Kumar Mangalam Birla emerged as the top bidder for Jatia House with an offer of Rs 425 crore, according to people familiar with the development. The iconic property is located on Little Gibbs Road in one of Mumbai’s most upscale locations, Malabar Hill. Birla, chairman of the Aditya Birla Group, is reportedly paying Rs 1.5 lakh per square foot for an area of approximately 28,000 sq ft.
Jatia House has been on the block for the past few months and bids that were invited via an auction process closed on Monday. Property consultants JLL India conducted the auction but declined to comment on the transaction citing fiduciary responsibilities. Both the spokesperson for the Aditya Birla Group and Shyam Jatia, who owns Jatia House, declined to respond to queries.
While the real estate fraternity is believed to have estimated a value of R500 crore for the property, experts pointed out such transactions rarely followed market norms. “These are marquee properties and as such the price is typically not representative of current prices or even sentiment,” said Shishir Baijal, CMD, Knight Frank India, adding that such purchases depended on the heritage value, location and needs of the buyer.
FE learnt that Jatia House will be used by the Birla family.
The Jatia family is the promoter of Pudumjee Industries, which has a presence in the paper and hospitality sectors. The proceeds from the sale, sources said, will be divided between Shyam and Arun Jatia, sons of MP Jatia, who currently reside there. Last year, in the same neighbourhood, Mehrangir or what was popularly known as “Bhabha House” was bought by the Godrej family for Rs 372 crore. Similarly, in 2012, Hindustan Unilever sold “Gulita”, a sea-facing property in Worli, to Piramal Group chairman Ajay Piramal for Rs 452.5 crore. In the same year, steel magnate Sajjan Jindal also acquired Maheswari Mansion on Napean Sea Road for approximately Rs 500 crore.