Penang warns 1MDB of tough road to approval for Air Itam project

1MDB bought 234 acres of land in Air Itam for RM1.38 billion. Shown here is an aerial view of the land. — Picture by K.E. Ooi
1MDB bought 234 acres of land in Air Itam for RM1.38 billion. Shown here is an aerial view of the land. — Picture by K.E. Ooi

GEORGE TOWN, Nov 4 ― Penang has warned 1Malaysia Development Bhd (1MDB) that it will be an uphill task to gain planning approvals for its development project on the 234 acres land if it deviates from its promise to build affordable housing there.

Penang Chief Minister Lim Guan Eng said the sovereign wealth fund will also face difficulties due to unresolved squatter issues on the land.

“I want to warn 1MDB that we will not allow them to throw out the present land tenants for a project other than affordable homes,” he said.

He was referring to a recent statement by 1MDB that it planned to build up to 10,000 units of affordable homes and also “other development purposes” to generate higher value for the land it bought here.

“We want them to know that they can only build affordable homes and not ‘other developments’ on that land as this is in Air Putih constituency, my constituency, and I will protect my constituents,” Lim said.

He said he will not allow 1MDB to evict his constituents without any proper compensation.

“If they go the hard way to evict them, the state government will also go the hard way on them when they submit applications for planning approvals,” he warned.

1MDB purchased the big parcel of land, located in Air Itam on the island, in three deals, the first two deals on April 29 last year, just six days before the May 5 general elections, and the final deal on September 23 last year.

The land was purchased for RM1.38 billion, believed to fulfil one of Barisan Nasional's (BN) 2013 general election promises to build 9,999 units of affordable housing on the land through 1MDB.

In September, Lim had demanded 1MDB explain the progress on the promised homes.

To date, 1MDB has not applied for planning approval for any project on the land.