Tata’s Rs.10bn mixed development project likely to begin construction next year

• Tata plans construct 15 to 30-floor two towers 
• Completes Rs.7bn resettlement project in Slave Island 

By Nishel Fernando
Tata Housing Development Company, the real-estate arm of India’s Tata Group and a wholly-owned subsidiary of Tata Sons, plans to commence construction of its proposed mixed development project, Colombo Square, next year following the completion of resettlement project last week.

With a delay of over one year, the Rs.7 billion resettlement project, Metro Homes, was completed last week and was handed over to the residents. 

Tata Housing and Urban Development Authority (UDA) at a ceremony graced by Prime Minister Ranil Wickremesinghe handed over the housing units to around 626 families and fully developed commercial spaces to around 114 shop owners last week. 

The UDA in 2014 leased an eight-acre land in Slave Island to construct a multi-storeyed building complex as a re-development and mixed development project, which included resettling the existing community in a residential complex with improved infrastructure.

Around 2-3 acres of the land was allocated for resettlement while the remaining 5 acres, which include several historical buildings, were allocated for the proposed mixed development project.  

However, UDA Chairman Dr. Jagath Munasinghe told Mirror Business that the project was delayed by over one year due to unforeseen problems, which were caused by the lack of prior studies.

“For an example, there was a drainage line running across the site, which was not known to anyone at the time. The project company only realized it, once the project commenced.  Therefore, the drainage line had to be shifted and it took around 4-6 months,” he said.

Similarly, Tata Housing also had to replace several power lines and water lines which ran across the project site, leading to an over one year delay. 

The UDA officials noted that the agreement was signed in a rush in absence of prior studies, which led to the unexpected delay. 

With regard to the mixed development project, Tata Housing has completed a conceptual design and plans to submit the detailed design this year to UDA to obtain the development permit.
Dr. Munasinghe revealed that Tata has indicated to invest around Rs.10 billion in the mixed development project with construction commencing towards the latter part of next year. 
According to the conceptual design, Tata plans to build 15 to 30-floor two towers and a podium, which includes designated retail, office, recreational spaces and 
luxury residences. 

He noted that Tata also plans to integrate the Soysa building in Slave Island as an integral part of the mixed development project by converting and re-constructing the heritage building. 
After reviewing the agreement with the local investment firm of Tata Housing, Colombo Project (Private) Ltd, the government in 2017 granted an income tax holiday for 10 years and tax exemption for six years to the firm. 

Dr. Munasinghe said that once Tata Housing receives the development permit, the proposed mixed development project has to be completed within a three-year period.