Here’s Why Swat Serena Hotel Has Closed

The Khyber Pakhtunkhwa government has issued a clarification over the closure of Swat Serena Hotel, stating that the hotel handed back the property after the expiry of its lease and the completion of a lawful takeover process.

In a statement, the government said the Swat Serena Hotel stands on about 44.6 kanals of land and includes 49 rooms along with allied facilities. Authorities leased the property in April 1985 to Tourism Promotion Services, which operates the Serena chain, for a period of 30 years at an initial annual lease of Rs. 0.5 million, in line with the rules in force at the time.

The lease expired on June 30, 2015, after which the hotel management sought an extension. The government said rent assessments carried out in 2014 fixed the annual lease value at Rs. 8.86 million. Disagreements over the assessed rent led to prolonged litigation, which kept the matter unresolved for several years.

Following court directions, authorities placed the issue before the provincial cabinet, which in October 2021 approved a retrospective lease extension, subject to reassessment of rent on fair market principles and final approval through relevant technical forums.

In line with the cabinet’s decision, authorities conducted fresh rent assessments. These reviews set the annual lease value at Rs. 13.27 million in 2022 and later at Rs. 104.69 million per year, as determined by a multi-departmental committee chaired by the director general of the Culture and Tourism Authority.

The government said the assessments aimed to reflect market realities, protect public interest, and comply with applicable laws and policies. The statement said the hotel made interim lease payments during this period, but authorities did not finalize the lease terms.

Officials later determined that existing provincial lease policy did not allow a further extension and that the original lease agreement had effectively expired. Authorities placed the matter before the board of directors of the Khyber Pakhtunkhwa Culture and Tourism Authority in January 2025.

The board deferred the case pending approval of a comprehensive provincial leasing policy. In December 2025, the hotel management formally informed the authority of its intention to hand over the property. Officials completed the lawful handover and takeover of possession on December 31, 2025.

The government said the KP Culture and Tourism Authority will now lease the facility through an open, transparent, and competitive bidding process. Authorities aim to ensure optimal use of the asset, maximize public revenue, and strictly follow legal and policy requirements.

Based on third-party market assessments, officials expect the auction to generate around Rs. 4 million per month.

The clarification followed the hotel’s announcement that it will cease operations from January 1, 2026, ending nearly four decades of service in the Swat Valley. In a notice, the hotel management thanked guests, partners, and associates for their support and highlighted the property’s role in promoting tourism in the region.