KARACHI: A United Arab Emirates-based real estate company, Diyár Homes Limited, will invest $30 million in Pakistan’s second major city of Lahore, an official from the company said on Monday. 

Prime Minister Imran Khan, whose government believes construction-related activities have a multiplier effect on the economy, has chosen the construction sector to stimulate the economy.

Khan’s government last year said it will subsidize low-cost housing and forgive tax evaders if they invested in construction projects. Banks have also been asked to increase their outstanding mortgages by at least 5 percent by December. Cement stocks have outpaced the nation’s benchmark index.

Pakistan’s consumer home finance, which is one of the lowest in South Asia, increased by 18 percent to a record 97.8 billion rupees this May, according to Foundation Securities Pvt. The country has also seen its first real estate investment trust in more than six years.

“The investment will be made in Lahore where a site has been acquired in the main city for a waterfront development project,” Zeeshan Shah, Diyár Homes Limited co-founder, told Arab News on Monday from London, saying the development would set a new standard for Pakistan’s super luxury real estate sector. 

“The company was planning and waiting for the right opportunity to make the investment in the Lahore’s prime real estate market for the last 24 months,” Shah said, adding that his company was for the first time “bringing the world’s leading consultants from the engineering, design and architecture world to Pakistan.” 

Through his project, he said, his company aimed to attract overseas Pakistanis to invest in their home country’s real estate sector.  

Last week, Khan launched an initiative by Pakistan’s central bank to secure investment from overseas Pakistanis in the country’s housing sector, calling it a “game changer” for the national economy. 

Pakistan has also created its first Real Estate Investment Trust (REIT) after a span of six years, as the country tries to improve its regulatory environment and provide incentives to the domestic construction industry.

The REIT was set up by Arif Habib Dolmen REIT Management Limited, which launched a similar initiative in Pakistan in 2015.