- The project is to be developed on a 16,517 m2 freehold vacant land in Bandar Kajang, which is owned by Regal Variety.
KUALA LUMPUR (Sept 5): Ireka Corp Bhd has joined hands with a property development and construction outfit for a mixed development project in Kajang, with a gross development value of RM310 million.
Ireka’s wholly-owned subsidiary Regal Variety Sdn Bhd inked a joint venture agreement with Elay Project Sdn Bhd to develop the project, which entails 22- and 23-storey towers that will consist 661 units of serviced apartments, 48 units of retail and 114 units of office space.
In a bourse filing on Monday, Ireka said the development is expected to commence end-2023 and be completed in six years. The project is to be developed on a 16,517 m2 freehold vacant land in Bandar Kajang, which is owned by Regal Variety.
Elay is entitled to the sole and exclusive right to develop and occupy the land without interference by Regal Variety to undertake and complete the development, said Ireka, adding that this is tantamount to the company disposing of the land’s development rights to Elay.
Ireka said that against the project’s gross development cost of RM220 million, the mixed development is to give rise to RM90 million in development profit.
The group said Regal Variety is entitled to 30% of the project’s net development value, while the remaining 70% will go to Elay. Elay has also provided a RM20 million profit guarantee to Regal Variety.
“The estimation of the profit guarantee of RM20 million is derived from the valuation of the land of RM16 million taking into account an expected return of 25% from the development,” it added.
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