Mysore/Mysuru: The tender value for leasing Lalitha Mahal Palace Hotel has been fixed at Rs. 3.76 crore, with bidders required to submit an Earnest Money Deposit (EMD) of Rs. 25 lakh.

Under the terms laid down by the Government, the private firm that wins the contract will manage and operate the hotel and pay the State an annual lease amount starting at Rs. 4 crore. The lease amount will increase by 10 percent every year.

Accordingly, the operator must pay Rs. 4 crore in the first year, Rs. 4.40 crore in the second year and Rs. 4.84 crore in the third year, with the amount continuing to rise annually at the same rate.

Only companies that agree to these financial conditions will be considered for the contract to run the hotel. The arrangement is aimed at ensuring the restoration and upkeep of the century-old heritage structure while also generating steady revenue for the State Government.

Sources said some bidders are expected to seek relaxation of certain conditions, particularly the requirement that the successful bidder must have prior experience in hotel operations.

Such requests, if made, will be examined later, and the Government will decide whether any of the conditions need to be relaxed. Officials will also scrutinise the financial strength of the applicants and their compliance with legal requirements before awarding the contract.