Government to put out for tender choice tracts in KL

KUALA LUMPUR: The government has identified and will put out for tender several land parcels located strategically within or near the sought-after Kuala Lumpur City Centre (KLCC).

Prime Minister Datuk Seri Najib Tun Razak announced in his keynote address at Invest Malaysia 2010 on March 30 that the tracts are located at Jalan Stonor, Jalan Ampang and Jalan Lidcol.

An industry source told theedgeproperty.com that a total of four tracts – two on Jalan Ampang and one each on Jalan Stonor and Jalan Lidcol – have been identified for the tender exercise. All these are believed to be owned by the Rubber Research Institute of Malaysia (RRIM).

It is believed that both the Jalan Stonor and Jalan Lidcol tract are each sized about three to four acres. One of the tracts on Jalan Ampang is said to be that on which Bangunan Getah Asli now sits on. This property sits across the road from the iconic Petronas Twin Towers. The other land parcel is located near Wisma Perkeso.

While no indicative price has been named, it is noteworthy that land around the Twin Towers has been transacted at RM2,000 or more per sq ft in recent times.

In April 2008, YTL Corp paid about RM2,000 psf or RM85 million for a one-acre tract on Jalan Stonor. Last December, Ireka Corp Bhd paid RM87.12 million for a about one-acre tract on Jalan Kia Peng, which is near Jalan Stonor.

The government’s decision to monetise the land via tenders has gone down well with industry players. Ho Chin Soon, director of Ho Chin Soon Research Sdn Bhd, told theedgeproperty.com that this is the first time the government decided to tender out parcels for development. The move, he added, will ensure more transparency.

The prime minister has also announced that the Malaysian government and the Employees’ Provident Fund (EPF) will form a joint venture to promote the development of 3,000 acres of land in Sungai Buloh, Selangor, into a new hub for the Klang Valley. The new hub in Sungai Buloh will lead to over RM5 billion of new investments, he noted.

The 3,000-acre land is believed to be part of the prized 3,700 acres belonging to the RRIM in Sungai Buloh. It was reported in 2003 that about 1,000 acres of the tract have been slated to be developed into a Rubber City and low-cost housing area.

Rubber City was to have been a rubber technology park devoted to the commodity with a development cost of between RM4 billion and RM5 billion.

Subsequently, the government unveiled a plan, through Syarikat Perumahan Negara Bhd (SPNB), to develop it into what was then dubbed the Klang Valley Northern Development Corridor (KVNDC). SPNB is wholly owned by the Minister of Finance Incorporated. This also did not take off.

Meanwhile, Zerin Properties chief executive officer Previndran Singh said it was a “good way” to unlock the government’s assets. He also said that it allowed for government-linked companies (GLCs) to unlock the latent value of their assets.

“The locations of these sites are fantastic, especially the Sungai Buloh site with the infrastructure in place. It is also surrounded by highways and near the Subang airport, Port Klang and the industrial parks in Shah Alam and Bukit Jelutong. But, I think the thing behind everyone’s mind is the implementation. They must provide good products,” he added.