Mumbai, May 26, 2026: The Maharashtra government is nearing the completion of its acquisition of the iconic Air India Building at Nariman Point, with the state finance department transferring ₹1,601 crore to the Public Works Department (PWD) to finalise the transaction.
According to senior government officials, the funds have already been transferred to the Executive Engineer of the Mumbai City Division under the PWD. The department has subsequently prepared the draft legal documents related to the purchase and forwarded them to the Law and Judiciary Department for final approval. Once legal clearance is granted, the acquisition process is expected to be formally completed.
The decision to acquire the landmark commercial tower was initiated after Air India was privatised and taken over by the Tata Group. Owing to its strategic location near Mantralaya, the Maharashtra government decided to secure the property for administrative purposes.
The Public Works Department has appointed a legal consultant to supervise the acquisition process and prepare the necessary transaction agreements. After approvals are completed, the Maharashtra government will enter into a formal agreement with AI Assets Holding Limited (AIAHL), the entity responsible for managing Air India’s remaining assets and liabilities.
Officials said the acquisition is being viewed as both an administrative and long-term financial decision. Following the major fire incident at Mantralaya several years ago, multiple government departments were shifted to rented offices across Mumbai. The state government is currently estimated to be spending more than ₹200 crore annually on office rentals for departments operating outside the main administrative headquarters.
Chief Secretary Rajesh Agrawal has reportedly directed officials to expedite the completion of the deal in order to centralise scattered government offices under one location and improve coordination between departments.
The 22-storey Air India Building, constructed in 1974 on state-owned land, was designed by an architectural firm led by noted New York-based architect John Burgee. Once acquired, the tower will provide nearly 46,470 square metres of office space for government operations in South Mumbai’s prime business district.
Government officials believe the acquisition will significantly reduce recurring rental expenditure while also strengthening administrative efficiency by consolidating several departments into a single government-owned complex.
