GEORGE TOWN: The Penang Island Municipal Council (MPPP) will only be paying RM11.5 million in exchange for Malaysia’s first sub-terranean New Convention Centre (sPICE) worth RM300 million, a new seven-acre public park and an upgraded and refurbished Penang International Sports Arena (PISA) and Aquatic Centre.

Chief Minister Lim Guan Eng said MPPP was slated to pay RM50 million for the convention centre, which has now been awarded via open tender to S P Setia’s subsidiary Eco Meridean Sdn Bhd.

In a statement, Lim said three companies had submitted their proposals but S P Setia’s bid was accepted as it offered an entirely new concept.

“Their concept is called Penang People’s Park (PPP) which includes the RM300 million sPICE, a new seven-acre rooftop public park, refurbish, repair and upgrading PISA and the Aquatic Centre and building a new hotel with retail outlets and additional carpark,” Lim added.

He said MPPP was supposed to pay RM50 million for the RM300 million sPICE but instead would earn RM25 million in savings for upgrading PISA and the Aquatic Centre, and S P Setia would also buy the portion of land at current valuation to build a four-star hotel to complement sPICE, and pay MPPP RM13.5 million for the land and MPPP would be actually only paying RM11.5 million.

Lim said three key requirements were considered when awarding the tender namely best value for money pricing, best product quality and whether it could be maintained to match world-class standards and sPICE fulfilled all the requirements.

Many felt that the council’s coffers should not be depleted for a project which they felt would end up as a “white elephant” as doubts were raised if such a convention centre was really needed, especially with several developers like IJM Land and Ivory Properties already announcing their intention to build convention centres within their respective developments namely The Light (IJM) and Penang Times Square (Ivory).

This article appeared in The Edge Financial Daily, January 17, 2011.