India, Feb. 12 -- A Rs.1,000-crore trophy bungalow is the latest conversation starter in central Delhi's rarefied real estate circles. The sprawling 3.2-acre estate on Bhagwan Das Road, owned by Maharaja Manujendra Shah of Tehri Garhwal, has drawn interest from a Delhi-based businessman with interests in the food and beverage sector. The same buyer was also in advanced discussions to acquire Jawaharlal Nehru's first official residence for almost Rs.1,111 crore, a deal that, if sealed, would reset price expectations in the capital's ultra-luxury market.

Should even one of these transactions close, it would rank among the largest residential deals Delhi has ever seen. Until now, marquee bungalow sales have largely hovered in the Rs.500-600...