MRCB acquires German Embassy land for RM259 mil

KUALA LUMPUR: Malaysian Resources Corp Bhd (MRCB) has acquired the German Embassy Land in Jalan Kia Peng through its wholly-owned subsidiary, Legasi Azam Sdn Bhd (LASB), at about RM259.16 million.

“The supply of land is inelastic and the cost of land banking will continues to rise, but land banking is an on-going process for all developers like MRCB because it is crucial for business growth,” said MRCB group managing director Tan Sri Mohamad Salim Fateh Din.

According to MRCB, the German Embassy’s 81,291.2 sq ft tract of freehold land is priced at RM3,188 per sq ft, which is about 6% higher than the market value of the land. It is based on the appraisal by CH Williams Talhar & Wong and Raine & Horne International Zaki & Partners.

“Looking at recent transactions in the same area, there were several ranging from RM3,000 to RM3,300 per sq ft. MRCB is confident that the price we paid is fair and correctly reflects the value of the property in the area,” said Mohamad Salim.

The sales and purchase agreement was inked between Mohamad Salim (on behalf of LASB) and German Ambassador Holger Michael, who signed on behalf of the government of the Federal Republic of Germany.

The land was used as the official residence of the German Ambassador to Malaysia until June 2013.

“The MRCB Board of Directors is optimistic on the prospects of the German Embassy land after taking into consideration the scarcity of freehold land in the highly sought after Kuala Lumpur city centre area,” said Mohamad Salim.

He added that the acquisition was internally funded. The company has yet to decide on what to develop on the acquired land.