Business Times

Defence Ministry directs Urban Development Authority to probe ‘Chalmers Granary' issue

By Bandula Sirimanna

The Urban Development Authority (UDA) has been directed by the Defence Ministry to immediately probe the claim by Multinational Property Developments Private Ltd (MDPL) of leasing out of 'Chalmers Granary', a nine acre plot of state land for its ‘Chalmers City’ project 17 years ago and submit a report to the Defence Secretary.

This directive has been issued to the Chairman UDA in a letter sent by Additional Secretary to the Ministry R.M.I. Ratnayake recently, UDA sources said. The move is a direct result of last Sunday’s exposure in the Business Times of the claim by the private company after the UDA began calling for other proposals for this land.

Chalmers Granary in Colombo's Fort and Pettah area is now used as a parking lot. The UDA is planning to relocate small shops around the nine acre block, which had been valued at Rs 8 million a square perch by the state valuer.

The new directive has temporarily suspended the UDA call for proposals to lease out the land under its plan for a joint venture commercial development, sources said. MDPL CEO Ranjan Arambawela told the Business Times that his company has not received any response from the UDA even after sending several letters to authorities providing details of their involvement in the project. He noted that the said land was offered, 17 years back, by the UDA to MDPL to carry out a development project of shopping complex and a car park known as ‘Chalmers City’ and the UDA had collected 10% of the lease premium, the legal fees, the stamp fee and the annual ground fee from the company, totalling Rs. 72 million which is still lying with the UDA.

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