Najib and MINDEF must come clean on commercialisation of military land as exemplified by the 1MDB purchase of Sungai Besi military base

Is our Prime Minister and Defence Minister playing a cat and mouse game about the plan by the Ministry of Defence to commercialise military land by relocating selected military bases located on prime land in exchange for less than market value?

I raised this issue in Parliament twice to ask for details about this “military land commercialisation program”, however the latest reply on 27 October was just a one line denial stating that the Ministry of Defence (MINDEF) has no intention of converting any military base or land for commercial purpose (parliamentary reply attached).

In another parliamentary answer on 8 June this year, MINDEF stated that it has no intention of selling military land, but admitted there is a plan to redevelop military bases in Penang, Selangor, Johor, Sarawak, Kuala Lumpur and Pahang with several companies through land swap programs.

While the government keeps denying military land is being sold, we can see more and more military bases are being commercialised to make way for new developments, while the original bases are relocated to less populated areas.

For instance, the historical Sungai Besi military base was sold to 1MDB for the astonishingly low price of RM1.6 billion, or RM74.20 per sq ft. This is in comparison to the market value of other prime land in Kuala Lumpur which is already being priced between RM500 – RM1000 per sq ft. In addition, 1MDB also awarded a RM2.1 billion contract for Lembaga Tabung Angkatan Tentera (LTAT) to relocate its original defence units in Sungai Besi to new eight separate sites.

The purchase of the former Sungai Besi air base is part of 1MDB’s acquisition of 15 plots of land in Sungai Besi in 2013, which are being developed into the multi-billion ringgit Bandar Malaysia project. Former Prime Minister Tun Dr Mahathir Mohamed estimated that the the government lost approximately RM20 billion in this deal. What makes this “too good to be true” deal for 1MDB even sweeter is the fact that it was awarded by direct negotiation and not open tender.

Meanwhile, Penang’s landmark 400ha Butterworth Air Base is in an ongoing deal to be taken over by TSR Capital, which intends to transform it into a RM10 billion integrated commercial development project.

In Johor, the 74-year-old Kem Majidee was sold last year (not withstanding an earlier tussle over rights to the land) to Syarikat Selia Pantai Sdn Bhd, which intends to develop it into a lucrative commercial and residential development known as Kota Southkey. Kem Majidee was once known as “the last bastion of Southern defence” due to its location.

The government has billed the so-called “land swap program” as a win-win for both the government and private sector, however when the government loses money in selling land to the private sector, it is the taxpayers who end up footing the bill.

The biggest question to be answered is, why is the government relocating MINDEF military bases and selling the land to private corporations?

In allowing large amounts of land which house military bases to be sold to the private sector, the government must consider whether this will jeopardise national security due to the classified nature of information and activities on the military bases. Parliament scrutiny is needed in order to ensure that national interest is not jeopardised. The Minister can start by first revealing details of the deals so that it can be debated in Parliament.

I urge MINDEF to reveal how many military bases will be sold for redevelopment and how much will the government stand to lose from these sweetheart deals? Who will benefit from these deals? In the interest of transparency, the Minister must explain the criteria used to select the developers, since the award was done by direct negotiation and without open tender.

These questions need to be answered immediately.

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