Daily Times

ISLAMABAD: The interest of real estate investors have been increased in the auction of commercial plots by Capital Development Authority (CDA) due to massive drive against non-conforming use of residential sectors and easiest way of payment, whereas the real estate investors and property consultants believe that CDA received bids more than market price for its commercial plots in recent auction.

CDA officials and property giants claimed that the recent auction of commercial plots located in different Marakiz of Islamabad has received tremendous response by the investors as 22 out of total 28 plots went on a high price than market rate. The authority has successfully earned 4.6 billion rupees through this auction.

A real estate consultant told the Daily Times that the civic authority has overall received a positive response against the commercial plots. “In recent auction a commercial plot in D-12 Markaz has gone on the price of Rs. 300,000 per square yard, whereas a plots of similar nature was sold out in last auction on Rs. 270,000 per square yard”, he maintained.

“A Plot in I-12 Markaz has auctioned at Rs. 145,000/- per square yard, whereas two plots in same sector were auctioned at the rate of 135000 per square yard and 134,000 per square yard in last auction respectively, which was held in October 2015” the consultant revealed.

A real estate investor on the condition of anonymity has stated that the CDA’s easiest way of payment against auction plots is the main reason behind high rates as in open market nobody can take a time of one year for payment, but same remedy is available through CDA auction. “Investors give high bids as they know they will collect the money from the pocket of small investors, who purchased shops and apartments from them”, he added.

“It is a routine that investor first bid in auction and takes a plot by paying down payment. He announced a project on the site without paying full amount to the authority than he collect money from common citizen by selling his project in the air and submit remaining amount to the CDA, whereas in open market it is not possible as you need to pay full amount at the time of the purchase of plot,” another investor said by adding; “In some cases even the investors go into the courts and use stay orders as a delaying tactic to avoid payment.”

A large number of property consultants believe that CDA’s drive against non-conforming use of residential buildings is one of the core reasons behind the investors’ interest in commercial plots. The offices, restaurants and other businesses are now forced to move their setup in commercial buildings, which ultimately enhanced the worth and rents of commercial properties in federal capital.

Malik Azhar Kursheed, Director Estate Management CDA while talking to the Daily Times said, “Yes, the campaign against non-confirming use of residential premises is one of the several reasons behind the investors’ interest in authority’s auction of commercial plots, but the core factor is a breakup of nexus between property dealers and few black sheep of the authority”.

Najam Rafique, who owns a real estate consultancy firm with his name in the capital has said; “The rent of commercial properties went up because of CDA’s drive against non-conforming use as the demand of space in commercial buildings is high now days.