In a fascinating development, Bollywood actor Amitabh Bachchan has leased property to SBI for a whopping Rs. 19 lakhs/month for next 15 years. The property is located just adjacent to Bachchan’s own Bungalow Jalsa in Juhu, Mumbai. Prior to SBI the property was leased to another private financial institution for years. Reportedly the property is spread over an area of 3,150 sq ft and given that it’s located in one of the most sought-after locations in Mumbai, its rent will escalate to 25% every 5 years.
Details
It’s a well-known fact that Bollywood celebrities not only make money by their acting projects, but also through their businesses and investments. On one hand, some celebrities own their own Production Houses such as Shahrukh Khan and Alia Bhatt. On the other hand, some celebrities invest in startups such as Anushka Sharma and Katrina Kaif.
Meanwhile, a new report also sheds light on another capital earning instrument for Bollywood celebrities – property investments and leasing.
The Facts of the Matter
Sr and Jr. Bachchan’s have leased the ground floors of their property to none other than the biggest bank in India – State Bank of India. Coming in at a hefty lease of Rs. 18.9 lakhs per month, the lease will be active for the next 15 years. The property is located in Juhu, adjacent to Bachchan’s current residence Jalsa. For the unversed, Jalsa and Prateeksha are two residences of the Bachchan, that have almost worn the label of a landmark in Mumbai.
Cost Escalation of 25% Every 5 Years
The property that’s been leased by the Bachchan to the biggest Public Sector Bank in India is spread over some 3,150 sq feet. What makes the lease a more than profitable investment for the Bachchans is that it will witness a cost escalation of about 25% every 5 years.
This means that for the first five years, the bank will have to pay a rent of Rs. 18.9 lakhs per month. However, after 5 years, the rent will automatically increase to about Rs. 23. 62 lakhs per month for the next five years. In the final five years, the rent will be about Rs. 29.53 lakhs per month.
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Property Was Leased by Citibank Prior to SBI
It should be noted that this is not the first time the Bachchan’s have leased a property to a financial institution. The same property was earlier leased to Citibank until 2019, when its lease was expired. According to reports, the State Bank of India has already paid a sum of Rs. 2.26 crores as a deposit for the property.
Is Rs. 19 lakhs/month Justified? Financial Experts Think So
One may think that rent of about Rs. 19 lakhs per month is not something that can be justified. However, the financial experts think otherwise. Hindustan Times quoted a financial expert saying, “This is a marquee property which belongs to Amitabh Bachchan, who is a superstar, and is just next door to his house. This is bound to attract a premium. In addition, this is a corner prominent spot in Juhu.”
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What’s So Special About JVPD Locality?
The current lease rent at JVPD, the place where the property was leased, is about Rs. 400-500 per sq feet. For the unversed, JVPD is one of the most plush and upscale Mumbai localities. The JVPD houses high-valued individuals such as Anil Kapoor, Sunny Deol, Rohit Shetty, etc.
Earlier this year, Amitabh Bachchan had yet again made buzz by buying a luxury duplex in Mumbai’s Oshiwara neighborhood. The Zanjeer actor bought the luxury duplex for Rs. 31 crores. Located in Mumbai’s western suburb, the duplex is on the 27th and 28th floor of the Atlantis building.
