Urban Regeneration: Is Legislation Needed? (Part 2)
Acquisition of Ampang Park
In July of 2015, one of the oldest malls in Kuala Lumpur, the Ampang Park shopping centre, was gazetted for compulsory acquisition for a public purpose: the construction of the second MRT line. Ampang Park was a stratified property.
The owners were given the option to sign a mutual agreement with MRT Corp if they didn’t want to go down the road of compulsory acquisition. 100% of consent was needed from 253 strata owners for the agreement to work. But it did not materialise.
The authorities proceeded with the acquisition of Ampang Park and on 31 December 2017, the mall ceased operations. A sad day for patrons, owners and tenants who were there until the end. The compulsory acquisition makes no distinction between old or new properties, strata or not. If the properties are needed for the purposes mentioned in Section 3, the authorities can proceed.
Statutory protection of listed buildings under the National Heritage Act (NHA) 2005, which was gazetted on 31st December 2005 and took effect 1st March 2006, prohibits any works without the approval of the Commissioner. Anyone who violates the prohibition faces prosecution. Buildings listed under the NHA are not spared from compulsory acquisition if they are required for a public purpose. It is not mentioned if the proposed legislation will be afforded this authority.
Willing buyer, willing seller
A friendlier route would be through the usual form of transaction, a private treaty sale. A sale of this nature is conducted in the open market on a “willing buyer, willing seller” basis. The two parties would agree to the terms and conditions of the sale before the sale completes.
The Row, located at Jalan Doraisamy, next to Sheraton Hotel in the city, was a revitalisation project that turned 22 pre-war shophouses built in the 1940s, into shops, cafés, and other commercial spaces.
A property consortium, Urbanspace, in a private treaty sale, took over the shop lots, formerly known as “The Asian Heritage Row” from a single entity. In July 2015, they launched the first phase with five shops open for business. Today, this mixed-use commercial development is home to stylish retail shops, cafés, bistros, restaurants, event spaces, and offices.
It is not easy to get consent from all owners. If an owner disagrees, the transaction would be stalled. Thus, came the proposed urban renewal legislation to facilitate this tedious and time-consuming process.
Based on the announcement, if the new legislation gets passed, the consent of owners is required and only older properties will be affected – time will tell if 100% consent or majority is needed. Whether the proposed legislation is needed or fair in getting consent from the majority, our government needs to carefully weigh and take into consideration the affected minority whose interests must not be suppressed.