Dijaya said to be selling

KUALA LUMPUR: A prime 1.16-acre (0.47ha) freehold tract on Jalan Sultan Ismail, believed to be owned by Dijaya Corp Bhd, is up for sale for RM3,500 psf. According to sources, the asking price of RM3,500 psf is on par with the price trend in the city centre.

Based on the size and location, sources believe the tract belongs to Dijaya. The tract here is made up of four lots — 784, 779, 780 and 734. Lots 784, 779 and 780 (0.62 acres) were acquired in October 2011 for RM65.25 million or RM2,400 psf; while lot 734 (0.54 acres) was acquired in 2010 for RM51.45 million or RM2,187 psf.

When contacted, Dijaya declined to confirm its intent to sell the 1.16-acre tract.

In a filing with Bursa Malaysia on Oct 7, 2011, Dijaya in announcing the acquisition of the three parcels had said it expected to generate an estimated gross development value of RM650 million from developing the tract. Sources are unable to confirm whether the tract comes with an approved development order.

In March this year, Dijaya announced its intent to dispose of several assets in a bid to pare down its gearing to 0.5 times from 0.9 times. It said this would translate into a debt reduction of RM1 billion.

The current benchmark price is RM3,300 psf — Mulpha International Bhd sold a 0.72-arce tract in Jalan Sultan Ismail to a company with links to Penang-based Monoland Corp Sdn Bhd and CA+ Associates in late 2011. The tract came with an approved development order.

Another tract, measuring 1.44 acres in Jalan Conlay, also has a asking price of RM3,500 psf. The residential plot, which comes with a development order, has an existing two-storey mansion.

Sources said the scarcity of land in the city centre is one of the key reasons for the high prices.

Prior to the Mulpha sale, Sunrise Bhd (now part of UEM Land Holdings  Bhd) acquired the 1.59-acre Wisma Angkasa Raya (comprising land and building) in 2008 for RM2,588 psf. In 2010, Urusharta Cemerlang (KL) Sdn Bhd from CDL Hotels (M) Sdn Bhd, a member of London-based Millenium & Copthorne Hotels plc, acquired a 0.66-acre tract in Bukit Bintang for a whopping RM7,209.80 psf.

Property experts considered the RM7, 209.80 psf to be an exceptional case and is not reflective of the price trends for development land in the Kuala Lumpur city centre.


This article first appeared in The Edge Financial Daily, on May 10, 2013.