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Tuesday, 4 July 2017

(The Star) Mah Sing buys prime land

PETALING JAYA: Mah Sing Group Bhd has acquired two parcels of prime land in Cheras, Kuala Lumpur and Bukit Mertajam, Penang for an integrated development and a business park respectively.

The proposed projects would have an estimated combined gross development value (GDV) of RM2.35bil.

The group said in a statement that it would acquire Cordova Land Sdn Bhd, which has an offer accepted by DBKL to purchase 11.233 acres opposite Courts Mammoth along Batu 2.5 Jalan Cheras.

The land is 1.8km from the Sunway Velocity Mall and will be developed into M Vertica, an integrated development with an estimated GDV of RM2.2bil.

“The total consideration of up to RM263.48mil or RM538 per sq ft after taking into consideration the share sales, land cost, reconstruction and upgrading cost, estimated at RM25mil allocated for the Kuala Lumpur Badminton Stadium, is at a discount from the indicative market value of the surrounding land, as per an indicative valuation by Rahim & Co at RM333.18mil or RM680 per sq ft,” the group said in the statement.

Mah Sing said Price-waterhouseCoopers has also been appointed to conduct due diligence on Cordova.

It said that under the share sale agreement, the shares in Cordova would be paid over a maximum of 21.5 months, subject to completion of the vendor’s obligations.

“The prime KL city location coupled with the affordable entry level pricing provides an unbeatable value proposition.

“We are looking at residential suites from 850 sq ft at an indicative price from RM450,000 or RM529 per sq ft and a choice of bigger units at 1,000 sq ft,” Mah Sing’s group managing director Tan Sri Leong Hoy Kum said.

“The Maluri mass rapid transit (MRT) and light rail transit (LRT) interchanges are only 600m away and Taman Pertama MRT Station is only 800m from M Vertica. Upon the completion of the MRT Line 1, Sunway Velocity Mall, My Town Shopping Centre and Ikea Cheras will be within walking distance from the Cochrane MRT station.

“It is also easily accessible via Jalan Cheras and is 300m away from thw Besraya Highway,” he added.

Mah Sing said the location and product met the current market demand as well as the company’s quick turnaround strategy due to the connectivity, established catchment, ready infrastructure and amenities.

Meanwhile in Penang, the group acquired 10.89 acres of freehold land in Bukit Mertajam along the south-western side of Jalan Permatang Tinggi.

The group said that the purchase price of RM43.8mil included the costs for conversion premium, land clearance, earthworks and development planning which have already been paid by the vendor.

According to a valuation report by PPC International Penang Sdn Bhd, the market value of the land is RM45.31mil.

“The land, with development order obtained and earthworks done, is ready for immediate development which fits in well with the quick turnaround model of the group,” it said.

Mah Sing said it planned to develop an industrial park using the award winning iParc concept.

The proposed development, with an estimated GDV of RM150mil, will offer well-conceptualised multi-functional industrial spaces comprising a mix of shop offices and light industrial factories.

On another matter, the group said it had mutually agreed to terminate the sales and purchase agreement with the vendor of 85.43 acres in Sultan Salahuddin Abdul Aziz Shah golf course, Selangor after the land conversion approval and consent to transfer were not fulfilled.

This termination will allow Mah Sing to focus on affordably priced products in other developments rather than high-end products, it said.

It also sold its 51% equity interest in Convention City Development Sdn Bhd to Diverse Capital Sdn Bhd for RM6.557mil.

The stake was acquired on May 27, 2013 for RM1.632mil as Convention City has a development agreement to develop 8.33 acres next to the Sabah International Convention Centre.

“We will continue to streamline our portfolio of landbanks to fit our business strategies and match current market demand.

“With the new acquisitions, currently Klang Valley yields 67% of our remaining GDV and unbilled sales, and we target to increase it to 75% within the next two to three years.

“To match market demand, we will choose lands that can be developed into quality homes with affordable pricing,” Leong said.