The only thing in common between a swindler and the swindled is the desire to make easy money. One can understand this by looking at the success of Pakistan’s richest and most successful Town planner, Malik Riaz. Every project of Bahria is ever more impressive than the one before it, courtesy it’s ever increasing ability to illegally acquire land and cheating public of billions of Rupees. Supreme Court in its decision in May this year found massive illegalities in the process of Acquiring land by Bahria town but at the same time in a way legitimized the sale of the government land to a private entity. The Apex court had observed that since the third party interest has been involved thus the land can be allotted to Bahria town a fresh under the Colonization of Government Lands Act, 1912. The decision has given Bahria a Clean chit with regards to the controversy surrounding procurement of land. No wonder why with impunity Malik boasts that the bribes he has given to the most powerful in the country protect his interests.
Irrespective of the violation of procurement laws one would certainly agree to the fact that the development done by Bahria is incomparable . Even the all powerful Defence housing scheme and lately fazaia housing has failed to even copy the development done by Bahria town. More over the rate at which Bahria sells its plots are such that it’s hard to understand how they end up constructing such a well planned state of art society. The answer to the question in part is in the fact that Bahria’s whole business model is based on earning profits at someone’s loss.
On the marketing end, Bahria over the years has managed to create and grow a system of dealership. One must understand that these are practically Bahria’s employees or to express it accurately “Slaves”. They are not allowed to invest anywhere but Bahria and at any time they have been made to invest billions of rupees in dead investments. This all is done to ensnare them. They follow what is told. The man who manages this entrapped dealer mafia is a ruthless profiteer and Malik’s Head of Marketing, “Mr Shahid Qureshi”.
It is said that Malik takes his profit before the deal is even floated. Mr Shahid Qureshi hands over his boss the amount he intends to make as profit with regards to a particular project, before hand, by collecting it from the dealers. Once the mafia head Malik is paid off its just up to the dealers and Shahid to play the way they want. Any dealer who fails to contribute the minimum amount assigned by Shahid has to suffer dire consequences. Shahid has made a lesson out of them. It is believed that he has made them bankrupted within days, while talking to newswatchpakistan.com a dealer on the condition of anonymity mentioned the case of Newyork real estate, violating the code ended up bankrupted. He remarked “Poor Musharraf (owner of Newyork Real Estate) has developed heart disease, sugar and many health issues even in his late twenties because of stress”. He added, few who even had escaped bahria town’s shackles and secretly had been investing and taking out their money from bahria were not spared. Like a mafia they were followed and targeted, the whole Government machinery started to work against them. The laws that somehow never seem to work for bahria became relevant. The development authorities made life hell for them and fictitious application for stay orders against their projects were granted within minutes. The Local land mafia most of them which has been created and funded by Malik started their activities against them so much so that their very lives were threatened. This all is done to make sure that they cannot work in real estate in Pakistan. Every project they have initiated is made to be a failure so that they are made a lesson for the rest of the members. Shahid runs Bahria dealer network on a principle “The money earned in bahria should never escape bahria”.
Bahria before even buying the land sells the plot via floating thousands of registration forms. Even though at this stage Bahria hasn’t even bought the land for the project completely. Mostly the trade starts between dealers, once the rate starts to increase, they lure their investors to invest – The profits made through gambling in the registration forms is too attractive for the investors to resist. The supply of the registration forms is controlled by Shahid, he tells them how many they can float, carefully managing the supply , a fake demand is created, the rates of the forms start to increase. Investors are shown the potential, the black money is attracted, the innocent public in order to make few quick buck jump in. The gamble initially pays off, money is made attracting more and more and thus within a few days the market goes in to a state of frenzy. Logic is defied. Speculation makes people enter the gamble at the peak rates. Thousands of forms are sold to public. A huge amount of money is collected, and then at a certain point Shahid allows the dealers to start selling their inventory. Within no time the dealers have sold their entire inventory at unimaginable profits. Parties start, some of them can be classified as rave.
Shahid still has work to do – the amount of registration forms floated are many times the number of plots bahria has to develop or can possibly develop. They must be equated. Bahria has to buy them back but not at the rates sold, rather at even lower than the booking rate. Massive amount of registration forms are floated they increase the supply, while dealers not buying, there is no actual demand. The rate drops rapidly. Those who have not escaped on time will have to lose, the game now is to sell it as soon as possible to minimize the loss, those who don’t sell might have to sell it at rates way lower than even the control price mentioned on the form. According to Majid Khan a Sub Dealer of Bahria town, in a day the rates for Bahria apartment’s form dropped to 5lac from 28lac. He told newswatch.com that he had bought the registration form for 10 lacs from Prism Estate. Majid Khan remarked, “The key is to exit before the dealers start selling”. He told newswatch.com “if you are not part of Shahid’s Dealer Mafia, you can only loose all your wealth and health in bahria town.
Once the rate has been dropped, Bahria through its dealers orders them to buy back the registration forms and submit them to Bahria. This way the excessive amount of registration forms are reduced. This process of buying back forms and files continues at different stages of development till it’s time to hand over the plot. Most of the time Bahria has managed to buy back even more forms and files they sold and subsequently own 30%-40% of the plots even after selling them to the public multiple times. At times when they have not been able to buy back enough to equate they offer adjustment deals by which they give the investor discount on installments by attaching a file instead of the installment.
In part, the differential of rate of buying and selling of the files is what provides an answer to the question of how Bahria manages to construct the infrastructure while selling plots initially at very competitive rates. In reality they have taken from public way more than the control prices they mention behind the back of the registration form for the development. So in essence the money taken by bahria for constructing your “Qaid villa” is the amount you paid along with the amount they made during the process of gambling at the launch of the project.
But one can’t find an answer why the government is keeping a blind eye on this real estate gambling business where people are losing their saving of lifetime. One fails to understand why bahria is allowed to sell more forms and files than the acquired land and why is it that it gets away with almost every scam successfully.