Encouraging buyers: Payment period for commercial plots extended

CDA has revised the schedule to facilitate clients.

ISLAMABAD:

After failing to ease the financial crunch the capital’s civic agency is facing from a shortened payment schedule for commercial plots, city managers have extended the payment period from two to nine months.

The decision came following a large number of complaints received from the civic agency’s Finance Wing where buyers of commercial plots in the last two open auctions had failed to submit premium amounts within two months that resulted in the cancellation of several prized plots.

According to the new schedule, successful bids of commercial plots will have to submit 25 per cent of the total cost of the plot within three days after their bid is accepted by the Capital Development Agency (CDA) board. The investor will be liable to pay the remaining 75 per cent in three equal installments of 25 per cent each every three months.



“We were advised by the Finance Wing to revisit the payment schedule. It was because of the shortened schedule, buyers were not taking interest in auctions conducted by the CDA in the past six months,” said CDA Land Director Chaudhry Aslam.

He said investors were facing immense difficulties in submitting amounts running into hundreds of millions in time in accordance with the previous payment schedule. “We expect better results from the extended payment schedule.” This will also encourage healthy competition, he added.

By the end of year 2012, the CDA board had reduced the payment schedule from 18 months to two months. Buyers of commercial plots were asked to submit 25 per cent of total price of the plot within three days and rest of the amount in two installments of 45 per cent and 30 per cent each within two months.



“The highest bid CDA received was Rs644 million for a commercial plot located in the Blue Area during an open auction held in March, but the successful bidders could not adhere to the payment schedule which resulted in cancellation of that plot,” said an official of the Finance Wing. This plot now will now be available in an open auction scheduled for May 21 and 22. Plots no. A-1 and A-2 met the same fate. Both of these plots located in Blue Area were auctioned at first but later had to be cancelled.

The revised payment schedule will be applicable to the auction to be held on May 21. CDA plans to auction 24 commercial plots located in various sectors. The centre of attraction will be a plot measuring 22.21 kanals located in Sector E-11, meant for construction of a five star hotel and conference and exhibition centre. While, plots no 93 and 83 measuring 1.80 acres and 2.60 acres respectively located in Sector H-8 are meant for construction of educational institutes.

Plots in marketplaces of sectors G-9, G-10, G-11, I-8, F-11, F-9/G-9, F-6/G-6 will also be offered for bidding. The plots are designed for construction of filling stations, class-III shopping malls, wedding halls or other commercial ventures.

Published in The Express Tribune, May 15^th, 2013.