Bidders for ITDC hotels, Ashok Delhi and Ashok Bangalore, will have to fish out Rs 136.67 crore and Rs 56 crore, respectively, apart from the upfront non-refundable payment and an annual lease payment, according to the sub-lease-cum-management agreement.
The two prime ITDC properties will be offered to private players in the first tranche which is slated to take place during the first week of November.
The properties will be given out on a thirty-year lease, which will be renewable for another thirty years.
For Ashok Delhi, the Rs 136.67 crore includes a one-time Rs 100 crore bank guarantee and an annual ground rent of Rs 14.17 crore.
In addition, while Rs 2.6 crore would have to be paid to the Land and Development Office (L&DO) towards damage charges and penalty for unauthorised constructions up to August 31, 2001, Rs 16.49 crore will go to the New Delhi Municipal Corporation (NDMC) as outstanding property taxes up to March 31, 2001.
Also, about Rs 3.28 crore will have to be paid as business transfer consideration and Rs 14.52 lakh as outstanding Sales Tax up to March 31, 1999.
The bidder will also be required to make a security deposit, which includes three years annual rent (to be paid to the lessor) and the minimum guaranteed annual payment (MGAP) for the first financial year (to be paid to the lessee).
Bidders for Ashok Bangalore will have to pay Rs 56 crore, which includes a Rs 50 crore bank guarantee, Rs 51.6 lakh security deposit and Rs 2.22 crore as business transfer consideration.
Bidders for the ITDC restaurant at Bangalore airport - which is also on offer along with the Bangalore property - will have to pay about Rs 2 crore.
The lessee will be required to pay Rs 19.8 lakh as six monthly average for water and electricity charges.
For the properties to be leased, ITDC expects to receive an upfront payment of 50 per cent of the MGAP for the next 30 years discounted at 12 per cent per annum and an annual payment which will be linked to the hotel's performance.
If the MGAP is greater than 25 per cent of the turnover for that year, then annual fees payable would be 50 per cent of the MGAP.
However, if the MGAP is less than 25 per cent of the turnover for that year, then annual fees payable is 25 per cent of turnover less 50 per cent of MGAP.
Both ground rent and annual payment will be increased by 25 per cent on April 1, 2007, and every five years thereafter.
The government has also directed bidders against retrenchment of any regular employees for a period of one year.
The government has also asked interested bidders to continue using the 'Ashok' brandname for these ITDC hotels. The bidder is, however, allowed to add any other name to 'Ashok.'
