KL CHRONICLE: #PeelAvenue Land Sale, Potential loss between RM 55 million to RM 393 Million

Saturday, June 3, 2017

#PeelAvenue Land Sale, Potential loss between RM 55 million to RM 393 Million

Dulu lain, sekarang lain?
*Potential loss to Penang people of between RM55mil to RM393mil because Peel Avenue land sold at JPPH valuation using direct negotiation?*

The price for the federal government's Land Valuation Department or JPPH cannot be considered as actual market value. It can be called the base price or minimum price.

A true market value is when you sell it by open tender.

In the case of the Peel Avenue land sold by direct negotiations, Lim Guan Eng continues to defend that the price sold at RM156 million is not below market value because it is the same as the JPPH value - asking people to blame the Federal Govt instead if they believe the land is sold below market value.

Here are three examples of Penang sale of land where the price sold was much higher than JPPH value.

*1. Taman Manggis land sale to KLIDC in 2010 - 35% higher than JPPH valuation.*

According to DAP, the JPPH valuation was RM8.5 million but they sold it via a tender (where 3 out of the 4 bidders quickly closed down after the tender) at RM11.5 million - or 35% higher.

*2.  Bayan Mutiara land sale in 2011 - 251% above JPPH price.*

According to Lim Guan Eng, the JPPH valuation for this land was RM84 psf for an 18-acre plot and RM65 psf for an 88-acre plot - giving an average of RM68 psf

It was eventually sold for RM240psf - 251% above JPPH price.

*3. Tanjung Pinang land for Penang Tunnel - 184% above JPPH valuation.*

According to Lim Hock Seng, the JPPH price for the land was RM457 psf but was valued at RM1,300psf when given to Consortium Zenith as payment for the Penang Tunnel project - 184% above JPPH valuation.

Thus, market price of land can be between 35% to 251% higher than JPPH valuation.

Using that range, the Peel Avenue land could therefore have been priced between RM211 million to RM549 million.

This translates to a loss of between RM55 million to RM393 million loss to the Penang people.

But we will never know since Lim Guan Eng went back on his word to do open tender and did direct negotiation to sell the land at JPPH valuation instead.


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