Govt. urged not to sell prime property in Colombo to highest bidder

By Chandeepa Wettasinghe 
The Sri Lankan government should stop selling land in Colombo to the highest bidder, and instead learn from the Berlin experience on holistic urban development, a German real estate and urban development expert told a forum in Colombo, this week.

“If the value of the city is growing, you have a lot of problems because of affordability of commercial space and affordability of residential space within the city areas and around the city areas. 

The (Berlin) government now is not selling anything (land) anymore,” Belius GmbH Managing Partner Andreas Kruger told the first chapter of the Cinnamon Life Forum held at the Taj Samudra Hoteld on Monday. 

After outlining that the presence of a wide array of restaurants, art galleries and other creative and leisure spaces for all to enjoy are essential for a vibrant city, Kruger was questioned on how creative individuals in Colombo could afford to develop them, when the Sri Lankan government was selling its land to the highest bidder.

There are currently over 220 acres of state land in central Colombo awaiting development.
The Sri Lankan government has been selling or leasing out these lands at highly inflated prices to foreign property developers to build hotels and mixed development projects.

This has resulted in the value of real estate in Colombo skyrocketing over the past several years, making affordable housing unviable within the city. Kruger said that in Berlin, the government stopped opting for competitive bids to sell land based on price, and instead started bids to ascertain the best concept that would fit into a particular block of land, and gave it out on lease. The high rise, high value property projects are built on private property, which is valued on commercial terms, Kruger said.

However, to make affordable housing available within the city, the Berlin government is even buying privately held land, he added.

“The mixture is the answer to the question. You have very valuable pieces of land with very high-end development, and beside it, you need to take care that you are more user related, and more, let’s say city environment related,” Kruger said.

Kruger said that Colombo could learn a lot from Berlin, since post-war Colombo is at a similar stage of development as Berlin was 28 years ago, after the fall of the Berlin wall.