The Hindu Business Line : Boat Club property in Chennai comes up for 66-year lease

Chennai June 6 A public notice calling for bidders interested in long-term lease of over 3.60 lakh sq ft at one of Chennai's most sought after neighbourhoods has sparked interest among real estate developers.

Going by the name of Ben's Garden, the property on Boat Club Road and Chamiers Road, which measures 150 grounds, is owned by the Sir John D'Monte Trust, a public charitable trust.

The Archbishop of Madras Mylapore, the trustee, has called for bids for 66-year lease of the property for commercial purposes.

This is the single largest chunk of land coming up for development in the area in recent times.

The bid is open up to July 31, 2007.

Flaunted address

While details of the lease are yet to be divulged, the property would be an ideal location for residential development.

Industrialists and VIPs flock to this area, leading to a stiff bidding war for every property coming up for sale.

In the last three years, three prime properties have been sold, all of them through an electronic auction by leading international property consultants.

The last such deal was in February 2007 for 1.04 lakh sq ft, which sold for over Rs 16,765 sq ft. A deal in the area sets a benchmark for property value in Chennai, according to developers.

Lease estimates

The terms of the lease would have a significant say on the value of the deal.

But developers estimate that a lease agreement may be struck at 65-75 per cent of the value of freehold sale.

Going by the last auction price, this puts the possible value at about Rs 450 crore (Rs 12,500 a sq ft) in addition to whatever lease rent that is finalised. Over the last three years large chunks of the property have come up for sale in the area.

The historical background of the property contains interesting nuggets.

Sir John D'Monte, a Portuguese businessman in 19th century Madras (now Chennai), owned extensive immovable properties in and around the city. He died on May 18, 1821 after executing a will that said that the rents and profits from his property were to be used for charitable purposes. The land could not be alienated or sold. The Archbishop of Madras Mylapore is the current trustee.

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