Nusa Gapurna mulls REIT

POTENTIALLY WORTH RM2.5b: Assets include six high-rise buildings being planned at PJ Sentral Garden City

NUSA Gapurna Sdn Bhd, a low-key developer, is mul-ling grouping its assets to form a commercial real estate investment trust (REIT) by 2015, which could potentially be worth more than RM2.5 billion.

It is understood the assets will include the six high-rise buildings that are being planned at PJ Sentral Garden City, a project by PJ Sentral Development Sdn Bhd.

PJ Sentral is a 70:30 joint venture between Nusa Gapurna Development Sdn Bhd (NGDSB) and the Selangor Economic Development Corp (PKNS).

Nusa Gapurna, controlled by Datuk Mohd Salim Fateh Din and his associates including Tan Sri Abdul Halim Ali, owns 60 per cent of NGDSB. The remaining stake in NGDSB is held by the Employees Provident Fund (EPF).

The construction of PJ Sentral Garden City located behind PJ Hilton Hotel will take seven to eight years beginning at the end of next year.

Business Times understands that it will comprise five custom-built office towers, each ranging from 20 to 45 floors, with estimated gross development value of RM2.6 billion.

The project will also include a five-star hotel, a 7,000 car park complex, a 1.6ha public park and a supportive retail element for food and beverage.

Sources familiar with the matter said that Nusa Gapurna is planning two business strategies for the assets.

"The first strategy is to form its own REIT, which is the primary option. It is more ideal because the company has ready tenants to give it good yield income. Financial advisers have been engaged for the matter," a source said.

The source said the second strategy is to sell the towers block by block to REIT managers or institutional investors with ready tenants.

According to the source, Nusa Gapurna is in negotiations with local public listed companies and corporate players to lease the buildings for a period of between 10 and 15 years.

"The company is finalising the design of the buildings with the anchor tenants. Construction will commence next year after getting all the necessary building approvals. Once these are settled, Nusa Gapurna will finalise the formation of the REIT," the source said.

The source said PJ Sentral Garden City will be built according to Multimedia Super Corridor Malaysia and Green Building Index specifications.

By Business Times