Interior Minister Mohsin Naqvi announced on Wednesday that the government will convert the controversial One Constitution Avenue building in Islamabad into a five-star hotel within the next few months. The decision follows the federal cabinet’s approval of a joint investigation team’s report on the long-disputed project near the convention centre.
Speaking at a press conference, Naqvi said the original plan for the site was always a five-star hotel. The government will now approach a major international hotel chain to operate the property. He highlighted Islamabad’s serious shortage of quality hotels and expressed confidence that an agreement could be finalised soon. The Capital Development Authority already holds the building in official records, and the cabinet decision has given the government the legal basis to take full control. The CDA’s member administration will immediately manage the site, with the clear priority of making the hotel operational as quickly as possible.
Affected buyers will receive compensation, Naqvi assured. Genuine investors will get their principal amounts refunded along with interest calculated on the Karachi Interbank Offered Rate or an inflation adjustment.
Planning Minister Ahsan Iqbal, speaking alongside Information Minister Attaullah Tarar and Minister of State Talal Chaudhry, confirmed the cabinet had approved the JIT findings. The inquiry found the project was pushed through with manipulated bidding, unauthorised rule relaxations, and suspicious documentation. The first auction was cancelled without CDA Board approval, and later terms were changed. Restrictions on building height, covered area and parking were relaxed without proper clearance. Although approved as a hotel with serviced apartments, 254 apartments were sold through 99-year sub-leases. The lease itself went to a private company that was not part of the original winning consortium, and a bank guarantee requirement was removed just before the agreement was signed. Questions were also raised about forged signatures and irregular lease registration.
The JIT named Abdul Hafeez Sheikh as the alleged mastermind, along with several former CDA officials. His company has been blacklisted from future public projects. The report recommends a fresh transparent auction, restoration of the original hotel purpose, and renaming the project after objections from the Ministry of Foreign Affairs. NAB has been directed to investigate those involved and file a reference within three months. Sheikh’s name is already on the Exit Control List.
The government stressed that the law will be applied equally and that institutional reforms, including digitisation of CDA records, will prevent similar irregularities in future.
