AP Govt moves to lease Rushikonda palace complex

KIRANMAI TUTIKA | AMARAVATI 

The Andhra Pradesh government has initiated the process of leasing out the ultra-modern palace complex built atop Rushikonda, paving the way for its conversion into a world-class hospitality destination. The Andhra Pradesh Tourism Development Corporation (APTDC) has issued an Expression of Interest (EoI) inviting experienced hospitality and tourism companies to operate and maintain the sprawling complex under the Operation and Maintenance (O&M) model. Interested firms have been asked to submit their proposals by July 10.

The luxury complex, constructed during the previous YSRCP government at an estimated cost of Rs 452 crore, has remained largely unused since the coalition government assumed office. Following a recent inspection by a ministerial committee, the government reportedly concluded that leasing the property to a private operator would be the most viable option for its effective utilisation.

Spread over 9.8 acres, the project comprises five premium blocks equipped with landscaped gardens, internal roads, pedestrian pathways and extensive parking facilities. According to APTDC, the infrastructure is ready for international-standard hospitality operations. The lease package also includes nearly 1,200 square metres of vacant land, while operators will be permitted to construct additional G+1 structures covering up to 4,800 square metres, subject to statutory approvals. The provision is expected to help increase room inventory and enhance commercial viability.

The project has already attracted interest from several leading hospitality brands. Industry sources indicate that representatives from hotel groups such as Taj, Atmosphere Core, The Leela and Fema have inspected the property. Since the existing room inventory may not be sufficient for a full-scale luxury resort, the government has allowed scope for future expansion.

However, any additional construction will have to comply with Coastal Regulation Zone (CRZ) norms, as the property is located close to the Bay of Bengal coastline.

Officials also pointed out that the Tourism Department owns over 70.63 acres in the Rushikonda region, of which 47.4 acres remain vacant, providing long-term potential for integrated tourism development. With the leasing process now underway, the government aims to transform Rushikonda into a premium tourism and hospitality hub, while generating revenue from one of the state’s most debated public infrastructure projects.