NEW DELHI: Tata Group’s Indian Hotels Company (IHCL) on Friday retained the iconic five star hotel Taj Mahal (popularly known as Taj Mansingh) for another 33 years as it emerged the winner in a closely fought e-auction conducted by New Delhi Municipal Council (NDMC), defeating the only other participant and rival hotelier ITC.
The winning bid, however, did not come cheap for Tata, which runs over 100 luxury hotels in the country under the ‘Taj’ brand. For the new lease, Tata will be paying double the license fees for 33 years.
“The Tata Group’s Indian Hotels Company Limited has retained the property at a license fee of `7.03 crore per month including GST or 32.50 per cent of the gross turnover of the property. Earlier, they were paying `3.94 crore per month as license fees,” said an NDMC official.
The Taj Mansingh was given to the Tata group in 1978 on a lease for 33 years, which ended in 2011. When NDMC decided to auction the hotel, Indian Hotels challenged the decision in the Delhi High Court and started a long legal battle. After several lease extensions, the Supreme Court approved the auction last April.
Friday’s auction also brings relief for the civic body as it failed to auction the luxury hotel in two attempts owing to strict eligibility criteria. The auction of the 292-room luxury property rarely created buzz in the industry. Earlier, NDMC had to cancel an e-auction as only IHCL auctioned for the hotel.
Tata, however, was always interested in the property. After winning the bid, Puneet Chhatwal, MD & CEO, IHCL said, “We are delighted that the iconic Taj Mansingh, New Delhi, which has been an important part of the cultural and historic fabric of the National Capital, will continue to remain a part of the IHCL family.”
The decision will allow IHCL to make investments to refurbish the hotel. “We look forward to investing in the hotel and taking it to new heights of Indian hospitality. The Taj legend will continue to serve Delhi with elegance,” Chatwal said.