Plaza Rakyat purchase hits yet another delay

KUALA LUMPUR: Ivory Properties Group Bhd’s proposed acquisition of the property assets of the abandoned Plaza Rakyat project in Kuala Lumpur for RM400 million will be delayed for another three months.

The property developer said in an announcement to Bursa Malaysia yesterday that the extension is to satisfy the conditions precedent as provided by the acquisition and rehabilitation agreement (ARA).

“In view of the extension, the applications to the relevant authorities in relation to the proposed acquisition will be further delayed for another three months,” it said.

Through its 65% unit, Ivory Place Sdn Bhd, the group had entered into a conditional ARA with Plaza Rakyat Sdn Bhd for the acquisition of a lease expiring on April 15, 2081 on five parcels of adjoining leasehold land with a total land area of 663,595 sq ft.

Ivory would also obtain the development rights on the project land, all the incomplete or abandoned structures built on it as well as the rights, interest and benefits on the lease in relation to the project land.

Once the acquisition of Plaza Rakyat is completed, it will mark Ivory’s first foray into the Klang Valley.

The group already has property development projects on Penang island, and the Plaza Rakyat purchase is part of its ongoing efforts to diversify its business outside the island.

The group also intends to revise the development plans of the Plaza Rakyat project, which encompasses a comprehensive and integrated residential, commercial and transport hub.

The original Plaza Rakyat project, with an approved development value of RM1.4 billion, comprised a seven-storey shopping mall, 21-storey four-star hotel, budget hotel, 45-storey block with 290 units of serviced apartments, and 79-storey office tower. It was scheduled to have been completed in 1998 but construction was halted due to the Asian financial crisis.

The abandoned Plaza Rakyat project site. Once the acquisition is completed, it will mark Ivory’s first foray into the Klang Valley.

This article first appeared in The Edge Financial Daily, on December 5, 2013.