By: Staff Writer
February 26, Colombo (LNW): Sri Lanka’s ambitious urban development vision is taking shape, even as foreign direct investment (FDI) inflows have slowed sharply over the past year. The latest landmark move comes from local business giants, Prime and Melwa Groups, who have jointly acquired a four-acre marina-front parcel in Port City Colombo, earmarked for a $250 million ultra-luxury apartment project.
The venture, under the newly formed Prime Melwa Port City Ltd., aims to redefine Colombo’s luxury real estate while attracting high-net-worth foreign investors. Completion is expected within four years, with all apartments offering direct marina views. By denominating transactions in USD and other foreign currencies rather than the Sri Lankan rupee, the project provides investors a natural hedge against currency depreciation, a key consideration given Sri Lanka’s persistent foreign reserve pressures.
The backdrop is critical. According to the latest Central Bank of Sri Lanka data, FDI inflows for 2025 fell by over 12% compared to 2024, totaling just $300 million. This slowdown has coincided with pressures on foreign reserves, which currently hover around $5.2 billion—a level insufficient to fully cover three months of imports. Economic analysts have repeatedly flagged the need for high-value foreign investments to stabilize currency volatility and replenish reserves.
By securing one of the last premium parcels in the Port City Marina District, Prime and Melwa are not just investing in real estate they are signaling confidence in the country’s potential as a global business and lifestyle hub. Seven out of eight land parcels in the Marina District have now been leased, highlighting robust investor interest despite broader FDI downturns.
Prime Group Chairman Premalal Brahmanage emphasized that the project represents a strategic step to export Sri Lanka’s real estate to international markets. “We strongly believe this project will attract expatriates, international business travelers, and discerning investors, offering strong foreign buyer appeal while contributing to the country’s foreign currency inflow,” he stated.
Melwa Group Director P.P. Anandaraja reinforced the point, linking the initiative to long-term nation-building and industrial growth. “This development reflects our vision to build projects that strengthen Sri Lanka’s global profile while fostering economic resilience,” he said.
The Port City Colombo initiative demonstrates a rare alignment between private sector ambition and national economic need. While broader FDI trends remain muted, high-profile, currency-denominated projects such as this have the potential to shore up foreign reserves, inspire investor confidence, and signal Sri Lanka’s readiness to participate in high-value global investment flows.
The question remains whether more such initiatives will follow. With macroeconomic challenges persisting, the government and private sector must collaborate to ensure regulatory stability, streamline approvals, and maintain confidence, turning marquee projects into a sustainable avenue for foreign capital inflows.