Why Malaysia needs the Urban Renewal Act and why some are resisting it

Malay Mail

05-05-2025

KUALA LUMPUR, May 6 — After more than a decade in the making, Malaysia's much-anticipated Urban Renewal Bill is expected to be tabled in the upcoming July parliamentary sitting.
The Bill aims to restore the vibrancy of old areas, provide affordable housing, enhance public facilities and revitalise architecture.
However, despite these goals, it still faces resistance on the ground.
PAS Youth recently announced a protest set for June 14 in the Klang Valley to oppose the Bill.
The group argues that the legislation could open the door to exploitation by developers and endanger vulnerable communities.
So why does Malaysia need an Urban Renewal Act (URA)?
Many of the country's buildings were constructed during the post-independence property boom. As a result, many are now deteriorating and in need of rejuvenation.
However, redeveloping these properties has long been hampered by legal hurdles.
Under current laws outlined in Section 57 of the Strata Titles Act 1985, a strata development can only be sold if 100 per cent of unit owners agree.
The proposed URA aims to lower this threshold based on the building's age and condition. If the Bill is passed in Parliament, it is intended to overcome that gridlock.
While the URA is much needed in Malaysia, Adjunct Professor Shuhana Shamsuddin of Taylor's University said the proposed Bill seems developer-driven. — Picture by Raymond Manuel
Majority rule proposed to break redevelopment deadlocks
Professor Jamalunlaili Abdullah, dean at Universiti Teknologi MARA's Faculty of Architecture, Planning and Surveying, said the Bill will look at giving power to the majority when it comes to determining consent threshold — before a building is sold or listed under the URA for refurbishment or redevelopment.
'Currently, even 10 per cent of residents can block a project supported by the 90 per cent who want a redevelopment project.
'So supposed if an area is very dilapidated, then supposed that 90 per cent of the residents want it to be redeveloped but 10 per cent disagree, they (authorities or developers) cannot do anything.
'That's why some of the projects are stalled for redevelopment. This new Bill will allow for that — majority power to determine a renewal project,' he said when contacted by Malay Mail.
That is not all, Jamalunlaili said as there are concerns on the ground, for example the concern of what happens after redevelopment is completed.
'Yes, people may get larger, better homes. But can they afford the property taxes and upkeep later?
'The property tax will increase as this tax is based on the value of the properties in an area. When redevelopment is done, the value of properties in the area will go up,' he added.
He also said that while the Bill is positive, it still needed to include some safeguards for property owners, especially if they belong to the low-income tier.
'People need this assurance that they will still be able to afford living in their houses after it has gone through redevelopment and this assurance should be long term — for the next 10 to 20 years.
'There have been cases in the past whereby land owners have to sell their land due to rising taxes. This is something that could still happen today,' he said.
A vision for renewal should prevent gentrification
While the URA is much needed in Malaysia, Adjunct Professor Shuhana Shamsuddin of Taylor's University said the proposed Bill seems developer-driven.
'If you compare this proposed Bill to URA in other countries, there is no mention of developers in their URA.
'Ours seem to put developers at the forefront, leading the renewal programmes.
'What should be done is the government setting up an agency that overlooks these urban renewal programmes,' she said when contacted.
Shuhana, who is also the Malaysian Urban Design Academy (Perekabandar) president, said this is why there is anxiety on the ground as property owners still have the sentiment that developers will not protect them.
'The sentiment on the ground is that people fear their homes will be demolished and replaced by high-rises that they cannot afford,' she said.
Citing an example, Shuhana pointed to Kampung Baru — a once-thriving cultural enclave now overshadowed by surrounding development.
'Urban renewal shouldn't erase identity. It should protect it,' she said.
A general view of the Kampung Sungai Baru in Kuala Lumpur April 26, 2025. — Picture by Yusof Mat Isa
On the ground, residents speak out
Save Kuala Lumpur chairman Datuk M. Ali said even if 1 per cent do not agree to sell their property, this decision should be respected.
'Why are they (government) pushing for 75 per cent and 85 per cent. You must respect even if one individual refuses, you must be able to work through it.
'If it's going to benefit them in the long term without any financial implication without loss of anything, then that is okay.
'This is what the government must make clear, what the exact plan is and why are they pushing so hard for a lesser percentage.
'Even if 1 per cent objects, you have to be able to convince that one person. Yes, they want better homes, but not at the cost of the community and livelihood,' said Ali.
Is there potential abuse of the URA?
According to Jamalunlaili, there should not be any room for abuse of the Act as any redevelopment should follow what is stated in the existing local and structure plans.
'That's why they need to follow the zoning laws in the local plan — plot ratio, density, how many units.
'Taman Rimba Kiara is an example — it was protested due to zoning issues. So in other scenarios, if the local plan states a plot ratio of 1:8, developers cannot build more than that.
'There should not be any abuse of the URA as the local plan has laws and must be followed,' he said.
Prime Minister Datuk Seri Anwar Ibrahim has since said the proposed URA will protect the rights of property owners by ensuring fair and significantly higher compensation than is currently provided.
He also said that the law aims to protect the rights and dignity of the people, particularly Malays in the cities, ensuring that the urban poor can live with greater dignity, rather than being left to live in overcrowded conditions for decades without resolution.