Lim: RM300m Penang convention centre good value

By Clara Chooi, The Malaysian Insider

GEORGE TOWN, Jan 16 — Penang Chief Minister Lim Guan Eng believes a new RM300 million international convention centre was a worthy investment in tandem with his administration’s goal of turning the state capital into an “international and intelligent” city.

He pointed out that the Penang Municipal Council (MPPP) would only be investing a net sum of RM11.5 million in the RM300 million project, through a public-private partnership agreement with developer SP Setia Bhd unit, Eco Meridean Sdn Bhd.

“In financial terms, MPPP is supposed to pay RM50 million for a RM300 million sPICE — a good exchange under any circumstances,” Lim said in a statement today.

The trained accountant noted that Eco Meridean was among the three firms that submitted a formal request for proposal in an open tender system for the project in 2009.

The project will create a “Penang People’s Park” that includes the country’s first subterranean Penang International Convention and Exhibition Center (sPICE), a seven-acre public park on the rooftop, a refurbished and upgraded Penang International Sports Arena (Pisa), a refurbished and upgraded Aquatic Centre and a four-star hotel with retail outlets and a spacious parking lot.

Lim also said the council was set to save some RM25 million from the refurbishment, repairs and upgrading work on Pisa and the Aquatic Centre by the selected firm.

“Further, SP Setia will also buy the portion of the land at current valuation to build a four-star hotel to complement sPICE and pay MPPP RM13.5 million for the land,” he said.

Lim said this meant that the net sum of MPPP’s investment in the project would only be RM11.5 million, a minute sum if compared with the returns the project would bring to Penang citizens.

For SP Setia, he added, the firm was confident that by managing and maintaining sPICE for 30 years, it would be able to recoup its investments through rentals and other related activities.

“This is a vote of confidence for Penang, that Penang will be a preferred choice for investors, tourists, young and talented residents who desire sustainable habitats,” he said.

Lim added that since the Penang Pakatan Rakyat government outlined its vision of transforming the state into an international and intelligent city, much business activity had been generated.

“The platform for the future is one of unbridled confidence that the state government is committed towards economic growth through good governance, integrity in leadership, public-private partnership, infrastructure works, balanced development for all and performance-based approach such as open tenders.

“In other words, the business of government is to get out of business, he said.

As an example, Lim pointed to the open tender system that was offered to companies bidding for the RM300 million project.

Before awarding the tender, he said, three key requirements were considered: best value for money pricing, best product quality, and whether it can be maintained to match world-class standards.