Tenants exploiting Evacuee Trust’s lower property rents

Government body has failed to implement new lease policies introduced in the past

LAHORE:

Even though the unprecedented levels of inflation have raised the market rates of most rental properties, those of the properties owned by the Evacuee Trust Property Board (ETPB) and the Punjab Auqaf Organization, remain unreasonably low.

The ETPB is endowed with the responsibility of overlooking the administration and lease of properties holding educational, charitable or religious significance, which were left behind by Hindus and Sikhs, upon their migration to India, and the Punjab Auqaf Organization overlooks the maintenance of mosques and shrines.

According to sources privy to the information, both governmental bodies combined own a number of residential and commercial properties at the Mall Road in Lahore, including 3500 acres of land and 3000 rental units, but for each of these properties they collect rents worth Rs 8,000 to Rs 10,000 per month only; whereas the market rent for similar sized properties nearby starts from Rs 50,000 per month.

Consequently, many tenants have started taking advantage of this rental rate differential by demanding high rents from sub-lessees but paying next to nothing in rent to the trust property departments.

As a resident, Muhammad Awais, living in an ETPB residential property confirmed to The Express Tribune, “even though the ETPB claims its rental rates are lower, since the past five years, I have been paying Rs 30,000 per month as rent to my tenant.” Awais further said that he had recently found out that the tenant who had rented the property from the ETPB at a lower rate, had since long passed away, and now his sons were the ones demanding a higher rent from him. “But obviously they are only giving a miniscule share of the rent to the department.”

When quizzed about the fraudulent behaviour of the tenants, the Chairman of the ETPB board, Habib-ur-Rehman Gilani, informed that the department was aware of the fraud. “We realised the corrupt property dealings of the tenants much earlier, and had even approved a higher rent policy in 2006, but widespread dissent among the tenants prevented it from being put into practice,” regretted Gilani. The tenants had objected to the 8 per cent per year increase in rents and since the past 17 years, most were not paying the revised rents, leading to arrears in revenue collection, according to Gilani.

“Our current collection of rents amounts to almost Rs 650 million, however we feel it would have been much higher if rents concurrent with the market rates had been respected and paid fully by tenants,” complained Gilani.

Concurring with Gilani, the Secretary of the Punjab Auqaf Organization, Dr Tahir Raza Bukhari, cited the reason behind the trust property board setting low rents for their properties in the first place: “The older tenants were rented out properties at this low rate in order to expand our network of residential units. However, since many years the lease policy has been revised but tenants are reluctant to oblige by it.”

Hence, similar to the ETPB case, Punjab Auqaf Board’s attempts at increasing the rental rates up to the level of the market rates in 2020, were met with resistance. “Despite the tenants’ disapproval, we are trying to ensure that at least 70 per cent of the tenants follow the higher rents policy, which might boost the total revenue of our department by Rs 350 million,” remarked Dr. Bukhari.

Published in The Express Tribune, April 25^th, 2023.