Magma announces RM850m Wolo Mont Kiara project to help it return to profit

GEORGE TOWN (July 28): Hotel and resorts operator Magma Group Bhd (KL:MAGMA) expects to return to profitability in the 2026 financial year, driven by the Wolo Hotel & Residences in Mont'Kiara, Kuala Lumpur, worth some RM850 million in gross development value.

The boutique branded residences development is scheduled for launch on July 31, according to its group managing director and chief executive officer Datuk Seri Thomas Liang.

Liang told The Edge that the group has obtained the Advertising Permit and Developer's Licence (APDL) and will begin selling the residential units following the project's official launch at Dewan Filharmonik Petronas.

Pre-launch marketing has generated expressions of interest for around 60% of the available residential units, with the group aiming to convert a substantial portion into sales by year-end.

"We are confident of converting a substantial portion of these expressions of interest into sales by the end of the year, enabling us to return to the black in 2026," Liang told The Edge.

He added that the project is also being marketed in London, Hong Kong, Taiwan and Singapore, where response has been encouraging.

The 60-storey mixed-use development comprises 378 serviced apartments, 98 serviced suites, a 63-room boutique hotel, retail space and supporting facilities.

Liang said the project introduces a boutique branded residence concept that combines personalised hospitality, professionally managed operations and fully curated homes, distinguishing it from conventional hotel-branded residences.

Under the development, Wolo will lease and manage the 98 serviced residence units on behalf of investors, generating recurring rental income while giving guests access to hotel facilities and services.

The hotel will be affiliated with Design Hotels, part of Marriott Bonvoy's global distribution network, while the residences have been endorsed by UK-based Global Branded Residences (GBR).

Liang said the Marriott Bonvoy affiliation gives the hotel access to a global loyalty programme with more than 271 million members, strengthening its international reach.

For the first quarter ended March 31, Magma posted a net loss of RM7.3 million on revenue of RM6.26 million, mainly due to higher staff costs and expenses related to corporate exercises.

Despite the first quarter loss, Liang said the hospitality business has remained resilient, with hotel operations continuing to provide a stable source of recurring income. Hotel operating revenue stood at RM5.64 million, while hotel management revenue was RM0.62 million, bringing total hospitality revenue to RM6.26 million.

The group plans to improve its hotel occupancy, increase average room rates and enhance operational efficiency. It is also exploring opportunities in the food and beverage business to diversify its income streams.

The Wolo Mont Kiara KL project will be built on a 2.26-acre site acquired by Magma. In July, the group appointed Grand Dynamic Builders Sdn Bhd, a wholly-owned subsidiary of GDB Holdings Bhd, as the main contractor.

Magma’s shares were unchanged at 28 sen per share on Tuesday, valuing the company at RM540.4 million. The stock is down 18.84% year to date.

..........

Read about emerging trends, data-backed insights, growing subsectors, and expert commentaries in EdgeProp print. Subscribe now for your free copy!