Penang Chief Minister Lim Guan Eng said there was no misappropriation in the sale of a 1.4 hectare piece of land in Georgetown.

Lim said any allegation against the state that it charged a low premium to the PDC Heritage Hotel Sdn Bhd (PHH) was one that was made without detailed study.

NONE He said the application actually involved two applications made simultaneously namely an application for change of condition and an application for change of land status.

"It's true the land has a high value as it was evaluated by the Valuation and Property Services Department (JPPH) at RM2,700 per square metre or RM270 per square foot," Lim told reporters today.

He was responding to an allegation by the Penang Umno Youth treasurer, Aziaan Ariffin, who made a report to the Malaysian Anti-Corruption Agency (MACC), on the state government that it charged a premium of more or less RM45 per square foot to PHH when the market price was about RM250 per square foot.

Elaborating, Lim said the land was evaluated by JPPH vide a letter dated June 19, 2008, the land was being valued at about RM37 million and its 99-year lease at RM31 million.

"In view that the land is the property of PDC Heritage Sdn Bhd where the leasehold is for 99 years and the application is not an application to own the land," he said.

This is the formula

As such, he said the state government could only charge a premium based on the difference between a leasehold period and a freehold period.

Lim also stressed that the state government did not provide or approve any discount and PHH needed to pay all the premium amounting to about RM8.3 million.

Lim clarified that the premium calculation for the freehold status was based on the difference in the price between the freehold status minus the value of the land for the lease's balance.

"Whereby, the formula for calculating the additional premium for status change is five percent of the value of the land," he said.

- Bernama