Saturday, September 04 2010
Affordable homes remain a dream
Thursday, 02 September 2010 14:11

By Himanshu Bhatt.

WITH ITS idyllic villages and sprawling fields, Balik Pulau has always been known as the quiet, rustic side of Penang island, fortified by green hills from the hustle and bustle of George Town and other urban areas.

But anyone who thought that the cost of living and housing in this mostly agricultural area would still be relatively low would do well to think again. Since the end of the 90s, developers have descended on the area, making it a target for luxury and medium-cost projects, due mainly to the scarcity of land in other developed parts of the island.

And today, housing in Balik Pulau is probably some of the most expensive in the country for rural and semi-rural areas – with prices ranging between RM300,000 and nearly a million per unit.

The high prices have come about so suddenly that they have raised the ire of locals, many of whom contend that the projects are targeted mostly for people outside the area.

The situation climaxed recently in a livid diatribe by the MP for Balik Pulau, Yusmadi Yusoff, who said that residents of the district have become "mere spectators" as luxury housing projects way beyond their means crop up around them.

Yusmadi’s echoing of the concerns of Balik Pulau residents rings true of the overall housing situation on the island which is today flooded with projects whose prices are best described as "astronomical". The situation has been one of the key issues to be raised by the new generation of young state legislators.

Yusmadi’s colleague, Sim Tze Tzin, the assemblyman for Pantai Jerejak, called on the authorities and developers to build more affordable and livable homes.

"It is a trend that developers are building homes way beyond the means of the general population," said Sim, a member of the state housing committee. "Young working adults find it difficult to even afford a home."

The concerns are not far-fetched. Many projects that take up precious space in the limited land banks of the island are targeted at foreigners and wealthy Malaysians. In Batu Ferringhi, for example, a vast tract of forest on a hill was cleared some years back for Mediterranean-style villas priced in the millions; and snapped up mainly by foreigners.

The situation has spiralled so much that housing in Penang has generally become the most expensive for any state in the country. Link houses on the island are selling for RM600,000 each and above, while condominiums are sold for a minimum RM400,000 with many costing at least half a million.

"It is, without the slightest doubt, beyond the means of around 70% of Penangites," says Sim who, like Yusmadi, is himself in his 30s. He said developers continue to build three-storey "super-link" houses, semi-detached units and bungalows where "prices are astronomical".

"However, these homes are selling like hot cakes and driving the prices higher and higher."

And so what the state needs, Sim insists, are more homes between the range of RM100,000 and RM300,000, which are affordable and, he emphasises, have good living environment, especially for young people.

What makes the issue even more pressing is that the official Penang Structure Plan has projected that by 2020, the state would require 180,500 new houses to fulfil the needs of the burgeoning population. And to achieve this there needs to be an average of 12,300 houses built yearly.

For Yusmadi, what is happening in Penang epitomises the dark shadow of housing that is bound to engulf the country. Malaysia, he says, requires a new national policy on property rights to safeguard its population against rising prices and "market excesses".

The question that dogs legislators like Yusmadi and Sim is why the authorities who exercise strict control over housing plans do nothing to look into the issue of pricing. It is a question many youngsters as well as middle and lower-income Penangites are left to wonder about as they find themselves surrounded in their own state by homes they can hardly afford.

Republished with permission. This article appeared in the Sept 2, 2010 issue of theSun. Himanshu is theSun’s Penang bureau chief.

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Can Penang ride its property boom wave?
Saturday, 28 August 2010 23:51

By Marina Emmanuel.

The success of Penang's bid to woo new investors will hinge on how its government handles the needs of existing investors who are in mega property-related projects.
 
IN the face of an anticipated property boom in Penang, with the prices in upmarket areas likely to cost more due to land scarcity and a hike in building materials and labour costs, the state government's move to request for proposals (RFP) for the development of selected pockets of land is timely.

The good times, which the property players are looking forward to, is also expected to serve as a challenge for the state authorities over the next two years. This is inevitable as all eyes will be trained on the island state, where major reclamation projects by the private sector are due to pick up speed.

As the state government looks at unlocking the value of land that it owns in areas like Bayan Mutiara in the southwestern corner of the island, the manner in which it handles the needs of other property players who are also engaged in land-reclamation developments will be scrutinised over the next two to three years.

The Penang authorities have issued an RFP to develop over 40ha of land at Bayan Mutiara, where the Penang Development Corp's property arm - PDC Properties - has already built and sold high-end properties which make up the first and second phase of its D'Residence development.

In June 2007, PDC sold a 0.82ha plot of land at Bayan Mutiara to the Inland Revenue Board to build a 16-storey corporate tower there.

The Marine Police department had also reportedly invested in about 4ha of land within the development.

The RFP, which invites local and foreign parties to develop 24.8ha of Bayan Mutiara, which is located south of the Penang Bridge, with the potential of developing an additional 14ha via reclamation in future after the development of the initial 24.8ha.

A stone's throw from the Bayan Mutiara development is an iconic waterfront project taking shape, called "The Light" carried out by property giant IJM Corp Bhd.

IJM's subsidiary, Jelutong Development Sdn Bhd (JDSB), was awarded the privatised construction of the Jelutong Highway by the Penang state government in 1997. As part of the privatisation agreement for the construction of the expressway, JDSB was granted the right to reclaim 130ha of land for development. No deadline has been set on when the company will need to complete the entire reclamation.

On the other side of the island closer to the city centre of George Town, high-end property developer Eastern and Oriental Bhd (E&O) has embarked and completed many facets of the first phase of its masterplan waterfront development project, Seri Tanjung Pinang (STP).

The development project is set on reclaimed area at Tanjung Tokong, located to the immediate north of the seafront promenade Gurney Drive.

E&O has an exclusive right (via a concession agreement with the Penang state government) to reclaim, sell and develop 392ha in the area.

E&O has yet to embark on the second phase of STP's development, covering 296ha, which is expected to arise from the seabed, in the form of multi-linked islands just off the coast.

Unlike IJM, E&O has a deadline to meet in completing the entire reclamation exercise for its landmark project.

It is constrained by a 2017 dateline or when the reclamation concession expires, and since it takes an average of three to four years to complete reclamation in deep waters, reclamation ought to commence in about four to five years from now.

In the face of the state government's move to ask for proposals to develop landmark projects in Penang, it is interesting to watch how the authorities are going to manage this exercise in a competent, accountable and transparent manner.

The success of Penang's bid in wooing new investors to the state will hinge on how its government handles the needs of existing investors who are in mega property-related projects.

In the event that existing property players are given a tough time of obtaining the necessary approvals for their projects, it is left to be seen if Penang will truly be able to ride the wave of the anticipated property boom.

**Reproduced with permission. This article first appeared in the August 26, 2010 issue of Business Times.

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Komtar and the tragic street lamp
Friday, 20 August 2010 08:42

By Himanshu Bhatt.

SOME time in the 1880s, the city of Paris saw angry protests after authorities approved a shocking design for a super-tall iron structure to grace the entrance of a world fair the city was hosting. When the Eiffel Tower was completed in 1889 for the Exposition Universelle, it was viewed by many locals with disgust; it was regarded as an eyesore, an ugly metallic mesh that rose rudely above, intruding into the beautiful architectural vistas of their beloved city. It was, in the words of the writer Leon Bloy, a "truly tragic street lamp".

But within just a few decades, opposition against the structure – the tallest in the world at that time – faded and was largely forgotten, as it quickly grew in stature to become an engineering marvel and a pride of France.

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