Selling office towers en bloc

The proposed 50-storey Menara Felda in Platinum Park. The iconic building in the prime KLCC area is set to boost the corporate image of Felda. Inset: Datuk Johan Ariffin

NAZA TTDI Sdn Bhd plans to sell en bloc its remaining two office towers in the RM3.5bil Platinum Park development in the KLCC area in Kuala Lumpur.

Group managing director Datuk Johan Ariffin said instead of selling piecemeal, the strategy now was to focus on en bloc sale given the current good demand for Grade A office buildings in the capital’s Golden Triangle.

“We are targeting purchasers with very strong financial positions. By selling en bloc, we eliminate sales and funding risks and this will stand us in good stead in any future downturn. It will also put Naza TTDI on a stronger footing to ensure the success of Platinum Park,” he told StarBiz.

On fears of an over-supply of condominiums in the KLCC area, Johan said the three high-end condominiums called Platinum Residences in Platinum Park would have only 265 units or a mere 4.4% of the estimated 6,000 units in the KLCC neighbourhood.

Moreover, these condominiums catered to a very niche market where the residents would enjoy a private 1.5-acre park with 80,000 sq ft of retail space in Platinum Park.

“We don’t believe there is an over-supply of condominiums in the KLCC as we are very niche. Not withstanding that, our current strategy is to side-step into a different market and that is to focus on selling our office towers en bloc. This will circumvent any downturn in the condo market,” Johan said.

The two remaining office towers are of 50 and 38 stories.

The first tower, a 50-storey Grade A building was sold to the Federal Land Development Authority (FELDA) for RM640.7mil or about RM900 psf when the company launched the Platinum Park on Jan 22 this year.

Named Menara Felda, it is about 700 metres from the Petronas Twin Towers and the Suria KLCC shopping centre.

Johan said work on Menara Felda is in full swing and would be completed in 2011.

“We have completed the diaphragm wall two weeks ahead of schedule and we’re hoping to complete piling three weeks ahead of schedule. We hope to call for the superstructure tender by the first quarter of 2009,” he said, adding that construction of the other two office towers should start early next year.

“We feel we have a very strong advantage as Platinum Park is in a super prime location within the KLCC area where about 93% of Grade A office buildings are occupied,” he said.

At the end of the day, people who owned offices in such locations would be in a better position to weather any downturn as offices in prime addresses would be much sought after, he added.

“Our buyers can make more money than us. For example, we have got offers for Menara Felda for nothing less than RM1,200 psf but we told them that we have sold it to FELDA which has made a very smart move by buying the building from us,” he said.

Platinum Park, a world-class high-end integrated residential and commercial development, will also have a five-star, 452-unit, 30-storey serviced apartment called Platinum Concierge Suites. The 80,000 sq ft of lifestyle retail space will feature international products and services never seen before in Kuala Lumpur. There will also be three levels of auto showrooms.

By The Star (by S.C.Cheah)