A new procurement and regulatory entity is to be established within next three to six months to conduct land sales, handle regulation and development activities of Colombo Port City (CPC), a top government official told Mirror Business.
The first land sale is targeted to be completed towards the latter part of this year, following the president declaring the CPC land as part of Sri Lanka’s territory.
Urban Development Authority (UDA) Chairman Dr. Jagath Munasinghe said that various agencies, including the Legal Draftsman’s Department, Attorney General’s Department and Survey Department, are currently in the process of completing the groundwork for the president to declare CPC as part of Sri Lanka’s territory.
“We have sent the necessary documents to the Legal Draftsman, Attorney General, etc. In addition, the Surveyor General has to confirm the boundary lines of CPC. All these matters are taken care of now as we speak. Once the process is concluded, it will be sent for the president’s signature,” he said.
The land reclamation of CPC concluded last week, adding 269 hectares to Sri Lanka’s landmass.
Surveyor General P.M.P. Udyakntha told Mirror Business that he’s awaiting the request from the relevant authorities to carry out a statutory survey for CPC, to confirm the boundary lines.
He said that the survey could be concluded within two weeks. The Survey Department earlier completed a preliminary survey for the reclamation of CPC.
Following the president’s declaration, Dr. Munasinghe said Megapolis and Western Development Minister Patali Champika Ranawaka would issue a gazette notification declaring CPC as an urban area.
Land Registry Department Registrar General N.C. Vithanage said that the Divisional Secretary or Land Registry itself is likely to register the CPC land in the Land Registry Department. However, he noted that he needs to study the CPC agreement to comment on the procedure.
Following the completion of this lengthy process, the proposed procurement and regulatory entity for CPC is expected to be established.
Though the UDA plans to complete the setting up of the entity within three to six months, Dr. Munasinghe noted that the time period would depend on the efficiency of the state agencies.
The entity, which would be established with the Cabinet approval, will have representations from CHEC Port City Colombo (Pvt.) Ltd, the Sri Lankan company handling the CPC project for China Communications Construction (CCC), the UDA and Megapolis and Western Development Ministry.
Commenting on the proposed special legislation for Colombo International Financial City, which requires the parliamentary approval, Dr. Munasinghe said that setting up of an authority under the proposed special legislation would depend on the legal opinion of the Attorney General.
“The regulatory and tenement laws might differ but again that will be decided by the Attorney General,” he said.
Elaborating on the sales of the CPC land parcels, he said that the entity would strictly adhere to the government tender procedure.
“CHEC Port City Colombo (Pvt.) Ltd can carry on land promotion and advertising. However, at the end, Sri Lanka’s standard procurement has to be followed and the lease agreements will be signed with the Sri Lankan government.”
He noted that the land parcels would be released to the market over the next 10 to 15-year period, one by one, without flooding the market.
The Valuation Department is expected to conduct a valuation for the CPC land blocks, to set a base price for the land plots.
Once the land plots are assessed by the Valuation Department, Dr. Munasinghe said that the proposed entity would call for requests for proposal for the land plots.
“The entity will call for proposals for different land parcels and then there will be competitive tendering and subsequently, the developers will be selected from the competitive tender process.
The successful bidder will be offered the land under certain conditions and on a maximum of a 99-year lease,” he said.
However, he noted that the tender procedure for some land plots could exceed one year under the current procurement rules.
“Once the land parcels are released to the market, we have to give sufficient time for the developers to come up with proposals. They have to prepare the proposal, calculate the cost and have to find the financing sources. Hence, it takes times. That’s why we usually give them three to four months to prepare the proposals and sometimes the preparation of final proposals will take over six months.”
He noted that it could take further two to three months to evaluate these proposals and in addition, these proposals would also have to go through a procurement committee.
Referring to the agreement between the government and CHEC Port City Colombo (Pvt.) Ltd, Dr. Munasinghe said that the land plots, which are leased to CHEC Port City Colombo (Pvt.) Ltd, would commence land sales from this year, while the land plots under the UDA would commence land sales from 2020.
The land plots CHEC Port City Colombo (Pvt.) Ltd wants to develop by itself would be exempted from the tender process. However, those will be subjected to other formalities.
CPC, which is scheduled to be completed by 2040, is expected to attract US $ 15 billion in investments.