By Danial Dzulkifly
SHAH ALAM, Aug 8 — The Selangor State Development Corporation (PKNS) must adapt to contemporary demands and expand its operations beyond merely constructing low-cost housing to ensure sustainability and enhance social mobility for residents.
Its group chief executive officer Datuk Mahmud Abbas said the corporation needs to also focus on delivering high-end products including condominiums, high-tech industrial parks, independent power production, and landmark projects like SA Sentral.
These initiatives are part of PKNS’s strategy to diversify its business portfolio.
Citing the escalating costs of building materials and other economic challenges, he said that an exclusive focus on low-cost housing would be financially detrimental to PKNS, describing it as a loss-making venture.
Mahmud added that the company no longer enjoys exemptions on land premiums, among others, from the state government and must now operate like other profit-driven businesses in Selangor.
“We started with building low-cost houses and will go through a phase where we will also build medium- and high-cost properties. But despite this, our original aim of balancing and boosting Selangor’s economy remains. Within PKNS, we still have our DNA to build affordable housing.
“We are still doing this, but we need to explore more profitable construction or business ventures, because PKNS no longer has the privileges it once enjoyed.
“Previously, we were exempt from paying land premiums, but now we are required to pay fees and other costs like other companies. As a result, we cannot sustain our high corporate social responsibility (CSR) agenda and continue building low-cost housing.”
“I must emphasise that the core mission of PKNS is not solely to build low-cost housing. Our enactment does not stipulate that PKNS must focus only on low-cost housing. It mandates that we engage in socio-economic development by constructing buildings, industries and other related projects,” he said.
Mahmud was speaking at a press conference after attending the 60th anniversary celebration of PKNS at the Shah Alam Convention Centre today.
At the present, PKNS loses up to RM25,000 for each unit of low-cost housing it builds, hampering its objective and ability to fund CSR projects in the state.
“Building 1,000 units of low-cost housing, for example, would result in a loss of RM20 million. With an annual CSR budget of roughly RM60 million, this is not sustainable,” he said, emphasising the need for PKNS to diversify its portfolio.
