Green plans for landfill

GEORGE TOWN: The state government has made plans to turn the Jelutong landfill into parks and a site for mixed development projects.

State Local Government and Traffic Management Committee chairman Chow Kon Yeow said the plans would be carried out through a proposed landfill mining and reclamation (LFMR) process.

He said the LFMR process is a proposed recovery and reutilisation project for the landfill.

“The state government has decided to give the Penang Development Corporation (PDC) the responsibility to carry out the project.

“In a meeting last week chaired by Chief Minister Lim Guan Eng, the state government asked PDC to appoint a consultant to set the specifications and criteria for the LFMR process within three months.

“After the specifications and criteria have been set, PDC will call for an open tender or Request for Proposal to invite local and international experts with experience in LFMR to submit their proposal to make the Jelutong landfill reusable for better land-use again.

“We will leave it to the experts to use their expertise to turn it into parks and a site for mixed development projects.

“We will also leave it to them to come up with their own operations on how to recover and reuse the waste materials and to treat and rehabilitate the landfill.

Estimating that the site recovery would take about five to 10 years, Chow said the move would also help to solve some of the existing problems concerning the landfill such as the removal of the potential peat fire threats as well as reducing the production of methane and carbon footprint.

“The possibility of toxic contamination of underground water sources can also be reduced. In addition, LFMR would also increase the land value of the Jelutong site and the social grievances of neighbouring residents will be resolved.

“For the state, this is another one of our green projects to improve the environment for the future generation,” he said. - The Star

Penang govt urged to cancel hillslope projects

GEORGE TOWN: The Penang government should cancel controversial hillslope projects, even if it will incur losses, Penang Gerakan local government bureau head Teh Leong Meng said.

Teh said the state government should do what was best for the people.

Asked if the state should go to court to cancel upcoming hillslope projects even if it may result in massive losses to the state, Teh said: “Correct, because you have to comply with the law and do the right thing.”

Teh, however, claimed that it was unlikely that the state would need to fork out any compensation to developers if the matter was brought to court.

He said even though approvals for certain hillslope projects may have been obtained years ago, a new legislature in the form of the Penang Structure Plan came into force in June 2007.

“This structure plan was gazetted on June 28, 2007 and supersedes all other guidelines.

“It clearly says that high-risk slopes, which include land above 76m or have a slope gradient of over 25 degrees should not be used for housing,” Teh said.

He claimed that the law was not bound by retrospective legislation and since a number of the hillslope projects had yet to begin construction, the state could now reject renewals for building permission based on the new legislature.

Questioned about hillslope projects that had been approved by the previous Gerakan-led state government after the Penang Structure Plan had been enforced, Teh said he could not comment as he did not have the full facts.

Asked about Penang Chief Minister Lim Guan Eng’s challenge to provide a letter of indemnity to cover any possible compensation costs, Teh said there would be no element of risk should other parties pledge to cover any losses. - The Star

Property buyers to be screened by estate agents

PETALING JAYA: Potential property buyers are to be screened before meeting estate agents in a precautionary move by the Malaysian Institute of Estate Agents (MIEA).

This follows several recent cases of attacks against agents by so-called buyers.

MIEA deputy president Siva Shanker said it had no choice but to implement the steps although it would involve more work for agents and clients.

“Agents have been told to screen potential buyers and record as much information as possible like vehicle licence plate numbers before setting up appointments.

“We have also informed agents to always meet them outside the premises first before viewing and be in constant communication with their offices,” he said, adding that the institute had also come up with a set of tips for agents.

“We have informed members to verify their customers, always work in pairs, not to set viewing appointments at night and register themselves at the property's guardhouse.

“We have also told them to carry pepper spray for self-defence.

“Five cases in two months is too much,” he said, adding that the institute was convinced that the robberies involving estate agents were premeditated. - The Star

郑雨周向市政局表明难以接受 反对海边地建超高楼

（槟城16日讯）超级高楼公寓发展计划引争议！槟岛北岸峇都丁宜海边地，拟议建一栋发展总值上亿令吉计的49层楼超高楼公寓，然而计划遭当地州议员“阻拦”，反对筑起这栋丹绒武雅选区最高的建筑楼。在山坡发展引起争议，酿发朝野互相指责之际，在丹绒武雅这个旅游地带，同时出现高密度发展计划争议，该计划被指也是峇都丁宜海岸线度假地的最后一块海边私人地；有关计划的高度被指超“破格”，一旦完工将成为北岸第一高楼，相信也是槟岛数一数二的超级高楼。
丹绒武雅区州议员郑雨周受询时表示，这项计划是在峇都丁宜海湾酒店毗邻的一片黄金地，该地也是峇都丁宜最后一块海边私人地。他在上月接获槟岛市政局城乡规划局告知，地主拟议提高容积率（Plot Ratio），在该海边地打造49层楼高建筑，而他也已针对此事向市政局表明其反对立场。
他表示，目前在其选区，分别在丹绒武雅及峇都丁宜个别有一项海边地计划拟议开动，而在峇都丁宜上述49楼高楼计划却是在新近提呈，而他已回函市政局提出反对。他说，由于丹绒武雅至峇都丁宜为槟城旅游地带，也是山坡生态敏感区，再加上该海边地也在传统上面对高楼限制，所以他反对允高楼在海边上矗立。
他说，前朝政府执政时已允许当地一些破格先例发展，造成开始出现高楼情况，包括沙洋酒店的新建筑也爬高至9层楼，而“By The Sea”高级公寓计划也爬高至最高11层，可是他难以接受49层楼高的公寓拔地而起矗立在海边。他提及，除了上述传统对海边沙滩地拟定的高度限制，目前其选区也面对“次要发展走廊”争议悬而未决，所以他要求暂时冻结任何与该争议有关的高密度发展计划。此外，他也表示反对另一项座落在丹绒武雅海边的33层高楼计划，目前他尚在等候市政局告知下文。- 光华

Residents unhappy over hillslope projects

GEORGE TOWN: Residents living around a hillside construction site in Sungai Ara here are unhappy over the project.

More than 30 representatives from four resident associations of SunriseGarden, Regency Heights and Raintree Garden A and B gathered to voice their grievances and concerns over the project.

State Gerakan local government bureau head Teh Leong Meng who met the residents, claimed that the developer was building two clubhouses and 14 blocks of apartments on a piece of land measuring about 32.7ha.

“The apartment blocks are between 10- and 21-storeys high. The project approved in February this year is above 76m. There will also be 92 bungalows.

Grave harm: A bald ugly spot in Bukit Gambier where a high-rise condominium project is set to emerge.

“The residents are unhappy that the project was allowed to proceed and want the state government to stop it,” he said yesterday.

He said the residents' primary concern was the issue on safety.

“Once the project is completed, the green lungs in the area will also be destroyed,” he claimed.

After visiting the group, Teh met up with another group of 15 residents from the Bukit Gambier area who also protested against a hillslope project there.

He claimed that the developer was building a 38-storey condominium along with seven bungalows.

“This project on 3.57ha of land is also above 76m and there will also be immense hill-cutting activities here,” he claimed.

He said the residents were against the project and were worried there would be flash floods or landslides.

“Even though the developer can claim they have taken slope protection measures, who can guarantee total safety?” he asked. - The Star

Our cars are costing us our homes

WHEN I first started my job as an architect in the 1960s, I was on a three-year contract with a monthly salary of RM628. I bought my first car, a Peugeot which cost RM7,724, equivalent to approximately one year of my salary. The car became my reliable companion for 14 years. Those were the good old days, when a car could be bought with just one year of a fresh graduate's salary.

Circumstances have since changed. Today, for a fresh graduate to own a car in Malaysia, it will easily cost him four years of his salary to purchase a foreign car, and even a local car costs around two years of his salary. If we take into consideration his living expenses and other commitments, it may take him even longer to settle his car loan. Hence, it has left him with very little option but to take the maximum car loan financing tenure of nine years.

In the table illustration below, a fresh graduate in the Washington D.C. earning about RM11,000 (about US$3,500) per month can easily buy a Japanese Honda Civic or Toyota Corolla worth RM50,000 as it is only 0.4 times of his yearly salary.

On the other hand, a fresh graduate in Malaysia earning about RM2,500 per month needs to pay RM120,000 if he would like to buy the same type of car. It costs him four times his gross yearly salary. This ratio is 10 times higher than his US counterpart.

For youths in Malaysia, buying a car is more expensive both in real terms, and in terms of debt-to-income ratio. In reality, it means they have to either purchase a car with lower price tag or commit to a longer term loan to own a car, which cost them the opportunity of owning a home.

This situation requires our youth to choose between buying a car or a house first, and many have committed to own a car first, considering our public transportation system is still in the process of being improved.

Many fresh graduates in Malaysia who start to serve their car loan tend to delay their plan of purchasing a home.

Unfortunately by the time they can afford to purchase a home, be it three, five or nine years later, the price of a property would have escalated due to among other things, inflation, higher construction cost and higher land prices.

While it may be safe to say that their salary would also increase, generally speaking the increment may not aligned to the rate of inflation. In most cases, owning a home will be a huge debt lasting 30 to 40 years of housing loan repayment.

What can be done differently to change the circumstances? Is there a better way for them to financially plan their future? These are questions that Malaysian youths ought to consider before purchasing any big-ticket items.

Let's look at the table again. It also lists the median price for three-bedroom apartments in the suburbs of these cities. The median price of an apartment in the Klang Valley is around RM300,000, equivalent to 10-year gross income of our fresh graduates. The affordability level is more favourable compared to other Asian countries, such as Indonesia and Thailand. The prices of same size apartments in Jakarta and Bangkok range from RM350,000 to RM400,000, and costing their fresh graduates 13 to 18 years of gross yearly income to purchase a house.

Therefore, when it comes to the question of home affordability in Malaysia, we are blessed compared to our regional peers.

However, there are many factors that contribute to the challenge for our youths to own a house. Two primary factors are the additional financial commitment of purchasing a car, and the relatively lower income level in our country compared to our Western counterparts.

When fresh graduates spend a substantial amount of their salary paying for a car, they are left with little savings to own a house, and their house affordability level decreases over the years as prices rise due to inflation.

Clearly the income level of our graduates has to rise, to enable better quality of living and higher affordability level, which is the current government's focus to make Malaysia a high income nation by 2020.

Perhaps it is also time to re-look at our national car policy and how it has affected the house affordability level in Malaysia. From the numbers above, it is clear that our cars are costing us our homes. - The Star

> FIABCI Asia Pacific chairman Datuk Alan Tong has over 50 years of experience in property development. He was FIABCI World president in 2005/06 and was named Property Man of The Year 2010. He is also the group chairman of Bukit Kiara Properties. (email atfeedback@bukitkiara.com)

RM6.5b projects planned in Penang

KUALA Lumpur and Penang-based developers are planning to execute some RM6.463bil worth of residential and commercial properties on the island and mainland in the second half year and 2013 despite the tightening of housing credit by banks and a gloomy global economic outlook for the future.

SP Setia Bhd (RM2.563bil GDV), IJM Land Bhd (RM608mil GDV), Mah Sing Group Bhd (RM180mil), Sunway Bhd (RM385mil GDV), Ideal Property Development Sdn Bhd (RM1.1bil GDV), and Ivory Properties Group Bhd (RM1.6bil GDV) are among the developers with plans for new housing projects in Penang.

The developers are displaying some of these projects at The Star Property Fair 2012 held at the Gurney Plaza and G Hotel from July 12-15. About RM6.105bil of projects are located on the island, with the remaining RM358mil planned for Seberang Prai, to be undertaken by Sunway and IJM Land in the second half year and 2013.

As land is still available in the South-West district, the area which covers residential cum commercial neighbourhoods such as Sungai Ara, Batu Maung, Bukit Jambul, Sungai Nibong and Teluk Kumbar continues to be popular locations for developers such as SP Setia, Sunway, IJM Land, and Ideal Property to launch their projects.

With the exception of Sunway Cassia and IJM's Trehaus landed property schemes project in Batu Maung and Bukit Jambul, all the other properties planned for the island comprise high-rise projects.

Visitor Chan Lai Ming (left) listening to Hong Leong Bank personal financial consultant Yeoh Wei Kheng (centre) and SP Setia property division (North) sales and marketing senior executive Agnes Chua explaining details of their projects.

Real Estate and Housing Developers' Association (Rehda) Penangchairman Datuk Jerry Chan says the trend of development on the island will be towards high-rise developments due to rising land cost.

“A few years back, developers could still build landed properties because they could be priced attractively.

“Nowadays with land cost escalating by about 20% from last year, developers will have to price a semi-detached house from RM900 per sq ft onwards in a prime area like Pulau Tikus as the cost for net land plot is RM500 to RM600 per sq ft.

“If the semi-detached unit has a built-up of 6,000 sq ft, the selling price will be RM5.4mil.

“How many people would fork out RM5.4mil for a semi-detached home?” he asks.

The cost of a plot of net land in a prime area like Pulau Tikus is between RM500 and RM600 per sq ft. In Tanjung Bungah and Batu Ferringhi, land is priced between RM300 and RM400 per sq ft, while in the South-West district it is between RM100 and RM200 per sq ft.

Chan says there is still demand on the island for landed properties priced below RM2mil and condominiums priced below RM1mil.

”This is the reason developers are still carrying out their plans to launch projects despite the stricter policies on housing loans and concerns over the upcoming general election.

“The state's economic status is still sound,” Chan says.

Penang Master Builders' and Building Materials Dealers Association executive advisor Datuk Finn Choong says developers are launching projects also because of stability in raw material prices.

“By launching their projects now, developers can lock on to the present prices of construction materials for their projects.”

This means developers can price their properties within the RM400,000 and RM500,000 range

IJM Land senior manager (sales and marketing) Patsy Lee (right) detailing one of the company’s projects to Ivan Oh Eng Lim and Tan Gek Im at The Star Property Fair 2012 in Gurney Plaza.

Affordable range

“A number of the projects planned for launching in the South-West district this year and next year are priced within this affordable range,” he says.

As demand for construction materials for the residential sector has softened over the past 12 months, the pricing of cement, for example, has also not gone above RM15 per 50 kg bag since late last year.

At the peak two years ago, the pricing of cement was above RM18 per 50kg bag.

Henry Butcher Malaysia (Penang) director Dr Teoh Poh Huat says the Penang property market sentiment is still positive.

”High net-worth Penangites living overseas still have confidence in the local property market. Thus, the property values look set to grow, particularly for those properties which are well designed, in good locations, and underpinned by a reputable developer,” he says.

Meanwhile, Henry Butcher Seberang Prai senior manager Fook Tone Huat says the price for properties in Central Seberang Prai has appreciated by about 20% since 2010.

“In prime locations of Seberang Prai, a semi-detached house is now priced about RM750,000, compared with about RM600,000.

“A terraced house in a similar location is now priced about RM350,000 compared with about RM280,000 two years ago.

”Similarly, a bungalow in a Seberang Prai prime location is now about RM1mil, about 20% more than two years ago,” he says.

The value of commercial properties in Seberang Prai has also appreciated by about 20% compared to 2010, Fook adds.

”A three-story shoplot in BM Business Park is now priced around RM700,000.

”The value of properties in Seberang Prai is now on the rise because more people are investing in properties on the mainland as the second bridge is scheduled to be completed soon and more funds are coming into the industrial park of South Seberang Prai,” he says.

From SP Setia, there are RM1.288bil worth of properties to be undertaken for the South-West district in the second half and in 2013, while the remaining RM1.275bil of projects are planned for Tanjung Bungah and Sungai Nibong in the North-East district.

These projects include the RM250mil Setia Triangle launched in June, a commercial cum residential scheme in Sungai Ara, the RM335mil Setia Greens 2 in Sungai Ara and a RM53mil condominium project in Teluk Kumbar which will be launched end of 2012 and in early 2013 respectively.

Wave and Breeze

In 2013, SP Setia plans to launch the Wave and Breeze condominium projects for Setia Pearl Island in Sungai Ara, with a GDV of RM350mil and RM300mil respectively, and a RM175mil condominium project in Sungai Nibong.

In the North-East district of the island, SP Setia's plan is to launch a RM1.1bil mixed-development project in Tanjung Bungah.

“Land on the island is becoming scarce. Since SP Setia wants to continue playing a dominant role in the property market on the island, it is seizing every opportunity to expand its land bank, capitalising on attractive deals,” SP Setia Property (North) general manager Datuk S. Rajoo says.

Penang-based Ideal Property Sdn Bhd has lined up residential and commercial projects with a collective GDV of RM1.1bil for the South-West district from now till the second quarter 2013.

The group plans to launch in August the RM400mil Imperial One project in Sungai Ara on a 9.1-acre site, comprising 768 units of condominiums with built-up areas of 1,050 sq ft and 1,250sq ft priced between RM399,000 and RM499,000 per unit.

The RM400mil Imperial Two, which is waiting for approval and likely to be launched in the second quarter of 2013, comprises properties to be priced between RM400,000 and RM550,000.

Early next year, Ideal plans to launch the first phase of the Ideal Vision Park, a RM1.5bil mixed-development scheme comprising 1,945 units of residential and commercial properties and 550,000sq ft of commercial space.

The first phase comprises RM300mil worth of high-rise residential and commercial properties, which will be priced between RM400,000 and RM600,000. There are four more phases for Ideal Vision Park that will be launched in stages in 2014 and 2015.

Ideal Property managing director Datuk Alex Ooi said the stability of construction material prices allowed developers to build more affordably priced properties that had a wider appeal.

”This is why we are able to focus on building properties priced between the RM400,000 and RM600,000 range,” Ooi adds.

Sunway is undertaking the RM200mil Sunway Cassia project in Batu Maung in November, which comprise 59 units of three-story terraced homes.

IJM Land plans to launch in late 2012 the RM85mil Trehaus scheme, comprising 26 semi-detached properties and 46 villa condominiums, in Bukit Jambul.

In the North-East district, its projects comprise the RM350mil Light Collection III, comprising 190 condominiums and duplex townhouses next to the Penang Bridge on the island. Ivory Properties Group Bhd (IPGB) plans to launch in the second half of 2012 approximately RM1.6bil worth properties on the island.

These projects comprised the first phase of Bayan Mutiara, which has a GDV of about RM800mil, the third and fourth phases of the residential towers for Penang Times Square, which has a RM300mil GDV, a RM130mil sea-fronting condominium block in Batu Ferringhi, and the RM400mil City Mall and City Residence project in Tanjung Tokong.

Elsewhere, Mah Sing plans to launch RM180mil worth of low-rise condominiums in the Batu Ferringhi tourist belt later this year.

Group chief operating officer Teh Heng Chong says Mah Sing will focus on residential properties priced below RM1mil in Penang, Kuala Lumpur, and Johor.

At present, about 70% of our launches are in this price segment, which comprises mainly small serviced residences and linked homes.

In Seberang Prai, the projects planned include the RM185mil Sunway Wellesley by Sunway, comprising residential and commercial properties, and the RM173mil Permatang Sanctuary scheme, comprising 300 semi-detached and bungalow properties.

The Permatang Sanctuary semi-detached properties are priced from RM438,000 onwards, while the bungalows from RM625,000 onwards. - The Star

‘No’ to price speculation

PEOPLE generally like to invest in properties. It is easy to understand you buy a house. It is a simple, tangible investment. It is long term and financing is usually easy. Most people tend to have positive experience after buying their first home, which normally would appreciate after a decade or two.

Simple things can morph into complex series of events. Buying houses may turn to speculation, massive speculations become a boom and bust “housing bubble”; banks may collapse from huge bad mortgages, a financial crisis and then a government bailout ensues, an economic recession soon follows. These events sound a little too familiar.

Low interest rates, massive liquidity and investors shying away from volatile stock markets, are some of the many reasons cited for Asia's potential property bubbles today. From 2009 or so, private residential properties have seen large average price jumps in China (Beijing +100%), Hong Kong (+53%), Singapore (+53%), Malaysia (+21%) and Indonesia (Jakarta +14%).

Asian policy makers have taken many pre-emptive actions to control this property “bubble”, usually by regulating excessive speculation and guiding mortgage lending by banks. In Hong Kong, policy makers try to discourage speculators by raising special stamp duty for short term resale of residential property (5% to 15%, depending on holding period); in Singapore, measures include a hefty extra 10% stamp duty on purchase price for non-residents. In Indonesia, there's a maximum 70% property loan limit.

Recent data suggest such curbs did not slow the Hong Kong or Singapore property markets for long. Transactions or prices picked up again recently. We believe however, if Asian property prices rise rapidly again, tougher curbs may be in the cards. The slew of increasingly tough measures in China the last 18 months is seen as an example. An avalanche of curbs eventually made China home prices dip for eight straight months up to May 2012.

Historically, financial crisis in many countries (Japan 1991, US 2008 and Spain today) are caused by property price bubbles bursting hurting consumers, banks and businesses. Therefore, it makes a lot of sense to have responsible lending.

Asian policy makers, having learned bitter lessons from the 1997/98 financial crisis, sees pre-emptive measures to control any potential property “bubble” as crucial to avoid banking problems or crises.

Governments in Asia on the one hand want to curb excessive price speculation, while at the same time, know that home ownership is a very important (and personal) issue notwithstanding it is also a big contributor to domestic economic growth.

What Asian policy makers aim to do is best captured in a Chinese phrase, which literally means “in peace time, think about danger”. The best time to prepare for rainy days is when the sun is shining it's a lot harder to do so in a storm.

The biggest challenge for policy makers is to develop a sustainable property sector and promote home ownership (especially first time house buyers) without boom and bust. That includes the balancing act of curbing property speculation without inadvertently pulling the brakes on the economy.

Some Malaysian non-listed property developers I met recently have expressed deep concerns that sales of their high-end, new condominiums are lagging, because buyers find it difficult to get financing.

Bank Negara's curbs on lending for third property mortgage (maximum 70% financing) and stricter banks credit standards appears to be working for now.

The intent of Bank Negara, we believe, is to nip excessive property price speculation in the bud. Current property curbs ensure at least prices don't run up too fast and banks may allocate more funds to first time house buyers rather than investors or speculators.

Interestingly, property developers who don't complain about curbs are often the established ones who prefer sustainable growth, rather than a boom and bust property market. I believe many property companies have learnt not to borrow too much.

Tellingly, the top five Malaysian listed property developers have reduced average net gearing from 70% in 2000 to 18% in 2011, (Indonesian and Thai property developers reduced from 612% to 9% and 255% to 84% respectively). Asean property companies today are undoubtedly less leveraged with healthier cash reserves.

That's one reason why most property developers in Malaysia, Indonesia and Thailand for example, are not rushing to unload properties at massive discounts, even as property curbs bite into sales. They know current measures are temporary and consumer demand is likely robust for quite some time.

Asian consumers are financially better off today. Healthy employment and wage increases across Asia means consumer demand for housing will likely stay buoyant and house prices, like in normal times, will gradually rise over time.

However, the intriguing impact on Asian properties today given the mind set and propensity of policy makers to pre-empt any potential property bubble I believe periods of excessive property price appreciation in many Asian property markets may already be over for now.

I believe policy maker's curbs on excessive price speculation is a right policy. Even if there's short-term pain, it will likely make Asian economic growth sustainable for the longer term in these difficult times. - The Star

Teoh Kok Lin is the founder and chief investment officer of Singular Asset Management Sdn Bhd.

Seeking more land from E&O

KUALA LUMPUR (July 12): The Penang  government is seeking as much as 20% of the net reclaimed land from Eastern & Oriental Bhd (E&O), which holds the concession to reclaim up to 980 acres (396.5ha) at the seafront Tanjung Tokong strip.
Penang Chief Minister Lim Guan Eng said the state government has been in negotiations with E&O to obtain the additional land to settle the property developer’s obligation to install traffic dispersal infrastructure.
“Earlier, they were supposed to give us about 5% to 10% of the land but we negotiated and now we are getting 20%,” Lim told The Edge Financial Daily in a recent phone interview.
In an immediate response, E&O deputy managing director Eric Chan Kok Leong said the concession agreement for the Seri Tanjung Pinang reclamation project stipulates that only 10% of the net saleable land will be made available to the state.
The net saleable land is derived after taking into account space for roads, public utility areas and public amenities.
Chan, however, did not specify the exact amount of land to be handed over to the state government.
“The developer will address its development infrastructure obligations for the project, including traffic infrastructure, in the course of the master planning process,” Chan said in an email reponse to The Edge Financial Daily.
The general rule of thumb is that the net saleable portion would usually comprise about 55% of the total reclaimed land size, according to a senior property analyst.
Based on this estimate, the net saleable portion of Seri Tanjung Pinang works out to be about 539 acres (215.6ha) from the total 980 acres to be reclaimed.
Analysts said the Tanjung Tokong land could be worth about RM25 psf or RM10.89 million per acre going by recently transacted prices of comparable land in Penang.
This means that the Penang government stands to receive land worth at least RM586.97 million based on the estimated 10% net saleable land area promised to it under the concession agreement.
E&O’s subsidiary Tanjung Pinang Development Sdn Bhd had in 1992 won the exclusive right to reclaim and develop 980 acres in Tanjong Tokong.
It has reclaimed about 240 acres under Phase 1 which is under ongoing development.
Last April, E&O announced that it received approval-in-principle to reclaim the balance concession area of 740 acres.
In an earlier interview with The Edge Financial Daily, the chief minister explained that the land obtained from E&O would be used as a “bargaining chip” to get companies to build highways and a tunnel at no cost to the state government.
This forms an integral part of Lim’s earlier plan to build RM5 billion to RM8 billionworth of infrastructure to cope with the expected rise in traffic volume especially on Penang island.
Lim had said these ambitious plans would be undertaken on a public-private partnership basis where the projects will be funded via land swaps or toll collections.
The deal is structured in a way where companies keen on a slice of the increasingly scarce seafront land can propose to build the infrastructure and receive the reclaimed land as payment in kind.
“E&O will give us land to fulfil their traffic requirements. As for the other projects, I use the land as a counterweight, as the chip for them to build the infrastructure and exchange,” Lim had said.
The open tender exercise is said to have attacted both local and regional construction firms.
The Penang government last year held a pre-qualification exercise in which it unveiled plans to build a 6.5km undersea tunnel to link Butterworth on the mainland and Gurney Drive on the island.
There are also plans to construct a 4.2km bypass linking the tunnel to the Tun Dr Lim Chong Eu Expressway  and a 4.6km bypass from Bandar Baru Air Itam to the expressway.
The fourth planned piece of infrastructure is a 12km paired road to the existing coastal road connecting Tanjung Bungah and Teluk Bahang.
Lim said construction is only expected to begin in 2016 with completion tentatively slated for 2020 due to the rigorous environmental studies and surveys that need to be conducted.

This article is appeared in The Edge Financial Daily on 12, July 2012.

Penangites cash in

MOST of the visitors who have purchased properties at The Star Property Fair 2012 are Penangites, who are attracted to property priced below RM1mil.

IJM Land Bhd senior manager (sales and marketing) Patsy Lee said the group had locked in RM12mil worth of sales for the first day.

Some RM7mil of sales were generated from the Vertiq, a condominium project in Metro East-Udini, and the condominium-cum-duplex loft -The Address in Bukit Jambul, while The Light collection III generated another RM5mil.

The selling price of Vertiq starts from RM700,000 onwards, while The Address in Bukit Jambul from RM900,000 onwards, and The Light Collection III starts from RM800,000 to RM3.5mil.

”Most of the buyers are attracted to projects that are priced below RM1mil,” he said.

Ivory Properties Group Bhd corporate communications manager Ann Tan said the group sold RM5mil worth of projects, comprising sales from The Latitude in Tanjung Tokong and The Wave in Penang Times Square, which are priced between RM600,000 and RM700,000.

SP Setia Bhd (Penang) sales and marketing manager Susie Loh said the group registered RM6.3mil in sales from the Setia Triangle in Sungai Ara and Setia V Residences project in Gurney Drive.

Ideal Property Development Sdn Bhd sales marketing manager Teh Yeow Jin said the group generated some RM2.5mil sales from its Fiera Vista condominium project in Sungai Ara, which were priced from RM500,000 onwards.

”We got about 300 people registering for our forthcoming project, Imperial One in Sungai Ara, which will be launched later,” he said. - The Star