Penang ‘will cooperate’ with MACC probe into Jerejak project

A mixed-development comprising condominium apartments, a hotel and theme park has been proposed for Pulau Jerejak, off southern Penang island. (Penang Property Talk pic)

PETALING JAYA: The Penang state government will cooperate with an investigation by the Malaysian Anti-Corruption Commission into a proposed resort project on Pulau Jerejak off the southeastern coast.

Deputy Chief Minister II P Ramasamy, responding tonight to a news report about the investigation, expressed hope that it was not politically motivated.

In a statement to FMT, Ramasamy said he was not sure why MACC was investigating the project, a joint venture between Tropical Island Resort Sdn Bhd, a subsidiary of UDA Holdings, and Q Island Development, a subsidiary of the Ideal Property group.

The project calls for development of a five-star hotel, a marina and 1,200 houses and condominium apartments on 32.37 hectares at the southern end of Pulau Jerejak, which once contained a leper colony and a penal colony.

News of the project, and of a proposed four-lane road connecting the resort to the main island, created a public outcry in 2016, and criticism from Gerakan leaders.

On Friday, Utusan Malaysia reported that MACC had opened an investigation paper on UDA Holdings and had seized documents from the company’s subsidiaries. The agency would be calling up several people for statements, the daily reported.

Ramasamy said he did not see the point of the investigation but the state government welcomed it nevertheless. “We will cooperate. Hope it’s not politically motivated,” he said. “What is the issue except questions raised by the opposition?”

He said the allegations raised by Gerakan in 2016 were malicious.

The Gerakan chairman at the time, Teng Chang Yeow, had questioned the sale of the Jerejak land and had claimed that Lim Guan Eng, then chief minister, had rejected the deal three years previously.

Lim sued Teng, The Star’s news editor David Tan and reporter Crystal Chiam Shiying for defamation, but the suit was struck out by the Penang High Court in 2018.

Ramasamy said the Ideal group subsidary had purchased a 49% interest in Tropical Island Resort with the consent of both UDA and the Penang Development Corporation or the Penang state government.

He said he understood that the 49% stake amounted to RM156 million, to be paid to the state government over a period of eight years with an initial down payment of 10%.

The resort project is listed at the Penang Property Talk website as “Queens Island” and also at the Ideal Property group website as an upcoming project.

“The development will see the demolition of existing hotel buildings for the construction of luxury hotels and residences” to be built in four phases, according to the property website.

These include a 10-storey hotel with 350 rooms and a 4-storey clubhouse; three blocks of 10-storey serviced residence with shop offices; two blocks of 10-storey condominium and 4-storey villas; and 10-storey serviced residence. A marina, theme park and a road to Penang island are included in the proposal.