The government has announced plans to convert the controversial One Constitution Avenue project in Islamabad into a five-star hotel within the next few months. Interior Minister Mohsin Naqvi said the federal cabinet had approved a joint investigation team (JIT) report into alleged irregularities surrounding the development, allowing authorities to move forward with taking legal possession of the property and restoring its original purpose.
Addressing a press conference in Islamabad on Wednesday, Naqvi said the government intended to approach a major international hotel chain to operate the building. He expressed confidence that an agreement could be reached soon, highlighting the shortage of quality hotel accommodation in the federal capital.
“We will make every effort to convert this building into a five-star hotel within the next few months, which was its original purpose,” the interior minister said.
Government Moves to Restore Original Purpose
The One Constitution Avenue project was initially approved as a five-star hotel with serviced apartments. However, the development later became controversial after apartments were sold to private buyers, reportedly in violation of the project’s approved purpose.
Naqvi said the Capital Development Authority (CDA) already held possession of the building in its official records. However, the federal cabinet’s approval of the JIT findings had provided the legal basis for the government to proceed.
He added that the CDA’s member administration would immediately take responsibility for managing the property’s affairs. The government’s priority, he said, was to make the hotel operational as quickly as possible.
Naqvi also assured affected investors that those eligible for compensation under the investigation’s recommendations would receive their payments.
JIT Report Identifies Serious Irregularities
Planning Minister Ahsan Iqbal, speaking alongside Information Minister Attaullah Tarar and Minister of State Talal Chaudhry, outlined the investigation’s findings.
According to Iqbal, the JIT identified several alleged irregularities in the project’s bidding, approval and leasing processes. These included manipulation of the bidding procedure, unauthorised relaxation of development rules and questionable documentation.
The report found that the initial auction had been cancelled without approval from the CDA Board. A subsequent auction was then conducted under revised conditions. Restrictions involving building height, covered area and parking requirements were also reportedly relaxed without the board’s authorisation.
Another major concern involved the sale of 254 apartments through 99-year sub-leases, despite the property’s original approval as a hotel with serviced apartments.
The JIT also questioned the lease agreement awarded to a private company, noting that the successful bidder had been a four-member consortium and the company was not among its members. The removal of a bank guarantee requirement shortly before the agreement was signed was another issue highlighted in the report.
The inquiry further raised concerns about allegedly forged signatures and irregular registration of lease documents.
Individuals Named in Investigation
Iqbal said the JIT had identified Abdul Hafeez Sheikh as the alleged mastermind behind the irregularities. Several former CDA officials and other individuals were also named in the report.
These included Kamran Lashari, Dr Faisal Awan, Azhar Ali Chaudhry, Brigadier Nusrat Ullah and the late Rai Nawaz Kharal.
The planning minister said Sheikh’s company had been blacklisted from future public-sector projects. He added that the government had directed the National Accountability Bureau (NAB) to investigate the roles of individuals allegedly involved in or facilitating the irregularities.
Information Minister Attaullah Tarar confirmed that Sheikh’s name had been placed on the Exit Control List (ECL). He said NAB would conduct its investigation on merit.
The government has also recommended a fresh and transparent auction process, digitisation of CDA records and institutional reforms to prevent similar controversies in future development projects.
Buyers to Receive Refunds with Interest
Protecting genuine investors is another important part of the government’s proposed response to the One Constitution Avenue project controversy.
Talal Chaudhry said affected buyers would receive refunds of their principal investments along with interest calculated according to the Karachi Interbank Offered Rate (KIBOR).
The JIT report recommends that the CDA compensate genuine buyers, potentially through KIBOR-based interest or an inflation adjustment. It noted that the authority had collected fees from investors before later disclaiming responsibility.
Chaudhry also said NAB would be required to file a reference against those found responsible within three months. He added that several individuals had failed to appear despite repeated summons, including former prime minister and PTI founder Imran Khan.
The government’s immediate focus is to establish legal control, transfer management responsibilities to the CDA and begin arrangements with an international hotel operator.
The One Constitution Avenue project has remained controversial for nearly two decades, making its proposed conversion a significant development for Islamabad’s property and hospitality sectors.
The JIT has also recommended installing appropriate fire-safety equipment and improving CDA procedures. These measures will be important if the building is to operate as a hotel and meet the required safety standards.
While the government’s announcement outlines a clear direction, the success of the plan will depend on transparent implementation, timely compensation for genuine buyers and accountability through the ongoing NAB investigation. Restoring the building’s original purpose could also help address Islamabad’s shortage of hotel accommodation, provided the legal and administrative issues are resolved.
