The reserve price of these properties, mostly residential units, ranged from ₹16 lakh to about ₹8 crore and were located in cities such as Mumbai, Delhi, Pune, Bengaluru, Chennai and Kolkata.

“The high reserve prices for the properties were not in tune with current market conditions and was the primary reason for the lacklustre response. Less than 10 units were actually sold at the end," said the first of the two people cited above, a senior Air India official.

The auction oversight committee would meet soon to decide if some of the properties were to be re-auctioned, said the second person requesting anonymity.

The money-losing airline had put up for sale a plot that has 14 flats with a total built-up area of 2,030 sq. m in Pali Hill, an upscale neighbourhood in Mumbai.

Properties located in other prominent parts of the city, including Mahim, Bandra, Prabha Devi, Colaba and Khar, were also on the block. Similarly, the airline had offered five flats at New Delhi’s Asian Games Village complex, a flat at Chennai’s Besant Nagar and 10 flats at Kolkata’s Golf Green area, for sale.

An Air India spokesperson didn’t respond to Mint’ s queries till press time.

The airline has generated about ₹450 crore from the sale of properties since 2012, when the government announced a turnaround plan for the debt-ridden national carrier, said the second person.

Properties that remained unsold in the April auction would be put on the block again in a few months, according to Air India employees handling the auction process.

Prices of some of the properties, especially those in tier I cities, are very high because they are located in prime locations, say real estate consultants.

“The fact that many of the assets the airline owns are in prime locations does not help, as any ‘discount’ on such prominent assets would set benchmarks that other commercial asset owners in these localities would not react well to, as a lower reserve price would affect the market value of similar assets," said a Mumbai-based property consultant on condition of anonymity.

“There are also smaller assets owned by the airline such as residential quarters for staff," the consultant said. “However, interested buyers may also hope that the government, which owns the airline, will bundle these assets as an added incentive if and when it makes a final decision to sell off the airline. So far, the interest in buying the airline’s real estate assets has been far from spectacular."

Meanwhile, the government plans to raise up to ₹10,000 crore by selling Air India’s subsidiaries and other assets, including real estate, to repay part of the carrier’s debt of ₹29,000 crore that the government had taken over from the airline, reports said earlier in May.

The airline had earlier set a target of ₹500 crore through the sale of land assets in FY19.

“We haven’t quite met the target set for FY 19 through sale of land assets, though we were successful in selling some real estate assets," said the senior Air India official cited earlier. “But a lot of properties that were earlier entangled in legal issues and couldn’t be put on the block have now been sorted. Almost all title deeds for our real estate meant to be put on the block are in place."

The official did not elaborate on the amount raised from selling real estate assets in FY19. The official added that Air India expected to raise an additional ₹500 crore from the sale of real estate assets in FY20.