en.Wedoany.com Reported - Mumbai-based listed real estate developer Oberoi Realty has paid Rs 2.47 billion as the first installment to the Indian Railway Land Development Authority (RLDA) for a 99-year lease on an 11-acre plot in Bandra, Mumbai. The company disclosed in a regulatory filing that it has established a special purpose vehicle (SPV) for this purpose.

According to company information, Oberoi Realty won the bid for this land lease project in February 2026 and subsequently paid Rs 2.475 billion to RLDA. The newly established SPV, named Centerstage Realty Private Limited, was registered as a wholly-owned subsidiary on June 2, 2026, with an initial paid-up capital of Rs 100,000. The company subscribed to additional shares worth Rs 2.685 billion in Centerstage through a rights issue on June 9, 2026.

The company stated last month that most of the plot requires no upfront cash payment. For the RLDA land, the payment can be settled by 2038, with only a small portion paid upfront, and the remainder linked to project revenue.

Oberoi Realty plans to launch a commercial project on this 11-acre plot. In February 2026, the company emerged as the highest bidder for the lease rights to the Bandra East plot with a bid of Rs 54 billion. During the Q4 FY2026 earnings call, company CMD Vikas Oberoi stated that the company plans to adopt a sales model rather than a lease model for this project, potentially with a 50-50 split or a 60% sale, 40% retention allocation. He noted that few Grade A developers are willing to sell commercial properties, and a strategic tiered sale approach is expected to yield strong cash flow performance, with large corporations already approaching the company to build standalone buildings for them.

Against the backdrop of ongoing geopolitical conflicts, Vikas Oberoi said that rising construction and energy costs, expensive labor, and material supply challenges are putting pressure on the real estate sector. On May 11, 2026, he noted that the company expects construction costs to rise and has set aside substantial contingency funds in its budget. During the earnings call, Oberoi mentioned that rising energy costs, aluminum, and glass prices, increased labor costs, and difficulties in material supply are all putting pressure on the entire industry.

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