Why exempt 1MDB projects from luxury property ban, asks DAP’s Pua

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KUALA LUMPUR (Nov 23): DAP lawmaker Tony Pua questioned as to why were 1Malaysia Development Bhd (1MDB)-related projects given special exemptions despite a blanket ban by the Cabinet on luxury property projects including condominiums, shopping complexes and commercial buildings above RM1 million in unit values.

In a statement today, Pua, who is MP for Petaling Jaya Utara and DAP national publicity secretary said that last week, Second Finance Minister Datuk Seri Johari Abdul Ghani announced the Cabinet decision on a “temporary ban” approvals for shopping complexes, offices, serviced apartments and luxury condominiums priced over RM1 million effective November 1.

Pua said the freeze came after Bank Negara Malaysia’s report on the substantial supply and demand imbalance within the country’s property market.

He said the report found that new property launches were skewed towards the high-end sector of the market.

“It has also been confirmed in various news reports that the Kuala Lumpur City Hall (DBKL) has received the above directive.

“However, we are not sure if we should be shocked that the Mayor, Tan Sri Mohd Amin Nordin Abd Aziz announced yesterday that the prospective single largest high-end property development project ever in Malaysia – Bandar Malaysia is exempted from the ban,” said Pua.

“At the same time, it was announced yesterday that IJM would be building a new RM500 million office tower at Tun Razak Exchange after acquiring TRX City subsidiary Fairview Valley Sdn Bhd. Will this new tower, which will have a gross floor area of 560,000 square feet also be exempted from the ban?

“Due to the size of these 1MDB-related projects, they will certainly exacerbate the property over-supply situation in the Klang Valley and effectively blunt the effectiveness of the Cabinet decision to ban high-end development projects,” he said

Pua said it would be unfair on the rest of the property development industry in the country if the 486 acres Bandar Malaysia and the 70 acres Tun Razak Exchange projects receive automatic exemptions from the ban.

He argued the “temporary ban” will fail to solve the “supply-demand imbalances” in the property sector.