Supply is set to overtake demand at the high end of Sri Lanka’s residential property market, with a series of large-scale projects under way in and around Colombo.
The supply of luxury apartments in the commercial capital could reach 6000 units by 2018-19, according to a recent report by the Research Intelligence Unit (RIU), up from 783 in 2009 and 2657 this year.
Potential for oversupply
Several residential projects are expected to be completed in the years head, including John Keells Holdings’s $850m Cinnamon Life waterfront project, which is billed as the largest private sector investment in the country, according to the company’s website. The 4.5m-sq-foot integrated resort is scheduled for completion in 2018 and will include an 800-room hotel, apartment and office complexes, a convention centre and a shopping mall.
Colombo’s Havelock City mixed-use development is also expanding, investing some $130m to add another four residential towers and nearly 650 units. Other luxury residential projects, such as the Astoria luxury condominium development, two 194-metre Shangri La residential towers and the 240-metre Altair skyscraper, will further add to stock in the city.
Though sales are steady, the increase in the supply of top-end residential units in the capital could outstrip existing demand. “In the premium residential segment, insufficient demand will be a problem,” Pravir Samarasinghe, CEO of Overseas Realty (Ceylon) – the company developing Havelock City – told OBG. “There is a maximum offtake of 500 units a year in Colombo, and there are probably, Read More>>
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