the Reserve Bank and Maharashtra government have demanded this space,” Fadnavis had said in a tweet.

Officials said that Maharashtra had leased the sea-facing property to Air India in 1970 for a 99-year tenure. Officials said that as per land transfer rules, the state revenue department was entitled to recover a transfer fee (or unearned income) during transfer of lease which would have worked out to around 1/8th of the market value.

“Air India had then sought a waiver of this payment as a special case also which was approved,” an official said.