Nearly two decades after Century Mill shut operations and its workers’ families were left in ageing tenements in Worli, the BMC is set to clear a redevelopment plan that will give them new homes while earning the civic body Rs 1,351 crore from the prime land parcel.

The proposal to redevelop the Century Mill plot is scheduled to be placed before the BMC House on Monday. Under the plan, the 21 existing buildings housing families of erstwhile mill workers will be replaced with modern residential towers. Around 500 flats measuring 300 to 400 sq ft have been earmarked for rehabilitation, while the remaining flats can be sold by the developer at market rates.

The BMC selected Peddar Realty as the successful bidder in May this year. According to a civic official, the developer will pay Rs 1,351 crore to the BMC for the project. The land is currently valued at around Rs 660 crore. The lease is for 30 years and includes a renewal clause under the private participation model.

The existing Century Mill colony comprises 476 tenements and 10 shops across 21 buildings, with the existing homes measuring around 180 sq ft.

“The primary clause of this project is that all the families of the erstwhile mill workers who have been living in these 476 housing tenements should get rehabilitated. The residents will get new houses accompanied with all modern civic amenities,” a civic official said.

The redevelopment had been stuck since 2006, when the mill suspended operations, amid a prolonged legal dispute over ownership and the terms of the original lease.

The land was originally owned by the BMC and leased to Century Spinning and Manufacturing Company in 1927 for 28 years at an annual rent of Re 1 under the Bombay Improvement Trust Transfer Act. The lease expired in 1955, but the BMC did not immediately seek eviction of the mill management.

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The dispute resurfaced after the mill suspended operations in 2006 and the company issued a legal notice to the BMC in 2007 seeking transfer of the land. The Bombay High Court initially ruled in favour of Century Mills. The BMC challenged the order in the Supreme Court, which in January 2025 held that the lease terms did not require the civic body to hand over the land to the company.

The Supreme Court ruling cleared a key legal hurdle for the BMC to proceed with the redevelopment.

Opposition questions valuation

The Congress in the BMC has questioned whether the civic body is getting adequate value from the project.

Congress leader in the civic body Ashraf Azmi, in a letter to Municipal Commissioner Ashwini Bhide, claimed that the land’s development potential under the current Floor Space Index could be worth around Rs 13,000 crore.

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“BMC is giving away a Rs 13,000 crore development opportunity for just around Rs 1,300 crore. After fighting for seven decades to reclaim Century Mill land, the civic body should not now surrender its value. The existing families of mill workers must be rehabilitated first, and Mumbai’s prime land must benefit its people,” Azmi said.

The proposal will now be placed before the civic House for final clearance.