Elsiedale Bungalow at Lebuhraya Halia, Mount Erskine

The Penang Island City Council (MBPP) will lease two heritage buildings in George Town to Mutiara Realty Construction Sdn Bhd for commercial and tuition centre use under a “15+15+15” lease arrangement, potentially generating approximately RM3.88 million in rental income over a maximum period of 45 years.

MBPP mayor Datuk A. Rajendran said the lease comprises three 15-year terms, with each renewal subject to the tenant fulfilling the lease conditions.

One of the buildings, a Grade II heritage property in Kampung Kolam, consists of 12 units, including six ground-floor commercial lots and six residential units on the upper floor. As the building has been deemed unsuitable for residential occupancy, the company will invest RM450,000 to restore the property and ensure it meets safety standards.

Heritage buildings at Jalan Kampung Kolam (Source: Buletin Mutiara)

MBPP will grant the tenant a six-month rent-free period to complete the restoration works. Upon completion, one of the units will be handed over to the council free of charge for public use.

The second heritage building, located along Lebuhraya Halia 2 in Mount Erskine, will be converted into a tuition centre. The monthly rental will begin at RM5,000 for the first three years, with a 5% increase every three years thereafter. The council expects to collect about RM994,000 in rental during the first 15 years, contributing to the projected RM3.88 million over the full lease period.

As part of its corporate social responsibility commitment, the tenant will also provide 20 free tuition places annually for students.

Rajendran said the company secured the lease after submitting the highest rental bid through an open tender process.

ADVERTISEMENT