Novel housing deal that went awry
The Star 17/10/2005 BY LOURDES CHARLES

KUALA LUMPUR: It was supposed to be an ingenious way to build housing for the police to resolve its accommodation problems in Kedah.

Transfer three pieces of prime police land to a private developer for him to develop and sell, and in return, the developer will build police stations and living quarters for the police.

However, the 2002 deal has turned sour.

While the developer has completed his commercial project on prime police land worth RM110mil, the quarters and police stations remain incomplete.

The developer is now under investigation by the police for failing to keep his end of the bargain. It is learnt that the developer who took over and developed the police land for a commercial housing project failed to complete two of the three projects earmarked by the Government in the Pendang and Yan districts as stated in the deal.

Sources said the developer had allegedly raked in millions of ringgit in profit from the sale of houses built on the police land transferred to him. They said the developer started construction work in another district, Kuala Muda, in 2003 although the agreement was signed the previous year.

Work on the Pendang project started in 2004 but it was abandoned shortly after.

Financial constraints including not being able to obtain bank loans were cited as the reason.

The sources also said the developer claimed that the cost of building the police stations and housing quarters had escalated.

Federal commercial crimes director Commissioner Datuk Hairuddin Mohamed confirmed they were investigating the developer following a report lodged by a senior police officer from the logistics department recently.

Sources familiar with the investigations said several people including police officers, Internal Security Ministry officials and the developer would be quizzed.

Deputy Inspector-General of Police Datuk Seri Musa Hassan said police would conduct a thorough investigation into the matter.

“We're not happy with the way things have turned out as our officers and men are still in their old and cramped quarters.”

In June, Prime Minister Datuk Seri Abdullah Ahmad Badawi had identified six reasons why developers failed to complete their projects.

Among the reasons he gave were incompetent developers, financial constraints faced by the developers, lack of capital to undertake projects, contractors facing labour shortage, technical problems and bad planning.

Abdullah had also announced that the Government had approved RM2.5bil to provide better housing and working environment for policemen including reviving abandoned police housing projects nationwide.