Harshini PERERA
There are many condominiums to be redeveloped in the city of Colombo but developers are reluctant to redevelop them. Here a condominium in Colombo 2 in dire need of refurbishment. Picture by Saliya Rupasinghe
There are many condominiums to be redeveloped in the city of Colombo but developers are reluctant to redevelop them, said the General Manager, Condominium Management Authority, (CMA) G. U. Upawansa.
He said that developers are keen on constructing new condominiums because redevelopment brings fewer prospects for them. The CMA has issued 84 completion certificates for condominium projects during the first eight months of this year. Of them 60 were issued for condominiums less than 10 apartments.
A single developer was issued a semi condominium certificate which is under construction. Construction work on new condominiums increased since July this year and a growth is expected in the coming six months, he said.
He said that forty-one condominiums were constructed within the Colombo city limits while 26 condominiums were constructed in Dehiwala and Mt.Lavinia. Three condominiums were constructed in Kandy.
Construction of condominiums in Sri Lanka dropped in the first eight months this year.
Thus it could be due to the global economic crisis and uncertainty that prevailed during the period. Many developers may go to Jaffna and other war-torn areas to construct condominiums in the future, he said.
Along with the drop in construction, redevelopment too has dropped but it is expected to pick up by the end of this year, he said.
Wednesday, September 2, 2009
Weak Bond Sri Lanka cement firm hit by construction slump
17 Aug, 2009 12:20:37
(LBO) - Sri Lanka's Tokyo Cement Company group said it made a loss of 56 million rupees in the June 2009 quarter compared with a 212 million rupee profit a year ago.
Sales fell 18 percent to 3.2 billion rupees in the quarter from a year ago owing to a slump in construction caused by economic slowdown, the company said in a stock exchange filing.
"The drop in sales is due to continuing sluggishness in the construction industry," the company, a joint venture between Mitsui Mining Company, the largest coal-mining company in Japan, and the local St. Anthony's Consolidated, said.
But it said short-term prospects were better as the 30-year war in the north and east has ended with government forces defeating the Tamil Tigers in May which is seen as reviving economic growth.
"Sales are likely to improve with the revival of the construction industry and opening of the roads to the north," the company statement said.
A new clinker grinding mill commissioned in the eastern port of Trincomalee where it has its plant is geared to meet the anticipated increase in demand.
Tokyo Cement attributed the June quarter loss also to an increase in depreciation charges following the commissioning of the new mill and a biomass power plant.
It said there was an "appreciable increase" in interest due to financing of the new mill and the biomass power plant costing about five billion rupees.
(LBO) - Sri Lanka's Tokyo Cement Company group said it made a loss of 56 million rupees in the June 2009 quarter compared with a 212 million rupee profit a year ago.
Sales fell 18 percent to 3.2 billion rupees in the quarter from a year ago owing to a slump in construction caused by economic slowdown, the company said in a stock exchange filing.
"The drop in sales is due to continuing sluggishness in the construction industry," the company, a joint venture between Mitsui Mining Company, the largest coal-mining company in Japan, and the local St. Anthony's Consolidated, said.
But it said short-term prospects were better as the 30-year war in the north and east has ended with government forces defeating the Tamil Tigers in May which is seen as reviving economic growth.
"Sales are likely to improve with the revival of the construction industry and opening of the roads to the north," the company statement said.
A new clinker grinding mill commissioned in the eastern port of Trincomalee where it has its plant is geared to meet the anticipated increase in demand.
Tokyo Cement attributed the June quarter loss also to an increase in depreciation charges following the commissioning of the new mill and a biomass power plant.
It said there was an "appreciable increase" in interest due to financing of the new mill and the biomass power plant costing about five billion rupees.
Excon - Sri Lanka Construction exhibition
Excon - Sri Lanka exhibition will be the region's largest trade fair on Construction Equipments & Construction Technology. Excon - Sri Lanka will be held at Bandaranaike Memorial International Conference Hall (BMICH) from 30 Oct to 01 Nov 2009. Manufacturers of Construction Equipments & related components will attract the Contractors, Defence, Leasing & Finance Companies, Machinery & Equipment Dealers.
http://www.biztradeshows.com/trade-events/excon-srilanka.html
http://www.biztradeshows.com/trade-events/excon-srilanka.html
Visiting British parliamentarian proposes a 'Sri Lanka Construction Fund'
Sat, Aug 29, 2009, 07:32 pm SL Time, ColomboPage News Desk, Sri Lanka.
Aug 29, Colombo: Visiting British Conservative Party shadow Defence Secretary Dr. Liam Fox has discussed the modalities of a fund proposed to rebuild Sri Lanka with the Sri Lankan Foreign Minister Rohitha Bogollagama.
In a meeting with the FM at the Foreign Ministry yesterday, the British parliamentarian has reiterated his proposal of a 'Sri Lanka Construction Fund', made during his last visit to Sri Lanka in March 2009.
The British MP reiterated during his meeting his view that only constructive involvement with the Government of Sri Lanka could help the victims of terrorism, while continued lecturing by some members of the international community benefited no one.
http://www.colombopage.com/archive_091/Aug1251554569CH.html
Aug 29, Colombo: Visiting British Conservative Party shadow Defence Secretary Dr. Liam Fox has discussed the modalities of a fund proposed to rebuild Sri Lanka with the Sri Lankan Foreign Minister Rohitha Bogollagama.
In a meeting with the FM at the Foreign Ministry yesterday, the British parliamentarian has reiterated his proposal of a 'Sri Lanka Construction Fund', made during his last visit to Sri Lanka in March 2009.
The British MP reiterated during his meeting his view that only constructive involvement with the Government of Sri Lanka could help the victims of terrorism, while continued lecturing by some members of the international community benefited no one.
http://www.colombopage.com/archive_091/Aug1251554569CH.html
Time To Join Hands To Uplift the Construction Sector Economy
An Introduction to the Chamber of Construction Industry, Sri Lanka
By. Ranjith Dayaratne
It is not unfair to say that recently the construction sector Economy of Sri Lanka has faced a severe and unprecedented downfall. Reasons for this are of course manifold. The world was undeniably heading for a recession and the events of the September 11th in USA have made it a nightmare for the world economy. Sri Lankan economy has been on a slippery road for the past decade or so emanating from the extra-ordinary expenditure of war efforts, loss of preparedness to harness the benefits of the open economy and globalisation and indeed, the general sense of hopelessness that has gripped the Nation in an alarming atmosphere of growing corruption, petty politics and misguided economic policies and misadventures.
http://www.buildsrilanka.com/ccisl/IntrobyRD.htm
By. Ranjith Dayaratne
It is not unfair to say that recently the construction sector Economy of Sri Lanka has faced a severe and unprecedented downfall. Reasons for this are of course manifold. The world was undeniably heading for a recession and the events of the September 11th in USA have made it a nightmare for the world economy. Sri Lankan economy has been on a slippery road for the past decade or so emanating from the extra-ordinary expenditure of war efforts, loss of preparedness to harness the benefits of the open economy and globalisation and indeed, the general sense of hopelessness that has gripped the Nation in an alarming atmosphere of growing corruption, petty politics and misguided economic policies and misadventures.
http://www.buildsrilanka.com/ccisl/IntrobyRD.htm
Tuesday, September 1, 2009
Monday, August 24, 2009- Sri Lanka opens doors to foreign investors
SRI Lanka is calling on foreign investments to pump prime its economy which had been ripped by over 30 years of civil war.
State Corp (Pvt) Ltd (SCorp) managing director and chief executive officer Keerthi Sri Weerasinghe said there are over US$70 billion (RM246 billion) worth of jobs available in construction, infrastructure and tourism.
Keerthi, who is chairman of the Coconut Development Authority under the Ministry of Plantation Industries said there are also contracts to be undertaken in mineral mining and housing.
"Because of the war, we could not undertake a lot of developments. Many buildings, roads and bridges were ruined during that time. We are now opening doors for investors to come in and develop the country for us," Keerthi told Business Times in an interview in Kuala Lumpur recently.
The present government has introduced a 10-year economic development policy the "Mahinda Chintana" where the focus is to steer investments to vital sectors such as agriculture and infrastructure development to pump up the economy.
Bilateral investment agreements, supported by a constitutional guarantee, provide strong protection to investors in Sri Lanka. Such an agreement exist between Sri Lanka and Malaysia.
Keerthi said a few Malaysian firms have made successful foray into the country and the situation was viable for new players to come in now.
Malaysia remains the largest investor in the country, mainly in telecommunications, infrastructure and property development.
Companies such as Dialog Telekom plc, a unit of TM International Bhd, MTD Construction Sdn Bhd and HeiTech Padu Bhd had ventured into Sri Lanka despite the war.
"We are an open economy and the government is interested to invite investors in oil and gas (O&G) and agriculture. We have identified six sites in north-west and south of Sri Lanka for O&G activities. We are also looking to revive a cement factory which had been shut down during the war and are calling for interested parties to bid," Keerthi said.
Keerthi said the Indian and Chinese governments, and the International Monetary Fund would lend their support financially while building materials were readily available for use.
By Business Times (by Sharen Kaur)
Posted by Kimberg at 5:29 PM
Labels: Sri Lanka
State Corp (Pvt) Ltd (SCorp) managing director and chief executive officer Keerthi Sri Weerasinghe said there are over US$70 billion (RM246 billion) worth of jobs available in construction, infrastructure and tourism.
Keerthi, who is chairman of the Coconut Development Authority under the Ministry of Plantation Industries said there are also contracts to be undertaken in mineral mining and housing.
"Because of the war, we could not undertake a lot of developments. Many buildings, roads and bridges were ruined during that time. We are now opening doors for investors to come in and develop the country for us," Keerthi told Business Times in an interview in Kuala Lumpur recently.
The present government has introduced a 10-year economic development policy the "Mahinda Chintana" where the focus is to steer investments to vital sectors such as agriculture and infrastructure development to pump up the economy.
Bilateral investment agreements, supported by a constitutional guarantee, provide strong protection to investors in Sri Lanka. Such an agreement exist between Sri Lanka and Malaysia.
Keerthi said a few Malaysian firms have made successful foray into the country and the situation was viable for new players to come in now.
Malaysia remains the largest investor in the country, mainly in telecommunications, infrastructure and property development.
Companies such as Dialog Telekom plc, a unit of TM International Bhd, MTD Construction Sdn Bhd and HeiTech Padu Bhd had ventured into Sri Lanka despite the war.
"We are an open economy and the government is interested to invite investors in oil and gas (O&G) and agriculture. We have identified six sites in north-west and south of Sri Lanka for O&G activities. We are also looking to revive a cement factory which had been shut down during the war and are calling for interested parties to bid," Keerthi said.
Keerthi said the Indian and Chinese governments, and the International Monetary Fund would lend their support financially while building materials were readily available for use.
By Business Times (by Sharen Kaur)
Posted by Kimberg at 5:29 PM
Labels: Sri Lanka
Sri Lanka`s biggest Real Estate Company confirms that bubble has burst Friday, 6 March 2009 - 1:59 PM SL Time
Sri Lanka`s biggest Real Estate Company is Overseas Realty (Ceylon) Ltd. It owns the Colombo World Trade Centre twin towers, and is building the massive Havelock City Project (shown in the photo, adjoining the Wellawatte canal).
The blurb for Havelock City reads, `Havelock City is the single largest mixed-use real estate development project to be undertaken in Sri Lanka. The residential component of Havelock City would comprise 8 towers with the first phase of 226 apartments already under construction. It will have all modern conveniences that would be expected of any international development of this magnitude. The commercial component would comprise a large shopping mall with department stores, a hypermarket, a multiplex cinema, numerous shops, cafes and restaurants.`
On the 5th of March, Overseas Realty (Ceylon) Ltd. (ORCL) said it is finding it difficult to sell apartments in a new high-rise condominium complex being built in the Sri Lankan capital Colombo due to the economic crisis. S P Tao, head of Singapore`s Shing Kwan group, said, ``The global financial crisis has had a direct impact on the progress of sales of condominium units in the Havelock City project. Significant demand was expected from the Sri Lankan diaspora overseas. However, given the dire and still uncertain economic situation prevailing, compounded by devalued currencies, potential buyers have deferred their investment decisions.`
The project`s first phase consisting of 226 apartments in two residential blocks is scheduled to be completed by June 2009.
Source(s)
http://www.property-report.com/property-news-top-stories.php?id=2366&date=050309
The blurb for Havelock City reads, `Havelock City is the single largest mixed-use real estate development project to be undertaken in Sri Lanka. The residential component of Havelock City would comprise 8 towers with the first phase of 226 apartments already under construction. It will have all modern conveniences that would be expected of any international development of this magnitude. The commercial component would comprise a large shopping mall with department stores, a hypermarket, a multiplex cinema, numerous shops, cafes and restaurants.`
On the 5th of March, Overseas Realty (Ceylon) Ltd. (ORCL) said it is finding it difficult to sell apartments in a new high-rise condominium complex being built in the Sri Lankan capital Colombo due to the economic crisis. S P Tao, head of Singapore`s Shing Kwan group, said, ``The global financial crisis has had a direct impact on the progress of sales of condominium units in the Havelock City project. Significant demand was expected from the Sri Lankan diaspora overseas. However, given the dire and still uncertain economic situation prevailing, compounded by devalued currencies, potential buyers have deferred their investment decisions.`
The project`s first phase consisting of 226 apartments in two residential blocks is scheduled to be completed by June 2009.
Source(s)
http://www.property-report.com/property-news-top-stories.php?id=2366&date=050309
SRI LANKA PROPERTY FIRM HIT BY FALLING PRICES Mon. June 01, 2009; Posted: 02:30 AM
COLOMBO, Jun 01, 2009 (AsiaPulse via COMTEX) -- EQY | Quote | Chart | News | PowerRating -- The real estate arm of Sri Lanka's Carsons Cumberbatch group said it was writing down the values of properties by 450.3 million rupees (US$3.9 million) as the prices slumped in the wake of tight monetary policy.
"This year has been a challenging year where we saw a significant market correction on the property prices as a result of tighter credit conditions and a change in investor and customer attitude on real estate," Equity One Ltd, a Carsons property firm said in a statement.
"The property values have reflected changes in interest rates and risk.
"Unrest in the financial markets and uncertainty in the wider economy have added to the crisis of the property market."
Under 'fair value' accounting rules - which permit asset values to be brought into a firm's profit and loss account whether or not they are actually sold and cash received - many companies have reported high profits in boom years.
But when central bank monetary policy tightens (money printing slows) and interest rates go, up asset-price inflation can reverse.
The 'fair value' concept goes against a time honoured accounting convention, based on historical cost.
Critics have said that fair value accounting is excessively 'pro-cyclical' and helped worsen the recent asset-price bubble in the world by bloating profits of banks and other firms when the Federal Reserve cut rates to one percent and fired the worst global 'boom' since the 1970s.
When central bank loose monetary policy fires asset-price bubbles, managers who wake the next day find that the asset values of their companies have gone up. After monetary policy reverses, the opposite happens.
"Having evaluated the current market conditions the company decided to defer in the interim, all of our property development activities and convert project lands which were earlier held for development, into land bank status," Equity One said.
"This resulted in bringing these lands to current market values in accordance with the accounting standards."
Equity one said it had cut the values land held by the unit Equity Property Developers (Private) Ltd by 258.6 million rupees, Equity Nine (Private) Ltd by 177.6 million and Equity Developers (Private) Ltd by 14.1 million rupees.
But the firm said other investment properties had seen an 82.5 million increase in value.
Equity One reported a loss of 365.9 million rupees for March quarter against a 382,000 rupee profit last year.
Equity Two, another Carsons firm reported a loss of 89.3 million rupees with a 90.0 million rupee write-down in investment properties.
Inflation Accounting
Inflation accounting, or current cost accounting, was widely discussed during the last century, as major central banks undermined gold-based money to help governments fight wars by printing money.
Historical cost accounting re-gained relevance again during the great depression in the 1930s, as prices fell in a deflationary collapse, like now.
In the 1970s after the US dollar broke its final link with gold and inflation raged around the world, accountants came up with formal inflation accounting standards including Britain's SSAP 16 and the USA's, FAS 33.
But the practice lost favour especially after inflation moderated in the 1980s with tight monetary policy by then US Federal Reserve chairman Paul Volcker.
There is currently an international standard on hyperinflation (IAS29) to be used in countries when central banks fail completely to issue a stable form of money and prices rocket in an uncontrolled fashion.
Critics say 'fair value' accounting is a back-door re-emergence of inflation accounting triggered by a bubble fired during the Greenspan-Bernanke years, which ended with the collapse of global markets last year.
Under a pure gold standard - before the emergence of 'fiat paper money central banking' - there was no significant long-term inflation in the world but only periods of slight inflation followed by periods of deflation.
When central banks issue stable money, wage earners manage to preserve the purchasing power of their salaries and the homeless are able to buy houses at affordable prices. Speculators make money during bubbles.
(LBO)
For full details on Equity One Inc (EQY) click here. Equity One Inc (EQY) has Short Term PowerRatings of 6. Details on Equity One Inc (EQY) Short Term PowerRatings is available at This Link.
"This year has been a challenging year where we saw a significant market correction on the property prices as a result of tighter credit conditions and a change in investor and customer attitude on real estate," Equity One Ltd, a Carsons property firm said in a statement.
"The property values have reflected changes in interest rates and risk.
"Unrest in the financial markets and uncertainty in the wider economy have added to the crisis of the property market."
Under 'fair value' accounting rules - which permit asset values to be brought into a firm's profit and loss account whether or not they are actually sold and cash received - many companies have reported high profits in boom years.
But when central bank monetary policy tightens (money printing slows) and interest rates go, up asset-price inflation can reverse.
The 'fair value' concept goes against a time honoured accounting convention, based on historical cost.
Critics have said that fair value accounting is excessively 'pro-cyclical' and helped worsen the recent asset-price bubble in the world by bloating profits of banks and other firms when the Federal Reserve cut rates to one percent and fired the worst global 'boom' since the 1970s.
When central bank loose monetary policy fires asset-price bubbles, managers who wake the next day find that the asset values of their companies have gone up. After monetary policy reverses, the opposite happens.
"Having evaluated the current market conditions the company decided to defer in the interim, all of our property development activities and convert project lands which were earlier held for development, into land bank status," Equity One said.
"This resulted in bringing these lands to current market values in accordance with the accounting standards."
Equity one said it had cut the values land held by the unit Equity Property Developers (Private) Ltd by 258.6 million rupees, Equity Nine (Private) Ltd by 177.6 million and Equity Developers (Private) Ltd by 14.1 million rupees.
But the firm said other investment properties had seen an 82.5 million increase in value.
Equity One reported a loss of 365.9 million rupees for March quarter against a 382,000 rupee profit last year.
Equity Two, another Carsons firm reported a loss of 89.3 million rupees with a 90.0 million rupee write-down in investment properties.
Inflation Accounting
Inflation accounting, or current cost accounting, was widely discussed during the last century, as major central banks undermined gold-based money to help governments fight wars by printing money.
Historical cost accounting re-gained relevance again during the great depression in the 1930s, as prices fell in a deflationary collapse, like now.
In the 1970s after the US dollar broke its final link with gold and inflation raged around the world, accountants came up with formal inflation accounting standards including Britain's SSAP 16 and the USA's, FAS 33.
But the practice lost favour especially after inflation moderated in the 1980s with tight monetary policy by then US Federal Reserve chairman Paul Volcker.
There is currently an international standard on hyperinflation (IAS29) to be used in countries when central banks fail completely to issue a stable form of money and prices rocket in an uncontrolled fashion.
Critics say 'fair value' accounting is a back-door re-emergence of inflation accounting triggered by a bubble fired during the Greenspan-Bernanke years, which ended with the collapse of global markets last year.
Under a pure gold standard - before the emergence of 'fiat paper money central banking' - there was no significant long-term inflation in the world but only periods of slight inflation followed by periods of deflation.
When central banks issue stable money, wage earners manage to preserve the purchasing power of their salaries and the homeless are able to buy houses at affordable prices. Speculators make money during bubbles.
(LBO)
For full details on Equity One Inc (EQY) click here. Equity One Inc (EQY) has Short Term PowerRatings of 6. Details on Equity One Inc (EQY) Short Term PowerRatings is available at This Link.
Property Project -Sri Lanka property eyed by Indian developer after war: report
Aug 19, 2009 (LBO) - India's Puravankara Projects, a Bangalore-based developer is looking to start an upmarket housing project after a civil war ended, an Indian media report said, though the property market in the island is in the doldrums.
India's Economic Times newspaper said three year ago Puravankara had picked up some land in Sri Lanka "for a song" and was now seeking planning permission from authorities.Puravanka was planning a 400,000 square feet serviced apartment and office complex and an up market "villa project" on the road to Colombo airport on a 26-acre site.
A 30-year war with Tamil Tiger separatists ended in March."With the civil war over, we are seeing huge demand for affordable housing in Colombo," Puravankara chairman Ravi Puravankara was quoted as saying in the report."We have already initiated the land acquisition process."
Sri Lanka's property bubble burst nearly two years ago and a few unfinished apartment blocks dot a few of the capital's plushest locations.A large property and finance focused business group in the island also ran into trouble in the downturn and many of its directors have been jailed pending repayments of deposits.
The report said Puravankara's Sri Lanka move comes at a time when Bangalore itself is seeing a slow recovery after three quarters of depressed buying sentiment.After a two year break it had launched an affordable housing scheme in Chennai.
India's Economic Times newspaper said three year ago Puravankara had picked up some land in Sri Lanka "for a song" and was now seeking planning permission from authorities.Puravanka was planning a 400,000 square feet serviced apartment and office complex and an up market "villa project" on the road to Colombo airport on a 26-acre site.
A 30-year war with Tamil Tiger separatists ended in March."With the civil war over, we are seeing huge demand for affordable housing in Colombo," Puravankara chairman Ravi Puravankara was quoted as saying in the report."We have already initiated the land acquisition process."
Sri Lanka's property bubble burst nearly two years ago and a few unfinished apartment blocks dot a few of the capital's plushest locations.A large property and finance focused business group in the island also ran into trouble in the downturn and many of its directors have been jailed pending repayments of deposits.
The report said Puravankara's Sri Lanka move comes at a time when Bangalore itself is seeing a slow recovery after three quarters of depressed buying sentiment.After a two year break it had launched an affordable housing scheme in Chennai.
Sri Lanka government to build an administrative complex in the South
Sun, Aug 30, 2009, 11:30 pm SL Time, ColomboPage News Desk, Sri Lanka.
Sri Lankan government is planning to construct an administrative complex for government institutions in the South.
The complex, expected to be completed by November will house a large number of government organizations that will come under the Hambantota harbor, government media unit said.The complex, built at a cost of 2.9 billion rupees on a 72-acre land in Siribopura, Gonnoruwa in Hambantota will also house the offices that ate to be demolished for the construction of the port.
Media Minister Laksman Yapa Abeywardena said the complex will be convenient to the people as they can get all their needs met at one location. The government plans to provide transport and other facilities for the people who come to this complex. Accordingly, 42 Government institutions will be housed in this administrative complex including banks, post offices, Local Government institutions, libraries, electricity depots, telecommunication offices and others.
A special committee to resolve land problems in Eastern Sri Lanka
Mon, Aug 31, 2009, 08:20 pm SL Time, ColomboPage News Desk, Sri Lanka.
Sri Lanka Government has appointed a special committee to resolve the long standing dispute between Eastern Muslims and Tamils over the 1,000 of acres of paddy fields in Vakarai.
The Government Information Department announced that the special committee will be headed by the Minister for Disaster Relief Services Amir Ali Sahabdeen and Eastern Provincial Council Chief Minister Sivanesathurai Chandrakanthan.The committee comprising 14 members is to submit its initial report within two weeks.
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