Keretapi Tanah Melayu Bhd’s (KTM) Tanjong Pagar station in Singapore will be relocated to the Woodlands checkpoint by July 1, 2011. The two countries will establish a company known as M-S Pte Ltd by December to jointly develop the land in Tanjong Pagar, Woodlands, Kranji and Bukit Timah, totalling 670 acres.
According to a joint statement by Malaysian Prime Minister Datuk Seri Najib Razak and his Singapore counterpart Lee Hsien Loong yesterday, these tracts of land could be swapped for land of equivalent value in Singapore’s Marina South and Ophir/Rochor area.
The joint-venture company will be owned 60:40 by Khazanah Nasional Bhd and Temasek Holdings, the statement said.
In addition, Malaysia’s customs, immigration and quarantine facilities will also be based at the Woodlands checkpoint.
In an immediate reaction, analysts said the move would strengthen bilateral ties between the two countries, and help to affirm Singapore’s commitment to make the joint development project a success.
“The improving ties between the two nations could spur more cross-border deals. The IDR (Iskandar Development Region) should gain tangible benefits as Singapore companies could broaden their involvement in the region, from hitherto mainly small and medium enterprises in industrial development, into service pillars of development such as healthcare,” said an analyst.
He added that among the potential beneficiaries of the development were UEM Land Holdings Bhd and WCT Bhd.
UEM Land, whose ultimate owner is Khazanah, will benefit by virtue of its flagship Nusajaya project, located in the heart of the Iskandar region. As for WCT, it is among the companies with a property development project in 1Medini.
In terms of the impact on Singapore, the analyst expects it to be minimal in the near term, as any new development will only come onstream within the next three years.
“In terms of beneficiaries in Singapore, Temasek’s wholly owned property development arm is Mapletree Investments. Given the scale of the project, we believe Mapletree may invite other government-linked developers to participate in the development. Other than Mapletree Investments, Temasek has a 40% stake in CapitaLand,” said the analyst.
It should be noted that property group CapitaLand owns a stake in locally listed QuillCapita Trust.
The announcement was made following Najib’s two-day leader retreat to Singapore, where the KTM land issue was expected to be discussed.
The two sides will now conduct their respective valuations on the proposal with Lee expected to pay a visit to Kuala Lumpur within a month’s time with further details.
Other developments that came out of the meeting include:
• the two countries will jointly develop a rapid transit system link between Tanjung Puteri in Johor Bahru and Singapore, which will be integrated with their respective public transport services. The two governments are hoping for the link to be up and running by 2018;
• to increase the frequency of bus and cross-border taxi services;
• to look into a reduction in toll rates at the Second Link between Malaysia and Singapore;
• the two governments to jointly develop an iconic project in IDR.
The fate of the Tanjong Pagar station and the parcels of railway land became a sore point between the two countries following the signing of the Malaysia-Singapore Points of Agreement in 1990.
According to reports, the agreement stated that KTM would vacate the station in Tanjong Pagar and relocate to Bukit Timah. The land would then be developed by a private company, with Malaysia holding 60% and Singapore, 40%.
A dispute arose when Singapore stated that the agreement was effective immediately after it was signed, while Malaysia held the view that it was effective once KTM moved its station from Tanjong Pagar.
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