The transaction is among the most significant commercial property deals in Srinagar in recent years, but Chaya's interest in the site goes beyond the value of the land.
The proposed project is expected to involve an overall investment of around Rs 1000 crore, including the Rs 421.75-crore bid and approximately Rs 650 crore in construction and development.
The auction itself demonstrated the premium investors are willing to pay for strategically located commercial property in Srinagar.
Against a reserve price of Rs 125 crore, the final bid reached Rs 421.75 crore.
We are going to start work and move ahead with the project,” Chaya said.
Srinagar, Sep 5: When the Srinagar Development Authority decided to put around 45 kanal of prime land at Sangarmal up for online auction, prominent hotelier Mushtaq Ahmad Chaya had already made up his mind to bid for it. His decision had been taken before the auction was put up, and he was prepared to pursue the property regardless of how high the bidding went. “Come what may, I had made up my mind that I would bid for it. I was ready to go for the bid at any cost,” Chaya told Greater Kashmir in an exclusive conversation.
Advertisment
That determination culminated in a winning bid of Rs 421.75 crore by a consortium backed by Chaya, following a marathon online auction that began on August 25 and continued until 1:48 am on August 26. The property had a reserve price of Rs 125 crore. The winning offer was therefore more than 3.3 times the reserve price and Rs 296.75 crore above the minimum amount fixed for the auction. “At around 2 am on August 26, we finally closed the bid and we won it,” Chaya said.
The 45-kanal property, offered on a full-lease basis, comprises land in front of and behind the existing Sangarmal City Centre. It is located a few hundred metres behind the Kashmir Golf Course, opposite Polo View and around a kilometre from LalChowk. Dal Lake is also roughly a kilometre away, while one end of the property touches ChuntKhul. The transaction is among the most significant commercial property deals in Srinagar in recent years, but Chaya's interest in the site goes beyond the value of the land.
“I had decided that I wanted to take this property and develop something big for Kashmir. There were other consortia, there was competition, but I was very clear in my mind,” he said. Chaya, who heads the Mushtaq Group of Hotels, has been in the hospitality business since the mid-1980s and has built a substantial presence across Jammu and Kashmir and Delhi. His group has operated and developed hospitality properties in association with international hotel brands and has been involved in the expansion of the region's tourism infrastructure. He has also held leadership positions in industry bodies, including the Jammu & Kashmir Hoteliers Club, representing issues concerning tourism, investment and the hospitality sector.
Advertisment
That experience now feeds into his plans for the Sangarmal site. The Chaya-backed consortium plans an integrated commercial and hospitality development featuring a hotel, shopping spaces, banquet facilities, exclusive retail, entertainment and leisure components.
“My idea is to create something big for Kashmir. It should have a hotel, shops, banquets and exclusive retail spaces. I want it to be a blend of international malls and international facilities, but with the Kashmir touch,” Chaya said. The proposed project is expected to involve an overall investment of around Rs 1000 crore, including the Rs 421.75-crore bid and approximately Rs 650 crore in construction and development.
A major feature planned for the development is parking capacity for around 5000 vehicles. The scale of the parking facility is expected to make the proposed destination more accessible to visitors and shoppers and address one of the key challenges associated with large commercial developments in central Srinagar.
Advertisment
The project is also envisaged as a new shopping and leisure destination for both residents and tourists. Its location near LalChowk, Polo View, the Kashmir Golf Course and Dal Lake places it within a high-traffic commercial and tourism corridor. Chaya said the objective was to create a destination where shopping would be only one part of the experience. “We want to create a destination. People should come there not only for shopping but also to spend time, eat, stay and experience something different. We want international standards, but we also want the project to reflect Kashmir,” he said.
The investment could also have a significant employment impact. Chaya estimates that the project could generate around 10,000 direct and indirect jobs.
“My aim is to create more jobs. We have seen years of peace and now people should get its dividends. Investment should ultimately benefit the people of Kashmir,” he said. Asked about the broader investment environment in Kashmir, particularly with the Valley witnessing increased economic activity and investment, Chaya said both local and outside investment were necessary for sustained growth.
He cited the takeover of the Centaur Hotel on Dal Lake by the Leela Group as an example of outside investment, while the Sangarmal auction represented a major investment by a locally backed enterprise. According to Chaya, the two should not be viewed as competing models. Outside investment can bring capital, expertise and new brands, while local investment can keep a greater share of economic activity rooted in the region.
What matters, he said, is that both contribute to business expansion, economic activity and employment.
The consortium plans to engage specialised consultants, designers and professionals with experience in large-scale commercial and hospitality developments. Chaya said the project was backed by his group and that specialised expertise would be brought in wherever required. The formal successful bidder is Parmesh Construction Company Ltd, a consortium involving Pahalgam Green Hotels and Bhutani Infra Ltd, with Chaya backing the project and driving its proposed development vision.
The location is central to the project's business proposition. The site sits close to Srinagar's established commercial centre while also being within easy reach of major tourism and recreational landmarks.“You have LalChowk, Polo View, the Golf Course and Dal Lake all nearby. If you develop the property properly, it can become a landmark for Srinagar,” Chaya said.
The Sangarmal City Centre itself has struggled to achieve the commercial activity originally envisaged for it. The complex includes commercial spaces, a Craft Bazaar, kiosks, food courts, a restaurant and office spaces, besides landscaped areas, fountains, parking facilities, lifts and escalators. Despite its strategic location, significant portions of the complex have remained underutilised. The proposed development could change the commercial character of the area by bringing together retail, hospitality, entertainment and leisure facilities in a single destination.
Advertisment
The planned parking capacity would further expand its ability to accommodate large visitor volumes. For the local economy, the proposed project represents more than a high-value property transaction. Its success would depend on whether the planned capital investment translates into operational businesses, sustained footfall, employment and new demand for local suppliers and services.
The auction itself demonstrated the premium investors are willing to pay for strategically located commercial property in Srinagar. Against a reserve price of Rs 125 crore, the final bid reached Rs 421.75 crore.
The consortium is required to execute the project within the stipulated lease conditions, including a three-year construction timeline. “We have to complete the construction within three years as per the conditions. We are going to start work and move ahead with the project,” Chaya said. The immediate outcome of the auction is aRs 421.75-crore lease commitment.
The larger proposition is the proposed Rs 1000-crore development, which could add a major new retail, hospitality and entertainment destination to Srinagar.
