SOUTH AFRICA’S SUN CITY TO INVEST $800M IN SRI LANKA TOURISM

South Africa’s Sun City resort will invest $800 million in a tourism project in Sri Lanka, the head of the island nation’s state-run Tourism Board said on Friday.

Sun City resort is run by South African gaming and hotels group Sun International Ltd.

It will be the largest ever investment in the country’s leisure sector, which is booming since the end of a 25-year war.

“Sun City of South Africa is now going to make an $800 million investment in a 200-acre private property,” Nalaka Godahewa, head of the Tourism Board told Reuters in an interview.

The investment will be made on Sri Lanka’s hotel city in Katana, a coastal town located 15 km north of Colombo, he said

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(Source: Ada Derana)

Sri Lanka Repeals 100% Land Tax on Foreigners

The Sri Lankan government is scrapping the 100 percent tax levied on foreigners buying land in that country in favor of a new special land tax to be unveiled in the 2012 budget.

The new tax will remove restrictions on foreigners buying and developing land anywhere in the country, and will also close loopholes which have allowed many foreigners to buy land in Sri Lanka tax free. It is also thought that removing the tax will increase tourism and property sales to foreigners. The overall aim of the decision is to increase the revenues coming into government coffers from the sale of land to foreigners, sources from the Finance Ministry told reporters.

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(Source: The Epoch Times)

Sheraton to build hotel in Sri Lanka's capital Colombo

Sheraton Hotels and Resorts, the largest Starwood Hotels and Resorts Worldwide brand, will build a hotel in the Sri Lankan capital on land originally offered to a Chinese firm, a government official said on Sunday.

The island nation's junior economic minister said the government has completed negotiations with Sheraton to allocate the land, earlier offered to China National Aero Technology Import and Export Corporation (CATIC).

Last month, Sri Lanka annulled a $500 million investment deal with CATIC after it refused to sell the beach front land outright to the state-run Chinese conglomerate as agreed earlier.


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(Source: Daily Mirror)

Dispute with CATIC over Galle Face deal

The Chinese investor in a multifunctional complex near Galle Face Green has refused their advance payment (to the government) after the government‘s policy decision that land will not be sold outright to them.
CATIC or China Aviation Technology Import-Export Corporation has said that instead it would require land on outright purchase terms. It has said it did not favour a 99-year lease for the same property. 
Its demand comes amidst conflicting legal positions taken by the Chinese aircraft manufacturing firm and the government. CATIC has threatened to seek legal relief on the grounds that assurances of an outright sale of land were given to it. It also cites the case of Shangri-La Hotels, a project for which land encompassing the Army grounds has already been given.


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(Source: Sunday Times)

Govt. plans land audit

The Government is planning a comprehensive audit of the country‘s public and privately-held land assets. The public sector property audit will be conducted under the first phase of this initiative. The Ministry of Lands and Land Development will present a paper indicating modalities of a full audit of state and private land covering a wide spectrum of issues including updating of land records; survey, demarcation and protection of lands; efficient use of land; encroachment of land, the extent and reasons thereof, effectiveness of encroachment and removal actions.


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(Source: Sunday Times)

Colombo waterfront lands adjoining Beira Lake up on lease on instalment cum upfront payment

The government is offering prime Colombo land at a mix of an installment cum upfront payment basis for a 99 year lease deal, a top official said. Prime, urban waterfront land adjoining the Beira Lake at D. R. Wijewardena Mawatha, Colombo 10 will be made available for development transforming the area as a leisure and entertainment hub of Colombo.
With basic infrastructure already existing, the terms of allocation of the crown land are long-term or 99 year leases at market value. Nihal Fernando, Director-General, Urban Development Authority (UDA) said that a considerable percentage of the land value has to be paid at the time of assessing the land and the balance should be paid in continuous installments within a period fixed by the (UDA). “ The former UDA head office at D.R. Wijewardena Mawatha which has five acres will also be offered for local or foreign investors for development,” he told a representative audience at a knowledge sharing conference on the role of real property development in an emerging economy in Colombo on Thursday. "The Beira Lake would be dredged and the water would be cleaned along Vauxhall Street to ensure a clean environment," he said.

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(Source: Sunday Times)

Govt accuses opposition of blocking Galle Face Land sale

With the Cabinet having approved the 99-year lease on seven acres of prime land near the Galle Face Green to the China National Aero-Technology and Export-Import Corporation (CATIC), the government valuer has been directed to work out the lease payments, Economic Development Deputy Minister Lakshman Yapa Abeywardana said yesterday. 

He accused the main opposition United National Party (UNP) and the Janatha Vimukthi Peramuna (JVP) of having compelled the government to change its earlier decision to sell the property outright at US$ 94.5 million or at nearly Rs.10 billion and thus having to forego the direct receipt of foreign exchange.

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(Source: Daily Mirror)

Asia Capital's leisure arm to add Wadduwa, Balapitiya beach hotels, 50 rooms

Asia Leisure's, plans to add two new beach properties, one in Wadduwa and the other in Balapitiya, over the next seven to eight months, which will add about 50 more rooms to the company's existing portfolio of hotels, which presently encompasses boutique hotel properties in Nuwara Eliya, Colombo, Balapitiya and Galle.

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(Source: Sunday Times)

South Asia’s biggest construction fair in Colombo next year

Construction Expo 2012 – International Exhibition and Symposium (CE2012), touted as one of the biggest and comprehensive exhibitions on construction in South Asia will be held in June next year at the BMICH, it was announced this week in Colombo. CE 2012 is organized by Ceylon Institute of Builders (CIOB) – the oldest body in construction industry in Sri Lanka together with Lanka Exhibition and Conference Services (Pvt) Ltd (LECS).

At the launch of the forthcoming event, Wimal Weerawansa, Minister of Constructions, Engineering Services, Housing and Common Amenities said that according to the Central Bank the construction industry is now contributing 9 % to the GDP and the growth next year would be 11 %.

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(Source: Sunday Times)

Sri Lankan homes to generate room capacity for tourism industry

Sri Lanka’s home stay concept initiated by the tourism industry is due to be launched next month and expected to generate about 1000-1500 rooms immediately.

Sri Lanka received 654,000 tourists in 2010, which is expected to top 750, 000 this year. In this regard the home stay and bungalow programme is expected to generate about 1000-1500 rooms immediately, a media release states.

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(Source: Sunday Times)

100% land sale tax for foreigners to be scrapped

Sri Lanka will scrap the 100% tax on foreigners buying land, to promote foreign investment and tourism. The Government instead plans to introduce a special land tax in the 2012 budget removing existing barriers in the sale of land to foreigners and foreign companies to develop land in any part of the country. This will bring more revenue to government coffers, Finance Ministry sources said. The new land tax, the amount of which is yet to be finalised, is aimed at preventing the sale of land at inflated prices to foreign buyers, making huge profits completely tax free and thereby cheating the government of revenue while also breaking immigration laws. Whenever there’s a prohibitive tax in place, foreign investors find a way around it and Sri Lanka is no exception, a senior official of the Finance Ministry, said More>>  (Source: Sunday Times)

Revised Galle Face deal offered to Chinese firm

Outright purchase changed to 99-year lease, but questions over CATIC’s acceptance

The Cabinet has now given approval for a 99-year lease of seven acres of prime land near Galle Face Green to China National Aero Technology and Export Corporation (CATIC). This is after reversing an earlier decision for the outright sale of the land for around US dollars 125 million (or about Rs 13.7 billion). It is not immediately clear whether CATIC — China’s aircraft manufacturing and marketing firm — would accept the offer or demand that its money be refunded. CATIC is learnt to have already remitted to the Treasury the amount involved. More>> (Source: Sunday Times)

Sanken, JKH JV on 240-room business hotel in Colombo

John Keells Holdings (JKH) plans to develop a total of 1000 rooms of the business-leisure segment in Colombo and, as part of this strategy, has joined up with developer Sanken Lanka Pvt Ltd to build a business hotel in Colombo.

The duo are investing in a 25 storey, 240-room business hotel worth Rs 2.9 billion in the heart of Colombo, with Sanken being the major shareholder and JKH having a minority stake while Keells Hotel Management Services will be the hotel operator, according to a JKH statement.

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(Source: Sunday Times)

SRI LANKA THE CHEAPEST PLACE IN THE WORLD TO BUILD

Sri Lanka and India are tied as the cheapest countries in which to build with construction costs estimated to be 72% cheaper than the UK baseline, according to one consultancy group study. 

The current economy plays a significant role, but analysts contend supply chains and other logistical issues faced by these countries also act to raise costs. 

Sri Lanka was also the cheapest country in the 2010 edition of the report with the cost of construction just 27% of the UK.

 

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(Source: Adaderana)

Jaffna's property prices surge as peace returns

Selvarajah Ragunathan greets me warmly at his Jaffna home. His face is kindly but furrowed with sadness.

He lost his brother and sister in the early years of the civil war, more than 20 years ago.
Like many others, he left his rural home when the army took over the land.
He worked for years in the Gulf but could not save much. Now he rents this place in the city - a quite spacious house with a garden, where he lives with his wife and their 21-month-old son, Adchayan.

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(Source: BBC)

CID probes big frauds in house and property deals

The Criminal Investigations Department (CID) has assigned a team to track down racketeers behind illegal house or land transactions, a senior officer said. The probe comes on a directive from Defence Secretary Gotabaya Rajapaksa amidst an increasing number of complaints, some of which he had received personally.

The CID will probe cases of persons illegally acquiring houses on forged documents, cases of driving out the owners by force, extorting money from owners of houses and cases of selling or mortgaging lands owned by others, the officer said.

Among the victims have been persons who have migrated few years ago and returned recently.
Complaints could be made by calling 011-2320141 -5. Fax – 0112380380.


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(Source: Sunday Times)

Sri Lanka Aitken Spence plans eastern resort

Sri Lanka's Aitken Spence group, which runs resorts in Maldives, India and Oman is in talks with two international chains to find a joint venture partner to build a 100 million dollar leisure complex in the island's east coast, an official said.
The complex will be made up of two hotels, residential villas and entertainment facilities. One hotel will be built by Aitken Spence under its flagship 'Heritance' brand and the second will be built by the joint venture partner.
The group owns 108 acres of beachfront property in Nilaveli in Sri Lanka's eastern coast.

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(Source: LBO)

Sri Lanka: International property developers eyeing Colombo’s prominent land

Sri Lanka’s one of the premier properties located in Colombo, owned by a family run listed company is likely to be developed as a mixed development project, a Colombo stock market analyst said.
It is anticipated by market sources that several international Real estate developing companies are eyeing to develop one of Colombo’s premier properties; freehold land at 41, W.A.D. Ramanayake Mawatha to be developed as a commercial and a residential project.

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(Source: Asian Tribune)

First ever 7 star property to commence business in 2012

Lanka’s first ever 7 star leisure property, the much awaited unique “Isle of Agnes” brain child of PJ Group Chairman Prasanna Jayewardene hopes to open for business next year.
“It will be one of a kind and aspires to be so on an international level” says PJ Group official Amara Galagoda. “ Though they will miss fellow creator of ‘The Elephant Corridor Hotel’ Susanne Filippin who is now settled in her native Europe, our chairman hotelier with 40 years of experience in 10 countries still has the other co-creator of  ‘Elephant Corridor’ Anton Jacob who has vast International experience with him on this project as well” she said.

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(Source: Daily Mirror)

Plan for luxury city suspended

Cabinet committee to review project amidst fears over possible loss of Galle Face

The US$ 700 million Chinese-backed 500 acre project to create a new city on reclaimed land from the sea overlooking the Galle Face Green, exclusively revealed in The Sunday Times last week, has been suspended. A high-ranking source said yesterday that the move followed a “high-level” order and added that the matter would now go for scrutiny before the standard Cabinet Appointed Review Committee. “They will determine whether or not the project proposal should be accepted by the Cabinet,” the source said. The move, the source pointed out, was the direct result of revelations made in the Sunday Times. The source declined to comment on who had issued the suspension order or whether other proposals, if any, would be subjected to Cabinet scrutiny. More>> (Source: Sunday Times)

Sri Lanka seeks developers for prime property

Sri Lanka is searching for a buyer for a block of prime beach front land adjacent to two that are slated to be among the largest real-estate cum hotel developments to start in the country after the end of a 30-year war, officials said.
"The land is still available," deputy economic development minister Lakshman Abeywardene said. Sri Lanka sold 10 acres of land to Hong Kong based Shangri La for 125 million US dollars in the 'Galle Face' beach front, shifting military installations that occupied the land.
Another 10 acres of land were given to CATIC, a Chinese defence contractor, for 136.5 million dollars, Abeywardene said. The two investors are expected to build 500 million dollar mixed hotel, shopping and apartment complexes.

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(Source: LBO)

Careful when buying land - Minister

Minister of Lands and Land Development, Janaka Bandara Tennakoon today warned people asking them to be extra careful when buying lands in certain districts. He added that there were a lot of Government lands in the below mentioned Districts and that he was made to aware of a racket where state lands were being sold.

The Minister added that the racketeers were showing fake deeds to entice buyers.  

The Districts are Puttalam, Anuradhapura, Rathnapura, Moneragala, Nuwaraeliya, Ampara, Trincomalee and Hambantota.

(Source: Ada Derana)

Sale and no more land leases for foreigners

Legislation is being introduced to remove existing legal impediments in the sale of land to foreigners and foreign companies to develop state land in major towns occupied by people illegally. These people are now being evicted, government officials said. The current system of levying a 100% tax on land transfers to foreigners will be removed by introducing a special land tax in order to prevent the sale of land at inflated prices to foreign buyers, making huge profits completely tax free and thereby cheating the government of revenue while also breaking immigration laws.  Under the present system, a foreigner or a foreign company can buy tax-free land if their investment for the whole project is over US$10 million. Foreigners are now allowed to own land in Sri Lanka with some restrictions. The purpose of this 100% tax is to discourage foreigners acquiring properties in Sri Lanka. However a joint venture company incorporated in Sri Lanka (with foreign participation) is not liable to pay that tax. Furthermore the condominium units of residential or non-residential accommodation on or above the 6th floor of a registered condominium apartment constructed with the approval of the UDA are exempt from such 100% tax, the Finance Ministry official said. More>> (Source: Sunday Times)

Chinese to build luxury port city off Galle Face

Govt gets US$ 700 million offer for 500-acres of sea land

China which has been increasingly involved in Sri Lanka’s economy, has secured another lucrative deal — creating a new 500-acre, port city on reclaimed land on the sea off the Galle Face Green. A top Government source, who declined to be named due to the sensitivity of the deal, said the government had agreed to the US$700 million offer from a Chinese investor. The offer has been channelled through Chinese authorities. The Sri Lanka Ports Authority will oversee the reclamation project which will be divided into three segments -- business, residential and leisure. A mini-golf course, a Formula One race track, a small yacht marina and areas for water sports will be created. The feasibility study and an environmental impact assessment conducted by the Sri Lanka Ports Authority and the Moratuwa University have been completed. More>> (Source: Sunday Times)

Eastern destinations to propel Sri Lankan tourism growth

Several hotel projects and tourism-related infrastructure are fast coming up in Eastern Sri Lanka, once ravaged by war, to propel the country to surpass its last year's tourist arrivals by a wide margin.
East Sri Lanka has some of the best beaches in Trincomalee (Uppuveli beach) and Batticaloa (Pasikuda), and off Ampara (Arugam Bay). In Pasikuda alone, 14 new hotel projects are coming up, with a total capacity of 1,000 rooms. Most projects have a gestation period of just over a year. The first one off the block, Maalu Maalu (meaning fish), has just opened for business.

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(Source: The Hindu)

Defence Secretary reveals Greater Colombo development plan

About 70,000 families identified as shanty or slum dwellers in the city of Colombo would be relocated within the next two years in high-rise community housing units that are to be developed for them within the city, Defence Secretary Gotabaya Rajapaksa said.
Mr. Rajapaksa revealed this and several other development plans that are underway in Colombo, while addressing the American Chamber of Commerce last Monday on “Development Plans for the City of Colombo.”

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(Source: Sunday Times)

Sri Lanka to construct new Colombo Port City at a cost of US$ 300 million

Under a presidential directive, the Sri Lankan government is to reclaim between 300-400 acres of sea land between the Colombo South Port Development project and the Galle Face Green in order to build a Port City at a cost of US$ 300 million.
The proposed offshore city, to be divided into three segments- business, residential and leisure, will be developed into a modern city with high rises, hotels, residential apartments, shopping malls, and other space to cater to the public needs.

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(Source: Colombopage)

Overseas Realty to start Havelock City’s Phase - 3 next year

Overseas Realty (Ceylon) PLC (ORC) will start Phase – 3 of its Havelock City Project (HCP) early next year to be completed within three years, according to officials. “This will encompass three towers, with an additional 405 residential units,” Pravir Samarasinghe, Group CEO ORC, who took up his appointment mid this month, told the Business Times.
Literally the ‘new kid on the block’ at the World Trade Centre (WTC) which ORC owns, Mr. Samarasinghe said that HCP’s Phase - 2 has been very encouraging and has seen 25% of its apartments snapped up within February when it was launched.

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(Source: Sunday Times)

Two islands leased out

Two islands near Kalpitiya have been leased out at Rs. 18 million to two foreign companies for investment in tourism for 30 years, Parliament   was informed today.

Of them, Vellai Island has been given on lease at Rs. 3.7 million to be developed as a joint investment between Sri Lanka and Maldives and Switzerland, and Inpativu Island at Rs. 14 million to an Indian company named Cube Leisure Property Private Ltd. The joint venture with Maldives and Switzerland is called Sun Resort Investment Lanka Private Ltd.

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(Source: Daily Mirror)

GOVT. PLANNING LAND RECLAMATION FROM GALLE FACE-WELLAWATTE

A feasibility report is being conducted for land reclamation by way of extending the coastline from Galle Face to Wellawatte by 300-400 acres, Deputy Minister of Ports and HighwaysRohitha Abeygunawardena today revealed in parliament.

 In a document submitted to parliament the Deputy Minister revealed that this will be done as a part of restructuring the commercial hub of Sri Lanka. The Government is looking at how to alleviate the inconveniences caused by ill-planned roads and badly constructed building in Colombo.

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(Source: Ada Derana)

Govt. says many offers to manage Hilton Hotel

The Government has been inundated by offers from top international chains to manage the Hilton Hotel in Colombo following the announcement last Wednesday that the property is now solely Sri Lankan owned. A Finance Ministry source said that the hotel is seen as a good, exclusive property in post-war Sri Lanka where tourism is growing fast.
“Many top chains have expressed interest,” the source said. Economic Development Minister Basil Rajapaksa announced in Parliament that the land had been taken over due to failure by Cornel & Co., which leased the land from the Urban Development Authority (UDA) and sub-let it to Hotel Developers Lanka Ltd (HDL), to pay lease rental.

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(Source: Sunday Times)

Chinese aircraft firm also gets Galle Face land

Gotabaya says billions from three hotel developers will be used for security forces headquarters

A Chinese aircraft manufacturing company will be the second of three successful bidders for star class hotels to be built on the area around the Galle Face Green to be vacated by the Ministry of Defence and Army Headquarters, Defence Secretary Gotabaya Rajapaksa told the Sunday Times. This follows the sale of a six-acre property to build a multifunction complex comprising a classy hotel and a shopping mall, adjoining another six-acre property where the Shangri-La hotel chain is putting up a hotel complex. Mr. Rajapaksa said the money raised from the sale of these properties would go largely to fund the construction of a state-of-the-art headquarters for the three military services, the Army, the Navy and the Air Force and the Ministry of Defence at Mattegoda. More>> (Source: Sunday Times)

Mega hotel on Cargills property?

CT Holding PLC, which controls retail giant Cargills, is raising a total of Rs 2.6 billion through a private placement and a rights issue with part of these funds going into a mega development in the Cargills property in Fort which would include an exclusive, upmarket hotel, market sources said.
Cargills officials including its Deputy Chairman Ranjit Page were not immediately available for comment but the sources said the funds from this capital infusion would be used for a development project at Cargills in Fort that would change the character of the area into a ‘touristic walkabout’.

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(Source: Sunday Times)

LankaPropertyWeb house price index updated

LankaPropertyWeb.com, Sri Lanka's leading property portal has updated it's housing price index with the latest property prices for the month of January.

The house price index can be viewed here

(Source: LankaPropertyWeb.com) 

New land powers for Def. Min.

Statutory body must approve any filling or development in Western Province

Developing or filling land in the districts of Colombo, Kalutara and Gampaha will henceforth require approval from a statutory body coming under the Ministry of Defence. New regulations to compel landowners to obtain the approval of the Sri Lanka Land Reclamation and Development Corporation (SLRDC) were gazetted last week. President Mahinda Rajapaksa, in his capacity as Minister of Defence, promulgated them. They have come in the form of a “Correction Paper” to regulations gazetted earlier by Dinesh Gunawardena, Minister of Urban Development and Sacred Areas Development. More >> (Source: Sunday Times)

Another big hotel project in Colombo

The government is to launch another hotel project in Colombo Fort, taking over the former Dutch Hospital (Transworks Building) opposite the one time Central Telegraph Office, a senior official of the Urban Development Authority said.
The adjoining car park and a land bordering Chatham Street and Hospital Street in Fort have also been identified for a tourist entertainment venue as part of the project, the official said.
“The former Dutch Hospital will be turned into a hotel in a manner that the ancient structure remains and the archeological value is preserved,” he said without disclosing details about the investors of the project.

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(Source: Sunday Times)

No big names for Kalpitiya, Govt. may issue fresh bids

The Sri Lankan government may issue fresh bids for Kalpitiya Integrated Tourism Resort Project (KITRP) in the hope of attracting meaty investors, as they are ‘not too happy with those who have been chosen’ to develop 10 islands in Kalpitiya in the Puttalam District, according to government sources.
“There are about 11 investors who applied to invest around US$ 500 million to put up tourist resorts, golf courses, marinas, etc in this zone which was defined as a tourist zone by the Sri Lanka Tourism Authority, but the government is not happy with the bids which have mainly come from Indian parties,” one source told the Business Times.

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(Source: Sunday Times)

New port city being built at $450 mln cost

The present capacity of the port is 4.5 million TEUs and this is expected to increase to 4.8 million units in 2011, said Sri Lanka Ports Authority Chairman, Dr. Priyath B. Wickram. Dr Wickrama said, “As a part of the overall expansion a modern port city is to be constructed at an estimated cost of $450 million.” This will also function as a commercial centre, with the project commencing in March this year. Further an ultra modern cargo village will be constructed at Peliyagoda which will be advantages to both the transport and logistics industries.

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(Source: Sunday Times)

World's 5th tallest Colombo's Lotus Tower to begin work next month

The final Bill Of Quantities (BOQ) of the proposed Colombo TV tower project is now being finalized.

The Telecommunication Regulatory Commission of Sri Lanka (TRCSL) expects to start construction work of the tower next month.

The 350-metre tower in Peliyagoda will be constructed with an investment of US $ 103 million. This Lotus Tower will be the latest in the country with seven levels, TRCSL Director General Anusha Palpita told Daily News Business.

The tower is scheduled to be completed within 30 months and will be managed by a public company owned by the TRCSL.

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(Source: Daily News)

Shangri-La lays down its grand plans for Sri Lanka

Plans to open a new hotel in Colombo in 2014 and 300-key resort in Hambanthota

Hong Kong-based Shangri-La Asia Limited yesterday officially announced the purchase of six acres of Government land facing the Galle Face Green promenade, a prominent landmark in Colombo, Sri Lanka.
The development will be a multi-use complex with high end retailing, deluxe apartments and a 500-key luxury hotel to open in early 2014 and the purchase marks the entry of the hotel group into Sri Lanka, often referred to as 'The Pearl of the Indian Ocean', a statement by the hotel chain said.
Shangri La is also planning to develop a second property, a 300-key city resort on approximately 100 acres of land in Hambantota, on the southern coast of Sri Lanka to open in 2013.

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(Source: Daily Mirror)