The estate management wing had forwarded the summary with the aim of reducing the number of expired lease cases pending with the authority and to retrieve millions of rupees in revenue struck due to non-renewal.
It suggested that the expired leases of commercial properties may also be extended where owners have committed building violations. Such renewals were to be made conditional — the owners would be asked to submit affidavits that they would voluntarily remove or address all building violations on their respective properties within 30-day of renewal of their agreements with the CDA.
The CDA estimates a revenue loss of over Rs2 billion due to non-renewal of lease agreements for nearly 980 commercial properties in Islamabad.
A few days back, after serving notices on these violators, the CDA claimed in press advertisements that it would initiate the cancellation of delinquent agreements. But for reasons unknown, the exercise was called to a halt before even a single property was cancelled. The unknown may include the fact that many of the properties in question are under the control of the high and mighty of the country.
Commercial plots are usually leased out for 33 years, extendable for two similar terms upon expiry. The lease agreements for the majority of commercial properties expired almost a decade ago, but leaseholders have yet to revalidate them, while the authority has yet to take any action against the violators.
Reason for non-renewal
According to insiders, most of the plot owners have built additional structures beyond permissible limits and in violation of the agreements they sign with the authority.
Once additional construction is done on a property, the owners usually avoid contacting the authority for renewal, fearing huge fines for the building violations and possible demolishion of the add-ons.
This can come back to haunt the owners as the fines keep adding up with every passing year, and the authority refuses to issue NOCs, including building control section clearance in the presence of building violations, which are required to transfer property.
Wisdom behind decision
A CDA board member, asking not to be named, spoke in support of the decision, saying that several such relaxations were granted in the past and only proved to be eyewash.
He said there were hundreds of property files with the CDA where such affidavits are attached. “By giving such relaxations, the authority just gives violators a way to sell their properties without any loss or fear of action,” the official said. He added that such practices set bad precedents.
In the backdrop of the board decision, a senior estate management wing official said, the department is reinitiating the process of publishing advertisement in the media asking owners to renew their agreements or face action.
When asked why the authority was not straightforwardly cancelling the agreements on grounds of the lessees’ failure to adhere to renewal requirements, the officer said such a step would bury the CDA in complex litigation.
Major violators
According to CDA records, the owners of 158 agro-farms situated in various schemes across Islamabad hold expired lease agreements, while the agreements for 37 industrial units in Sector I-9 are also expired.
Similarly, 67 industry and trade centres — mostly commercial plazas — are operating with expired lease agreements.
The owners of five commercial plots in the highly-fortified Diplomatic Enclave and of 12 properties in Kahuta Industrial Triangle have also failed to renew their lease agreements.
Published in The Express Tribune, October 3rd, 2014.
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