A lot on Naza TTDI’s plate

SHAH ALAM: Naza TTDI Sdn Bhd, the property developer privately held by the Naza brothers, is looking at a busy but exciting time ahead. Its landbank totalling a whopping 1,200 acres (480ha) with a potential gross development value (GDV) of RM20 billion is expected to keep it busy for at least the next 10 years.

According to its group managing director SM Faliq SM Nasimuddin, the company has put on hold its plan to list the entity as it has so much on its plate. It was something the company has contemplated about two years ago. Naza TTDI is comfortable being privately held, and any plan for listing will be evaluated accordingly to give the shareholders the highest value possible, he said.

“The plan for listing is always there. We were looking at it about two years ago, but the market turned out to be not so good. I think what’s important when we decide to get listed is that we should get the best value. As of now we are very comfortable with what we are. We have been growing, our profits have been increasing, so we are just looking at the right time,” said Faliq.

Faliq said the banks have been supportive due to its financial track record of growing revenue and profitability, and strong brand, especially in the township segment.

“The company is doing very well, our profit has been increasing every year, our turnover has been increasing. This year, we are looking at a turnover of about RM1.2 billion. I think we are on the right track. It is very important for us to grow organically. We don’t want to grow too fast, especially when we have a big project like KL Metropolis, it is very important for us to execute it accordingly,” said Faliq, who took over the baton to lead Naza TTDI about four years ago from his late father Tan Sri SM Nasimuddin SM Amin.

The Naza group had tested the waters of being shareholders in a listed company when it acquired a controlling 33.15% stake in Kumpulan Jetson Bhd in August 2009. However, that venture didn’t turn up quite well, mainly because of the differences in visions among the shareholders and managements of Jetson with the Naza group. Thus the “marriage” was called off in March 2011.

“Now we are moving forward, especially for Naza TTDI. We don’t only develop township, we are also looking at building shopping malls and hotels, going forward. So certain restructuring needs to be done at various level [before Naza TTDI gets listed],” said Faliq.

Naza TTDI is currently building its multi-billion ringgit flagship development in Kuala Lumpur City Centre — the Platinum Park. In addition, the group’s attention is also channelled towards the upcoming KL Metropolis mega project near Jalan Duta. The project, which is expected to house a 100-storey office tower and more than one million sq ft of exhibition and convention facilities, is estimated to have about RM15 billion of GDV.

“The KL Metropolis project was launched last October. It turned out to be very good, [there was] a lot of good response locally and internationally. I think a lot of investors are interested to be part of that project. I think we position it quite well. RM15 billion of our total GDV, a big chunk of it is there, I think, moving forward, Naza TTDI will have a lot of focus on KL Metropolis,” he said.

Some industry observers would expect a single project of RM15 billion GDV to be undertaken by big listed property developers due to their relatively easier source of fundings. On this, Faliq said currently, Naza TTDI is funding the project through internally generated funds and bank borrowings, but eventually it will need to seek partners to undertake the development of the project.

The exhibition centre, which is currently being built, is expected to be completed by the end of 2014. The venue should be ready for use by 2015.

The project is almost like a sure bet for the company, as it will house several government agencies such as Malaysia External Trade Development Corporation (Matrade) and the Ministry of International Trade and Industry (Miti). Nevertheless, the phases of development will be undertaken according to market demand so that the company will not be trapped by oversupply in the office building market.

Its Platinum Park development has been on track, and according to Faliq, Naza TTDI will hand over the one of the office towers to Felda by the middle of the year, which is about 18 months ahead of schedule. The company is also looking at launching the residences portion of the project by this July, probably starting with a local launch in Malaysia, followed by international roadshows in Singapore, Jakarta, Hong Kong and Dubai.

Faliq said the property market has been slowing down. This, he reckons, is mainly in certain price brackets and type of property such as the above RM1 million shoplots. However, he said, Naza TTDI’s bread-and-butter business, which is building townships, is still getting a lot of demand from buyers.

“Demand is always there, but for us we have always been very careful of our products. We always stick to our bread-and-butter business which is our townships which is ongoing and so far has been doing very well. So when we launch high end properties like Platinum Park, it was located on a prime land. To sell a few hundred units to local as well as international buyers, I don’t think, that’s a problem,” said Faliq

Besides its existing projects in the Klang Valley, Naza TTDI is also building a township in Penang, on an 800 acres of land it has in Bertam. Faliq said the property market in Penang is very vibrant and it offers a lot of opportunities to the property developers.

Naza TTDI is also planning for a development in Kota Kinabalu, which is deemed the hottest property market in Sabah and Sarawak.

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