The construction industry in Penang will likely remain flat this year, with a value of around RM6.8 billion, or almost similar to that posted in 2014, reported The Star.
According to Penang Master Builders and Building Materials Dealers Association president Datuk Lim Kai Seng, the RM6.8 billion mark is “one of the highest in the history of the construction industry in Penang. Due to the economic slowdown, it will be difficult to surpass this figure.” He noted that most of the projects were for hotel and mixed developments.
He noted that most of the projects were for hotel and mixed developments.
“For the first six months of this year, the value of jobs given out reached RM2.68 billion for 171 contracts. Out of that, some 153 are from the private sector while the remainders are government contracts,” he said.
The value of government contracts stood at RM214 million while that from the private sector totalled RM2.47 billion.
Notably, business contracts generated in 2014 was revised from RM4.8 billion to RM6.8 billion, after considering projects tendered in late 2014.
Lim revealed that the association is confident that at least over RM4 billion contracts were given out in 2H 2015 in Penang.
Some of the large projects are from Ideal Property Group with a gross development value (GDV) of RM1.8 billion, Ivory Properties Group Bhd (GDV: RM1.156 billion), Mah Sing Group Bhd (GDV: RM1.005 billion), Eco World Development Group Bhd (GDV: RM600 million), IJM Land Bhd (GDV: RM486 million) and Sunway Bhd (GDV: RM150 million).
The project’s construction cost would come up to around 40 percent or around RM2 billion of the total RM5 billion GDV, said Lim.
“The renovation will cost about 30 percent or RM600 million of the RM2 billion spending for construction works.”
“We can expect spending of over RM800 million for construction and renovation works annually for the next three years from these projects alone.”
Moreover, new shopping malls that are being planned will also generate around RM3.5 billion worth of jobs in the next five years.
“This means that there will be about RM800 million to RM1 billion worth of construction jobs given out in Penang per annum starting from next year,” said Lim.
Source : propertyguru.com.my