One Constitution Avenue to Become Five-Star Hotel
The federal government has said that One Constitution Avenue in Islamabad will be turned into a five-star hotel, after a joint investigation team found that the project was built on fraud and manipulated bidding. The One Constitution Avenue hotel decision was announced by Planning Minister Ahsan Iqbal on November 4, 2026, following a report by the investigation team to the federal cabinet.
Interior Minister Mohsin Naqvi said the government had now regained legal possession of the tower and would try to convert it into a five-star hotel within months. He said Islamabad faced a severe shortage of hotels, and the government would soon try to reach an agreement with a large hotel chain.
The building, a twin-tower skyscraper in the federal capital, was first approved as a five-star hotel about two decades ago. It was later converted into residential apartments and commercial space instead. The Capital Development Authority cancelled its lease after the company behind the project defaulted on payments, and the Islamabad High Court upheld that decision in April 2026. Residents were evicted in May, and Prime Minister Shehbaz Sharif then formed a joint investigation team to examine the matter.
One Constitution Avenue hotel: what the JIT found
Iqbal said the investigation team drew input from the National Accountability Bureau, the Federal Investigation Agency, the Federal Board of Revenue, the Securities and Exchange Commission of Pakistan, the Intelligence Bureau and Inter-Services Intelligence. He said the team assessed the project carefully and the cabinet approved its report.
According to Iqbal, the report found that the bidding process was manipulated, rules were ignored to benefit the developers, and the company given the lease had no rightful claim. He said the Capital Development Authority was found complicit, and conditions of the bank guarantee were removed to benefit the developers. Apartments were sold illegally, he added, and the national exchequer suffered losses while those involved gained financially.
The minister named Abdul Hafeez Sheikh as the person the team identified as the mastermind, working in connivance with Capital Development Authority officials. He also named Kamran Lashari, who was chairman of the authority at the time, Dr Faisal Awan, Azhar Ali Chaudhry, retired Brigadier Nasrullah and the late Rai Nawaz Kharal as officials found to be colluding in fraud. Dawn reported the minister’s remarks from the press conference in Islamabad.
What happens to the people who bought flats
The investigation team recommended that Sheikh and his company be blacklisted from future public projects, and that proceedings be launched against him. It also recommended that the project be started anew and auctioned in a transparent manner, so that it achieves its original purpose as a hotel.
Iqbal said the government had a responsibility to protect people who were swindled. He said those defrauded would receive compensation, their principal investments would be refunded, and payments would be adjusted against Kibor interest so that they do not suffer losses. Naqvi said making rightful payments to occupants was binding on the government after the report.
The team also recommended renaming the project, because the name One Constitution Avenue matched the address of the finance ministry and was used for marketing purposes only. It called for security clearance and clearance from other institutions before any new work, along with fire safety and other protocols.
Wider reforms proposed after the scandal
Iqbal announced broader changes aimed at preventing a repeat of the fraud. He said the Capital Development Authority and its ordinance should be overhauled, and an independent master plan commission should be formed. Records must be digitised, he said, and officers should rotate between state planning, enforcement and building control departments every two years.
“People have held offices for 20 years and opened offices of fraud,” Iqbal said. “With this constant rotation, it will close the door on such corrupt projects.”
He added that the National Accountability Bureau had been ordered to take action against anyone involved in the project and those who facilitated it. A residents’ committee that had overseen the building’s affairs has been abolished, Naqvi said, and a Capital Development Authority member will now look after the building.
The cabinet decisions from the same meeting, including the defence agreement with Kuwait, were covered in Cabinet Ratifies Kuwait Defence Agreement, New Notes.
Why this matters for Islamabad
For Islamabad, the decision closes a long dispute over one of the city’s most visible towers and reopens the question of hotel capacity in the capital. Naqvi described the hotel as a gift to the people of Islamabad, but the test will be whether the promised auction is genuinely transparent and whether displaced buyers are paid in full and on time.
Frequently asked questions
What will happen to One Constitution Avenue?
The government says the building will be turned into a five-star hotel, its original approved purpose, after a fresh and transparent auction.
Who did the JIT blame for the fraud?
Planning Minister Ahsan Iqbal said the team identified Abdul Hafeez Sheikh as the mastermind and found several Capital Development Authority officials colluding in fraud.
Will people who bought apartments be paid back?
Yes, according to the ministers. Iqbal said principal investments would be refunded and adjusted against Kibor interest, while Naqvi said rightful payments to occupants were binding.
Why was the lease cancelled?
The Capital Development Authority cancelled the lease after the company behind the project defaulted on payments, and the Islamabad High Court upheld the decision in April 2026.
When will the hotel open?
Naqvi said the government would try to convert the building into a five-star hotel within months, but no opening date or hotel operator has been announced yet.
