Lincoln House, the sprawling three-storey bungalow, which housed the US Consulate, is being sold at about Rs 750 crore, Rs.100 crores below its reserve price, to Cyrus Poonawalla, chairman of Poonawalla Group, that includes biotech company Serum Institute of India. Restriction on redevelopment and uncertainty over other approvals are being quoted as reasons for a discount on the reserve price of Rs.850 crores.
Poonawalla, a prominent personality in horse racing, confirmed the deal for the house, which is a mere 10-minute drive from the Mahalaxmi Racecourse. The 2-acre Grade-III heritage property at Breach Candy has a built-up area of around 50,000 sq ft. “It’s a beautiful house, we will use it as our residence,” mentioned Poonawalla.
The Poonawallas will make few changes to the house which was earlier used as an office by the US consulate. The deal will conclude in a few weeks after completion of certain documentation process.
The property has been in the market since the past five years, but there were no takers, given that there was no redevelopment potential for it. Initially, when the sprawling property that carries grade III heritage tag, was put on the block in 2011, the reserve price was set at Rs 850 crore. While few developers, including Tata Housing Development Company, had evinced interest in the property then, their bids were below the reserve price. Tata Housing was the sole bidder for the property at a reserve price of Rs 850 crore. Recently, Tata Housing Development Company also backed out of the deal, given the development restrictions.
Few developers were also evaluating the property, but they decided not to bid in the face of uncertainty surrounding heritage tag, approval from the ministry of external affairs and restriction on redevelopment, said two realtors who had planned to bid for the property.
After the US Consulate shifted into its new premises in the Bandra-Kurla Complex, it had put up two of its South Mumbai properties Lincoln House and Washington House for sale in June 2011 with a reserve price of Rs 850 crore and Rs 350 crore, respectively. Of these, Washington House at Altamount Road in South Mumbai was bought by realty developer, Lodha Group in 2012 for Rs 341.82 crore, also below the reserve price.
Built in 1933, the palatial house was earlier owned by the Maharaja of Wankaner until 1957, when it was leased to the US consulate. Leading British architect Claude Batley, whose work includes landmarks such as the Bombay Gymkhana, had designed the Lincoln House.
In a sluggish property market, this is the second large bungalow transaction that has taken place in the past week. On September 7, industrialist Kumar Mangalam Birla emerged as the highest bidder for the sea-facing 30,000-sq-ft bungalow Jatia House in Malabar Hill locality with a bid of Rs 425 crore.
The Jatia House deal is also expected to be concluded in a month’s time. This is the most expensive bungalow deal overtaking Maheshwari House transaction that took place in 2012 at Rs 400 crore.