Wanted: Malaysian partners

REGIONAL BOOST: Artist’s impression of part of the Knowledge Economic City

KNOWLEDGE Economic City Developers Co Ltd (KECD) is in talks with Malaysian companies to rope them in as partners and long-term investors for the US$8 billion (RM26 billion) Knowledge Economic City (KEC) development in Medina, Saudi Arabia.

Its chief executive officer Tahir Mohammed Bawazir said the company has identified several interested parties and hopes to conclude some deals soon.


TAHIR: The Knowledge Economic City is expected to bring about RM9billion a year into the region once it is completed by 2020

"We plan to leverage on the expertise of Malaysian companies from various sectors and hope more will come in as partners and investors," he told Business Times in Kuala Lumpur.

Tahir said that as the project develops, KECD will continue to seek investors, partners and sub-developers as well as establish joint ventures with strategic partners to develop and operate key component areas.

Since its launch in 2006, KECD has signed memorandums of understanding and contracts with several Malaysian companies and the government.

They include Malaysian Multimedia Development Corp, HELP University College, Multimedia University and, the latest, iTopia Sdn Bhd.

Consultancy contracts have been awarded to MSC Technology Centre.

"The project is expected to bring about 10 billion Saudi riyal (RM9 billion) a year into the region once it is completed by 2020," Tahir said.

The KEC is one of four economic cities being developed in Saudi Arabia to boost regional development by focusing on intellectual property, knowledge-based, medical, hospitality, tourism and multimedia industries.

Other economic cities being developed by the Saudi Arabian General Investment Authority are the King Abdullah Economic City, Prince Abdul Aziz ibn Musaed Economic City and the Jizan Economic City.

The five million sq m KEC includes a theme park, educational institutions, integrated hospitality complex (with private medical centre, nursing and medical schools, senior assisted living community), residential, commercial and retail components.

"KEC Medina aims to utilise Saudi Arabia's second competitive advantage after energy - its strategic location as a link between East and West," Tahir said.

The project is expected to create more than 20,000 jobs and accommodation for about 150,000 people.

By New Straits Times (by Azlan Abu Bakar)

TH Properties in design pact with Villa Muhandis

TH PROPERTIES Sdn Bhd yesterday signed a memorandum of understanding (MOU) with Villa Muhandis Internationale Sdn Bhd (VMI) to incorporate Italian designs and influences in future phases of its Bandar Enstek township project.

TH Properties chief executive officer Zaharuddin Saidon said the MOU also covered the promotion and undertaking of research and development in houses and real-estate design at Bandar Enstek and the promotion of information exchange for common business interest and opportunities between the two companies.


"The design business centre will be a platform to help develop and commercialise Malaysian designs for local and international markets." Zaharuddin Saidon Chief Executive Officer TH Properties

"An integral component of the MOU will be the setting up of a design business centre by VMI and the proposed establishment of the Malaysian Italian Design Institute at Bandar Enstek," he told reporters after the signing ceremony in Kuala Lumpur yesterday.

Zaharuddin said the design business centre will be a platform to help develop and commercialise Malaysian designs for local and international markets and also promotes collaborations with other housing research centres, especially universities.

"Initial discussions have already been made with the Housing Research Centre of Universiti Putra Malaysia and Universiti Tun Hussein Onn Malaysia," he said, adding that one of the main areas of research is on the Industrialised Building System which will help enhance quality and safety at construction sites and reduce construction costs.

VMI is involved in the business of industrial design in collaboration with international institutions worldwide.

TH Properties, a wholly-owned subsidiary of Lembaga Tabung Haji, is developing Bandar Enstek, a RM9.2 billion integrated township in Nilai, Negeri Sembilan.

By Bernama

Italian designs for Bandar Enstek

KUALA LUMPUR: TH Properties Sdn Bhd aims to bring Italian designs to future phases of its Bandar Enstek development in Nilai, Negri Sembilan.

“We would like to produce a local brand which is recognised globally,” CEO Zaharuddin Saidon said after the company signed a memorandum of understanding (MoU) with Villa Muhandis Internationale Sdn Bhd yesterday.

Zaharuddin Saidon

Villa Muhandis is involved in industrial design in collaboration with international institutions worldwide.

Zaharuddin said an integral component of the MoU would be the setting up of a Design Business Centre (DEBUCE) by Villa Muhandis and Malaysian Italian Design Institute (MIDI) at Bandar Enstek.

DEBUCE would be a platform to help develop and commercialise Malaysian designs for local and international markets, he said.

“DEBUCE will also be the platform for innovative collaboration with other housing research centres, especially with universities. Initial discussions have started with Housing Research Centre of Universiti Putra Malaysia and Universiti Tun Hussein Onn Malaysia.

“One of the main areas of research is in an industrialised building system which will help in enhancing quality and safety at construction sites as well as reducing construction costs,” he said.

Currently home to a population of about 5000, Bandar Enstek is a RM9.2bil integrated township on 5,116 acres.

According to Villa Muhandis president Giovanni Pergaminelli, Malaysia does not lack talent but there is a need to learn how the European countries are able to harness their talent in art and design for commercialisation.

On the outlook of the property market, Zaharuddin said it would be hit by the increase in petrol prices, which would affect building material prices.

“The cost of building houses will go up; therefore the selling price will also go up.

“What is important is to adjust and address the issue and one of the things we want to do is identify alternative building materials that will reduce costs,” he said.

By The Star

KDEB may bid for Gamuda's Splash stake

KUMPULAN Darul Ehsan Bhd (KDEB), will make an offer by as early as September to buy Gamuda Bhd's stake in Syarikat Pengeluar Air Selangor Sdn Bhd (Splash), people working on the project said yesterday.

"The state will give notice to Gamuda by as early as next month of its intentions to pursue the acquisition as the financial stress test on the valuation of the company has just been completed," a finance executive who worked on the project said.

Gamuda owns 40 per cent of Splash, while the remaining equity is equally held by Tan Sri Wan Azmi Wan Hamzah's The Sweet Water Alliance Sdn Bhd and KDEB.

Gamuda's stake in Splash is valued at between RM700 million and RM1.3 billion, depending on the methodology used. JP Morgan, using the discount cashflow (DCF) method values the stake at RM1.17 billion, while Macquarie Research in a report said based on DCF, the stake is valued at RM1.3 billion.

Splash, with a concession that runs up to December 31 2030, is the largest water producer in the state, producing some 43 per cent of the state's total water supply.

"KDEB is in the process to acquire the water assets. We will elaborate on the specifics in due time, as we hope to have the scheme in place by September," said KDEB's corporate communications general manager Necia Abdullah in a text reply to Business Times.

Gamuda, the country's second largest builder might be willing to cash out, as gains from the sale could be used for other purposes abroad.

The builder is under scrutiny over plans to invest as much as RM1.5 billion in property ventures over the next three years in Vietnam, which has a currency cum financial crisis looming over its head.

"Delays in property sales in Vietnam could also mean that Gamuda would have to rely entirely on borrowings to fund its initial infrastructure outlay," Choong Wai Kee of Citigroup, wrote in a report dated May 29.

Early this year, Gamuda's managing director Datuk Lin Yun Ling had told this paper that the builder was in preliminary exploration for a possible sale of Splash.

By New Straits Times (by Francis Fernandez)