The project will be developed in three stages over five years, with the initial work start earliest in March 2011 and completion by mid 2015.
SunCity's managing director for property development (international) Ngian Siew Siong said SunCity expects the eco-city project to contribute to its earnings only in 2012.
Speaking to reporters on Friday, April 30 after the signing of the collaboration agreement, he said this is the second project undertaken in China.
The first is the RM492 million Sunway Guanghao mixed development project in Jiangyin, which will be launched next month.
The 41-hectare development will incorporate the “Lifestyles of Health and Sustainability” (Lohas) philosophy to promote an ecologically and socially sustainable environment for residents. The Lohas philosophy started in the US in 1998 and consists of five pillars – health and fitness, personal development, environment, sustainable living and social justice.
“Lohas is not just about green buildings. That is only one component of it. Our design will center on these five pillars. One of the concepts of eco-city is that 40% of its residents can work within the city itself,” Ngian said to reporters after the signing ceremony.
SunCity’s development will consist of 90% residential properties, with a waterfront parcel housing exclusive high-end villas. The remaining 10% are commercial areas.
The eco-city is about 40 km from Tianjin city centre and 150 km from Beijing. It is the largest eco-city under development in the world by area size.
Funding for the project will be sourced internally and from bank borrowings in China, said SunCity senior general manager Ong Pang Yen.
“In China, foreign companies can borrow up to 50% of the project cost, while its domestic companies can borrow up from 65% to 70% of the cost,” he said.
SSTEC was incorporated in China and is the master developer for the Tianjin Eco-City. It is a 50:50 venture between the Chinese consortium led by Tianjin TEDA Investment Holding Co., Ltd. and the Singapore consortium led by the Keppel Group.
SunCity is the sole Malaysian developer selected to participate in this project, which enables SunCity a 60% equity stake in the 41 hectares development and a 40% equity stake by SSTEC.
Five more top regional developers are involved in the 3,000-hectare eco-city project: Keppel Land of Singapore, Farglory Group of Taiwan, Shimao of Hong Kong, Mitsui Fudosan of Japan, and Vanke in China.
SunCity said the overseas market provides possible new revenue source to SunCity. China has been identified for the group's regional expansion due to its huge population and high economic growth.
Currently, overseas property development contributes less than 5% to SunCity’s earnings in 2009. Ngian expects this portion to increase to 30% by 2015.
By The EDGE Malaysia (by Aishah Mustapha)
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