Visakhapatnam: Construction of the much-hyped IT Signature Tower at Vizag continues to be in doldrums more than a year after it was planned because of the high cost involved and fears of inability to get proper returns. The state government had called for global tenders for the project but there was no response apparently due to financial considerations. The Signature Tower was planned as an iconic structure on lines of Cyber Towers in Hyderabad that would be the nucleus of the IT sector in the state. The state government, it is learnt, is not sure if it should go ahead with the project.
The revenue model and the proposed high annual lease rentals by the APIIC as well as the doubts over its prospects in a Tier II city with a stiff competition from Hyderabad, seem to have forced prospective agencies to bid for the project. The tower was to be developed under Public-Private-Partnership (PPP) – in design, build, finance, operate and transfer (DBFOT) format. APIIC fixed Rs 386 per sq.m as minimum reserve concession payment of land which translates to '1.25 crore for Phase-I and Rs 2.80 crore for the entire development.
The Special Purpose Company (SPC) was supposed to have entered into a concession agreement with the Authority for a period of eight calendar years or six calendar years post-Commercial Operation Date (COD), whichever is later. After the expiry of the concession period, APIIC and the concessionaire will sign a lease agreement for a period of 30 calendar years. The annual lease rent of '815 per sq. m. of land area plus applicable taxes were to be payable to APIIC for the entire year beginning the commencement of lease period.
“We will take a decision on construction of the IT Signature Tower within a couple of months. Meanwhile, work on the Millennium IT Tower has begun. The building will have three lakh SFT space and will be ready by 2018,” said IT minister Palle Raghunatha Reddy.
