Urban Regeneration in a Historic City: Think City’s Initiatives in George Town, Penang Smart Cities Conference 12 March 2014Neil KhorSenior Fellow, Think City

1

AGENDA

Setting the Context: Malaysia’s Response to the Urban Challenge

Penang as a Case Study:Challenges, Opportunities in a Historic City

Putting Policy into Practice: Urban regeneration in a World Heritage Site via a public grants programme

Cities are Engines of Economic Growth

Source: World Bank, World Development Indicators 4

In 1800, only 3% of people lived in cities

In 1950, only 30% of the world was urban

By 2030, 60% of people will live in cities

Globally, economic activity is highly concentrated in key cities in each country

High income countries are economically dense

Adapted from Cities, People and The Economy (2010)

Working PartnersEconomics of geography suggests that high density localities will be best placed to attract new firms and exploit economies of scale.

• The world is being shaped by competition between cities, and no longer between nations

• People now choose the city where they want to live; before they chose the job they wanted

• Efficient and liveable cities are the keys to successful national development

• Agglomeration permits scale economies and generates higher incomes

• Agglomeration will only happen in globally and locally networked cities

Rapid urbanization requires cities to be made liveable and sustainable to optimize the potential of cities as the engines of economic growth

A changing world

Source: Economic Intelligence Unit, Price Waterhouse Coopers

Trend line of countries’ expected spending according to wealth

There is a strong linkage between the wealth of cities and the quality of life within cities

Malaysia’s Response to the Urban Challenge

28% 75%1970 2013

11%1911

“Competition is no longer only between nations but also between cities. For Malaysia to move into a higher income economy, we must exploit higher returns by adopting strategies to build density, develop clusters and specialize in high value sectors.”

Dato’ Sri Mohd Najib Tun Haji Abdul Razak, Prime Minister of Malaysia

“ …leveraging on cities to accelerate economic growth will be an important strategy during the 10th Plan”

Building vibrant and attractive living spaces. Influencing the form and character of living spaces to make them attractive

places to live, work and play”

Concentrated decentralization and promote areas with the greatest potential. Strive towards compact, energy-efficient urban forms with clear identity

20

Source: adapted from the 10th Malaysia Plan

Growth will be concentrated in urban conurbations

21

Kuala Lumpur, Iskandar and George Town Conurbation already account for more then 50% of Malaysia GDP

Source: adapted from the 10th Malaysia Plan

Iskandar

10MP has identified strategies that will focus on building density, developing clusters and specialization in high value sectors

Greater KL

A comprehensive plan is required to harness economic opportunities in the region

27

Who we are

•Providing urban policy thinking. •Implementing innovative urban solutions.

•Driving urban regeneration.

30

Penang as a case study …

Putting POLICY…into PRACTICE

31

• George Town is a UNESCO World Heritage Site (alongside other global sites like Venice, Borobudur, Angkor Wat and Hoi An)

• Penang is Malaysia’s culinary capital (world renowned food haven)• Penang is the third most popular destination (13% of Malaysia’s

total foreign tourists)

• A Melting Pot of Food, Beaches, Heritage, Culture & Religion

51% 92%1970 2013

37%1911

Putting POLICY…into PRACTICE

“We came here for low cost labour… we stayed

for talent.”

“We came here for low cost labour… we stayed

for talent.”

Trading

(1786-1969)

Manufacturing

(1970-2008)

Knowledge

(2009 - )

Port City

Industrial City

Knowledge City

Compact City Urban Sprawl ???

Challenge for Penang: Losing its old world charm

Challenge for Penang: Traffic Congestion

Perbandingan di antara Jumlah Kenderaan dan Jumlah Penduduk di Pulau Pinang antara Tahun 1998 hingga 2007

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Tahun

Bila

ngan

Ken

dera

an/ P

endu

duk

Jumlah Kenderaan Bermotor Jumlah Penduduk

Comparison between number of registered motor vehicles and population in Penang (1998 – 2007)

• Private car registrations increased by an average of 9% each year for the last 15 years (double the rate for motorcycles). If this rate keeps up, the number of cars will double every 8 years

Challenge for Penang: Urban Areas Getting Hotter

39

Challenge for Penang: Mean Temperature Rising

Mean Temperature in Bayan Lepas, Penang (1951 - 2009)

26.0

26.5

27.0

27.5

28.0

28.5

29.019

51

1956

1961

1966

1971

1976

1981

1986

1991

1996

2001

2006

Year

(oC

)

Challenge for Penang: Unsustainable Water and Solid Waste Trends

Water consumption and Solid waste per capita is nearly twice higher then Singapore

Country / Region Average (LCD)

Penang 291

Rest of Malaysia 188

South East Queensland 163

Singapore 154

France 150

Germany 127

Estonia 100

Water consumption

Challenge for Penang: Bad street infrastructure

Over-burdened drainage system leading Over-burdened drainage system leading to flash flood prone streetsto flash flood prone streets

High street curbs are not pedestrian friendly

42

Challenge for Penang: River Pollution

43

Challenge for Penang: Marine Water Quality

44

Vulnerable groups pushed to the periphery and concentrated in emerging urban ‘slums’

Tanjong Tokong UDA FlatsMacallum Street Flats

15 Storey20 Storey

Social Housing in the 70’s & 80’s

45

The outcome of all of these challenges

• Flight of talent from Penang.

• Declining growth of high-value tourism.

• Declining quality of life

High opportunity cost: The decay of Penang’s natural endowment is happening at a time when the ‘liveability of cities’ has become a key

factor in the competitive advantage of nations.46

© All Rights Reserved. This material is confidential and property to Khazanah. No part of this material should be reproduced or published in any form by any means, nor should the material be disclosed to third parties without the consent of Khazanah.

CONFIDENTIAL

Penang as the centre of the Northern Region. The economic activity brings the region together.

Penang as the centre of IMT-GT. Good connectivity can bring activity into the region, thus enhancing itself and the region as a whole.

Penang as the centre for the Bay of Bengal. Can act as the urban centre for the Bay of Bengal region.

PENANG The Regional Opportunity

Penang has the potential to be the heart of one of the fastest growing regions with access to a large hinterland for resources, human capital, technology and markets

Building on Strengths: Penang is emerging as a business & services hub of the Bay of Bengal (GDP of over USD 750bil)

Adapted from presentation on “Positioning Penang”, December 17th 2008 Dr Homi Kharas, Wolfensohn Center for Development, The Brookings Institution

• Penang is well-placed to become a hub for the Northern Corridor, the Indonesia-Malaysia-Thailand growth triangle and the Bay of Bengal. The Northern Corridor is well situated as the dominant economic mass in the IMT-GT. Penang has the highest economic density and lowest distance to market for a large local area in this triangle.

• The economics of geography suggests that high density localities will be best placed to attract new firms and exploit economies of scale.

‘Cones’ on the map represent economic output per square kilometre; the cities with higher ‘cones’ are more economically dense

The emergence of a new mega region

48

49

Bayan Lepas 64%RM 240 bil

KLIA 34%RM 130 bil

Subang 1%RM 4.5 bil

Others 1%RM 3.3 bil Malaysia Cargo Movement

(mil kg)Total: 79.4m kg

Thailand

Vietnam

Laos

Cambodia

PhilippinesSubic Bay

Yangon

Ho Chi Minh

Phnom Penh

Bangkok

Indonesia

Singapore

Penang

Jakarta

Kuala Lumpur

3 hours

Myanmar

2 hours

1 hour

Medan

Chennai

Three concentric circles define the distance from Penang in terms of air flying times of 1 hour, 2 hours and 3 hours respectively

Overview of the Catchment Area Defined by Air Flying Times from Penang

Penang Airport constitutes 20% of Malaysia’s total airflown cargo

Building on Strengths:Penang is emerging as a logistics hub

• Penang Airport has the maximum direct connectivity and cargo volume in the IMT-GT region

• Penang Port has a total handling capacity of 25 million tonnes of cargo, interconnected by road & rail

• Malaysia’s rail system: 70% of KTM’s freight services is based in the north with regular service between Bangkok and Butterworth

• George Town is a UNESCO World Heritage Site (alongside other global sites like Venice, Borobudur, Angkor Wat and Hoi An)

• Penang is Malaysia’s culinary capital (world renowned food haven)• Estimated # of Tourist Arrivals in 2008 ≈ 4 million

• A Melting Pot of Food, Beaches, Heritage, Culture & Religion

Building on Strengths:Penang remains an attractive tourism destination

50

51

Building on Strengths: Penang is an anchor for medical tourism in Malaysia

52

Food, Beaches and Heritage are large Tourism draws• George Town core a UNESCO World Heritage Site• Malaysia’s culinary capital (World renowned food haven)• Silicon Valley of the East

“It’s about time Southeast Asia offered business an alternative to choking, congested capitals. But hope now flickers. George Town…is stepping out of the shadows.”

Monocle, “Trade Secret – Malaysia”, April 2008

Building on Strengths: Penang is already a strong brand

For Penang, this requires its cities, people and economy to develop together

CITIES

PEOPLEECONOMY

Agglomeration and increasing returns to

scale

Liveability

Talent

Liveable and efficient cities attracts and retain talent and this bring capital together to build the economy.

Building distinctiveness : Penang’s cultural heritage; cosmopolitan people; and built form

54

A city that promotes new ideas for improving urban mobility for everyone

55

“Transport defines the form of a city.”

The Economist, May 2007

55

A city with a place for small businesses, space for children and marginalized

More civic spaces for the marginalized to indulge in healthy activities…

A city that retains its rich cultural heritage, urban form and diversity

EconomicallySuccessful

SociallyEquitable

Environmentally Responsible

Sustainable communities

We need to have a different way of imagining the city that is built on

ideas of sustainability

Positioning Penang

Positioning Penang• Strategy for reinventing the George

Town Conurbation• Key enabling factors and policy levers

needed for Penang to avoid the Middle Income Trap

GTTP

Sustainable Penang Initiative 2• Community level; people’s initiative• Building consensus on a sustainable

liveable Penang

George Town Transformation Programme• Micro level implementation;

demonstrative & catalytic projects• Transform George Town into a model 21st

century city and a ‘sticky space’ to retain and attract talent

Transforming Penang into an

International City State, which is…

Location of choice for investors

+ Destination of choice for visitors

+ Habitat of choice for talent,

desiring sustainable living

Sticky Space

58

•To become the most livable place in Malaysia and top 25 Most Liveable Places by 2030

•Transform Penang as Malaysia ´s laboratory for urban solutions in the knowledge economy

60

VISION:

Strategic Spatial Framework

63

Major upgrade to the urban infrastructure is on the way to strengthen the competitiveness of the region. (>RM20b)

65

• Rapid

from Policy… to Practice

Urban regeneration in a World Heritage Site through a public grants programme

George Town Grants Programme

• Physical/Public Realm• Social Capital &

Capability • Knowledge

OUTCOMEOUTCOME

• A culturally vibrant & sustainable city,• Endangered trades, services and

communities taken off the endangered list• A community aware of its history and

heritage• Resilient small businesses that evolved with

the WHS• George Town’s OUVs enhanced

DETAILSDETAILS• Fund Size : RM 20 million

• Project Size: RM 20,000 to RM 2 million

• Duration : 24 months

• Grant Type :

• Project & Booster Grants

• Matching Grants

• Repayable Grants

• Technical Assistance & Capacity Building Grants

6 KEY THRUSTS6 KEY THRUSTS

• Mobility & Connectivity• Social & Cultural

Communities• Economy & Services• Environment &

Sustainability• Safety & Quality of Life• Learning & Knowledge

OBJECTIVESOBJECTIVES

• Kick-start the regeneration of George Town• Build on the momentum of the civil society

and private sector initiatives• Capacity building and capability

development for the protection and development of the living heritage, culture and architecture

• Encourage a sustainable livable environment

CORE PRINCIPLESCORE PRINCIPLES

• Catalyst

• Partnership

• Developmental

• Inclusive

• Sustainable

• Creativity & Innovation

3 KEY AREAS3 KEY AREAS

THINK CITY PROJECTS

• George Town Land Use SurveyGeorge Town Land Use Survey– in-person survey collected data on

every business, residence, association, government agency, hotel and education institute within the George Town WHS (covering 260ha)

• George Town Conurbation StudyGeorge Town Conurbation Study– provides the spatial framework with

planning, design and development recommendations designed to support the transition of the regional economy and improve quality of life

Baseline studies

D e v e l o p m e n t a l: Rejuvenating the Waterfront

70

Adaptive Re-Use: of waterfront properties

Adaptive Re-Use: of waterfront properties

71

M e d i c i n a l H a l l :Retaining traditional trades in new context

M e d i c i n a l H a l l :Retaining traditional trades in new context

Yin Oi Tong, established in 1796 is the oldest Chinese Medical Hall in South East Asia

I n c l u s i v e

75

76

Affordable Housing Scheme

79

Apprenticeship Programme for Endangered Trades & Celebrating “Living Heritage”

S u s t a i n a b l e : Greening the city’s “Shared Spaces”

80

Jan 2011

81

Carnarvon Street Pilot Greening Project

Improving urban mobility in Penang

Successful implementation and cycling campaign in Penang, including night cycling in UNESCO World Heritage Site

Creativity & Innovation: Aspirational & Practical Solutions

84

Creativity & Innovation: Aspirational & Practical Solutions

85

86

Building Partnerships:

87

Business Improvement District Scheme (BIDS)Business Improvement District Scheme (BIDS)

Panoramic view of the BIDs Area

Business Improvement District Scheme (BIDS)Asia’s first Business Improvement District Scheme

George Town BIDS

90

ENHANCEMENT TO PEDESTRIAN CONNECTIVITY

George Town BIDS

91

Little India Improvement District (LIID)Little India Improvement District (LIID)Community Led InitiativeCommunity Led Initiative

93

94

Proposed Special Action Plan for Little India

Proposed Special Action Plan for Little India

Public Engagement ActivitiesPublic Engagement Activities

98

99

100

Malaysian Federal Government

Agencies

Jabatan Perancangan

Bandar dan Desa

Majlis Agama Islam Negeri Pulau Pinang

World Bank

Majlis Perbandaran Pulau Pinang

Penang State Government

Aga Khan Trust for Culture

Khazanah Nasional Berhad

Working Partners

102

5 – number of cultural interpretation centres

40% - the number of community-led initiatives

Working PartnersReinventing The City: Intelligent Urbanization

City as a Living Space– Public health, safety & security– Mobility & accessibility– Open spaces and private space– Inner city regeneration / renewal– Affordable Housing

City as a Transaction Hub– Economic Revitalization– Regional / international hub – Creativity & Innovation– Connectivity & Logistics– Microenterprise / corporate social entrepreneurship

City as a Cultural Hub– Cultural & Civic Facilities– Living Heritage & Endangered Trades– Entertainment & Culture– Cultural Diversity – Creative Industries

City as a Knowledge Hub– Repository of Knowledge – Learning & Living– Libraries & Museum– Living History & Culture– Research, Innovation & Development Centres

City as a Civic & Democratic Space– Urban Governance & Popular Participation– Social Inclusion & Sense of Community– Poverty– Cultural Diversity– Access to Public Facilities

City as a Sustainable Space– Greening, urban form and planning– Parks & Gardens– Waste Management– Walkable & Cyclable– Ecological sustainability– Carbon footprint & energy

A city that combines most of these characteristics is likely to have a high “Liveability” index

Cities Hub + Home

Inclusive Respectful Vibrant & Creative Excellence Driven

WelcomingIntimate

SurprisingNon-Conformist

Young & Pro-active

Value-Based Approach vs Physical Planning Approach

Sustainable, Liveable City

105