Light at end of tunnel over KTM’s Singapore land

KUALA LUMPUR, Sept 22 — The contentious bilateral talks over the Keretapi Tanah Melayu (KTM) land in Singapore appears to have moved forward with a proposal to swap it for valuable land near the island state’s first casino in Marina South, instead of scattered pieces across the tiny republic.

Government sources said Singapore has submitted a proposal to Wisma Putra last month for a joint-venture company that will develop the new piece of land. Malaysia will hold 60 per cent equity in the company while Singapore will hold the balance, both through their respective sovereign wealth funds.

“The ball is now in Wisma Putra’s court,” a source told The Malaysian Insider.

It is understood that Malaysia has already appointed private valuers to ascertain the exact land value of the site, which is in lieu of the 217 hectares that KTM now owns in Singapore.

“Singapore claims the new site is in the heart of the most ‘happening’ place in the city, with massive new developments earmarked around the area,” he added.

The site is near the Marina Bay Sands, which was due to open end 2009 but has now moved its opening launch to early 2010. It also overlooks the Singapore F1 race track comprising streets in the republic’s priciest commercial zones.

A view of the Marina Bay Sands casino resort under construction and Singapore’s financial district at night. — Reuters pic

The source said Wisma Putra is now mulling the proposal but foreign ministers from both neighbours are unlikely to meet anytime soon because of the on-going United Nations (UN) General Assembly sessions. It will mark Malaysia’s Datuk Anifah Aman’s debut in the UN.

However, the Malaysia-Singapore Joint Ministerial Committee (JMC) is scheduled to meet in mid-October and could discuss the proposal.

The land swap has been contentious since the Malaysia-Singapore Points of Agreement (POA) was signed in 1990 over the issue of the future of the railway land. The POA was signed between former Singapore Prime Minister Lee Kuan Yew and former Malaysian Finance Minister Tun Daim Zanuddin.

Under the agreement, KTM was to vacate its historic station at Tanjong Pagar and move to Bukit Timah while all of KTM’s land between Bukit Timah and Tanjong Pagar would revert to Singapore. The land at Tanjong Pagar would be handed over to a private limited company for joint development — of which its equity would be split 60 per cent to Malaysia and 40 per cent to Singapore — as it is in the latest proposal.

But the key contention was the interpretation of the agreement as Singapore insisted the agreement meant KTM had to move its terminal from Tanjong Pagar to Bukit Timah within five years of its construction, when the republic moved its railway immigration in August 1998.

But Putrajaya said it would only be effective once it decided to move the station.

The railway land was acquired under a 1918 colonial ordinance specifically for use by Malayan Railway (Keretapi Tanah Melayu or KTM) for a period of 999 years. That same ordinance limits the use of this land. The land, which the main railway station is situated on, is considered prime land.

The 1990 POA states that the KTM railway station would be moved either to Bukit Timah first, or directly to Woodlands. In exchange, under the 1990 POA, three parcels of railway land — at Tanjong Pagar, Kranji, and Woodlands — would be jointly developed on a 60/40 basis with the Malaysian Government holding the larger share.

However, three years later, former Prime Minister Tun Dr Mahathir Mohamad expressed his displeasure with the POA as it failed to include a piece of railway land in Bukit Timah for joint development.

KTM’s Bukit Timah railway station. — Wikipedia.org pic

In September 2001, both neighbours reached a comprehensive agreement with an understanding that the Malaysian immigration checkpoint on the Kuala Lumpur-Singapore railway line will be moved from Tanjong Pagar to Kranji.

Las Vegas casino chain Sands has committed to invest S$3.85 billion (RM9.43 billion) in the project in Marina South, not including the fixed S$1.2 billion cost of the 6,000,000-sq ft site itself, which by most estimates will make it the most expensive casino in the world.

The total cost of the development is placed at S$8.0 billion. In addition to the casino, other key components of the plan are three hotel towers with 2,600 rooms and suites; a 200,000-sq ft arts and sciences museum; and a convention centre with 1,200,000-sq ft of space, capable of accommodating over 52,000 people.

The resort, inspired by card decks, was designed by Moshe Safdie. The company has promised to create 10,400 jobs for the project, 75 per cent of which will be reserved for Singaporeans.

Marina Bay Sands will feature three 55-storey hotel towers which were topped out in July 2009. The three towers will be connected with a 1 hectare sky terrace on the roof.