COLOMBO, May 6 (Xinhua) -- Sri Lanka has the potential to position itself as a stronger regional real estate destination, but policy stability, transparency, project delivery, and investor confidence will determine how far the sector can go, industry leaders said at a forum hosted by a Sri Lanka-based consultancy firm Research Intelligence Unit on Tuesday.
Speakers noted that Sri Lanka's property prices per square foot remain lower than many comparable developing markets, creating an opening for investors entering at the right time. However, they stressed that foreign investors look beyond pricing. Construction progress, accountability, timely delivery, and clear exit mechanisms, including capital repatriation, are critical to sustaining interest.
Namal Peiris, managing director of Sri Lankan real estate developer International Construction Consortium, said while Sri Lanka has advantages in location, weather, hospitality, and lifestyle potential, the country's recent fuel shortage, credit rating, exchange rate pressure, debt sustainability concerns, and political stability remain important factors. He also noted that higher fuel, material, and logistics costs had placed the construction sector under pressure.
Home Lands Group Executive Director Amaya Herath said remote work and changing lifestyle preferences were supporting demand for serviced apartments, second homes, luxury villas, and beachfront properties. She added that land near airports and ports was also attracting stronger interest.
With 51 percent of Port City Colombo allocated for residential development, the project could become a regional hub if supported by clear regulations, world-class infrastructure, and consistent incentives, said Dhanya Gunawardana, head of Branding and Communications at Colombo Port City Economic Commission.
However, concerns remained over limited Grade A commercial space, inconsistent policies, restrictions on dollar transactions, regulatory uncertainty, and weak facilitation. Speakers said long-term investors need long-term predictability.
The main message was that Sri Lanka has the ingredients to become a real estate hotspot, but the opportunity will depend on execution, policy consistency, and the country's ability to give investors confidence that projects will be delivered transparently and on time. ■
