Prestige Estates Projects has stepped in to take over a project in Mumbai’s Mulund suburb by cash-strapped Ariisto Developers, which will benefit 350-400 homebuyers and lenders to the stuck project.
The committee of creditors representing the lenders had approved a hybrid plan where Prestige will pay upfront cash of Rs 370 crore and provide the lenders with 8 lakh square feet built-up commercial area. This has led to the resolution of Rs 1,650 crore of debt of the approximately Rs 2,200 crore owed by Ariisto Developers.
This is one of the largest real estate resolutions in Maharashtra in recent times. The project was stuck for over a decade due to legislation. The property was planned on a 30-acre hill-facing plot in Mulund. This will be Prestige’s first major project in Mumbai.
Legal firm Rajani Associates acted as adviser to the corporate insolvency resolution professional of Ariisto Developers. Speaking to TOI, Ashish Parwani, partner at Rajani Associates, said that the National Company Law Tribunal has approved the transaction. “This is a win-win resolution for the buyers and the lenders as the project was stuck for more than 12 years,” said Parwani.
Prestige has agreed to complete the project and has also promised to deliver the commercial premises to the lenders in four years. Parwani said that the lenders would be free to sell the commercial property to anyone.
There are 104 financial creditors admitted under the insolvency process. Some of the big names in the list are HDFC, IIFL Trustee, Indiabulls Housing Finance and JM Financial.
