Oberoi Realty Pays ₹247 Crore for 11 Acres of Prime Land in Mumbai
Oberoi Realty, a leading real estate developer based in Mumbai, has made a significant payment of ₹247 crore as the first tranche for leasing 11 acres of prime land parcel in Mumbai's Bandra for 99 years from the Rail Land Authority of India (RLDA).
- The company has formed a special purpose vehicle (SPV), Centerstage Realty Private Limited, to undertake the project.
- Oberoi Realty won the bid for the land leasing in February 2026 and paid ₹247.50 crore to RLDA.
- The company has incorporated Centerstage Realty Private Limited as a wholly owned subsidiary with an initial paid-up share capital of Rs. 1 Lakh on June 2, 2026.
The payment for the RLDA land is structured to allow the company to pay for the land until 2038, with a small upfront payment and the balance linked to revenue generation.
Strategic Approach to Commercial Sales
Oberoi Realty's CMD, Vikas Oberoi, has expressed the company's intention to focus on selling commercial properties rather than leasing them, citing the limited number of Grade A developers willing to sell commercial properties.
- Oberoi Realty plans to adopt a strata sale model, which will help increase cash flows and reduce the upfront payment required for the land.
- The company is in talks with big houses to develop stand-alone buildings, indicating a growing market for such projects.
Impact of West Asia Conflict on Construction Costs
Oberoi Realty's CMD, Vikas Oberoi, has acknowledged the impact of the West Asia conflict on construction costs, raw material availability, and project costs.
"Yes, costs are going up. And luckily, we literally, we really make sure we have a lot of contingency built in when we do our budgeting. But yes, costs have gone up. Energy cost has gone up, aluminium has gone up, glass has gone up, labour's become expensive," Oberoi said.
- Oberoi Realty is factoring the increase in construction costs into its ongoing projects.
- The company is grappling with the challenges posed by the West Asia conflict, including raw material availability and project costs.