The Telegraph
Since 1st March, 1999
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CMC debut in hospitality biz
- Joint venture for Bypass plot

The Calcutta Municipal Corporation wants to enter the city’s five-star hospitality business by tying up with a private partner.

The civic authorities are preparing to invite proposals from private firms for a star hotel it plans to do on the five-acre plot close to ITC The Sonar Calcutta it got back from the Calcutta Stock Exchange (CSE) last year. A senior CMC official said the ball would be set rolling immediately after the polls.

The CMC got the land parcel back on September 26, 2008, following an out-of-court settlement with the CSE brokers’ association after chief minister Buddhadeb Bhattacharjee intervened. The CMC had sought the entire land back since it was lying idle for a decade with no signs of the proposed financial hub coming up. The brokers’ body then moved court.

In the proposed hotel project, two acres will be treated as the CMC’s paid-up capital and the civic body hopes the land value will keep appreciating over the years as the private partner continues to jack up investment.

“It’s true we are looking for steady streams of income for the CMC coffers (by making the land sweat) instead of leasing out plots for fixed sums,” said mayor Bikash Ranjan Bhattacharyya. Keeping in mind the joint-venture project, the mayor and municipal commissioner Alapan Bandyopadhyay, after a meeting with the CSE brokers’ association last month, abandoned the earlier plan to invite open bids for the plot.

Instead, both parties have agreed to share the land, with the CMC keeping two acres and the stockbrokers three. The modality of revenue sharing is yet to be worked out, said the civic official, and the CMC could settle for a minimum annual guarantee.

The city’s hospitality fraternity feels this model could be a win-win one for the private partner and the civic body. “It will combine the strength of private expertise with the stability of a public institution and also ensure that clearances are issued fast,” pointed out Ranvir Bhandari of ITC Sonar.

Amitabh Rai of The Oberoi Grand echoed the buoyancy over the arrangement. “Worldwide, and even across India, this model has worked very well, and there’s no reason why it won’t in Calcutta,” he said.

There won’t be any dearth of private interest even in this downturn scenario, which has severely impacted the hotel rooms rack in the city, feels realtor Pradip Chopra of the PS Group, a former secretary of Credai Bengal. “In fact, this is just the right time to start construction of a hotel project, so that the property is ready to reap the harvest once the tide turns,” he observed.

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