Bumiputera developers suffer millions of losses due to abandoned PR1MA projects

by AFIQ AZIZ/ pic by MUHD AMIN NAHARUL

 Bumiputera developers and contractors said their companies are at risk of being shut down, as they suffer millions of losses due to abandoned 1Malaysia People’s Housing Programme (PR1MA)  projects.

Malay Chamber of Commerce Malaysia (DPMM) youth chief Mohd Ali Amin Ab Latif said many of PR1MA construction has failed to restart, even a year after Pakatan Harapan took over the federal administration.

“Out of about 100 developers and contractors involved in PR1MA construction, about 30 of them are Bumiputera, which half of them came to us addressing their concerns related to dormant projects and outstanding payments by the agency.

“Many of them are facing financial constraint because of the long due solution over the project. Some of them have even received bank notices,” Mohd Ali Amin told the press in Kuala Lumpur today.

He added that on average, the developers have forked out around RM10million to RM15 million for land acquisition and to start the project.

Thus, these developers demanded PR1MA to provide new direction on the low-cost housing project.

Mooted in 2012 by former Prime Minister (PM) Datuk Seri Mohd Najib Razak, the project has been supervised by PR1MA Corp Malaysia, which was under the purview of Prime Minister’s office.

The agency had promised to provide one million homes to the middle-income group by 2020.However, despite more than RM8 billion of government injection to the state-owned affordable housing scheme, only 16,682 units, or 1.6% of the total houses reached completion as of 2018.

The Malaysian Reserve (TMR) has also reported that PR1MA Corp, which was transferred to the Ministry of Housing and Local Government (KPKT) last year would be dissolved after the due diligence process completed next month.

KPKT Minister Zuraida Kamaruddin said currently there will be no new PR1MA project will be constructed.

Mohd Ali Amin said besides the provision of the affordable houses, one of the PR1MA agenda was to transform Malay contractors to become the property players.

As such, he said PR1MA Corp must give clear indication whether these incomplete projects, which was signed under the previous administration would be developed or not. The corporation, he said, should be able to resolve the debt suffered by these developers due to prolonged uncertainties on the matter.

One of the developers told TMR that should PR1MA decide to halt the project, he would offer the land to other potential and interested developer.

He added that the discussion with PR1MA Corp did not produce the desired results, hence, which led him to consult DPMM to facilitate future engagement between them.

“Leaving the projects and the developers hanging in the dark would not benefit anybody in the supply chain, as well as the economy of the country.

“The multiplying effects impact developers, contractors, supplier, and even the banks who cannot serve loan to other parties. Developers will find very hard to secure any future projects,” Mohd Ali Amin said. 

“If the project is halted and the contract is voidable, PR1MA should compensate the developers,” he added.