Colombo is Sri Lanka's commercial capital and largest city. Its large harbour and strategic position along the East-West sea trade routes made it a historically important location, known to ancient traders 2,000 years ago.
Today, it’s home to a major property development undertaking, as Sri Lanka plans a new urban conurbation and central business district (CBD) as an extension of the existing city of Colombo. This is the single largest private sector development project in Sri Lanka and is intended to boost the economy alongside the country’s existing development plans. Through sustainable urban development, the country hopes to promote itself as a significant business and tourist destination.
The Colombo Port City project requires seabed reclamation of approximately 269 hectares, producing land connected to the Fort district and existing CBD area in central Colombo, and adjacent to Colombo International Container Terminal. This will create 5.65 million m² of gross developable area, to be used for commercial, residential, marina, office, retail, education, medical, hospitality, leisure, cultural, exhibitions and conventions, public parks and beaches.
Through sustainable urban development, the country hopes to promote itself as a significant business and tourist destination.
The private investment for Colombo Port City has come from China, with the China Harbour Engineering Company (CHEC) entering into a Tripartite Agreement with the Ministry of Megapolis and Western Development and Urban Development Authority, to form CHEC Port City Colombo (Private) Limited (CPCC). As master developer, CHEC will undertake all land reclamation and infrastructure works.
The project is benefiting from a multidisciplinary team of economists, urban planners, urban designers, marina designers, and water and coastal engineers from our parent company, Atkins. Faithful+Gould is using our development advisory expertise to ensure the plot division and real estate development are strategically planned, designed, phased and delivered to maximise returns.
We are addressing the significant commercial questions associated with masterplanned communities. There is, of course, pressure for each asset to earn its keep. When forecasting community needs, additional business elements will ideally be embedded within the development mix, to generate further revenue streams. Residential components will benefit from community shopping and healthcare facilities, for example.
Our team is leading the establishment of project development strategies that consider the master plan composition, the return on investment objectives, and the investment constraints. The focus is on achieving the optimum mix of real estate land parcels, in order that sound commercial propositions can be brought to market.
Residential components will benefit from community shopping and healthcare facilities, for example.
It’s also essential that the overall product mix produces a positive lived experience for residents, businesses and tourists, and exists alongside suitable infrastructure and sustainable plans for the future. There are some key signature projects, and we are preparing feasibility studies for these.
Development phasing is especially important to investment returns. Masterplanned communities are often delivered in phases as a result of funding constraints and geo-political drivers, and to progressively respond to market sales. Development sales strategies can be modelled in detail, determining which facilities should be completed first.
We are modelling infrastructure strategies, together with establishing costs for the various options. This will be followed by a fast-track phased programme that allows infrastructure construction to commence closely behind the reclamation works, improving our client’s cashflow by giving early access to sellable land.
CHEC may directly undertake some development, but most plots will be sold to third-party developers. Part of our role is to compile development guidelines for the sale of the plots, balancing best value with the overall sustainable development strategy.
The focus is on achieving the optimum mix of real estate land parcels, in order that sound commercial propositions can be brought to market.
Attracting foreign direct investment is crucial, so it’s important that the plots and subsequent developments are aligned with the needs of global equity funders, end-user occupiers and developers. We are identifying and negotiating with third-party developers, partners and investors, and already there has been significant investor interest from China and India.
Guiding our client into a new business stream is also part of our role, as this is CHEC’s first venture in Sri Lanka. We are using our expertise to ensure they benefit from global best practice in masterplanning and project management, while also eventually achieving the best results from the local construction market.
Faithful+Gould offers comprehensive support to private sector and public sector real estate developers and funds, supporting masterplanning schemes across Asia Pacific and in other parts of the world. We bring a sound understanding of business case planning, program management, urban planning, design and engineering to our clients’ development planning.