Non-Colombo markets to drive Sri Lanka property sector by 2024

A new national plan for the island means it will be the ‘little’ towns steering the island’s real estate into a brighter future

Galle fort, Sri Lanka. X_vini/Shutterstock

Colombo may be the beating, thriving nexus of Sri Lanka, but it certainly does not hold a monopoly on the stream of capital entering the island nation.

From Galle and Hambantota in the south to Nuwara Eliya in the country’s historic highlands, there is almost something for every type of investor or property seeker in this island. Its strategic location in the Indian Ocean, after all, has made it an important fulcrum of maritime policy, with everyone from China and India, even the US, vying for a piece of the action.

Although Colombo is home to 11.3 percent of the total Sri Lankan population, other areas of note in Sri Lanka are coming into their own as legitimate residential real estate markets.

The first-tier cities of Galle, Kandy, Kurunegala, Matara, Hambantota, Jaffna and Trincomalee have seen considerable demand, according to Nirmal de Silva, CEO of Paramount Realty and head judge of this year’s Asia Property Awards (Sri Lanka). “The lower cost of property, continuous improvements to infrastructure, and close proximity to tourist attractions are some of the key demand drivers outside Colombo,” he said.

Demand for tier-II cities will even rise in the next five years, forecasts de Silva. Such cities, including Athurugiriya, Homagama, Ja-Ela, Kadawatha, Kelaniya, Kotte, Malabe, Moratuwa, Panadura, Pannipitiya, Thalawathugoda, and Wattala will be good areas in which to invest because of continuous improvements in infrastructure and facilities.

More: UDA Chairman named 2019 Sri Lanka Real Estate Personality of the Year by PropertyGuru

The National Physical Plan proposes a network of transport infrastructure projects that will change the landscape of the island in the next 30 years. By 2025, for example, Colombo will be connected by expressway to Matara and Hambantota—two of the locations eligible for this year’s Best Residential Development (Southern) prize. A railway is also being planned connecting Polgahawela and Jaffana, a region covered by the accolade for Best Residential Development (North East).

This year’s awards will also honour the best residential developments in central Sri Lanka and even the country’s tourist-friendly neighbour: the Maldives.

Through the auspices of the Urban Development Authority (UDA), the National Physical Plan will fashion Sri Lankan cities into better versions of themselves, mitigating decades of spur-of-the-moment development and a paucity of city-specific urban plans.

“We all fault most of the cities and towns in Sri Lanka for being disorderly and ad-hoc; unpleasant and not conducive for living; non-responsive and not attractive for business; amongst other things,” said Dr. Jagath Munasinghe, chairman of the UDA and director-general of the National Physical Planning Department (NPPD).

“The UDA is now in the process of preparing plans for all urban areas, including Colombo, its metro regions, and other major cities such as Kandy, Galle, Kurunegala, Rathnapura, Anuradhapura, etcetera, where the real estate businesses are mostly concentrated. These plans have adopted a novel approach which I would call ‘pro-development,’ deviating from the conventional regulatory based approach,” added Munasinghe who also won the title of 2019 Sri Lanka Real Estate Personality of the Year.

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The plans include regulatory measures that guide physical developments in appropriate locations. They also give developers a flexible framework around which they can base their projects, with incentives for green building, among others. In recognition of these, Asia Property Awards (Sri Lanka) has opened the categories of Best Green Development and the Special Recognition in Sustainable Development.

“We can expect well-structured and well-facilitated, environmentally sustainable and socially responsible development activities in these locations in the near future,” Munasinghe said.

Do you know of any exemplary real estate development in Sri Lanka, especially those outside Colombo? Nominate them to the 2019 Asia Property Awards (Sri Lanka) until 23 August. Find more details here: https://www.asiapropertyawards.com/award/sri-lanka-property-awards/

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