Benalec monetises reclaimed land in Melaka

KUALA LUMPUR: Benalec Holdings Bhd on Wednesday, June 1 entered into two separate deals, one on land disposal while another on joint venture (JV) property development, with Melaka-based developer Vista Selesa Development Sdn Bhd.

The company expects to realise a net gain of RM22.13 million from the land disposal exercise and at least RM12.8 million from the JV property development. The total net gain of RM34.93 million from the two exercises represents earnings per share of five sen.

In a statement on Wednesday, Benalec said its indirect wholly-owned subsidiary Sentosacove Development Sdn Bhd entered into a sale and purchase agreement with Vista Selesa for the disposal of six parcels of leasehold land measuring 151,191 sq m (1.6 million sq ft) in Klebang Besar, Melaka for RM45.6 million.

Another of its indirect wholly-owned subsidiaries, Orientalcove Realty Sdn Bhd, entered into a JV agreement with Vista Selesa for a mixed development project on another piece of land in Klebang Besar measuring 125,450 sq m or 1.35 million sq ft.

Under the JV agreement, Orientalcove is entitled to about RM37.8 million or 25% of the gross development value from the project, whichever is higher.

Both the disposed land and the JV land are reclaimed land received from Benalec's reclamation projects in Melaka that involved settlement in-kind from the state government.

Benalec group managing director Vincent Leaw commented that the transactions indicated the land around the area was in great demand.

He said it was a milestone achievement as it showed that the company had come full circle from land reclamation, adding that Benalec was keen in building value for the land it had reclaimed.

"This project will be an avenue for us to create this value, as the development of these few parcels of land will create spin-off and generate more interest in the adjoining plots of land.

"We are optimistic that the value of the joint venture will increase the value of the land when it's completed," he said.

Leaw said proceeds from both activities would be used to finance the group's ongoing land reclamation projects and to meet the capital requirements of the group.