However, this move to reduce debt and cut interest costs may not be easy, caution experts.

India’s oldest airline is surviving on a Rs.30,000 crore government bailout package approved in April 2012. The airline, which had a total debt of Rs.40,000 crore as of 31 March, is expected to turn around by 2018-19. Air India is expected to post a loss of Rs.3,900 crore for the year ended 31 March 2014, numbers for which have not been disclosed. It posted a loss of Rs.5,100 crore in 2012-13 and Rs.7,100 crore in the preceding fiscal year.

“Selling real estate properties is one among three plans suggested by the government to turn around the airline. Real estate monetization is critical as it would save at least Rs.300 crore in terms of interest as the airline has plans to use these proceeds to settle a part of high-cost loans,” said one of the executives cited above.

The executive said that Air India, which may sell properties in the three cities shortly, is also planning to raise some rupee bonds and sell some planes to retire debt.

To be sure, the airline had formulated a plan to monetize assets worth Rs.5,000 crore by March 2016. But it failed to sell any assets citing delay in receiving various approvals. In January 2013, Air India appointed real estate consultant DTZ International Property Advisors Pvt. Ltd to help it monetize the assets.

“There are still buyers in the market who are looking to invest in buying land because they are available at fair market valuations,” said Rajeev Bairathi, executive director, capital transactions group, at property advisory Knight Frank India. “In the last two to three years, a number of corporates who haven’t got adequate cash flows from their core businesses have divested real estate assets to raise capital,” Bairathi added.

In December, Sahara Group, which is trying to sell some of its real estate assets, sold a 185-acre plot in Gurgaon for Rs.1,211 crore to realty firm M3M India Pvt. Ltd. This was the biggest among the company’s four land sales.

In March, 2014, Oberoi Realty Ltd emerged as the highest bidder for Tata Steel Ltd’s 25-acre land parcel in suburban Mumbai’s Borivali, offering Rs.1,155 crore in an e-auction.

The Air India is also proposing to sell properties including its office and reservations building at the airport and staff housing quarters in Vasant Vihar, all in New Delhi, and staff housing quarters in Navi Mumbai and Chennai. The company is also planning to monetize its properties in Hong Kong, Nairobi, Mauritius, London and Tokyo.

“It may not be easy for Air India to sell its assets because they have a mixed bag of assets, including apartments, and not all are clear land parcels. While there is demand for clean titled land parcels, there may not be many takers for other kinds of properties in a slowdown scenario,” said a property consultant familiar with the development, who didn’t wish to be named.

The second Air India executive admitted that Air India is trying to regularize title deeds of several other real estate properties. “Once we get title deeds perfected, we will be able to realize Rs.5,000 crore from real estate assets,” the executive said.

Air India has already rented out most floors of its iconic headquarters at Nariman Point in Mumbai.

“Air India is expecting to get at least Rs.88 crore for Sterling Apartments in Mumbai, while the Anna Salai plot in Chennai is likely to fetch Rs.108 crore. Our Coimbatore plot should fetch Rs.20 crore. The majority of money should come from overseas properties,” the second Air India executive said.