Redevelopment of New Delhi Railway Station

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January 08
Redevelopment of New Delhi Railway Station
Tata Realty and Infrastructure Limited
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About TATA Group

• TATA
• India's largest business group with diverse
  business interests in 7 sectors
• Revenues equivalent to 3.2 of Indias GDP and a
  Market capitalization of 62 bn
• Operations in over 80 countries with
  International income 65 of group revenue
• Products and services exported to 85 countries
• Largest employer in private sector, over 2,70,000
  employees
• Group revenue FY 2007 Rs 215,414 cr / 48 bn
• Group profit FY 2007 Rs 14,871 cr / 3.3 bn

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Strong ethics and corporate governance

• Tata Sons has set a strong ethics framework and
  encouraged the pursuit of highest standards in
  corporate governance

• The Tata Group mission is to improve the quality
  of life of the communities it serves, through
  leadership in sectors of national economic
  significance

Tata Group Mission

• Five core values provide direction to the Tata
  Group companies

• These values are fully reflected in the way that
  the companies manage their businesses

Five Core Values Understanding, Integrity,
Responsibility, Excellence, Unity

• Tata Code of Conduct prescribes ethical
  principles, such as Transparency, Respect, and
  Ethical Business Approach

Tata Code of Conduct

• Tata Sons pursues highest standards in corporate
  governance through
• Experienced Board of Directors
• Three key Board Committees for greater
  transparency
• Group Corporate Centers overall monitoring

Strong Corporate Governance
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About Tata Realty and Infrastructure (TRIL)

• Objective
• Real estate and infrastructure identified as the
  next new area for growth
• Tata Realty and Infrastructure Limited (a 100
  subsidiary of Tata Sons) has been set up as a
  Real Estate and Infrastructure Development
  company
• TRIL is the investment advisor for offshore fund
  Tata Realty Initiatives Fund (TRIF - 1) with a
  corpus of US 750 Mn for Real Estate projects

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Focus Areas of TRIL

• Key Focus Areas for TRIL
• Real Estate
• To develop unlock the value of real estate
  assets of other Tata companies
• To develop real estate as per market
  opportunities
• Infrastructure
• Airports, Urban Infrastructure, Surface
  Transportation, Special Economic Zones (SEZs),
  Logistic Parks

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Infrastructure Projects

• Airports
• TRIL and Changi have signed an MOU for
  development of 35 Non Metro Airports in the
  country. Technical bid already submitted for the
  first airport.
• Proposed Metro Airport - Cost around Rs. 10,000
  Crores to develop and would handle 40 Mn
  passengers when completed
• TRIL would also evaluate the development of
  airport ventures as and when announced by the
  Government of India
• Logistics Parks
• TRIL and Jafza have signed a JV for development
  of Logistics Parks in India
• Land evaluation / acquisition is already underway
  for phase - I (7 strategic locations
  identified across the country)

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Infrastructure Projects

• Urban Infrastructure
• TRIL has successfully qualified along with Tata
  Power and Mitsubishi Corporation to bid for phase
  2 of the Mass Rapid Transit System, Metro Rail
  from Charkop to Mankhurd (approximately 32 Km)
• Special Economic Zones
• Development of sector specific SEZ in Andhra
  Pradesh (323 Acres)
• Development of Multi-Product SEZ in Maharashtra
  (3000 Acres)
• Multi Product SEZ in Orissa

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Infrastructure Projects

• IT Parks and Campuses
• IT SEZ for Tata Consultancy Services, TCS at over
  8 locations

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Real Estate Projects

• Andhra Pradesh
• Proposed development of a high end Retail and
  commercial development in the Central Business
  District (CBD) of Hyderabad
• Karnataka
• Approximately 13 acres site with a proposed mix
  of commercial and retail development

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Real Estate Projects

• Tamil Nadu
• Development of an IT and Telecom campuses
• MICE resort in Tamil Nadu on 500 acres
• Kerala
• Development of an IT SEZ

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Project Details Redevelopment of New Delhi
Railway Station
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Project Back Ground

• The Ministry of Railway (MOR), Government of
  India plans to develop the New Delhi Railway
  Station through Public Private Partnership (PPP)
• MOR has decided to redevelop major railway
  stations into World Class Stations benchmarked
  with the worlds best stations
• These projects are to be executed with private
  sector partnership by leveraging the real estate
  development potential in the air space above the
  station and on railway land around the station
• Twenty two (22) railway stations including New
  Delhi, Howrah, Chennai, Mumbai CST, Bangalore
  etc. have been selected so far by the MOR for
  development into world class stations.
  Development is proposed to be undertaken in
  phases
• The first phase comprises six stations- New
  Delhi, Patna, Jaipur, Agra, Howrah and Chennai of
  which New Delhi is the first station to be taken
  up

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About New Delhi Railway Station

• New Delhi Railway Station is the main railway
  station in Delhi (capital of India), and is one
  of the largest stations in India
• The station is located in the heart of the city
  and borders Connaught Place, the prime business
  center of New Delhi
• At present, New Delhi station is handling, on an
  average, 0.35 million passengers per day who
  arrive/depart by 256 trains including 78 suburban
  trains
• New Delhi Station is a junction station and
  accommodates originating, terminating and passing
  train services. The existing Station comprises 12
  platforms that vary in length, the longest
  platform being 610 m in length. The station is
  currently being extended and upon completion will
  comprise 4 additional platforms and an additional
  fourth foot over bridge
• Government of India has appointed world renowned
  U.K architect Terry Farrell, who has built Hong
  Kongs Kowloon Station and Londons MI6
  Headquarters, to develop a detail master plan for
  redevelopment for New Delhi Railway Station

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Scope of Work

• The work would encompass
• redevelopment and modernization of the
  infrastructure at the passenger terminal and
• real estate development on about 86 hectares of
  land comprising the railway station, offices,
  parking, public spaces and commercial
  development.
• The concessionaire selected through international
  competitive bidding would undertake the work on
  Design, Build, Finance, Operate and Transfer
  (DBFOT) basis.
• The indicative capital cost of the project is Rs.
  5000 crores, excluding the real estate
  development for commercial purpose.
• Additional investment on the real estate
  development with be approximately Rs. 2500
  crores.
• Cushman and Wakefield (Real Estate Consultant)
  has recently stated that the site is worth USD
  2.5 billion (Rs. 9,900 crores).
• Real Estate redevelopment of the surrounding
  railway land, is for approximately 86 hectares.
  Of this, about 49 hectares of land area is
  covered by tracks at station and yard. The air
  space above such tracks and rest of the land will
  be considered for utilization while developing
  the master plan.Real Estate development will be
  in four distinct zones for commercial, transport,
  residential and community usage
• Total Commercial development will be in the range
  of 4-6 million sq ft

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Bidding Process

• The two stage bidding process is selected for the
  award of the project.
• Stage 1 Technical Qualification Stage
• The first stage, termed as qualification stage,
  involves the qualification of the interested
  parties/consortium, who make an application in
  accordance with the provisions of the
  qualification document.
• At the end of this stage up to 5 suitable
  pre-qualified applicants shall be eligible for
  participation in the next stage, termed as
  bidding stage.
• Stage 2 Financial Bid Stage
• Bids will be invited for the Project on the basis
  of the lowest financial grant required by a
  Bidder for implementing the Project.
• A Bidder may, instead of seeking a Grant, may
  also offer to pay a premium to the Authority for
  award of the concession.
• The Grant/ Premium amount shall constitute the
  sole criteria for evaluation of Bids.

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Stage 1 Technical Qualification Stage

• Projects which qualify as
• Category 1 Project experience on Eligible
  Projects in passenger terminals and railways
  sector that qualify
• Category 2 Project experience on Eligible
  Projects in core sector that qualify
• Category 3 Construction experience on Eligible
  Projects in passenger terminals and railways
  sector that qualify
• Category 4 Construction experience on Eligible
  Projects in core sector that qualify
• For the purpose of this project
• passenger terminals shall mean railway stations,
  metro stations, airport terminals and bus
  terminals and
• railways sector shall mean tracks, bridges,
  tunnels, signalling and overhead equipment and
• core sector shall mean highways, power, telecom,
  ports, airports other than passenger terminals,
  industrial parks, petroleum and natural gas,
  pipelines, irrigation, water supply, sewerage and
  real estate development.

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Stage 1 Technical Qualification Stage

• For a project to qualify as eligible project
  under Category 1 and 2
• It should have been implemented on BOT, BOLT,
  BOO, BOOT or other similar PPP basis
• The entity claiming experience should have held,
  in the company owning the Eligible Project, a
  minimum of 26 equity during the period for which
  Eligible Experience is being claimed
• The capital cost of the project should be more
  than Rs. 250 crore (Rs. Two hundred and fifty
  crore only ) and
• The entity claiming experience shall, during the
  past 5 (five) financial years preceding the
  Application Due Date, have (i) commissioned the
  construction work of the project and paid for it,
  and/ or (ii) collected and appropriated the
  revenues of such project after commencement of
  commercial operation.
• For a project to qualify as eligible project
  under Category 3 and 4
• the Applicant should have paid for execution of
  its works or received payments from its client(s)
  for works executed, fully or partially, during
  the 5 (five) financial years immediately
  preceding the Application Due Date, and
• only the payments (gross) actually made or
  received, as the case may be, during such 5
  (five) financial years shall qualify for purposes
  of computing the Experience Score.
• However, payments made or received in respect of
  projects having a capital cost of less than Rs.
  250 crore (Rs. two hundred and fifty crore only)
  shall not be reckoned as payments for Eligible
  Projects.

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Stage 1 Financial Qualification Requirement

• The Applicant shall have a minimum Net Worth of
  Rs.1,000 (one thousand) crore as at the close of
  the preceding financial year.
• In case of a Consortium, the combined technical
  capability and net worth of those members, who
  have an equity share of at least 26 each in such
  Consortium, should satisfy the above conditions
  of eligibility.
• Thus there will be a maximum of 3 consortium
  partners whose technical and financial
  capabilities can be counted

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Method to Compute the Technical Score

• a) For every eligible project, calculate the
  capital expenditure incurred and revenue
  appropriated from such project in last five years
• b) Summation of all the eligible scores will
  give the final technical score from the company

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Consortium Structure

• In a consortium, for a members technical and
  financial score to qualify ,it has to have at
  least 26 stake
• Thus the number of members who can contribute to
  technical and financial score will be a maximum
  of three

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Unique opportunity

• Apart from modernisation of the railway station,
  the real estate development rights on
  approximately 86 hectares are on offer.
• This poses a one off opportunity to own a legally
  clear commercially developable real estate in the
  heart of the capital.
• As per the current real estate scenario, the
  current commercial capital value in Conought
  Place is approximately Rs. 30,000 Rs, 45,000
  per sq ft (USD 750 USD 1100 per sq ft).
• Due to unavailability of any private land in the
  vicinity, the developer of the subject site will
  command a huge location and real estate stock
  advantage.
• Current passenger traffic of approximately 0.35
  million people a day, providing enormous
  opportunities
• All railway stations in India are in the heart of
  city thus providing huge upside potential
• Other major railway stations in the country are
  also on offer on PPP basis in the near term, thus
  this also provides a first mover advantage in
  this sector.
• The modernization and redevelopment of adjoining
  lands for railway stations will be one of the
  biggest opportunities in India infrastructure/real
  estate in the near future

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Time Lines
In view of the above, the consortium needs to be
finalized as soon as possible( by the end of the
month)
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Information Required

• According to the criterion stated in the
  presentation and the RFQ
• Details of list of eligible projects according to
  the criteria mentioned
• For every project
• Date of commencement of construction
• Date of commencement of operations
• Project Cost on the date of project commencement
• Revenues appropriated from the project in the
  past five years
• Capital expenditure incurred on the project
  during the past five years
• Equity in the project and the duration for which
  equity was held
• Total experience score
• Financial Net Worth (It shall mean the sum of
  subscribed and paid up equity and reserves from
  which shall be deducted the sum of revaluation
  reserves, miscellaneous expenditure not written
  off and accrued liabilities.

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Contact Details

• Detailed RFQ and Project Information Memorandum
  are also attached with the mail.
• Alternately one can download the same from
  www.indianrailways.gov.in
• Details of Website
• Tata Group www.tata.com
• Tata Realty and Infrastructure
  www.tata-realty.com
• Contact Details in Tata Realty and Infrastructure

Contact Abhijeet Maheshwari , Address Tata
Realty and Infrastructure Limited , Elphinstone
Building, 2nd Floor, 10 Veer Nariman Road, Fort,
Mumbai - 400 001, India. Tel [phone]
Fax [phone] Email amaheshwari_at_tata.com
Contact R.P. Mahajan , Address Tata Realty and
Infrastructure Limited , Elphinstone Building,
2nd Floor, 10 Veer Nariman Road, Fort, Mumbai -
400 001, India. Tel [phone] Fax
91-22-66290520 Email rmahajan_at_tata.com