Blackstone-backed Nexus Select Trust is in talks to buy Axis Mall in Kolkata, but the transaction could be complicated because the mall is primarily strata-owned, and a portion of the mall acquired by disgraced diamantaire Mehul Choksi has been attached by the enforcement authorities, sources said.
To recover dues from Choksi, who is now a fugitive, State Bank of India and Punjab National Bank are in the process of valuing and selling properties belonging to him, which include a portion of Axis Mall that he owns. Sources said that Nexus Select was looking to buy this space.
Nexus Select declined to comment on the transaction.
The acquisition of the mall would require a different structure to be set in place since it does not have a single owner or promoter. Although the transaction value is still unclear, considering the total area and the presence of good brands occupying spaces, it should be valued at around ₹700 crore, sources said. The area owned by Choksi, spanning 80,000 square feet, is worth around ₹100 crore on its own. In 2011, Choksi’s Gitanjali Group of Companies acquired space in the mall and then leased it to Landmark Group for its Lifestyle and Home Centre brands.
With a built-up area of 5 lakh square feet and spread over three blocks in Kolkata’s upcoming Newtown area, Axis Mall has been in operation for around 15 years now. It was originally developed by the Bengal Peerless Housing Development Company, which then sold spaces in the mall to investors or retailers, who either rented them out or used them for their own retail operations.
Except for the fourth floor, which houses the multiplex Bioscope, Peerless’ role is now confined to managing the facilities, pending the formation of an association or society that will manage the mall.
With a portfolio of 17 malls spread over close to 10 million square feet, Nexus Select is expanding through acquisitions, with its typical playbook of acquiring assets, upgrading them through strategic capex, and then repositioning the assets by premiumising the brand offering.
It has already finalised the acquisition of three malls in Hyderabad owned by L&T, which have a total area of 1 million square feet, and is awaiting regulatory approvals. Another 8 lakh square feet of assets are undergoing due diligence, while it has ongoing discussions about another five retail assets, according to its last investor presentation.