Sri Lanka’s Urban Development Authority targets Rs. 1 billion from 20 land leases
The Morning: The Urban Development Authority (UDA) of Sri Lanka is aiming to secure a total target of Rs. 1 billion by 31 December 2022 by leasing out 20 State-owned lands for potential investors, both international and local, The Sunday Morning Business learns.
A senior UDA official, who wished to remain anonymous, confirmed that even amidst the potential economic crisis and uncertainty in the market, the UDA would successfully be able to fulfil the Rs. 1 billion target as the 20 proposed State-owned lands were on schedule for attracting potential investors.
“At the moment, we have 20 lands without any issues. We have already received the approvals for each property and based on that we can release the land according to the Government rules and regulations. Right now, we are waiting for potential investors who could be local, international, Public-Private Partnerships (PPP), Joint Ventures, or direct acquisitions,” the official highlighted.
The official noted that it was crucial for the UDA to get the expected revised revenue target of Rs. 1 billion from the initial target of Rs. 2 billion for 2022, as the Treasury had completely stopped funding the Authority, leaving it dependent on itself to function.
However, the official refused to divulge information on land names, base value, and expected leasing date.
Three global companies – ESR, Jones Lang LaSalle (JLL), and Apollo Hospitals India signed Memoranda of Understanding (MoUs) with UDA for investment purposes, earlier this year.
The same senior UDA official, speaking to us in March, said: “From the 52 lands identified for investment purposes on a 99-year lease basis, five to six lands have been confirmed and MoUs have been signed. For the remaining lands, we notice a rise in inquiries from potential investors as they are willing to come and develop their concept with us.”
According to UDA Acting Deputy Director-General of Real Estate and Land Development E.A.C. Priyashantha, the lands that had not been utilised by the UDA had been identified for development projects as they could generate income.
He stated that Colombo City would be developed as a commercial and tourist destination parallel to the Colombo Port City, and the office complexes in the city centre would be shifted towards Kotte and Battaramulla.
He also noted that the older buildings situated in the heart of Colombo would be developed under the Heritage Building Development Plan and those buildings would not be demolished as they must be preserved.
Published newspaper advertisements listed seven valuable plots of land around the country for investment projects on a 99-year lease basis, including three land plots on D.R. Wijewardena Mawatha. The identified lands included the Sri Lanka Exhibition and Convention Centre (SLECC), the People’s Bank Queens Branch, and the Sathosa Warehouse Complex.
The base value of the SLECC land is Rs. 3.7 billion, the base value of the People’s Bank Queens Branch land is Rs. 1.3 billion, and the base value of the Sathosa Warehouse Complex land is Rs. 1.6 billion.
In addition to the UDA investment projects, properties including the Grand Oriental Hotel, York Building, Gaffoor Building, General Post Office, Cey-Nor Seafood Restaurant near the Lotus Tower, Waters Edge, Hilton Colombo, and Grand Hyatt Colombo located in the vicinity of the Colombo Port City, as well as the International Coordination Centre in Kankesanthurai, Jaffna have been earmarked for development purposes under Selendiva Investments.
The properties would be developed under three investment portfolios, namely, ‘Heritage Square in Colombo Fort,’ ‘Real Estate Development,’ and ‘State-Owned Hospitality Sector’.
The restructuring and revamping of unutilised or underutilised state lands and assets as revenue generation methods has also been undertaken by the government of Sri Lanka under its ongoing development programme. Sri Lanka is working towards the target of placing the country as a growing business destination in the South Asian region. The country’s geographical positioning in the Indian Ocean and the many trade agreements as well as concessions enjoyed by the country have also helped boost Sri Lanka’s expanding opportunities. Given the increasing business potential in Sri Lanka, foreign businesses/investors could explore the expanding opportunities in Sri Lanka.
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