Pay Plan Not Feasible? Logistics Park Fails To Find Any Developers, ET RealEstate

July 17, 2023

NOIDA: The Yamuna Expressway Industrial Development Authority (YEIDA) has failed to attract any developers for the Tappal-Bajna multimodal logistics park (MMLP), proposed to come up on 200 acres.

A study by one of YEIDA’s consultants on the reasons for the lack of response highlighted that the current payment structure is more in favour of the Authority than potential concessionaires.

The benchmark revenue share for the Authority is set at a higher rate of 10.5%, along with an additional fixed component of Rs 10 crore. In contrast, market bids for similar MMLPs in Chennai, Bengaluru, and Indore have consistently centred around the 5% revenue share mark.

Economic uncertainty has been found to be another reason. Investors’ interest in investments seems to be on the lower side at present due to global and domestic economic uncertainty, including higher inflation, fear of recession, and a high interest rate regime.

The consultant has also highlighted the inclusion of a non-compete clause in the request for proposal, restricting bidding by several companies.

YEIDA has been suggested to conduct a market consultation exercise with stakeholders to understand their concerns and requirements and make modifications to the existing payment structure.

YEIDA CEO Arun Vir Singh said the matter would be discussed with the state government soon, and a revised RFP would be floated.

YEIDA floated an RFP in February for the project to be built on a public-private partnership. According to the RFP, the private concessionaire will develop the park and operate it for 45 years. In the first phase, the park will be developed on 200 acres, out of which 10 acres will be for commercial use, 12 acres for institutional use, and 24 acres for residential land use. The core activity will be developed on 154 acres.

YEIDA will spend Rs 990 crore on acquiring land and developing basic facilities.

Initially, the last date to submit the bid was March 15, but it was extended several times. June 30 was the latest deadline.

  • Published On Jul 17, 2023 at 03:00 PM IST

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