Under the public-private partnership model, the Bangalore Development Authority (BDA) has chosen a joint venture partnership to redevelop its Indiranagar Shopping Complex with Embassy Group and Maverick Holdings & Investments.
To redevelop six of the BDA’s 11 shopping complexes, another joint venture of MFAR Developers, Bengaluru and Realty and other has been chosen. They are in Austin Town, Vijayanagar, HSR Layout, RT Nagar, Sadashivanagar, and Koramangala.
According to Ravindra Babu, member-engineer, BDA said, “We’ll sign contracts in a couple of months and complete the project in two years. Shopping complexes will have the world-class infrastructure with 1,000 parking slots in each complex. Of the commercial space, about 35% will come to us and the rest of private partners. Tenants can either shift to the setback area or accept compensation if they don’t wish to keep the site. As per trade rationalization, a front-facing shop owner will get a suitable slot in the new complex. Packages are highly competitive.”
As per the BDA, the operating expenditure far surpassed the revenue of approximately Rs 5 crore generated by the seven complexes. Therefore, the redevelopment plan.
The BDA admitted that the main location and high visibility of its complexes would generate higher proceeds if quality infrastructure, which could hold malls and multiplexes, is given. The commercial space of BDA to be leased out for 30 years.
The commercial space will be leased out to private partners for 30 years, and it can be renewed for another 30 years, according to public-private partnership (PPP) model. BDA keeps its ownership of the complex. Partners earn their return on investment through rent of its share in the commercial space.