LIC to appoint realty consultant

Life Insurance Corporation of India (LIC) has decided to appoint a real estate consultant to evaluate its properties in south Mumbai.

This comes close on the heels of the Supreme Court verdict putting large companies out of the purview of rent control protection.

LIC is the biggest landlord in south Mumbai and owns several buildings in the Fort area, the city's oldest business district, which are currently involved in dispute over payable rent.

A senior LIC official said: "We are happy over the SC verdict and our legal department is studying its implications. We are also in the process of appointing a real estate consultant to evaluate our properties. This is a step to back up our side with an independent view to argue our case in the courts."

LIC owns various properties in the area, which have been let out to both corporates and individuals, and in some cases with leases dating back to the 1950s. The state-owned insurer has been able to get its property back and re-let at market rates in some cases.

The apex court on Thursday dismissed petitions by several PSU companies and banks against the Maharashtra Rent Control Act 1999.

The decision, delivered by Justices BP Singh and Altamas Kabir, upheld the constitutional validity of Section 3 (1) (b) of the Maharashtra Rent Control Act, 1999. The section exempts banks, PSUs, MNCs, foreign missions or large companies with a paid up capital of over Rs 1 crore.

However, property analysts like Anuj Puri of Trammel Crow Meghraj said: "The SC decision will primarily free more commercial space in the Fort area. Its major impact will be on those who want to continue to stay in the area despite the high rents. Its impact on commercial rents in south Mumbai will not be felt for the next six to eight months."