Three years on: Twin Towers — LDA’s hunt for investors continues

Authority invited expression of interest twice but failed to find suitable parties to start the project

LAHORE: The Lahore Development Authority (LDA) has failed to attract investors for the construction of its multibillion rupees mega commercial project - Twin Towers.

LDA Chief Engineer Israr Saeed told The Express Tribune that the authority has twice invited expression of interest (EoI) from the prospective companies, but hasn't been able to find suitable parties.

Both the times, only one company expressed interest in the project, but it couldn't meet the set criterion, he said. The authority could accept proposals up to 4.5% higher than the LDA's engineering estimate, but both times it received about 13%higher proposals, he indicated.

He pointed out that now the authority has slightly changed its plan to attract more investors. The project would be built on a private-public partnership model, he said. The authority would participate in the project by providing a 22-kanal commercial plot on the prime location of Jail Road under a deferred sale mode, he added. "The private investor will be responsible for the construction of an international standard commercial plaza."

Responding to a question, Saeed said that if the LDA received a similar cold response from investors again then it would have to change the project plan entirely.

In a recent meeting, LDA Director General Zahid Akhter Zaman said that the authority was trying to initiate construction of this mega project shortly. The project would cost around R3.81 billion.

The Twin Towers is the biggest commercial project of the LDA for which it has been trying to attract investors since 2014. Earlier, the LDA officials were aiming to do groundbreaking of this mega project during the current year, but now their hopes have faded as no investor is currently willing to partner with them on the present terms.

According to the project documents, the LDA wishes to engage the private sector to bring their capital, experience, and expertise in real estate development by entering into a joint venture arrangement for undertaking the development of the high-rise project. The joint venture partner shall be expected to take the lead role in designing, constructing, financing and marketing the proposed project.

The LDA, as the land owner and regulator, shall provide the project land under the joint venture arrangement and play a facilitating role. The LDA also contemplates having an escrow account arrangement to ensure that proceeds from investment or sale, as the case may be, are applied for project development in a transparent manner. The LDA is committed to empowering the private sector partner to take market-based operational and commercial decisions in relation to the project while retaining an oversight and facilitating the role.

The Twin Towers project is aimed at offering ample opportunities for the varied genre, like the retail business, food outlets, residency, offices, showrooms and a large service area. There will be a multiplex cinema, spa centre, and a large rooftop restaurant, featuring the spectacular views of the city.

Published in The Express Tribune, December 24^th, 2017.