Govt to Compensate One Constitution Avenue Apartment Buyers

The federal government has decided in principle to compensate apartment owners at Islamabad’s One Constitution Avenue by paying them their original purchase prices, as it seeks to resolve a long-running property dispute tied to a defaulting developer.

A formal announcement is expected after approval from Prime Minister Shehbaz Sharif, according to a report by a national daily.

A high-level committee set up by the prime minister has started reviewing the legal and administrative dimensions of the case, according to a Cabinet Division notification.

The panel is headed by Law Minister Azam Nazeer Tarar and includes Minister of State for Interior Talal Chaudhry, as well as the secretaries of the Cabinet Division and Commerce Division.

The committee has been asked to examine all related cases, hear affected apartment owners and recommend a course of action that addresses grievances while remaining consistent with court orders. It is due to submit its report to the prime minister by May 8.

Pending a final decision, authorities, including the Capital Development Authority, police and district administration, have been told not to take action against residents.

The dispute dates back to 2005, when the Capital Development Authority allotted 13.5 acres to a private developer for the construction of a five-star hotel. The developer secured the lease for Rs. 4.8 billion and took possession after making an initial 15% payment, but later defaulted, triggering years of rescheduling and litigation.

In 2019, Pakistan’s Supreme Court ordered the developer to pay Rs. 17.5 billion to restore the lease. The company has so far paid Rs. 2.9 billion and remains in default on about Rs. 14.5 billion, leading to cancellation of the lease in 2023.

Authorities say the developer also violated the original agreement by constructing 263 residential apartments on the site. Despite public notices warning buyers that the project was under dispute, sales continued.

Only 69 of the 263 apartments are currently occupied, according to officials, while most remain with investors. Of the occupied units, only a small number are being used for permanent residence, with many rented out on a short-term basis.

Following directions from the Islamabad High Court, CDA officials accompanied by police recently issued seven-day eviction notices to occupants.