Business

Assessing the impact of the current crisis on Sri Lanka’s condominium sector

Published

4 years ago

2022/05/5

By Rohan Parikh

Sri Lanka is currently going through what appears to be a ‘once in a generation’ crisis, both economically and politically. How would this impact the country’s real estate market, particularly the market for residential condominiums?

Firstly, it’s important to understand that unlike, say, manufacturing or services, the impact on condominiums will be complex and mixed. This is because the current situation has both positive and negative implications and will impact both demand and supply.

Positive implications

First, exploring the positives, real estate and residential condominiums provide investors a buffer to protect their wealth from unpredictable and rampant inflation – which has been one of the most prominent outcomes of the current crisis in Sri Lanka. Inflation is at record levels already and by all indications will remain high in the immediate term.

Since real estate is a long-term asset class, nominal values of properties generally rise to match inflation, ensuring that the investor gains in real terms. Hence, real estate assets like residential condominiums represent a safe and long-term store of value, which can offset the impact of inflation and can be sold profitably, once normalcy returns.

This is in sharp contrast especially with financial assets classes such as stocks and bonds that carry high levels of risk and can be very volatile during a macro economic crisis like the one we are experiencing currently. Hence, real estate can perform far better in protecting your wealth, compared with typical alternatives like cash or savings accounts, that could lose value substantially and rapidly due to inflation.

Overall, real estate represents a tangible and solid asset that can provide security and stability to investors at a time when the value of items and the stability of companies and industries are in flux.

Negative implications

However, the current crisis can also negatively impact the real estate market.

There is a strong likelihood of a shortage of apartments in the medium term as new projects are cancelled or postponed due to the uncertainty regarding the cost of inputs and availability of necessary imports. Buyers could rush to purchase the existing condominiums available in the market, reducing the availability for other buyers.

Such shortages may also result in prices of condominiums increasing rapidly – which is however likely to benefit buyers who get in early. Funding such new investments could however be challenging, given especially the rapid increase in interest rates.

Real estate developers and companies will also face significant constraints and challenges due to the inability to start new projects, as they would be uncertain of the prices of inputs. Hence, it will be difficult for developers to price apartments accurately. As projects are put on hold, employees in the sector could either face job losses or companies will have to contend with high overheads.

Need for additional caution

Low-quality developers who have invested in projects with low feasibility and who have heavy levels of borrowings are likely to be impacted far more than prudent, high-quality developers, given the above situation. Hence, buyers of residential condominiums need to take extra care to assess the feasibility of their developer, ensuring that they select only reputed developers with a strong track record.

The quality of future construction projects could also be compromised as imports will remain restricted in the medium term, leading to difficulty in procuring key components like kitchens, appliances, etc.

There could also be a dampening impact on land prices (discounting inflationary pressure) as land purchases by developers slowdown. This can be also perceived as a positive, especially for buyers but will negatively impact sellers.

Weighing the positives and negatives, overall, real estate and residential condominiums are likely to remain an attractive investment class in Sri Lanka. Long-term fundamentals remain relevant, especially considering that Sri Lanka has low levels of urbanisation and that vertical living clearly provides the only viable solution. Projects with sound business fundamentals, formulated by high-quality developers and which are aligned closely with market needs, will continue to be attractive investments.

(The writer is the Chairperson of Iconic Developments and an alumnus of the Wharton School of Business and INSEAD.)

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Business

Sri Lanka worthy of being ranked as the world’s top holiday spot – cricketing great Wasim Akram

Published

29 mins ago

2026/06/23

Sahan Weerasooriya

Cricketing great Wasim Akram being felicitated by chairman Softlogic Life Ashok Pathirage.(R)

Pakistani cricketing legend Wasim Akram said Sri Lanka is the best tourist destination and is worthy of being ranked the world’s top holiday spot. ‘The island’s natural beauty and my decades-long connection with the country, are factors that enhance Sri Lanka’s value, he explained.

Speaking at a Softlogic Life investor forum in Colombo last Tuesday Akram said Sri Lanka remained one of his favourite destinations despite having traveled extensively around the world.

Akram who captained the Pakistani national cricket team and was celebrated as Softlogic Life’s brand ambassador said filming the company’s latest television commercial gave him another opportunity to experience some of the country’s most scenic locations, including Galle and the central highlands.

Akram said Sri Lanka’s landscapes, rivers and coastline were among the most beautiful he had beheld during his travels and expressed surprise that the country was not already considered one of the world’s leading tourism destinations.

Having first visited Sri Lanka as a teenager in 1985, Akram said he had returned numerous times over the years as a player, commentator and tourist. He added that he plans to continue visiting the island regularly and hopes to explore more of the east coast in the future.

Softlogic Life had impressive growth last year and is looking forward to introducing new life insurance products to the local market considering the increasing the aging population in Sri Lanka.

By Hiran H. Senewiratne

Business

Veenath Indrajith from the University of Sri Jayewardenepura wins the 2026 Saman Kelegama Memorial Research Grant

Published

30 mins ago

2026/06/23

Sahan Weerasooriya

Veenath Indrajith / Dr Saman Kelegama

Veenath Indrajith, a fourth-year undergraduate from the Department of Business Economics at the University of Sri Jayewardenepura, has been selected as the winner of the Saman Kelegama Memorial Research Grant for 2026. Indrajith’s academic and professional interests lie in economics, finance, investment, and policy-oriented research. In addition to his undergraduate studies, he is currently pursuing the Chartered Accountancy qualification in Sri Lanka, demonstrating a strong commitment to analytical rigour and professional excellence. He aspires to contribute to evidence-based policymaking through applied economic research.

Indrajith’s research study, titled “Small Vehicle Businesses and Household Investors Using the Second-Hand Car Market as an Alternative Investment Method in the Colombo District of Sri Lanka,” will adopt a qualitative research approach to explore the motivations, experiences, perceived returns, and risks associated with investing in used vehicles. By analysing household-level decision-making and investment behaviour, the research aims to shed light on a relatively underexplored area of Sri Lanka’s alternative investment landscape. The findings are expected to provide valuable insights for policymakers, particularly in relation to financial literacy, household investment strategies, and the development and regulation of alternative investment markets in Sri Lanka.

The Saman Kelegama Memorial Research Grant, established in 2018, honours the legacy of the late Dr. Saman Kelegama, former Executive Director of the Institute of Policy Studies of Sri Lanka (IPS), whose work significantly shaped public policy discourse on socio-economic development in Sri Lanka and the broader South Asian region. The grant is awarded annually to an outstanding undergraduate student from a Sri Lankan university, with the aim of encouraging innovative, policy-relevant research and nurturing the next generation of policy thinkers. As part of this grant, Indrajith will receive training and mentoring from IPS senior researchers to complete the proposed study.

Business

Delmege Consumer partners with Daraz

Published

31 mins ago

2026/06/23

Sahan Weerasooriya

Signing ceremony - from Left to Right - Dushan Khadagammege, Head of Retail and Supply Chain, Daraz, with the team from the Delmege Group comprising Baratha Piyadigama Group Head of Marketing, Shanaka Rajapaksha Manager Marketing Delmege Consumer, Atheeq Kabeer Manager E- Commerce and Digital Marketing .

Delmege Consumer, the flagship FMCG cluster of the Delmege Group, has evolved into one of Sri Lanka’s most trusted household names, building lasting relationships with communities across the island through a diverse portfolio of quality products that have become an integral part of consumers’ everyday lives for generations. Renowned for enriching households with Delmege’s own brands, leading local brands, and world-renowned international brands, the company continues to strengthen its presence, reputation, and connection with consumers nationwide.

A key strength of the FMCG cluster lies in the strong and enduring partnerships it has cultivated with suppliers, enabling the company to establish a responsive, time-sensitive, and mutually beneficial distribution network that has made a significant impact across Sri Lanka. Through its extensive reach and customer-focused approach, Delmege Consumer serves retail, wholesale, HoReCa, export, and modern trade channels, supported by flexible channel management strategies and winning consumer-centric propositions that cater to evolving market needs.

Further strengthening its distribution network and expanding its digital footprint, Delmege Consumer has partnered with Daraz, Sri Lanka’s leading e-commerce platform, to offer customers a more convenient, seamless, and accessible way to purchase its extensive range of FMCG products online.

Commenting on the partnership, Anil Meegahage, CEO of Delmege Consumer, stated:

“At Delmege Consumer, we are committed to innovation, continuously strengthening our product portfolio, and enhancing customer convenience and experience. Our partnership with Daraz enables us to serve customers across the country more efficiently by providing them with an easy, secure, and reliable platform to purchase trusted Delmege FMCG products online.”

Adding further, Baratha Piyadigama, Head of Group Marketing, Delmege, said:

“This partnership with Daraz marks another important milestone in our journey to enhance brand positioning, visibility, and awareness, especially at a time when digital and online commerce continue to gain significant momentum. As one of Sri Lanka’s leading FMCG distributors, we are proud to extend our trusted portfolio of products into the digital space through Daraz, ensuring customers across the island can conveniently access their favourite products with just a few clicks.”

Delmege’s extensive FMCG portfolio includes well-known Delmege branded products such as Canned Fish, Hiru Kahata Tea, Delmege Soya, Flavours and Colours, Delmege Pasta,

Delmege Noodles, and Salt, together with the much-loved Motha range of dessert ingredients, beverages, and mixes. The company also represents globally renowned international brands including Kellogg’s cereals such as Corn Flakes, Muesli, and Oats; Pringles; and the Ferrero portfolio featuring Ferrero Rocher, Nutella, Kinder Joy, and Tic Tac. Through its diverse and trusted brand portfolio, Delmege Consumer continues to reinforce its position as one of Sri Lanka’s leading FMCG companies.