Out with the old and in with the new. As Malaysia bid farewell to a BN-led government and hello to a new one under PH, so did we say goodbye to mega-projects and hello to new potential ones. Fresh off the press, we covered the top 8 mega developments under review by the Malaysian government just recently, and barely days after that, news broke of the cancellation of the Kuala Lumpur-Singapore High Speed Rail and MRT 3 respectively.

While both projects have been scrapped midway through their development, parties have made their justifications as to why it should have been scrapped and why it should have not been.

The Uncertain Future of HSR?

(Source: BBC.com)

“The amount of money spent to build the Kuala Lumpur-Singapore High Speed Rail (HSR) project does not justify the number of jobs it could generate.” Prime Minister Tun Dr Mahathir Mohamad stated. This was in response to an online post from former prime minister Datuk Seri Najib Tun Razak, who claimed that the HSR would increase the gross national income and create more than 100,000 job opportunities.

On the other hand, PH’s Bayan Baru representative, MP Sim Tze Tzin, listed 10 comprehensive reasons why the HSR would be more beneficial to be scrapped than continued. Some of them included:

1. The cost, estimated to be RM80 billion by the time of its completion in 2026, would be double the allocated budget for the Ministry of Education.

2. The idea of using a train to travel to Singapore as unfeasible, as Malaysia already has so many airports with frequent and fast trips to Singapore.

3. An unlikely profit margin that would not breakeven even 10 years down the road after it has been completed.

Nevertheless, the prime minister has spoken up about this issue and the implications that might occur, adding that he will reevaluate the state of the HSR if Singapore is able to offer a better deal.

Leaving MRT 3 Line Behind

While Singapore has yet to be officially notified of the cancellation of the HSR, Malaysians are faced with another brutal truth: the MRT 3 line has been cancelled. The MRT 3 line was an extension from previously existing MRT lines travelling from Sungai Buloh-Kajang and Sungai Buloh-Serdang-Putrajaya, and costs up to RM45 billion to develop. The MRT 3 line was slated to connect urban areas such as Mont Kiara and Damansara Heights with the city centre (Kuala Lumpur, Jalan Bukit Bintang, KL Eco City, and more).

(Source: Lowyat.NET)

Because of the strategic location of the MRT, the first wave of its construction brought on a boom in property developments and house buyers. But now that it has been scrapped, the future seems bleak and stocks have dropped for these developers who have invested in land and property alongside these proposed MRT lines, not to mention house-buyers who have purchased homes solely for the convenience of public transportation.

Malaysia’s Plans for the Future

As for the future of the HSR, Datuk Steve Chong, the chairman of the Johor Real Estate and Housing Developers Association, believes that the affected property developers would not suffer the losses tremendously, as they have already gotten used to the ever-changing industry. Instead, he suggested investors and house-buyers to keep their properties close to them until prices pick up again.

(Source: IFAN-Maritime)

The government has also proposed new projects to consider, one of it being a proposal to develop an island in the waters nearby Singapore. The waterway of this potential future development is a strategic one at the eastern entrance of the Singapore Straits, and is also one of the busiest routes for commercial shipping in the world.

The southern state of Johor, on the other hand, plans to cancel 2 mega-tourism projects amounting to more than RM3 billion. The projects include a science-fiction theme park and an eco-entertainment park. There are currently at least 10 theme parks in Johor alone, including Legoland Malaysia, Angry Birds Activity Park, and Hello Kitty Town.

(Source: The Peak)

Barely 100 days into the new governance under Pakatan Harapan, we can definitely expect and anticipate the fulfilment of their words and promises, plus what their future plans for Malaysia will be. To recap, here are the 10 promises they have pledged to fulfill within their first 100 days in term:

1. Abolish GST, reduce the people’s cost of living

2. Bring back government subsidies for petrol

3. Eliminate the forced debt of FELDA settlers

4. Introduce an EPF scheme for housewives

5. Introduce minimum wage for the whole country, plus increase minimum wage value

6. Postpone PTPTN loans’ repayment

7. Establish a Royal Commission of Inquiry

8. Restore the status of Sabah and Sarawak

9. Introduce a scheme to help finance basic healthcare necessities

10. Re-evaluate mega-projects

As bleak as it may seem for some, the cancellation of the projects may have been for the greater good. Nevertheless, it is expected that the projects will be revived or restructured to serve the country in another way, as it would be a waste to leave the developments half-finished and without use. Until then, the whole of Malaysia - and the world - is watching with eager eyes on what our new government will do next. 

(Written by: Ashley Ooi, 1st June 2018)

thanks for sharing! 

Have the MRT Line 3 start construction or have the land acquisition started?

@henry 

Definitely the MRT3 feasibility study and track alignment has been confirm...  

I have heard that the MRT1 and MRT2 is currently under utilized... maybe there is still a lack of public interest, for taking public transport in KL

@domng yqa, but then if the construction and land acquisition has not started, the damage shall be minimal right? Since the gov only have to pay for the preliminary studies only

@domng is not like that, i also want to take MRT but the cost too high, eg car parking fees, change LRT fees etc. make it not worth.

@henry I think at least the land acquisition started, because I was around Sungai Besi on the weekend and I saw closed off construction sites that were labelled MRT3 stations like Sungai Besi and Chan Sow Lin. Could see a glimpse of barren land + machinery behind the fences. Not sure how the cancellation notice will pan out for the developers though. 

Will they cancel the TRX too ?

@cheehing1223 

Any idea on the construction progress for TRX?

Particularly on the "The Exchange 106" tower

@yeofang 

I believe the current situation, need more reliable and cheap public transport to link housing estates to nearby MRT stations...

Heard that they are rolling out a RM100 per month for unlimited public transport rides.

@domng Ya, that's the plan and hope that they will make it come true.

@domng construction still going on for exchange signature tower. But for the mall and two blocks of office and hotel wasn't really started yet.

@cheehing1223 from my POV,  I don't think so as somehow this project will benefits the greater KL plan. It's another top development in greater KL plan same like KL Metropolis.

@yeofang but if you count it with the time you spend in traffic and the petrol consumption plus your monthly car parking fees, it won't be that expensive already for taking public transport, isn't it? =)

thanks for reply , what about bandar Malaysia ?@windzneom 

The Exchange 106 ady nearly completed, estimated completion by this year

@henry 

It will be the new landmark of Kuala Lumpur, even taller than Petronas Twin Towers and KL Tower.

I believe that currently, the Petronas Twin Towers still hold the record for the TALLEST twin towers in the world?

@domng yes, follow by ocean club USA, and JW Marriott Dubai.

@cheehing1223 for bandar malaysia, for the current situation, i think that it might cant be succeeded in this few year, might need more time since HSR been called off.

@windzneom 

Really hope that Bandar Malaysia, will not get delayed until become an abandoned project. Omg. 

ya lor , a lot investor bought properties for investment there @domng 

@cheehing1223 

Also there are a lot of investors, who bought properties nearby other HSR stations...

@domng their investments are now doomed. Hope next time they will learn not to invest in a project solely for an uncompleted infra

so true , actually I'm aiming the TRX residential , any advise for this ? buy or not buy @henry 

@cheehing1223 i also aiming for a residential nearby, but im definitely not buying now bcoz there are so much uncertainty. And also, i foresee the property price will go down in the near future especially for the new developments as there is some signs in some areas like Cheras ady. The launching price are more expensive than the subsale price.

okay thanks for the information@henry 

@cheehing1223 depends i would say. Whether you want it to own stay or invest. Invest wise, i will think that it is too risky. For own stay yes, infrastructure and amenities surrounding TRX was done, shopping, schools, university, access road...etc. Somehow i agree on henry where the property price nowadays really over price. As if the lesser investor or buyers, the property price will get lower, rebates will be increase from the developer.

thanks !@windzneom 

@cheehing1223 most welcome chee hing

yes uncertainty but definitely a good start for benefits of many of the rakyat

Having to hear the cancellation of the MRT3 project is a bit of the disappointment. Having such project is really an advantages for the inflow of the investor to Malaysia. Maybe currently the debt have reaches 1 Tril and gov try to cut down on unnecessary budge for the projects which they think is not the priority yet..

Hopefully our new Gov will start back the MRT 3 and of course revise back the terms of the project. Really looking forward..

@px_jerome 

I have heard that Penang will proceed with their LRT project soon, within 5 years. I wonder if Penang will get any funding from the federal government?

This will highly depends on the gov plan and direction. IF Penang is the priority and cost are justifiable with the benefit gain, I think they would. It is also part of the economical management method. The resources will go to which part is brings the best benefit to the country at the moment. 

Actually foreign investment really took a sharp slide, most prominently investment from China. My friend who is in MM2H industry said the past month post GE14, there is 0 application for MM2H from Chinese citizens. Hence, property market is also hit quite badly, especially those developments targeting China market.

@Zara 

Do you know typically how many applications they get per month for MM2H?

@domng Perhaps I should say, her agency itself got no application since the past 2 months, not the industry as a whole. But I am pretty sure the whole market is affected.

Not too sure about the average applicant numbers per month though.

Hope for the best, all the people are in place

Will get better soon I believe

@iankwa 

I believe now, Malaysia is hard trying to lure talented Malaysians who migrate to other countries... to return to Malaysia.

If the news of 50% cut of the cost to built HSR, it's good news, project remains! we shall wait

@carmenfoong 

If really 50% cut from the initial cost, just hope that the quality of the project remains. 

Something to ponder: I wonder if the initial cost was inflated to cover kickbacks? 

@domng if cut 50% from the cost, the quality won't be affected i guess, because the initial cost is over-priced as we heard.

@domng ...news has it as what @windzneom mentioned, overpriced in the beginning

@carmenfoong yea exactly!

@windzneom 

All projects will need to have open tenders before awarding any contracts, no matter big or small. 

Direct awarding of contracts, will only cause conflict of interest.

@admin_ps good sharing