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Hua Yang buys Seri Kembangan land for RM57m

KUALA LUMPUR: Property developer Hua Yang Bhd announced that its wholly owned subsidiary Prop Park Sdn Bhd, has entered into a sale and purchase agreement (SPA) with Amazing Borneo Sdn Bhd to acquire a piece of leasehold land in Seri Kembangan worth RM56.9 million.

In a filing with Bursa Malaysia yesterday, Hua Yang said the proposed land acquisition is in line with the group’s objective to expand its existing landbank in order to sustain its core business as a property developer.

The proposed land acquisition is expected to be completed by the third quarter of the financial year ending March 31, 2014.

The 1.5ha parcel of land is currently occupied by a night bazaar called Mines Downtown.

Hua Yang proposes to develop two blocks of serviced apartments and retail units as the tract is surrounded by mature residential and commercial developments, hotels and shopping malls.

Hua Yang said the proposed development has an estimated total gross development value (GDV) of RM285 million.

“However, it is too preliminary to ascertain the total development cost, the expected commencement date of the development and the expected profit to be derived from the development of the land,” it said.

The property outfit noted that the development cost of the land will be funded by internally generated funds and bank borrowings.

According to Hua Yang, the proposed acquisition is expected to contribute positively to the future earnings of the group due to its prominent location.

It reasoned that the property would be in the middle of three mature towns — Serdang, Kajang and Bangi. There are major highways linking it to the entire Klang Valley as well as public transport via KTM commuter.

“The demand for residential and commercial development in the surrounding area is expected to be positive in the immediate future,” said the group.

Hua Yang said the land is located near its existing ongoing integrated development at One South, Seri Kembangan.

“This will enhance the group’s profile in that area as a notable developer in the affordable homes segment and enhance our future revenue and earnings,” it said.

The land is also situated near notable landmarks such as the Mines Shopping Fair, Palace of the Golden Horses, South City Plaza, Jusco Balakong, Universiti Putra Malaysia, SEGi College, Australia International School and Columbia Asia Hospital Balakong.

“The board, having considered all aspects ... is of the opinion that the proposed land acquisition is in the best interests of the Hua Yang group,” it said.


This article first appeared in The Edge Financial Daily, on June 18, 2013.

 

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