K Raheja Corp buys Sobo Central for ₹476 cr under debt resolution scheme

April 12, 2024

K Raheja Corp Real Estate has acquired the land and buildings of Crossroad Condominium in Mumbai’s Haji Ali area, previously home to Sobo Central Mall owned by a Kishore Biyani company, for ₹476 crore as part of a debt resolution plan for non-performing assets. This has enabled Biyani to settle his dues to lenders.

According to documents provided by data analytics firm Propstack, the Kishore-Biyani promoted firm Bansi Mall Management Company that owned the mall, sold the property to K Raheja Corp and the sale was registered earlier this week.

The plot area is 5,357 sq m, and the built-up area is 11,453 sq m, including the common area and facilities.

The consideration paid in the transaction was the amount that Kishore Biyani is reported to have offered to lenders as a one-time settlement. The mall owner owed over ₹700 crore to lenders led by Canara Bank, who, under a settlement, have been forced to take a haircut.

The background

Crossroads or as it later came to be known ‘Sobo Mall’ was one of the first malls in Mumbai. Located in a congested area where parking was a nightmare, the mall quickly lost ground to newer, larger malls in the suburbs. The Covid pandemic was the final nail in the coffin and with no rental income, it defaulted on payments to banks, which initiated action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act.

In January, in order to recover the dues, Canara Bank put up the mall for auction in January with a reserve price of ₹500 crore, and according to media reports the Runwal Group made a bid for ₹475 crore that was accepted by lenders. However, subsequent to this, Biyani approached the Debt Recovery Tribunal challenging the bid and offered to settle the amount.

When contacted there was no response from K Raheja Corp as to what it planned to do with the place. Runwal group also did not respond.

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