Rivertree STF unit bags RM168 mil contract for workers’ quarters in Klang

KUALA LUMPUR (July 15): Rivertree STF Synergies Bhd (KL:RSSB) has secured a RM168.14 million contract to build a 9,000-bed centralised labour quarters facility in Kapar, Klang.

In a filing with Bursa Malaysia, the company said its wholly owned subsidiary RSSB Builders Sdn Bhd was awarded the turnkey contract by Asetvest Sdn Bhd, which is wholly-owned by investment holding company Asetra Sdn Bhd.

The contract covers the design, planning, engineering, procurement and construction of the CLQ facility, known as Q Centre @ Teratai, on a parcel of land in Mukim Kapar, Klang.

Construction will commence once conditions precedent are fulfilled, including the completion of the land sale and purchase transaction between Asetvest and Q Centre (Teratai) Sdn Bhd, as well as the handover of vacant possession of the land.

The project is targeted for practical completion by June 30, 2028, with full completion and certification expected by Dec 31, 2028. The contract is expected to contribute positively to Rivertree STF’s earnings from the financial year ending June 30, 2027, onwards.

The RM168.14 million contract sum is fixed, although the agreement allows RSSB Builders to seek adjustments through a contingency provision should construction material costs rise because of global market volatility.

“We are excited about the prospects of Centralised Labour Quarters in Malaysia. We firmly believe it is becoming an increasingly important part of Malaysia’s industrial infrastructure, supported by the Act 446 enforcement, heightened ESG expectations and rising demand from industrial employers,” said Rivertree STF executive director Datuk Simon David Leong during the commemoration ceremony.

The project forms part of an earlier plan to develop up to four centralised labour quarters with a combined capacity of 28,800 beds at an indicative value of RM600 million.

Rivertree STF said the latest award formalises the first project under the heads of agreement signed in March between RSSB Builders, Asetra, Catenary Capital Sdn Bhd, Q Centre (Teratai) Sdn Bhd and Q Centre Management Sdn Bhd to develop and operate the worker accommodation facilities.

Separately, Asetvest and Q Centre Management have entered into an agreement to lease the completed facility, with Q Centre Management set to operate the accommodation once construction is completed.

Rivertree STF said the project is part of its strategy to expand its portfolio of purpose-built worker accommodation, which it expects will provide a source of recurring income over the longer term.

Catenary Capital, which manages Asetra, is a Securities Commission Malaysia-registered private equity manager and is a joint venture between Foster Capital Sdn Bhd and Castleforge Partners Ltd. It is involved in real estate investments through a co-General Partner structure under Dana Pemacu, Kumpulan Wang Persaraan (Diperbadankan)’s (KWAP) strategic investment initiative.

At the time of writing on Wednesday, shares of Rivertree STF were up by one sen or 2.9% to 35 sen. At its last price, it had a market capitalisation of RM182.9 million.

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