M Pallonji buys Turner Morrison building in Kala Ghoda for Rs 150 crore

MUMBAI: In one of the rare outright transactions to be concluded in South Mumbai for an entire building, M Pallonji Group has bought Turner Morrison Building in Fort’s Kala Ghoda locality, said two persons with direct knowledge of the development.
The M Pallonji Group has a presence in construction, shipping and finance, among other sectors, through the group’s various firms. The century-old building was sold by the Kolkata-based company Turner Morrison for about Rs 150 crore. The ground plus four storey building has total area of 54,000 sq ft built-up space.

“The deal has been concluded recently and all formalities have been completed. It’s a freehold property,” said one of the persons mentioned above. Property consultants said the deal assumes significance as an entire building has been sold in a micro-market that usually does not offer an opportunity like this.

The last similar transaction took place in early 2017, when Dawat-e-Hadiyah, a charitable trust of Dawoodi Bohra community, acquired the iconic Fort House from the Videocon Group. The prime property, with total 1.50 lakh sq ft office space in on DN Road of South Mumbai, was sold for around Rs 300 crore.

The Turner Morrison Building houses travel and tour operator Cox & Kings, the largest and anchor tenant of the building, and legal firm Crawford Bayley. Turner Morrison also occupies some space in this building. Email queries to Turner Morrison, M Pallonji Group and transaction advisor CBRE India remained unanswered till the time of going to press. The deal valued the property at around Rs 28,000 per sq ft. The last sale transaction on outright basis for Fort House was concluded at Rs 20,000 per sq ft.

However, property consultants are of view that both deals are not comparable as the Fort House transaction was initiated by State Bank of India to recover its dues from Videocon Group.

The micro-market, known for its Victorian Gothic architecture and structures that remind one of the British era, has not witnessed many such transactions and even a large lease deal in 2016 had surprised many.

In 2016, in the largest ever space transaction by any international retailer on high streets across the country, Spanish fashion chain Zara leased 50,000 sq ft carpet space in South Mumbai's prime location of Flora Fountain, close to Fort House. The world's biggest fashion retailer leased the space on the ground floor of Ismail Building diagonally opposite HSBC's India head office.