Delicate task of remaking Penang Hill
Ho Chung Teng 
Penang Hill’s iconic funicular train

The iconic Penang Hill attracts 1.6 million visitors a year while its website gets two million hits a month. The number of visitors to the hill resort continues to grow year by year.

Its popularity was evident when thousands made a beeline for its funicular train services which resumed operations on Dec 30 after a two-month closure due to several landslides.

Penang Hill is dear not only to Penangites but also to millions of visitors over the years. And now the state government is poised to undertake a remaking of sorts which will require heavy investment.

Over the past several years, the state and federal governments have spent over RM100 mil to upgrade and enhance the facilities and infrastructure, including its iconic funicular train system. And more funds will be required if the state government’s vision to elevate Penang Hill as Malaysia’s hill resort of choice is to become a reality.

The hill will not see any large-scale development but there are plans to refurbish and redevelop a hotel and bungalows. Other attractions expected to be added are a museum and galleries.

Although there is no plan to change the face of Penang Hill, the authorities hope to emulate Hong Kong’s hill developments but within a set of guidelines.

The hill is managed by Penang Hill Corporation (PHC) which took over the operations of the funicular services and management of its facilities in April 2011. The funds invested to improve the facilities and infrastructure included RM18.2 mil for upgrades on the Penang Hill Upper and Lower stations and its surroundings, RM63 mil for a new set of funicular trains and RM11.5 mil for a car park.

On average, Penang Hill generates more than RM16 mil revenue a year based on a RM10 return ticket for its railway service.

However, managing Penang Hill is not easy. PHC has to be independently managed but in the past, management positions and directorships of the state-owned body were widely sought after, especially by politicians and their allies.

For example, Kebun Bunga assemblyman Cheah Kah Peng was removed from the PHC board in 2016. The recent appointment of Seremban Member of Parliament Anthony Loke Siew Fook, a non-Penangite, to the board generated criticism among the state government’s detractors who questioned why an “outsider” was appointed.

Since its inception in 2009, the corporation has seen five general managers. The highest ranking executive position is widely perceived as a hot seat. The incumbent, Cheok Lay Leng, was appointed on Jan 4, 2017 replacing Datuk Ng Wee Kok, who was redesignated a director.

Cheok, a former engineer and technopreneur, will have his plate full in the coming years, as he will have to ensure Penang Hill remains relevant, while safeguarding the flora and fauna on the hilltop. He is also tasked with changing visitors’ perception and increase visitor count, and ensuring ticket prices remain affordable.

All these challenges will not be easy for Cheok, as back in 1990, civil society groups such as Friends of Penang Hill campaigned against Penang Hill’s development. News reports indicated the campaign cost then chief minister Tun Dr Lim Chong Eu his seat in the 1990 general elections. In 1990, there were talks that Berjaya Corp Bhd was proposing to develop Penang Hill (see sidebar).

In recent years, Penang Hill was in the limelight again when its multi-storey car park – once dubbed the “Kancil car park” – had to be rebuilt as it was not up to specifications. The reconstructed car park was opened a year overdue in January 2015 at a cost of RM11.5 mil, up from the original RM5 mil.


Transforming PHC

In an interview with FocusM, Cheok says to move away from such legacy issues, one of his key tasks is to transform and rebuild PHC. This includes transforming the corporation to be the custodian of Penang Hill as per the amended Penang Hill Special Area Plan (SAP).

“Historically, many companies have come and gone. Likewise, PHC’s system and processes will start to break if we are not agile and alert,” he says.

On plans to introduce new developments, such as those proposed by Berjaya Corp in 1990, Cheok says they will not happen. “That discussion has to stop.”

Penang Hill’s mission is to become Malaysia’s hill resort of choice, and Cheok plans to expand it regionally. This, however, is a challenging task given the popularity of other hill resorts like Genting Highlands and Cameron Highlands.

“To achieve that, there are many housekeeping rules that we need to do – essentially to upkeep Penang Hill, [ensure] the facilities are safe for the public and train service is in good working condition,” he adds.

The SAP for Penang Hill, which came into force on Aug 1, 2016, is mainly to ensure “sustainable development” on the hilltop. However, the SAP has not been well accepted by non-government organisations (NGOs) as it includes plans to construct a cable car system and redevelop old bungalows which will commercialise Penang Hill.

Cheok says PHC’s other responsibilities include the maintenance, upkeep, conservation and preservation of Penang Hill, which take up a significant portion of its budget. The corporation is also tasked to ensure roads, public facilities, sewage and drainage systems are well maintained.

All these will not be easy for PHC as Penang Hill comprises several hills such as Strawberry Hill, Halliburton’s Hill, Flagstaff Hill, Government Hill, Tiger Hill and Western Hill.

On PHC’s budget to sustain his plans, Cheok says part of the funds for operations come from the state government. He declined to disclose the budget.

He adds the state government has never hesitated to support PHC, especially on hill maintenance, rectification on landslides and repairs of railways.

“We don’t have unlimited budget, but we are trying to make the most out of the budget we have by ensuring we get the maximum activity and efficiency from it,” he elaborates.

Penang Hill is one of the oldest British colonial hill stations in Southeast Asia, dating back to late 1700’s. The hill resort is also close to the heart of most Penangites, and is seen as part of their identity.

PHC is undertaking the refurbishment of state-owned bungalows on Penang Hill

Refurbishment plans

The SAP includes plans to refurbish state-owned bungalows and hotels such as Crag Hotel into one of the “low-density boutique hotels and villas of exceptionally high quality”. The hotel was constructed in the 19th century.

According the SAP draft, only an estimated 50 ultra-posh rooms will be refurbished on Penang Hill. Currently, the only hotel there is Bellevue Hotel which has 12 colonial-type rooms.

Cheok says Crag Hotel’s refurbishment has been awarded to a hotelier group, while other old state-owned bungalows on the hilltop will be turned into affordable accommodations for tourists, at affordable rates.

“(This is to enable) people to go up and spend the night there. We are slowly refurbishing the bungalows. Several months ago, we completed one (bungalow), and are in the process of initiating a request for proposal for a new project,” he says.

The PHC website lists 52 hill bungalows on Penang Hill – 42 privately owned and 10 state owned. Cheok says the government assets will be refurbished, albeit at a slow pace to protect the environment.

“I’m still actively looking for a place where we can set up a museum, information centre or galleries on top of Penang Hill,” he says, adding he wants to encourage activities that promote cultural and historical conservation, besides natural conservation.

Cheok hopes to emulate Hong Kong’s hill developments, but says refurbishment has to adhere to certain SAP guidelines.

“We do not want to change the face of Penang Hill. Whatever we do, it has to be sustainable development. Hillslopes are fragile, and once damaged, you can never recover it in your lifetime,” he adds.

He reiterates there will be no large-scale development on Penang Hill – only refurbishment of state-owned assets into public facilities. “We have certain guidelines for refurbishment. We try to preserve the original setting as far as possible.”

However, even such smaller-scale developments are not welcomed by some NGOs which claim increased commercialisation of Penang Hill will have a negative impact, especially on its flora and fauna. Penang Hill, surrounded by virgin forests that are more than 130 million years old, is seeking Unesco Biosphere Reserve status.

CBRE|WTW director Peh Seng Yee says apart from enjoying the hilltop cold breeze, tourists to Penang Hill also want to explore its flora and fauna.

“If you build them (high-density developments), Penang Hill will lose its appeal and characteristics because it is different from Genting Highlands,” he says. The Genting group is constructing its 20th Century Fox World theme park at the Pahang hill resort.

Peh is agreeable to “minor developments” on Penang Hill as long as they are insignificant and do not alter the character of the environment.

PHC has come under fire for not being able to handle the long queues at the funicular train stations 

Political hot potato

Almost three decades after the Berjaya Corp’s development plan was rejected, Penang Hill potentially remains a political hot potato for the state leadership, especially with the general election just around the corner.

Penang Consumers Association (CAP) president SM Mohamed Idris at a recent press conference expressed concern over plans to build a cable car station that will connect the Penang Botanic Gardens with Penang Hill.

“CAP is completely opposed to this plan as the cable car project will cause very serious environmental and social impacts, both to the Botanic Gardens and Penang Hill,” he said.

Last February, Friends of Penang Hill, comprising CAP and Sahabat Alam Malaysia, proposed to launch “Save Penang Hill 2.0” if the state government goes ahead with the proposed cable car project.

PHC realises it is treading on very sensitive ground. Cheok reassures Penangites there is “no major redevelopment plan” for Penang Hill. “PHC is committed to the preservation of the natural and historical heritage of Penang Hill for future generations.”

He confirms there are currently no plans to build a cable car system although it is proposed as an alternative mode of transportation in the SAP. “It is neither an approved project nor funded by the federal government until today,” he says.

“If there’s plan to proceed, it needs careful feasibility study to determine the most suitable location(s) and until strict environmentally-friendly implementation is assured. PHC will consult with the relevant authorities and engage special interest groups as appropriately, if and when there’s a plan to proceed,” he adds.

He, however, notes that Penang Hill will eventually require an alternative mode of transportation not just for visitors but also its residents. He says last November’s tropical rainstorm that caused the hill to be cut off due to landslides exposed the vulnerability of the existing transportation mode to the hilltop. The funicular train system was shut down for nearly two months for repairs.


Under fire

Despite the improvement in facilities since 2011, PHC continues to be under fire due to poor customer service, especially long queues at the train station.

Cheok views the long queues as a “good problem” as they reflect the hill resort’s rising reputation as an international tourist destination. Nevertheless, for better queue management, he says PHC is improving its visitors’ guide, which recommends nature and hiking trails to visitors in a bid to disperse the crowds.

He adds PHC is striving to improve its customer service. “We have to rebuild the team to ensure they are very service and result orientated as a big part of our organisation is serving the public. So hopefully we will see significant improvement soon.

A technopreneur's national service

Cheok Lay Leng, 56, was looking forward to a slower pace of life in Penang when he retired in April 2016 after forging a successful career as an IT engineer and technopreneur over the past 30 years.


Cheok says all key decisions and policies must be approved by the PHC board

In November that year, he was “head-hunted” to take over the general manager’s hot seat at Penang Hill Corporation (PHC), which oversees the management of the state’s premier hill resort.


He was installed as PHC general manager in January 2017 on a two-year contract. As PHC’s highest ranking executive, he reports directly to the Chief Minister, who is also the corporation’s chairman. However, Cheok says all key decisions and policies must be approved by the PHC board.

Prior to joining PHC, Cheok was one of the pioneers involved in setting up the Tech Dome Penang, the first science discovery centre in Penang, which opened on July 16, 2016.

He graduated from Penang’s University of Science Malaysia and received his MBA from Nottingham Trent University, UK. He holds one US patent related to USB technology.

He started building technology start-ups in the US, Hong Kong and China in 2005. His last position prior to retirement was president for Asia operations for a US company. He also served as president of Flexcomm Ltd and CEO of ProSem Technology Sdn Bhd.

Before becoming a technopreneur, Cheok was attached with US-based semiconductor giant Intel Corp as general manager of Asia operations, communications infrastructure group.

He was a member of the Intel team that developed the Universal Serial Bus (USB) v1.0 standard and co-managed the worldwide USB technology adoption by peripheral original equipment manufacturers.

FocusM recently met Cheok at his office at the foothill of Penang Hill and here are excerpts of the interview.


FocusM: Given that you were a successful engineer and technopreneur, what are your competitive advantages in transforming PHC?

Cheok: I’m in no position to call myself superior to others. It just happened that I was given a task. I’m just focusing on passing on my experience, such as management coaching, applying basic management principles and discipline in executing projects.

[I consider] every staff member here as a project manager. When they are stuck, I help them with a problem-solving methodology such as applying analytical skills. Having worked for big multinational corporations has given me the exposure of projects from small to large scale.


Why were you picked over, say a party leader, politician or civil servant?

I don’t know the exact reason(s) why the Chief Minister picked me. My most important task is to change PHC’s work culture and transform it into a performance-driven and customer-oriented organisation.

Since 2017, we have experienced staff from various industries joining PHC. Together, we hope to introduce some of the best management and engineering practices accumulated over many years working for major global companies and start-ups. Hopefully, PHC will one day become a world-class organisation that stands tall.


How’s your working relationship with the Chief Minister?

The Chief Minister empowers me to run the organisation because we are a state-owned agency. PHC is governed by three Ps – policy, process and procedures. Despite that, I go to him for guidance.

Coming from the corporate world, we do things very differently. Although we have the three Ps, they are very different, but the end objective is to ensure proper governance. So he gives me guidance on what can and cannot be done. The Chief Minister does not dictate what and how we do things.


What does the Chief Minister want for Penang Hill?

The vision for Penang Hill is to be the hill resort of choice in Malaysia, but I’m saying it should be regional. We have already received 1.6 million visitors a year, and our website has two million hits a month. We are proud to be highlighted by TripAdvisor that Penang Hill is the most “searched” destination among Malaysia’s tourist attractions.


Penang Hill’s popularity has resulted in long queues at the funicular train stations during weekends and public holidays

What are your challenges?

What challenges me is handling a multitude of different issues – there is never a dull moment each day. I’m motivated by just doing a good job, constantly finding ways to solve problems, and coming up with long-term and sustainable solutions, while working with different levels of people and visitors.

We are a service-orientated organisation, so we are here to serve the people at the end of the day.


With increasing visitor numbers, how is PHC innovating to solve bottleneck issues such as long queues?

We make visitors understand the objectives and purpose of coming here. Penang Hill is rich in history since its beginning in the 18th century. I would also want to look at the engineering and technology behind the funicular railway and every bungalow built during the British colonial era which has its own story. So when visitors come to Penang Hill, they will be prepared and, hopefully, the wait is worthwhile for them.


Does Penang Hill generate profits?

We do from rides, but we also ensure ticket collections are channelled back to maintain the hill and facilities. In addition to the ongoing maintenance, funds are also required for some refurbishment of assets (like bungalows).


What is the estimated budget to transform Penang Hill into the hill resort of choice?

There is no fixed budget per se to transform Penang Hill into the resort of choice as it is an ongoing work. Over the past several years, the state and federal governments have spent over RM100 mil in upgrading and enhancing the facilities and infrastructures as well as landscaping the hill top areas into a more attractive tourist attraction for both local and foreign visitors.


The Penang Hill Special Area Plan (SAP) includes a proposal to build a cable car system connecting Penang Botanic Gardens to Penang Hill. Will this be implemented?

There are no plans to build a cable car system although it is proposed as an alternative mode of transportation in the SAP. It is neither an approved project nor funded by the federal government until today.

Penang mega projects that toppled ruling elite

The people of Penang generally do not take kindly to proposed mega development projects they consider detrimental to their interest and state icons close to their hearts.

So when reports surfaced that Berjaya Corp Bhd was going to develop Penang Hill in 1990, they lashed out strongly against the proposal.

The ensuing political backlash was said to have cost then chief minister Tun Dr Lim Chong Eu his state seat in the October 1990 elections. In the aftermath, Lim’s successor Tan Sri Koh Tsu Koon withheld the go-ahead for the controversial project and directed the local authority to prepare a local plan for Penang Hill.

Berjaya Corp’s controversial plan aimed to develop 364.21ha on Penang Hill, including two large hotels, a condominium, an ‘Acropolis’ complex on the summit with shopping and sports centre, cinemas and nightclubs. The mixed development would also house over 300 units of houses and chalets, a golf course and other facilities.

An informal grouping called Friends of Penang Hill, which included Consumer Association of Penang (CAP) and Sahabat Alam Malaysia, launched a series of “Save Penang Hill” initiatives to save the hill from the redevelopment.

Critics said the proposed mammoth project would have adverse environmental and social implications because a large part of the hill comprises forested areas, either located in water catchment areas and forest reserves or is closely connected to them.

Fast forward 18 years later to 2008, the Penang Global City Centre project on Penang island faced similar resistance from Penangites. The mega project was to have been undertaken by Abad Naluri Sdn Bhd, an associate company of Global Oriental Bhd (formerly known as Equine Capital Bhd). It planned to redevelop the 104ha Penang Turf Club land into a mixed development with a gross development value of RM25 bil. The proposal included two five-star hotels, a performing arts centre, retail complex, two office towers, residential properties, a convention centre and an observatory tower.

The backlash against the massive project was said to have partly caused the downfall of Koh and the Barisan Nasional state government in the 2008 elections.

One of current Chief Minister Lim Guan Eng’s first acts after taking office in 2008 was to reject the Penang Global City Centre plan.

This article first appeared in Focus Malaysia Issue 267.