Reclamation issue ‘water under the bridge’, says Lim

Chief Minister Lim Guan Eng yesterday put to rest the issue of the conversion of 28ha of reclaimed Queensbay land from leasehold to freehold by the previous state government, saying it was done in full compliance with the National Land Code (NLC).

Saying the matter was “water under the bridge,” Lim said the decision to convert from leasehold to freehold was a question of policy implemented by the previous state government.

“As far as this new state government is concerned, we consulted legal authorities, both within and outside the state government about this and it has been done in full accordance with the NLC and the legal process is valid. It was done in the past and it is for us to comply with.

“The state government is entitled to convert the category of land from river/river bed to dry land and also to convert foreshore and seabed into dry land by way of reclamation and there is no prohibition against this.

“Since the foreshore and seabed ceased to be of existence upon reclamation of the land, there is no issue of the foreshore and seabed being converted into freehold status.

“The question that should be posed to the previous state government is why such a policy decision was made to convert the land from leasehold to freehold in the first instance.

“Why was there no consultation made before such a decision was reached?” Lim said at a press conference which was also attended by Penang Development Corporation (PDC) general manager Datuk Rosli Jaafar and PDC legal adviser Zainun Abdul Rahman.

He was responding to a press report on the status of the state-owned land which is converted to freehold for a private commercial project. The conversion followed a court sanctioned scheme of arrangement in 2004 to enable the project to be revived by a “white knight”.

The land was reclaimed by PDC and later sold to a private developer and was part of the Bayan Bay project.

However, the development, helmed by Bayan Bay Development Sdn Bhd via a joint venture between the PDC (which held a 30% stake) and Anson Perdana Bhd, was stalled in 1998, a casualty of the Asian financial crisis. (Anson Perdana is now under liquidation.)

After several attempts, the state government gave the project to the “white knight” CP Landmark Sdn Bhd. The terms included converting the reclaimed land into freehold.

Rosli said the rescue plan for the project was based on the new business model which was presented by CP Landmark at the court convened meeting where a scheme of arrangement was agreed upon.

To another question on why the land was converted to freehold when PDC had reclaimed the land at its own cost, Rosli said when the reclaimed land was sold via a tender exercise, the cost was recovered.

“The whole privatisation exercise was paid in full and even when the land was converted from leasehold to freehold, the premium was paid in full. When the rescue proposal was submitted and before the court gave its consent, the PDC brought the matter of conversion to the state executive council for consideration.

“It was then that it was agreed that in order for the business model of the “white knight” to be guaranteed and successful, the freehold status should be granted.

“Otherwise, we would not have been able to revive the project,” he added.

by Regina William (The Edge Daily)

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