The Clothespin Port City project worth US$540 million expired unsigned after the developer abandoned its original Colombo development plan.
Sri Lanka’s proposed Clothespin Port City project, valued at US$540 million, expired unsigned in January 2026 after the investor decided not to proceed with the original development.
The proposed agreement involved Clothespin Management and Development and plans to construct a major hotel development within Colombo Port City. However, the Director General of the Colombo Port City Economic Commission (CPCEC) confirmed that the agreement did not proceed.
The CPCEC granted Clothespin Management and Development (Private) Limited a 25-year tax holiday through a Gazette notification issued in July last year.
The company had proposed building a “twin tower marvel” featuring a clock tower larger than London’s Big Ben.
The development plan also included what the government described as the “world’s largest art gallery.” The proposed development was planned for Hotel Use Land Plot 2-01-11, covering 24,324 square metres within Colombo Port City.
“The investor advised us he’s not going ahead with that development,” CPCEC Director General Revan Wickramasuriya told EconomyNext.
However, Wickramasuriya said discussions between the investor and the authorities had not completely ended.
“But he’s discussing new developments,” he said, referring to the latest talks involving Clothespin Management and Development and the CPCEC.
Clothespin Port City Project Faces New Negotiations
A Clothespin Management and Development source familiar with the project said the developer could not finalise the original contract.
According to the source, outstanding bond issues and internal board complications prevented the company from completing the agreement.
However, new discussions have been taking place with the Colombo Port City Economic Commission and China Harbour Engineering Company (CHEC). The discussions focus on the possibility of reaching a new lease arrangement.
If the parties finalise and sign a new lease agreement, authorities will not allocate the same plot originally identified for the project.
Both the CPCEC Director General and the source familiar with the discussions confirmed that any renewed project would involve a different plot.
The source also said the developer removed the clock tower from the original plan because the feature was not considered lucrative.
Under the Gazette notification for the project, published on July 14, 2025, the parties had to sign the agreement within six months.
However, the proposed agreement remained unsigned when the deadline expired on January 14, 2026.
The original Clothespin Port City project represented a pledged investment of US$540 million.
Of that total investment, the company had allocated US$75 million for the land lease. The remaining US$465 million was earmarked for construction of the planned development.
While the original proposal has now expired, the ongoing discussions indicate that Clothespin Management and Development remains engaged in talks over possible new developments within Colombo Port City.
SOURCE:- ECONOMYNEXT.COM
