Penang’s new policy on land conversion

The new Penang state government land policy seeks to encourage Penangites to become permanent landowners and boosting commercial and industrial growth. Under the new policy, industrial landowners in Penang can apply to extend their lease period from the present maximum 60 years to 99 years, while owners of leasehold residential lands can apply to convert their land to freehold status. More at We will be fair in land conversion.

The conditions and procedure for conversion are here and here.[Update : The official guidelines (Bahasa Malaysia version) on the new land conversion policy and the application form (Borang 12A) is now available and can be downloaded from the website of Penang State's Department of Land and Mines].

Land owners can begin submitting individual applications after June 15 to change the status of their land titles.

And here are the views and comments on the state’s new land conversion policy from man on the street, local community leaders, property consultants and housing developers to legal practitioners.

The move is expected to benefit industrial land owners or companies to secure financing to expand their factories as presently commercial banks are less keen to provide banking facilities to industrial lands and factories with short leasehold tenure of less than 30 years as collaterals.

Industrial/Housing schemes to benefit from this new land conversion policy

Industrial lands and factories in Penang’s Industrial Parks developed by Penang Development Corporation (PDC) are alienated on 60 years lease. These industrial parks are Bayan Lepas Industrial Park, Mak Mandin Industrial Park, Seberang Jaya Industrial Park, Prai Industrial Park, Bukit Tengah Industrial Park and newly developed Bukit Minyak Industrial Park.

Whilst PDC’s housing schemes are mostly leasehold properties of 99 years namely Bandar Bayan Baru and Bandar Seberang Jaya, Taman Pelangi and Komtar development area in Georgetown.

Other notable housing schemes built on state alienated lands of 99 years lease are Techware’s condominium schemes along the Sungai Nibong coastal area ie Gold coast, Putera Marine, Villa Emas, Putera Place and IJM’s housing schemes ie Tmn Sri Damai, Alphine tower, Parkview tower, Lakeside, Ocean view, The Spring etc. Others such as Mewah Court, Midland condo, Mutiara Idaman, Mutiara Heights, Pangsapuri Tanjung Tokong and Sri Saujana at Harbour city.

However, owners of leasehold high rise stratified units seeking to obtain freehold rights may have to be patient until the state government resolved legal matters with the Federal Government. More at Freehold land applications now on hold.

Several high profile townships such as the Seri Tanjung Pinang and Bayan Bay development (both on the Penang Island) and 456-acre Bandar Perda township and Bayu Mutiara in Bukit Mertajam of mainland Penang have since been granted conversion from leasehold to Freehold status. Related link at Penang projects to gain from conversion.

For more insights on Malaysia’s land administration policy, a recommended website by Ministry of natural resources and environment provides resources on Malaysia’s current land administration process, types of land titles , classification of lands etc.

For advisory on individual property investments in Penang, email to us at Izrin & Tan Properties Sdn. Bhd. or call us at +604 6588333 (Penang Office) or +603 92839782 (Kuala Lumpur Office) and we would be pleased to assist.

Aerial view of the Perai Industrial Park in central mainland Penang and its coastline. The development of the industrial parks in Penang since 1970’s have transformed Penang into the biggest industrial hub in the northern Peninsular Malaysia.

Bandar Perda, a privatized 456-acre housing project in central Seberang Perai which have been granted Freehold status…

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3 Responses to “Penang’s new policy on land conversion”

  1. Real Estate Industrial & Commercial Says:

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  2. I&T Penang Properties Blogs » Blog Archive » 6 websites that property investors need to know in Malaysia Says:

    [...] 4. Department of Director General of Land and mines – this website posted general information and a list of Malaysia Laws and application guidelines of various land dealings in Malaysia language such as application for state alienated lands, subdivision and amalgamation, land conversion and guidelines on the approval process of land ownership (residential units) by foreign interests. Under Malaysia’s Federal Constitution, Land is under the jurisdiction of the respective state administration and each state has its own set of land enactments. Related link : Penang’s new policy on land conversion. [...]

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