While more property development projects are in the pipeline, the research unit of a local bank, CIMB Research, has reportedly warned of a “significant” commercial property glut in Penang. From an Edge report:

Occupancy rates:

  • Office space: 76% (the lowest in Malaysia)
  • Retail space: <70% (second lowest in Malaysia)

“There appears to be a significant glut in Penang, which would worsen if more office and retail space were built.”

  • Beach hotels: 63% (3rd quarter, 2009)
  • George Town hotels: 68%
  • Hotels outside city: 37%

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Sigh…. good luck to George Town and its heritage conservation. Looks as if the state government has already made up its mind to give the green light to the four projects. Why am I not surprised.

The state government says these hotels are needed to stave off the recession. But it forgets that tourism is a major revenue earner for Penang, and visitors don’t come to George Town to check out its boutique hotels. Rather, they are drawn to the historical character of the place. Once that is gone, George Town becomes just like any other city in this region.

This excerpt from a Business Times report:

Penang hotel projects on, Unesco guidelines awaited
By Marina Emmanuel
marinae@nstp.com.my

Chief Minister Lim Guan Eng yesterday said the state authorities and affected developers are awaiting guidelines from the United Nations Educational, Scientific and Cultural Organisation (Unesco) on whether any changes should be made to the project plans.

“The developers fully understand that legally, the projects can still proceed, although Unesco needs to state if any modifications are needed. Penang needs these projects (investments) to offset the oncoming economic recession,” he told a press conference at his office in George Town.
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