ISLAMABAD, Jan 19: The federal civic agency frequently complains about its financial state, but it has leased out a prime commercial property reserved for the establishment of a hotel for peanuts to a five-star hotel.

According to documents made available to Dawn, in December 2012 the Capital Development Authority (CDA) leased out a three-acre plot to Marriott Hotel in sector F-5/1 for Rs1 million for a one-year term from Sept 2012 to Sept 2013.

A letter of the administration division of the CDA stated: “The competent authority has considered your (hotel’s management) request regarding extension of temporary permission to use open space for placement of temporary/removable containers behind Marriott Hotel due to law and order situation for further period of one-year.”

“You are therefore requested to deposit a one-year licence fee with 10 per cent increase amounting Rs10,98,665 in advance through pay order draft in favour of Directorate of Municipal Administration, CDA,” it added.

A CDA official claimed that the 10 per cent increase in cost of lease of the plot was also included in the current extension of the lease.

“The plot is reserved for commercial purposes and its lease on such a cheap rate is a financial dent to the authority,” said an official of the Estate Wing.

The official said currently the sale price of commercial property in F-6 and F-5 area is around Rs300,000 per sq yd while the vacant plot is around 14,520 sq yd (three acres).

“This 14,520 sq yd plot if auctioned on an approximate price of Rs300,000 per sq yd could have easily fetched the authority around Rs4.3 billion,” he claimed.

In another letter, the CDA’s Planning Wing had also noticed multiple violations over the same plot.

In a letter forwarded to the Cabinet Division, a Planning Wing official wrote: “Under the open area permission over the commercial plot of five-star hotel’s southern side of Marriott Hotel, the management of the Marriott Hotel had opened a rear gate (in violation of building by-laws), developed a paved path as well as placed numerous containers and other materials
utilising the commercial plot of hotel for their commercial benefit.”

Another official in the administration department told Dawn that in a number of communications with the top-ranking management of the civic agency, the Planning Wing’s concerns were ignored throughout 2012 and then an extension granted in Dec 2012.

The Planning Wing too in a communication with the Estate Wing had noted: “The planned site of the five-star hotel on the southern side of Marriot Hotel may be immediately auctioned.”

It is pertinent to mention that the matter was also taken up by the Public Accounts Committee (PAC) in May 2012.

However, the authority could not give a reply to the PAC members. The issue wasn’t picked up after that by any forum.

Yasmin Rehman, a PPP legislator and member of the PAC, in her brief statement to Dawn said: “We are concerned over such leases and PAC will scrutinise the lease given to the five-star hotel.”

On the other hand, CDA spokesman Ramzan Sajid claimed that the commercial property rests with the civic agency and it has only issued a licence for a lease of the plot.

“We can ensure vacation of the prime land any time we want,” the spokesman said.

When questioned that the lease extension to Marriott Hotel could create litigation troubles in the future for the CDA, he insisted: “It is state land and we can vacate it any time and this is not a ‘big issue’.”

When asked whether CDA chairman Syed Tahir Shahbaz was aware of the lease since the sale of the five-star plot may have bailed out the authority from its financial troubles, he replied: “We are aware that auction of the five-star plot will benefit CDA
but since the plot was vacant so we leased it to the hotel on a temporary basis.”

He added: “I have no idea Mr Shahbaz is aware of the lease or not.”