Remember an earlier article about 1MDB’s huge piece of land in Air Itam Penang which was earmarked for 9,999 units of affordable housing? It was said that the Chief Minister of Penang Lim Guan Eng said that nothing else must be built except for the 9,999 units of affordable housing. Since this is within the island, the maximum price for the units would only be RM400,000. It may not be that viable if the whole land is used only for affordable units. Maybe with a very strict cost control, profits may be obtained but it’s not going to be easy. Full article here: 9,999 units promised? Sure, build only affordable and low cost please.
Today, I read in propertyguru.com.my’s news article that the Chief Minister wants to talk to 1MDB on their plans for that plot of land. There was no mention of whether the Chief Minister would be willing to give some flexibility since in his earlier announcement, he was adamant that nothing beyond affordable units are built there. Perhaps this time, let me speak on behalf of the future owners of these 9,999 affordable units. If I am one of the owners, I would also want the area to a developed one, if possible with some additional comforts like a mall, nice restaurants, schools, if possible hospitals and perhaps even a park for my kids to run and play. For one, I would not feel that amazingly cool if everything that I can see are just rows after rows of flats or low medium cost units. It would also not be good for me unless I intend to only stay in such units forever. For prices to also appreciate meaningfully, that development should be sought after. I am not talking about crazy price growth because with majority of affordable units, it would be unlikely anyway. However, just refer to the places where there are just rows after rows of ONLY flats. Think seriously. Do you only want to buy such places? Yes, this is my view if I am one of the owners of these affordable units.
Thus, my hope is that whatever talk or discussion that the state government may want to have with the private developer, it should always be focussed on the benefit for the people, not just currently but also for the longer term. This is not the time to show who’s more powerful compared to the other. While the state government can choose to bulldoze their views across, the private developer can also choose not to proceed any further, sell the land off and even the new owners would still find it tough to build only affordable units. In the end, actually, no one wins anything. In fact the loser would just be the people who really needed a better home compared to what they have currently but still wanted it within the island and not in mainland. Happy talking to both CM and 1MDB.
written on 19 Nov 2014
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