Sunway snaps up land in Subang Jaya, Kajang for RM231 mil

KUALA LUMPUR (Aug2): Conglomerate Sunway Bhd has announced the acquisition of two freehold plots — a 14.8-acre (6 ha) tract in USJ 1, Subang Jaya, for RM167.59 million, and a 5.28-acre plot in Kajang for RM63 million.

The acquisitions come after Sunway’s purchase of a 4.53-acre freehold parcel in Jalan Belfield, Kuala Lumpur, less than a month ago, and a 8.45-acre tract in Jalan Peel in February.

Inclusive of the two new plots, the property developer has bought four parcels of land with a cumulative gross development value (GDV) of RM5 billion, according to Sunway’s statement yesterday.

All the plots will be suitable for transit-oriented developments (TODs) since they are near mass rail transit (MRT), light rail transit, bus rail transit and monorail stations, said Sunway.

The land in USJ, bought from Jaks Resources Bhd, will be used for warehousing and storage facilities for its trading and manufacturing businesses, said Sunway. However, it will subsequently consider using the land for a proposed mixed development with a GDV of about RM1.4 billion in five years.

The USJ land, near Sunway City, is surrounded by amenities including Sunway Pyramid, Da Men Mall and USJ Summit, as well as Giant and Mydin hypermarkets.

Meanwhile, the Kajang land, acquired from Concept Housing Development (M) Sdn Bhd, comes with semi-completed structures from a previously approved development whose construction work had been discontinued.

Sunway intends to continue building on the semi-completed structures but will replace them with a proposed mixed development comprising a retail podium or commercial lots and serviced apartments or small office home office (Soho), with an estimated GDV of RM460 million in five years.

Less than 2 km from Kajang town, the Kajang land is immediately adjacent to the newly opened Sungai Jernih MRT station, making the former another TOD for Sunway and is expected to be the first of its kind in Kajang.

Sarena Cheah, Sunway managing director for its Malaysia and Singapore property division, said Sunway’s healthy balance sheet will continue to allow the group to actively engage in landbanking.

“In the Klang Valley, we are actively looking for TODs where we can leverage our prior experience of building integrated and mixed-use developments near public transportation networks,” she said. The acquisitions are expected to provide further earnings visibility for the conglomerate.

Sunway’s total land bank now stands at 3,325 acres with a total GDV of RM53.5 billion. It also owns and manages over 30 million square feet of commercial properties. Sunway shares closed up seven sen or 1.64% yesterday at RM4.35, with a market capitalisation of RM8.8 billion.

This article first appeared in The Edge Financial Daily, on Aug 2, 2017.

For more stories, download TheEdgeProperty.com pullout here for free.