AUDIT REPORT Construction delays in a redevelopment project in Bukit Bintang cost Yayasan Selangor RM15 million.

The first in the 2014 series of the Auditor-General’s Report said Yayasan Selangor lost RM15.12 million in rental revenue from September 2012 to August 2014.

Yayasan Selangor lost RM2.52 million in 2012 (Sept-Dec), RM7.56 million in 2013 and RM5.04 million in 2014 (Jan-Aug).

The 12-storey building was left abandoned and vandalised after tenants were told to vacate the building three years ago.

It was reported in 2013 that the building, located in the shopping district, was to be transformed into a boutique hotel.

Kenanga Wholesale City Sdn Bhd won the bid to refurbish the building.

Once completed, the building is to be connected to the proposed Bukit Bintang Central MRT station.

Yayasan Selangor had then issued termination notices to all tenants to vacate the premises by August 2012.

However, due to internal issues with the consortium, the project was yet to be finalised as at August 2014.

Hostels vacated but no construction

Yayasan Selangor also incurred losses in the proposed Asrama Yayasan Selangor Kuala Lumpur (AYSKL) redevelopment project in Kampung Pandan, as a result of delays.

Students sponsored by Yayasan Selangor staying at the hostels were moved to residential schools.

The audit staff’s visit to the proposed project site in September 2014 revealed that the site had not even been cleaned to enable the project to commence.

The audit report recommends that Yayasan Selangor provides a more detailed, long-term strategic planning for property management in order to generate revenue so that the  objective of Yayasan could be realised.

“Planning should take into account the effects and consequences before a decision is made on the implementation of development projects to avoid losses for Yayasan.

“(Yayasan should also) intensify property marketing activities to attract more tenants, establish a more effective monitoring mechanism for the collection of rental arrears and ensure procedures relating to collection of rental arrears are enforced,” the Auditor-General's Report states.