One Constitution Avenue to Become a Five-Star Hotel as Cabinet Approves JIT Report on Islamabad’s Biggest Property Scandal

One Constitution Avenue, the twin-tower project that has stood unfinished and disputed in the heart of Islamabad for two decades, is finally heading back to its original purpose. The federal cabinet has approved a joint investigation team (JIT) report that found large-scale irregularities in the project, and the government says the building will be turned into a five-star hotel within months.

Interior Minister Mohsin Naqvi announced the decision on Wednesday, 4 November 2026, after the cabinet signed off on the JIT’s findings. The government will take legal possession of the property, the Capital Development Authority (CDA) will take over its management, and a major international hotel chain will be approached to run it.

For the hundreds of people who bought apartments in the towers, there is also long-awaited news: the government says genuine buyers will get their money back, with interest.

At a glance

What happened: On Wednesday, 4 November 2026, the federal cabinet approved a JIT report into alleged irregularities in the One Constitution Avenue project in Islamabad.

What the JIT found: The inquiry found that the bidding process was manipulated, rules were relaxed without approval, and 254 apartments were sold through 99-year sub-leases even though the project was approved only as a five-star hotel with serviced apartments.

Who was named: The report identified former finance minister Abdul Hafeez Shaikh as the alleged mastermind, along with several former CDA officials. His company has been blacklisted from future public-sector projects, and his name is on the Exit Control List.

What happens next: The National Accountability Bureau (NAB) has been told to investigate those responsible and file references within three months. Genuine buyers will be refunded their principal amount plus interest linked to KIBOR, the Karachi Interbank Offered Rate. The building is to be re-auctioned transparently and converted into a five-star hotel.

The cabinet’s decision

The announcement came in two press conferences in Islamabad on Wednesday. Interior Minister Mohsin Naqvi spoke first, saying the government would make every effort to convert the building into a five-star hotel within the next few months, which was its original purpose.

“We will make every effort to convert this building into a five-star hotel within the next few months, which was its original purpose,” Naqvi said.

He said the government would approach a major international hotel chain to operate the building. Islamabad, he noted, faces a severe shortage of hotels, and he expressed hope that an agreement with a hotel chain would be finalised soon.

Naqvi said the cabinet’s approval of the JIT’s findings had paved the way for the government to take legal possession of the property. He maintained that the CDA already held possession of the building in official records, but the cabinet’s decision had now provided the necessary legal basis.

The CDA’s Member Administration will immediately take charge of managing the building, with the government’s priority being to make the hotel operational as soon as possible. Naqvi also assured that people entitled to compensation under the JIT’s recommendations would receive their payments, and he thanked Prime Minister Shehbaz Sharif for supporting the government’s position despite criticism after its earlier move to take possession of the property.

At a separate press conference, Planning Minister Ahsan Iqbal, Information Minister Attaullah Tarar and Minister of State for Interior Talal Chaudhry laid out the JIT’s findings in detail.

What the JIT found

The JIT was made up of senior officers from the National Accountability Bureau (NAB), the Federal Investigation Agency (FIA), the Federal Board of Revenue (FBR), the Securities and Exchange Commission of Pakistan (SECP), the Intelligence Bureau (IB) and the Inter-Services Intelligence (ISI). It was given 60 days to complete its investigation.

According to Ahsan Iqbal, the inquiry found that the project had been carried out through manipulation of the bidding process, unauthorised relaxation of rules and suspicious documentation. The findings, as announced by the ministers, were:

The auction was changed midway. The first auction of the plot was cancelled without approval from the CDA Board. A second auction was then held under revised terms. The report found that restrictions on the building’s height, covered area and parking requirements were relaxed without the board’s approval.

The wrong company got the lease. The successful bidder was a four-member consortium. But the lease was awarded to a private company that was not among the members of that consortium.

A hotel became apartments. The project was approved as a five-star hotel with serviced apartments. Yet 254 apartments were sold through 99-year sub-leases, in violation of the approved purpose.

A key safeguard was removed. The requirement for a bank guarantee, a standard protection for the government in such deals, was removed shortly before the lease agreement was signed.

The paperwork itself is suspect. The report raised questions about the authenticity of the project’s documentation, including allegedly forged signatures and irregular registration of the lease.

Iqbal said the irregularities had caused losses to the national exchequer and left people deprived of their money. The CDA, he said, was found negligent and involved in the irregularities and fraud.

The people named

The JIT identified former finance minister Abdul Hafeez Shaikh as the alleged mastermind behind the irregularities, along with several former CDA officials and other individuals.

The report also named former CDA chairman Kamran Lashari, Dr Faisal Awan, Azhar Ali Chaudhry, Brigadier Nusrat Ullah and the late Rai Nawaz Kharal as having acted in collusion.

The planning minister said Shaikh’s company had been blacklisted from future public-sector projects. Information Minister Attaullah Tarar confirmed that Shaikh’s name was on the Exit Control List (ECL), which bars a person from leaving the country.

It is important to be clear about what this means. These are findings of an investigation and allegations announced by ministers. No court has yet ruled on them. The legal process, through NAB, is what comes next, and the people named will have the chance to answer the allegations there.

Minister of State Talal Chaudhry added another detail: seven to eight people had been given repeated chances to appear before the inquiry and put forward their claims, but had failed to do so. Among those who did not appear, he said, was former prime minister and PTI founder Imran Khan.

What happens to the building

The JIT recommended that the project be restored to its original approved purpose and put up for a fresh, transparent auction. The government has accepted that recommendation.

The building will be converted into a five-star hotel, and the government plans to bring in a major international hotel chain to operate it. No hotel operator has been named yet, and no date has been given for when the hotel would open, beyond Naqvi’s statement that the conversion would happen within months.

The project will also get a new name. Iqbal said the Ministry of Foreign Affairs had objected to the use of the One Constitution Avenue address, maintaining that the address belonged to its own premises. The JIT recommended renaming the project, and the government has agreed.

The report also recommended that the CDA digitise its records and introduce institutional reforms to prevent similar cases in future, and that proper fire-safety equipment be installed in the building immediately.

What happens to the buyers

For the people who bought apartments in the towers, the most important recommendation is about compensation. The JIT recommended that the CDA refund genuine buyers their principal amounts, together with KIBOR-based interest or an inflation adjustment.

Talal Chaudhry assured affected buyers that their principal investments would be refunded along with interest calculated using KIBOR. The report noted that the CDA had collected fees from buyers before disclaiming responsibility for the project, which is one reason the refunds are being ordered.

The ministers stressed that genuine investors would not be penalised. Ahsan Iqbal said they would get back their full invested amount along with interest above KIBOR.

The story so far: a 21-year saga

To understand why this decision matters, it helps to go back to the beginning.

In 2005, the Capital Development Authority put a 13.5-acre plot in Islamabad’s Red Zone up for auction. The plot sits on Constitution Avenue, near the Prime Minister’s House and the Diplomatic Enclave, some of the most valuable land in the capital. BNP Group won the auction on 9 March 2005 for Rs4.88 billion, on the promise of building a world-class five-star hotel with serviced apartments.

That hotel was never built as promised. Instead, the towers were filled with luxury apartments that were sold to buyers. The project became one of Islamabad’s longest-running property disputes, passing through court cases, government inquiries and changes of government.

Talal Chaudhry said the project had remained controversial for nearly two decades and that action had been taken against it twice during PML-N governments. The JIT is the latest and most far-reaching step: a multi-agency investigation whose recommendations the cabinet has now formally approved.

The case also underlines a wider problem in Islamabad’s property market. When a prime plot meant for a hotel can be turned into apartments, sold on 99-year leases, and left in dispute for 21 years, it raises questions about how public land is managed and who is watching. The JIT’s recommendations on digitising CDA records and reforming its procedures are aimed at exactly that problem.

What happens next

Several things will now move in parallel.

First, NAB has been directed to investigate the roles of those involved, including people who allegedly facilitated the irregularities. NAB has been given three months to file references against those found responsible. A reference is the formal case NAB files in an accountability court, and it is the step that turns an investigation’s findings into a trial.

Second, the CDA will take over management of the building and begin the process of converting it into a hotel. The government says it will approach a major international hotel chain, but no operator has been named and no agreement has been announced yet.

Third, the refund process for buyers will need to be set up. The government has promised refunds of the principal plus KIBOR-based interest, but has not yet said how buyers should apply or when payments will begin. For families who have waited years, that detail matters more than any announcement.

Fourth, the building is to be re-auctioned in a transparent process and given a new name. No date has been given for the auction.

For Islamabad, the decision also has a practical side. The city has long had too few five-star hotels for a capital that hosts foreign delegations, conferences and a growing number of visitors. If the conversion goes ahead, One Constitution Avenue would add a major hotel in the city’s most central location.

But the history of this project is a warning against taking announcements at face value. The towers were supposed to be a hotel in 2005. Twenty-one years later, the government is announcing the same thing again. What matters now is whether the NAB cases are actually filed within three months, whether buyers actually receive their refunds, and whether a hotel chain actually signs up. Those are the tests by which this decision will be judged.

Frequently asked questions

What is One Constitution Avenue?

It is a twin-tower project on a 13.5-acre plot on Constitution Avenue in Islamabad’s Red Zone, near the Prime Minister’s House and the Diplomatic Enclave. The land was auctioned in 2005 for a five-star hotel with serviced apartments, but luxury apartments were sold there instead.

What did the JIT find?

The JIT found manipulation of the bidding process, unauthorised relaxation of rules, suspicious documentation, the sale of 254 apartments on 99-year sub-leases against the approved purpose, the award of the lease to a company that was not part of the winning consortium, and the removal of the bank guarantee requirement.

Who did the JIT name?

The report identified former finance minister Abdul Hafeez Shaikh as the alleged mastermind, and named Kamran Lashari, Dr Faisal Awan, Azhar Ali Chaudhry, Brigadier Nusrat Ullah and the late Rai Nawaz Kharal. These are investigation findings and allegations, not court verdicts.

Will apartment buyers get their money back?

The government says genuine buyers will be refunded their principal amount plus interest based on KIBOR, the Karachi Interbank Offered Rate. No application process or payment date has been announced yet.

What will happen to the building?

The government plans to convert it into a five-star hotel, run by a major international hotel chain, and to re-auction it transparently under a new name. No hotel operator has been named yet.

What happens to those named in the report?

NAB has been directed to investigate and must file references in an accountability court within three months. Shaikh’s company has been blacklisted from future public-sector projects, and his name is on the Exit Control List.

Sources

• The News, “Minister says One Constitution Avenue to be converted into five-star hotel”, 4 November 2026: https://www.thenews.com.pk/story/1446852-naqvi-says-one-constitution-avenue-to-be-converted-into-five-star-hotel
• Khabr.pk, “Cabinet approves JIT report on One Constitution Avenue, orders action”, 5 November 2026: https://khabr.pk/en/news/one-constitution-avenue-jit-report-ahsan-iqbal
• Khabr.pk, “One Constitution Avenue in Islamabad to become a five-star hotel, says Naqvi”, 5 November 2026: https://khabr.pk/en/news/one-constitution-avenue-to-become-five-star-hotel
• Energy Update, “Islamabad’s One Constitution Avenue to be converted into five-star hotel: Naqvi”, 5 November 2026: https://www.energyupdate.com.pk/islamabads-one-constitution-avenue-to-be-converted-into-five-star-hotel-naqvi/
• Business Insider Pakistan, “JIT Report Reveals Irregularities in Islamabad’s One Constitution Avenue Project”, 4 November 2026: https://www.businessinsider.pk/jit-report-reveals-irregularities-in-islamabads-one-constitution-avenue-project/
• TaazaTaren, “One Constitution Avenue: Big Blow as 13.5-Acre Plot Re-auctioned”: https://taazataren.com/one-constitution-avenue-jit-report-hotel/

This article is for general information and education only. It is not legal or financial advice.