North MCD to lease out a wing of Civic Centre to increase revenue
In an effort to overcome financial crisis, cash-strapped North Delhi Municipal Corporation has announced to rent out one of the wings of the Civic Centre, headquarters of both North and South MCDs.
The Corporation, which is the sole owner of the property, has informed that the move will boost its revenue by over Rs 88.09 crore in the first financial year and 7 per cent hike in each passing year.
“Earlier, we had decided to lease out a portion of the agencies’ headquarters so we could raise more revenue. Following the move, the Mayor has recently given in-anticipation approval and the matter was placed before the Standing Committee. Now, when the Standing Committee has given the go ahead, decks are clear to materialise the plan,” said Pravesh Wahi, Chairman of the Standing Committee.
According to the report, Civic Centre’s C-block was available for leasing out since its construction in 2010. The tower spread over 1,41,171 square feet including the service block of over 7,128 square feet.
The Corporation, in its draft, has allowed to lease out the property for as many as 30 years to the Income Tax department. The price fixation committee had earlier fixed a rent of Rs 486.22 per square feet but later it was raised to Rs 520 per square feet. With this, the tenant would deposit two years’ rent as security deposit in advance and payment of total rent in advance in the beginning of the year.
As per the Corporation’s document, the civic body will enhance the rent by 7 per cent every year on a compounding basis at the rate of 21 per cent at the end of every three years.
A total lease rent for three years will be Rs 264.27 crore or every year Rs 7.34 crore per month. “The Corporation is facing acute shortage of money hence, the move will minimise the problem up to a certain extent.
The important part is that the Corporation will not spend a single penny over its upkeep and maintenance as the party concerned will incur all type of expenses,” said Wahi.