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BSNC: Why was SPV condo project approved in eight days when Penang affordable housing project took 223 days


  • Nation
  • Friday, 21 Jul 2017

The site of the Penang tunnel special purpose vehicle (SPV) condo project.

The site of the Penang tunnel special purpose vehicle (SPV) condo project.

PETALING JAYA: The Barisan Nasional Strategic Communications (BNSC) team has questioned why the Penang tunnel special purpose vehicle (SPV) condo project was approved in only eight days when in comparison, approval for the state's affordable housing project took more than 200 days.

The project in question is a joint-venture between the SPV and a listed company to develop a piece of seaside state land and build luxury condominiums, reported to be worth RM800mil in gross development value. The joint-venture for development was on a 60-40 basis, with the SPV holding a 40% interest

“The JV applied to the Penang Island City Council (MBPP) for planning permission on March 9, 2015. The planning division of MBPP then gave its approval within eight days even though it's standard approval period is 108 days,” BNSC deputy director Datuk Eric See-To said in a press release on Friday. 

“Further checks show that even the Penang state government's one and only affordable housing project on the island at SP Chelliah took 223 days to get approval from MBPP compared to eight days for the Tunnel SPV's luxury condo development,” he said.

The joint venture sees the SPV holding a 40% interest in the development of the luxury condominium project comprising two blocks of 40 storey buildings, totalling 572 condo units where each unit is priced at RM1,200psf and above.

See-To said that based on calculations, the approval given had also raised the development density to 156 units per acre from the 30 units per acre limit that had previously been in effect in that area several years ago.

According to See-To, a payment of RM209mil was made to the SPV company for the consultancy studies for three road projects in the state, consisting of two plots of state land. The first payment was for the plot of seaside state land valued at RM135mil and was transferred to the SPV on Feb 17, 2015.

“Checks at the luxury condo project site showed that construction has already started — despite none of the three highways having started construction — a delay of at least three-and-a-half years,” he said.

“The condo project is now facing some delays as more than 100 residents in the area had complained that the MBPP is wrong in approving such a high density project in that residential area,” he said, explaining that the residents had managed to get a stay order from the Penang State Appeals Board, which had ruled in their favour.

“However, in a shock move the MBPP then appealed on behalf of the developers against their own Penang State Appeals board. The MBPP lost the appeal in April 2016 and had to pay costs to the appeals board and the residents,” he said.

See-To described it as an “embarrassing situation” where the state government via the MBPP had appealed on behalf of a developer against the state government's own appeals board and lost.

“Is it the normal practice of the Penang state government to appeal on behalf of a developer against its own State Appeals Board or was this a one-off event — hence indicating special treatment,” he said.

See-To added that a Federal Government agency affordable housing project took 516 days to obtain planning permission approval from the planning division of MBPP, as opposed to eight days for the luxury condo project of the Tunnel SPV company and 223 days for the Penang government's own affordable housing project.

“Questions are now raised if the Penang tunnel SPV company had been given special treatment in the super-fast approval of the luxury condo project — especially when compared to affordable housing projects,” he said.

See-To also questioned whether the Penang government had increased the value of the land to the Tunnel SPV company by increasing the development density by almost five-fold.

Penang , Politics , Malaysia

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