The New Delhi Municipal Council (NDMC) has extended the lease of Indian Hotels Company Limited (IHCL) run hotel Taj Mansingh, by one year. The hotel is a five-star property located in the upmarket Lutyens Delhi area, in close proximity to Parliament and offices of Central government ministries.
The decision to extend the lease was taken in the NDMC council meeting chaired by Delhi Chief Minister Sheila Dikshit.
“A resolution was passed stating that within this one year period, the process of open auction would be completed. The property would be given on lease to the highest bidder, but IHCL would be given the right of first refusal (RoFR),” stated council member and BJP MLA Karan Singh Tanwar.
Tanwar said that NDMC owns the land on which Taj Mansingh is built. IHCL was given the hotel on lease for 33 years, which ended in October 2011. All these years, IHCL was paying 10.5 per cent of the gross revenue to NDMC by way of rent. In October 2011, IHCL’s lease was extended till October 12, 2012 and the company was asked to pay 17.50 per cent of the gross revenue as rent.
Additional Solicitor General Rakesh Kumar Khanna recommended to NDMC that an open auction should be conducted for Taj Mansingh. Whereas, NDMC appointed consultant Ernst and Young, stated in its report that the municipal body would benefit most if the hotel is operated by IHCL through a re-negotiated contract between NDMC and IHC. NDMC’s counsel’s Harish Salve and Madhu Tewatia also opined that renewal of lease would be in the interest of the municipal body.
The news of the Taj Mansingh going for auction generated a lot of interest from hotel majors like EIH, a part of the Oberoi Group, which owns five star Oberoi and Trident brands. PRS Oberoi, the chairman of the group had evinced interest in the property. Other contenders include ITC, which runs the Maurya in Delhi and French hotel group Accor.