RM2 firm creates land deal history

Urusharta Cemerlang (KL) pays RM210 million, or RM7,209.80 per sq ft, to a company controlled by Singapore's property tycoon Kwek Leng Beng for a vacant land in Jalan Bukit Bintang, Kuala Lumpur

A RM2 company is the buyer of the country's most expensive piece of land.

On Wednesday, Millennium & Copthorne Hotels plc (M&C), a company controlled by Singapore's property tycoon Kwek Leng Beng, sold 29,127 sq ft of vacant land in Jalan Bukit Bintang, Kuala Lumpur, to Urusharta Cemerlang (KL) Sdn Bhd for RM210 million, or RM7,209.80 per sq ft.

The previous record in a reported land sale was RM2,588 per sq ft for Wisma Angkasa Raya in Jalan Ampang in 2008.

A search at the Companies Commission of Malaysia revealed that Urusharta Cemerlang (KL) is owned by Tan Sri Zainol Mahmood and Shazni Sulaiman. The two have been its directors since 2006.

Zainol is the chairman of Urusharta Cemerlang Sdn Bhd and Pavilion Kuala Lumpur Sdn Bhd. Urusharta Cemerlang owns the Pavilion Kuala Lumpur shopping mall, which is also located in the Bukit Bintang area.

Urusharta Cemerlang is 51 per cent owned by Urusharta Cemerlang Development Sdn Bhd and 49 per cent by the Qatar Investment Authority(QIA).

Not much is known about Shazni.

In the financial year ended December 31 2009, Urusharta Cemerlang (KL), which is described as a dormant company, had current liabilities of RM5,010 and posted a net loss of RM1,305.

Real estate agents are describing the latest deal as "dizzying heights" and reckon that it could take many more years to surpass the figure.

But observers are wondering how and who will finance the acquisition given that the buyer is a RM2 company.

They also questioned whether QIA will later participate in the deal and what will be built on the land - an extended retail mall or luxury residences.

A mall would make sense given the land's proximity to Pavilion. However, at such a price, there is no doubt it could take more than the usual eight to 10 years to see a return on investment should a shopping complex be built.

It might recoup the investment faster if it built and sold high-end residences. After all, the land had been initially slated for the RM500 million Millennium Residences project.

In a statement issued in Kuala Lumpur on Wednesday, M&C said a 10 per cent deposit had been paid to its wholly-owned unit, CDL Hotels (Malaysia) Sdn Bhd, which owns the land.

The deal confirms a Business Times report early last month that a land deal was being negotiated by CDL Hotels which could fetch a record price of over RM3,000 per sq ft.

The latest deal is nearly three times the price paid per acre in several private sales of nearby land, and the highest ever in the country's history.

"This transaction has obviously set a new benchmark in the local property market. I view the transaction as a special transaction as it is a special purchaser - an adjoining property owner who probably places more value on the asset than others," said a real estate agent, who declined to be named.

It is understood that the YTL group, which owns the nearby Starhill Gallery, Lot 10 Shopping Centre and JW Marriott Hotel, had also been eyeing the land.

The deal is expected to be completed no later than the second quarter of 2012.

M&C's carrying value of the land was RM42.8 million. Based on this, the sale is expected to result in a pre-tax profit of RM164.1 million after taking into account transaction costs.

By Business Times

Mines 2 eyes up to RM15m annual rentals

Mines 2 Sdn Bhd expects to rake in up to RM15 million in rentals a year from the Mines 2, an office building and shopping mall.

Its chairman/founder, Tan Sri Lee Kim Yew, said Mines 2, which was expected to open in Oct 15, was the first fully light-emitting diode (LED) commercial building in the country.

Lee said Mines 2 was expected to attract 10-12 per cent more visitors from the Mines Shopping Fair (owned by CapitaLand) which has one million visitors a month.

"We expect Mines 2 to record an occupancy rate of 90 per cent by June next year," he told reporters after signing an agreement with Frontken Corp Bhd to enhance cooperation on green initiatives today.

The RM150 million 11-storey mall houses 400 shops and kiosks to encourage small and medium businesses as well as office spaces.

Lee said the company invested RM5 million for the LED installation to help save energy, promote sustainability, reduce environmental impact and improve the quality of the light.

The LED, installed by GreenFront, a division of Frontken, was designed to create a new green initiative to validate cost savings and its technology capabilities to deliver the economic, environmental and application benefits.

"With Frontken's LED technology, Mines2 is expected to reduce the utility expenses by up to 40 per cent from the lighting and air-conditioning loads.

"This will in turn help minimise the environmental impact by reducing carbon discharge," Lee said.

Lee, who is also the deputy chairman of Country Heights Holdings Bhd, said the group also planned to install LED lighting in projects that were built in the past 10-20 years ago as well as for future developments.

Among Country Heights's projects are Palace of the Golden Horses, Mines Wellness Hotel, which is the city's only beach resort, Mines Waterfront Business Park and Mines Exhibition and Convention Centre, he said.

Meanwhile, Frontken's executive chairman/managing director, Willie Wong, said the company would also install one of the biggest LED screens in Malaysia to run promotional messages for Mines 2 and also social awareness video campaigns.

The screen is expected to complete by the end-October, he said.

"We have created some innovative green products and would like to invite other shopping malls to join us in creating and developing energy-efficient malls," Wong said.

By Bernama

Mydin to expand reach with 14 more outlets

MYDIN Mohamed Holdings Bhd, the owner and operator of the Mydin chain of wholesale stores and hypermarkets, plans to make its presence felt in more areas in the country by opening another 14 outlets nationwide.

The group will invest about RM1.6 billion to open the new outlets in the next three years.

Mydin managing director Datuk Ameer Ali Mydin said the hypermarket has bought 14 plots of land valued at RM165 million in various strategic locations in the country.

"Our aim in the next three years is not only to open new hypermarkets, but also mini supermarkets in major towns such as Kuching, Kota Kinabalu, Sungai Petani, Bukit Mertajam, Kota Bharu, Kuantan, Johor Bahru, Kuala Terengganu, Seremban and Kajang," he told reporters at the Mydin Hari Raya open house and the countdown to Malaysia Day at the Mydin Mall in Malacca on Wednesday.

"Soon, we will open Mydin stores in Manjoi and Meru Raya in Perak. It would be our 56th and 57th stores," he said.

The countdown to Malaysia Day was officiated by Malacca Chief Minister Datuk Seri Mohd Ali Rustam. Also present was the state's Transportation, Information and Consumer Affairs committee chairman Datuk R. Perumal.

On the operations of the Mydin stores in Malacca, Ameer Ali said its three stores there are the second biggest contributors to the group, after those in the Klang Valley.

By Business Times