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

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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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Priority areas for deepening Japan-SL economic ties

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Executive Committee for the Year 2026/2027

Japan Business Council (SLJBC) of The Ceylon Chamber of Commerce recently held its 47th AGM, with the Ambassador of Japan and the Patron of the Council, Akio ISOMATA, attending as the Chief Guest.

Addressing the gathering, Ambassador ISOMATA outlined three priorities for deepening bilateral economic relations: an effective and forward-looking trade and investment policy, the promotion of domestic industrial policy, and expanded investment in renewable energy. He noted that Sri Lanka’s ongoing review of its Free Trade Agreement policy would be important in shaping the country’s future negotiating landscape. He encouraged Sri Lanka to look Eastward toward Southeast Asia and Japan, proposing that the country adopt an export-oriented industrial model. The Ambassador welcomed the Government’s National Export Development Plan 2026 and National Mineral Policy 2026 as consistent with Japan’s vision of connecting Sri Lanka’s export-related manufacturing sectors with India’s high-growth manufacturing base.

In his address, President Athulla R F Edirisinghe reflected on nearly seven decades of humanitarian and development support extended by Japan to Sri Lanka, and paid tribute to the Chairman of the Sasakawa Peace Foundation Yohei Sasakawa, for his magnanimity in establishing the Foundation. Reflecting on the history of Japanese investment in the region from the 1970s onward, he observed that Sri Lanka had missed many opportunities to attract Japanese foreign direct investment. Highlighting the 2025 proposal for a Sri Lanka – Japan Economic Corridor by the Ministry of Economy, Trade, and Industry Japan, he called on Sri Lankan businesses, industry associations, and the wider community to come together in dialogue with the Government to ensure the country does not miss this opportunity as well.

2026/27 Committee: President: Athulla R F Edirisinghe – Director, Hirohama Ceylon (Pvt) Ltd, Senior Vice President – Ruwan Waidyaratne – Managing Director, Hayleys Advantis Ltd, Vice – President – Shamil Mendis – Managing Director, Spear International (Pvt) Ltd, Treasurer – Rohitha Mendis – Managing Director of Prudential Shipping Lines (Pte) Ltd, Immediate Past President – Mahen Kariyawasan – Managing Director, Andrew The Travel Company (Pvt) Ltd, representatives from Amano Lanka Engineering (Pvt) Ltd, BOV Capital (Pvt) Ltd, Brandix Apparel (Pvt) Ltd, Heritage Teas (Pvt) Ltd, Kalhari Enterprises (Pvt) Ltd, Lanka Harness (Pvt) Ltd, Dentsu Grant (Pvt) Ltd, MAC Holdings (Pvt) Ltd, and Vidullanka PLC. By invitation: HVA Foods PLC (subsidiary of George Steuart & Co), Spillburg Holdings (Pvt) Ltd, and Vaughan Chemicals (Pvt) Ltd.

The Sri Lanka – Japan Business Council plays an important role in promoting trade, tourism, and investments between Japan and Sri Lanka. For membership inquiries contact Kiyara at The Ceylon Chamber of Commerce via E-mail: businesscouncils1@chamber.lk or Tel.: 011 5588875/ 5588800.

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Rekawa turns turtle conservation into a 30-year community business model

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Stakeholders at 30th anniversary celebrations of the turtle conservation project.

By Ifham Nizam

What started 30 years ago as an effort to protect sea turtles has evolved into a community-based economic model that has generated livelihoods, attracted tourists and transformed Rekawa into one of Sri Lanka’s best-known nature tourism destinations.

The Rekawa Turtle Conservation Project, launched on September 2, 1996, by the Turtle Conservation Project (TCP) in partnership with the Department of Wildlife Conservation and the Rekawa community, marked its 30th anniversary last week, demonstrating how biodiversity protection can become an economic opportunity for communities living alongside sensitive natural resources.

Speaking at the anniversary celebrations, TCP chairman Thushan Kapurusinghe said the project currently provides direct livelihoods for 28 people, but its economic impact extends considerably beyond those directly employed by the programme.

‘Today, 28 people directly earn their livelihood through this project. But its impact goes far beyond those 28 individuals, Kapurusinghe said.

He pointed to the transformation of the area over the past three decades, arguing that the growth of tourism in the community has been closely linked to the turtle conservation programme.

‘If you travel from Netolpitiya to this area, you can clearly see how much the village has transformed over the years. There is no doubt that the growth of tourism in this community has been driven by the Turtle Conservation Project, he said.

The economic significance of Rekawa lies in its ability to convert the protection of a natural asset into a source of recurring community income.

Tourists do not come to Rekawa merely to see a beach. They come to witness sea turtles emerging from the ocean and nesting in their natural habitat—a tourism experience that depends directly on the continued protection of the nesting beach.

Kapurusinghe said tour operators regularly bring visitors to Rekawa, with some tourists traveling there after visiting major attractions such as the Kandy Esala Perahera.

The model represents a fundamental shift from viewing conservation as an expense to recognising biodiversity as an economic asset that can generate sustainable livelihoods when properly managed.

The 30th anniversary celebration at the Rekawa Turtle Conservation Project Information Centre brought together Southern Wildlife Region Director of the Department of Wildlife Conservation Channa Suraweera, government officials, conservation organisations, community representatives and long-standing supporters of the initiative.

Individuals who had contributed to the project over the past three decades were also recognised with awards for their service to sea turtle and environmental conservation.

Rekawa’s experience has attracted international attention because of precisely this combination of conservation and community development. The project has received international recognition as well as the Green Employment Award from the Ministry of Environment and Natural Resources. Earlier international recognition included a highly commended ‘Tourism for Tomorrow’ award, while the project’s turtle-watch programme subsequently received further recognition in responsible tourism and conservation.

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Ceylinco Life brings premium policyholders closer to the magic of the Kandy Perahera

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For an evening, the timeless spectacle of the Kandy Esala Perahera unfolded at especially close quarters for a select group of Ceylinco Life’s most valued policyholders and their families, who were hosted to an exclusive viewing experience by the Company’s Customer Relations Division.

Held at the Ceylinco Life Kandy Branch on Kings Street, the annual event coincided with the second Randoli Perahera, bringing guests into the heart of one of Sri Lanka’s most spectacular expressions of culture, tradition and pageantry.

As the procession made its majestic passage through the streets of Kandy, guests enjoyed VIP seating at a prime vantage point, allowing them to experience the colour, movement and grandeur of the Perahera up close. The evening offered a fitting setting for Ceylinco Life to celebrate its enduring relationships with its premium clientele.

The experience extended well beyond the spectacle outside. Guests were welcomed with evening refreshments and an exclusive dinner buffet presented by the prestigious Amaya Hills Resort, adding a fine-dining dimension to an already memorable evening.

Families, too, were at the centre of the occasion. A private movie theatre experience provided entertainment for children and adults alike, while each attending family received a beautifully framed family photograph as a personalised souvenir, a tangible reminder of an evening shared together against the backdrop of one of Sri Lanka’s most treasured cultural traditions.

Besides being a much sought-after opportunity to watch the Perahera, the occasion was an expression of appreciation. Through its continuing Customer Relationship Management activities, Ceylinco Life seeks to create experiences that recognise its most valued policyholders not simply as customers, but as relationships to be celebrated and nurtured. And on this particular August evening, the enduring splendour of the Kandy Perahera provided the perfect setting for doing just that.

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