Do We Need The Proposed 100 Storey Warisan Merdeka Mega Tower
I am sure everyone is so eager to wait for Budget presented every year.
Last friday, our Prime Minister, Datuk Seri Najib Razak, disclosed the plans for the Warisan Merdeka project, a new Kuala Lumpur landmark, in the Budget 2011.
This mega tower building, named ‘Warisan Merdeka’ or ‘Heritage of Independence’, would be the tallest in Malaysia, dwarfing the iconic Petronas Twin Towers, which were the world’s tallest buildings at 88 storeys when completed in 1998.
Construction of the 100-storey tower skyscraper, which is part of the RM5bil mega project within the enclave of Merdeka Stadium and Stadium Negara in Kuala Lumpur, would begin sometime next year and is expected to be completed in 2015.
The 19-acre development area of the mega project — which includes a condominium and a shopping mall — is sited on the car park and land adjacent to Stadium Negara and Stadium Merdeka.
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PM: Warisan Merdeka not a waste
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Najib has said such projects exemplify the spirit of “Malaysia Boleh” or “Malaysia Can”, a national campaign conceived by former premier Mahathir Mohamad, an advocate of mega projects.
It has come under a very heavy criticism from the opposition as well as the general public.
This is clearly shown in a Social networking site Facebook page called 1M Malaysians Reject 100-storey Mega Tower. It have more than 45 million people who say NO this wasteful white elephant project.
I think the Government need to address the following issues:
1) What is the main purpose to build this Mega Tower when there was an existing property glut?
2) Why do we need another landmark near the Petronas Twin Tower?
3) How many actual landmarks do we need?
4) Do really need for yet another super skyscraper, despite already having the iconic Petronas Twin Towers?
5) What is the demand and supply of office space in the capital city now?
6) How does the Permodalan Nasional Berhad (PNB) going to pay for this mega project?
7) Has a proper feasibility studies done?
8) How does those CONTRACTS help our economy?
9) How many local retailers can afford to rent a retail space in the complex?
I hope the government can spend wisely and remember not to spend recklessly even have money!
Malaysia needs better education, better health care, better public transportation, safer neighborhoods, cleaner water, but NOT another taller building
A few months ago, some Minister said that the country will be going bankrupt if subsidies are not withdrawn…. so this is why the subsidies were withdrawn… to build another “Mega White Elephant “ project?
What the city needs badly is a first-class transport system NOT a warisan tower!
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MPs: Mega-tower won’t improve quality of life
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Five DAP MPs from the Fedral Territories are strongly opposed to the government proposal to build a RM5 billion 100-storey commercial building in the heart of the city.
They said that the building will not improve Kuala Lumpur’s international standing but will exacerbate the traffic congestion in the area.
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Will mega-tower affect ASN dividends?
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An opposition parliamentarian has raised doubts on the ability of Permodalan Nasional Berhad (PNB) to build the 100-storey Warisan Merdeka skyscraper, hinting at the possibility of lower dividends from its unit trust schemes.
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Warisan Merdeka – a beacon to PNB’s future
By ANGIE NG
The 100-storey 5-star green building is set to attract more interest to the whole development.
BACK in 2000 when Permodalan Nasional Bhd (PNB) was presented the opportunity to buy the 14.5ha where Stadium Merdeka and Stadium Negara are located, it had decided to retain the heritage value of this priceless asset while looking for opportunities to develop the surrounding area.
A decade later, PNB is doing precisely that.
PNB paid RM310mil or RM220 per sq ft to buy the land from Pengurusan Danaharta Nasional Bhd. The market value of the land has since appreciated to RM800 per sq ft today.
At a special briefing for media editors on Wednesday, PNB president and group chief executive Tan Sri Hamad Kama Piah Che Othman disclosed that the heritage aspect has been fulfilled through conservation works to restore the heritage characteristics of Stadium Merdeka and Stadium Negara. The two stadiums are now being managed by a heritage trust.
Both the stadiums are occupying 6.8ha, which have been identified as a national heritage site.
Hamad says the overall Warisan Merdeka development on the remaining 7.7ha will complement and blend with the heritage theme. He is optimistic that together with the restored stadiums, the site will be another major landmark in Kuala Lumpur.
“We are looking at ways on how to integrate the building aspects of the stadiums with the planning of the overall development of Warisan Merdeka. The heritage part will not be sacrificed and will actually serve as the enhancement factor to the commercial aspects of the building. The heritage preservation of the stadiums will be undertaken by the heritage trust,” he explains.
Construction work on the 100-storey Warisan Merdeka tower will kick off next year.
Touted to be the country’s tallest when it is completed in 2015, the building will cost RM2.5bil to RM3bil. It will have gross floor space of 3 million sq ft and 2.2 million sq ft of net floor space.
Hamad says the five-star green building will be the “beacon” to create more excitement and attract more interest to the whole development.
This will be followed by two subsequent phases comprising a shopping complex and condominiums. The whole development, to be undertaken over a 10 year period, will cost RM5bil.
On the rationale for mooting the project, Hamad says: “Since the plan to develop the land was approved by the PNB board in 2004, we were waiting for the right time to proceed with the project.
“The concept of 100-storey building, its retail portion and the condominium was mooted in early 2004 taking into account the need for enhancement of value and effective utilisation of the 19-acre land adjacent to Stadium Merdeka and Stadium Negara. In 2005, the master plan was approved by the municipal authorities followed by final titles being issued in 2008. The principle concept of PNB Iconic Building was then approved in 2009.”
He says that having held the land for so long, “we feel it is now the right time to go ahead. The Government is also promoting this type of development.”
Hamad stresses that most importantly, by initiating the Warisan Merdeka project, PNB is taking the lead to preserve the historical value of Stadium Merdeka as the site for the country’s declaration of independence back in 1957.
Emphasising that PNB is not looking to compete with anybody when it decided to put up a 100-storey tower as part of the Warisan Merdeka development, he says it will make more economic sense to build the high-rise tower than lower rise buildings.
He says as a state investment agency, PNB’s main concern is to maximise return for its stakeholders. “Each year, PNB declares income distribution of 6% to 7% to unitholders. The project with expected yields of between 8% and 10% will be able to meet our responsibility as an investment agency.”
Meanwhile, the new tower will be able to meet PNB’s need for new office space in line with its strategic positioning for the future.
Hamad says PNB will be moving out from its present headquarters, Menara PNB, which will be 30 years old when the tower project is completed, to the Warisan Merdeka tower upon its completion.
PNB has set up wholly-owned unit, PNB Merdeka Ventures Sdn Bhd to undertake the project. Helming it since early this year is Tengku Abdul Aziz Tengku Mahmud who was formerly from Guthrie Property Development Holding Bhd and Sime Darby Property Bhd.
So, will Warisan Merdeka be an iconic project and will there be foreign expertise involved such as the like of world renowned architect Cesar Pelli who designed the Petronas Twin Towers?
Hamad says the project design plans are still in the drawing board.
“We are in talks with several parties comprising experts from the relevant fields. We are exploring the possibilities of creating a strong architectural and engineering team for the project,” he adds.
With its latest venture, PNB is certainly thrusting ahead with its plans to build up its presence in the local property scene.
fr:biz.thestar.com.my/news/story.asp?file=/2010/10/23/business/7276793&sec=business
Tough job for PNB
By ANGIE NG
PERMODALAN Nasional Bhd (PNB) has studied market trends before deciding to embark on the Warisan Merdeka development, its president and group chief executive Tan Sri Hamad Kama Piah Che Othman says. The 100-storey tower will be a five-star green building which is still uncommon in Kuala Lumpur.
“We believe it will be able to meet the market’s growing need for such office space,” he explained when asked about the rationale for the tower project.
At a time when the world economy is still uncertain and amid rising prices, many Malaysians have questioned the necessity for the RM2.5bil to RM3bil tower project after Prime Minister Datuk Seri Najib Tun Razak announced the project in his budget speech last Friday.
Responding to questions on the project recently, Najib stressed the Government did not instruct PNB to construct Warisan Merdeka and that it was the investment agency’s board of directors that had wanted to embark on the project.
He said the area would be a business centre for both the bumiputra and non-bumiputra, and could be one of the country’s attractions that will generate profit.
Developers and property consultants have urged PNB to undertake extensive and in-depth feasibility and market studies to weigh the cost-benefit and potential impact of the tower on the property market.
The public also wants an environmental impact assessment study to be done on the project to look at the impact to the social system, the traffic situation and suitability of the site.
Most of the concerns are on whether the high-impact commercial development will cause an over supply of office space in the capital city, and the impact of the skyscraper to the worsening of the heavy traffic jams in the area.
There are also a number of schools in the vicinity and the expected heavier flow of the traffic have worried students, parents and the school authorities.
Hamad says PNB is looking to have the mass rapid transit (MRT) plying the Warisan Merdeka route.
“We are aware of the public’s concerns that the traffic jam in the area will worsen with the tower project, and will be working with the relevant authorities to look at ways to improve the infrastucture and traffic flow in the area,” he adds.
Hamad also allays fears that funds from unit trust investors or the Government will be used to finance the project.
He says PNB has enough funds to finance the whole development if need be but he does not rule out borrowings if interest rates are reasonable.
On the project’s positioning, Hamad stresses that the heritage elements of Merdeka Stadium will be one of the central themes and highlights of the project.
If that is the case, industry observers have asked whether PNB will look at introducing a full-fledged culture village around the historical site that can also double up as function destinations to ensure the the project will remain functional.
To avoid the project becoming a “white elephant” like many observers fear will happen, the culture village should be kept alive with interesting cultural performances and events on a daily basis.
Perhaps, the National Museum should be moved there as its historical ambience is the most appropriate to showcase important things and events of the country’s past.
On the rationale for the 100-storey tower instead of vying to be the world’s tallest, Hamad explains: ”We are not competing with anybody in the world in terms of the height of the building. Currently, there are already three buildings being planned at 1000m heights, surpassing Burj Khalifa’s 828m. There will be no end to this sort of competition. So making it the world’s tallest is a non-issue and we would not go into this.”
Hamad stresses that the building is not being designed to outshine any particular organisation, including the Petronas Twin Towers which have been and will continue to be Malaysia’s icon.
“We want the building to look architecturally good and acceptable whilst incorporating the green features. These are market expectations in the near future. With this, we can get a reasonable return on our investment on this building.”
Besides being the country’s most famous landmark, the 88-storey Petronas Twin Towers are the world’s tallest twin buildings today. Completed in 1998 at a cost of US$1.2bil, they were the tallest buildings in the world until they were “dethroned” by Taipei 101 which was completed in 2004.
The twin towers also have world renowned Argentine-American architect César Pelli, to thank for its unique and timeless design. The towers were constructed largely of reinforced concrete, with a steel and glass facade which have given them the magical and glittering effect.
On the cost difference between the two projects, Hamad says: “We are comparing relative costs, in terms of the timing of these two developments. Material prices have gone up quite a fair bit. The real yardstick is the return on investment, using current market prices and costs for the building materials and other related costs.”
fr:biz.thestar.com.my/news/story.asp?file=/2010/10/23/business/7276952&sec=business
Taking care with mega projects
A QUESTION OF BUSINESS
By P. GUNASEGARAM
IT’S common during times of economic slack for the Government to push for projects to get activity up to provide jobs and incomes for people.
It was economist John Maynard Keynes, who is now fashionable again, who famously said that the economy would be better off during a depression if all workers did was to dig up ditches and fill them up again.
Sometimes, governments tend to take that statement too literally forgetting that for small open economies it is not possible to print money without disastrous consequences on the currency rate, inflation and investment.
Keynes’ statement must be taken with a pinch of salt given that there is a limited amount of government resources that can be put into stimulus packages. The most has to be obtained from the limited amount the Government ploughs into these projects.
Each ringgit must count and the leakage in terms of both over-pricing as well as foreign sourcing of goods and services must be limited as much as possible so that maximum benefits accrue to local industry and enterprise and creates jobs for Malaysians.
It is not always easy to do that. Take the mass rapid transit system (MRT) for instance. At an estimated cost of RM40bil, it’s a very massive project, even if it is undertaken over 10 years with all the potential for costs to increase the further out into the future it goes.
That it will have major benefits in terms of moving people around and in Kuala Lumpur and the vicinity, reducing traffic congestion, enhancing the quality of life, etc, cannot be denied. But if it is not properly planned, designed and executed it could become a major disaster and fall far short of the expectations.
Economically, there will be plenty of leakage from this project. Trains and tracks will be ordered from overseas and could account for 30% or more of the cost. Tunnelling will be highly automated and use a lot of expensive equipment sourced from outside the country.
Labour is likely to be largely foreign as well as expertise. The rest of the remaining costs are likely to be for acquisition of land and other civil works. The latter has little impact on economic growth.
Thus, while the RM40bil figure is huge, the final contribution to the economy in terms of production of goods and services will be smaller than expected even if we take into account the multiplier effect.
This theorises that spending of a sum in the economy enlarges the economy by more than the amount spent. But if there is high leakage of project costs to outside the country, that’s not going to happen.
It is imperative that much more thought is given to the project. There is no hurry to get it off the ground – or under the ground in this case! – given the huge capital expenditure involved. Considering that nowhere in the world is an MRT profitable, we must expect that the Government will in one way or another bear this burden.
Meantime, authorities should focus on other ways to get traffic down during rush hour. Car-pooling will work if there is incentive and punishment to get it going. You need to have a surcharge on cars going into congested areas for instance and for existing public transport to improve.
Ditto for the rapid train to Singapore. If you can open Subang airport to flights to Singapore in a big way and allow boarding 15 minutes before departure for passengers without check-in baggage, you can get people to Singapore in an hour or so. That will be quite comparable with a rapid train – without all that expense, last estimated at a whopping RM8bil.
Finally, all that hooha over Permodalan Nasional Bhd’s (PNB) RM5 billion plan to put up a 100-story tower between Merdeka Stadium and Stadium Negara seems a bit overplayed considering the project will span 10 years.
But what is worrisome is the question of why the tower needs 100 storeys, to be built at much greater expense per square foot. Is it really true that you need such height to attract interest? There are examples of many projects around the world much shorter than that but which are considered to be of high quality and which attract plenty of interest.
PNB should be more forthcoming with what it plans to do and how it will make it something the nation can be proud of with – and this is important – minimal cost.
● Managing editor P Gunasegaram does not like the word “iconic”. It does not say much but conveys unambiguously one important message – expensive.
fr:biz.thestar.com.my/news/story.asp?file=/2010/10/23/business/7280773&sec=business
PNB gets go-ahead for 100-storey tower
It was reported that the development will also include a shopping complex and condominium unit.
PERMODALAN Nasional Bhd (PNB) has obtained the development order from City Hall to build the 100-storey Menara Warisan Merdeka.
The development order was attached with several conditions, including those related to legal matters, said PNB president and chief executive officer Tan Sri Hamad Kama Piah Che Othman.
“We are studying the terms in order to fulfil them. We must ensure proper planning because the development order is approved with conditions,” he said after announcing the income distribution for Amanah Saham Wawasan 2020 for the year ended August 31 2012, here, yesterday.
Earlier reports said PNB would be undertaking the RM5 billion Warisan Merdeka development in three phases over 10 years, starting with the 100-storey tower this year.
The tower – touted to be the country’s tallest – will cost RM2.5 billion to RM3 billion and will have gross floor space of three million sq ft and net floor space of 2.2 million sq ft. It is scheduled to be completed in 2015.
To another question, Hamad said PNB would announce the disposal of its fifth non-core company to qualified Bumiputera companies by October.
“Four companies have already been divested so far. We hope everything will be settled by the first half of next year,” he added.
The four are U-Insurance Sdn Bhd, U-Travelwide Sdn Bhd, Inobel Sdn Bhd and FEC Cables (M) Sdn Bhd.
fr:btimes.com.my/Current_News/BTIMES/articles/warisen/Article/