Fate of 12,000 Housing Units in 57 Islands Remains Uncertain; Proposals Invited for 2,100 Units in 13 Islands Under Contractor Financing
Under this project framework, where the contractor's remuneration is derived from the sale of the developed units, the developer is solely responsible for securing project financing and executing all engineering, procurement, and construction (EPC) activities.
Housing towers constructed in Hulhumale' Phase 2. | getty images
While the progress of the announcement made last year to develop 12,000 housing units across 57 islands remains unclear, the government has now opened opportunities for developers to submit proposals for the construction of 2,100 housing units in 13 islands under a contractor-financed model.
The islands included in this latest announcement were also part of the initial list published in January last year.
Under the previous year’s framework, housing projects were categorized into four groups. Local contractors were eligible to apply for projects involving fewer than 50 units, while both local and international contractors could bid for larger projects ranging from 51 to 150 units, 200 to 250 units, and those exceeding 300 units.
However, the Ministry of Housing, Land and Urban Development has stated that for this newly announced round—which requires companies to secure their own funding—bidding is restricted to 100% Maldivian-owned companies.
Under this developer-funded model, the contractor is responsible for securing finance, as well as managing the engineering, procurement, and construction (EPC) phases. The developer’s investment is expected to be recovered through the sale of the completed units. The government has committed to providing the necessary land free of charge.
The Ministry further specified that at least 60% of the units in each package must be sold as social housing, while developers retain the right to sell the remaining 40% at market rates.
Questions have been raised regarding why these projects, which are entirely funded by contractors, cannot be spearheaded directly by island councils, especially since land resources fall under the jurisdiction of local authorities.
According to the Ministry, the projects must be completed and handed over within two years of land allocation. The units are designed as three-bedroom apartments, which must include parking facilities and commercial spaces on the ground floor.
In this new invitation for 13 islands, the government has notably reduced the number of units per island by approximately half compared to previous plans. Furthermore, the government has yet to clarify the status of the islands that were included in the initial Ministry of Finance announcement but are omitted from the current list.
The designated islands and planned housing units are as follows:
- HA. Hoarafushi: 100 units (Previously 200 units)
- R. Ungoofaaru: 100 units (Previously 500 units)
- B. Thulhaadhoo: 50 units (Previously 100 units)
- Lh. Naifaru: 300 units (Previously 400 units)
- M. Muli: 100 units (Previously 300 units)
- Dh. Meedhoo: 100 units (Previously 200 units)
- L. Gan: 200 units (Previously 500 units)
- Thinadhoo City: 300 units (Previously 500 units)
- Fuvahmulah City: 300 units (Previously 500 units)
- Addu City, Hithadhoo: 300 units (Previously 500 units)
- Addu City, Feydhoo: 200 units (Previously 200 units)
- Addu City, Maradhoo-Feydhoo: 25 units (Previously 100 units)
- Addu City, Maradhoo: 25 units (Previously 100 units)
The Housing Ministry has stipulated that each apartment must have a minimum floor area of 900 square feet, with a maximum selling price capped at MVR 1.5 million. While developers must provide one free motorcycle parking space per apartment, they are permitted to sell car parking slots separately.
The government has also announced that buyers of these social housing and market-rate units will be exempt from GST. Additionally, developers will benefit from duty exemptions on the importation of materials and machinery required for the projects.
Once 20% of the project is completed, developers will be allowed to mortgage their development and sale rights to secure further financing, subject to Ministry approval.
Interested parties are required to submit any inquiries via email to the Ministry by 1:00 PM on the 4th of next month. Technical and financial proposals must be submitted by 1:00 PM on the 17th of next month.
President Muizzu’s presidential pledge includes the development of 20,000 housing units in the north and an additional 20,000 in the south of the Maldives. Despite MVR 2.5 billion being allocated for housing in last year's budget, the public has noted a lack of visible progress on the actual construction of these units.
President Muizzu has reaffirmed his commitment to making this administration the one that secures housing for the highest number of citizens in Maldivian history, emphasizing that providing basic housing remains the top priority of the government. He stated that these major housing initiatives would continue uninterrupted, with the aim of completion and handover by mid-2028.
