GEORGE TOWN: Penang’s first urban renewal project is valued at RM600mil – and not one of the current residents has to move out.

Instead, a block comprising the “compensation units” is being built first. Work began last month.

“Once it is completed, residents will move into their new homes and only then will the old flats be demolished,” said state housing committee chairman Datuk Seri S. Sundarajoo.

The project is taking shape at the four-storey walk-up Mahsuri Flats, one of Penang’s densest and most mature neighbourhoods in Bayan Baru, literally across the road from the Bayan Lepas Industrial Estate.

A file photo showing an aerial view of Mahsuri Flats in Bayan Baru, Penang.

The five blocks on the 2.6ha land will ultimately be replaced by three towers of 38, 46 and 33 storeys.

The first tower – of 38-storeys – is now being built and will house the replacement homes for the 300 walk-up flat units built in 1976.

While the existing units mea­sure 250 to 500sq ft, the resi­dents will each get new homes of 850 to 900sq ft at no extra cost, except for title processing fees and new maintenance fee rates.

“It’s a win-win situation. Families get better homes, the developer benefits from marketable projects and the state recovers value from under-utilised land,” said Sundarajoo, adding that the developer is Hunza Properties Bhd.

After the old flats are demo­lished, a 46-storey tower of affordable housing, offering 770 units of 881sq ft each, and three floors of shop offices, will be built.

The final phase will see the construction of a 33-storey serviced apartment block of 133 units of 500sq ft, 137 units of 900sq ft, 140 units of 1,055sq ft and four floors of shop offices.

“The land will be redeveloped into mixed housing to increase Penang’s public housing stock,” said Sundarajoo, adding that this redevelopment has a gross deve­lopment value of RM597.84mil.

He said four other decades-old housing areas have also been identified for urban renewal in Penang, but challenges remain.

“These projects require 100% consensus from residents. In high-density areas like Rifle Range Flats, which has over 3,000 units, temporary relocation is a major task,” he said.

Penang, said Sundarajoo, has to embrace vertical growth for future housing demands due to land scarcity.

“We identified many blocks of under 12 storeys for urban rene­wal. It no longer makes sense to patch up decades-old buildings that do not meet modern living standards,” he said.

Mahsuri flat owner Yanty@Hasny Suki, 49, is happy that she will get a new home twice the size of her current home.

She now lives with her husband, three children and elderly mother in a single-room, 400sq ft unit on the third floor.

“The new 850sq ft, three-room unit we are getting is a dream come true,” she said, adding that the state is offering subsidised maintenance fees for 18 months plus assistance with moving expenses.

“This means separate rooms for my children, space for a dining table and a real kitchen. Not just a small hall for everything,” she said.

Another flat owner, Neelavathi Karruppiah, who lives with her son in a two-bedroom unit, considers the compensation of a 900sq ft unit as “a better future for her son”.

“We would have to spend around RM300,000 to buy a unit that size,” she added.

Sales and marketing manager Tong Mun Keen, 50, whose parents bought their flat in 1981, said the upgrade will greatly improve his elderly mother’s quality of life.

“She is 74 and lives on the third floor, and walking up is hard on her knees. With the new unit, she’ll have lifts and modern facilities.

“She will be living with my sister, a single mother,” he added.