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RM1.8b Lai Meng school land project deferred

KUALA LUMPUR: Magna Prima Bhd is postponing its RM1.8 billion mixed development called Iconic Towers on the Lai Meng school land on Jalan Ampang here by a year to make way for two other upcoming projects, said its chief executive officer Datuk Rahadian Mahmud Mohammad Khalil.

“We will concentrate on the development of the RM90 million commercial property development in Desa Mentari in Petaling Jaya and the RM1.4 billion integrated development dubbed ‘Magna Eco-City’ in Shah Alam,” Rahadian told reporters after the company’s extraordinary general meeting (EGM) yesterday.

He said that Iconic Towers, to be built on a 2.62 acre (1.06ha) site formerly occupied by Sekolah Jenis Kebangsaan (C) Lai Meng, is unlikely to take off within the next year, he said.

“Since it will be the company’s most high-profile development, we are taking things slow and easy to make sure the project comes out perfect,” he added.

The group completed land acquisition for the project early this year and had applied for a development order from the authorities, he revealed.

The Iconic Towers project comprises two 60-storey towers, one of which is a mixture of serviced apartments, hotel and offices, while the other tower will consist of grade A offices with Green Building index elements.

On the group’s two upcoming projects, Rahadian said Desa Mentari is set to start by the first quarter of next year (1Q2015), while Magna Eco-City will commence by 2Q2015. Both projects are expected to be completed in 18 months.

Meanwhile, Magna Prima is expected to register substantial sales proceeds from its maiden overseas property development project The Istana in Melbourne, Australia, next year.

Rahadian declined to disclose the amount likely to be recognised by the group, only saying that the gross development value of the project is A$210 million (RM608.38 million).

The Istana comprises a 25-storey apartment building on a 2,700 sq m piece of land. It will have 320 units with built-ups ranging from 403 sq ft to 4,458 sq ft. The 403 sq ft 1-bedroom unit is priced from A$309,000, while the 4,458 sq ft 2-storey penthouse is priced at A$1.3 million.

Rahadian hinted that sales proceeds from The Istana would be used for the group’s iconic development in Jalan Ampang and possible mergers and acquisitions activities.

“We have to diversify [our business] slightly as our earnings mainly come from property development. We are also looking to buy small parcels of land within Klang Valley to replenish our land bank,” he added. The group only has 28 acres of undeveloped land bank on hand.

Magna Prima shares closed unchanged at 89 sen yesterday, giving it market capitalisation of RM296.27 million.

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This article first appeared in The Edge Financial Daily, on December 4, 2014.

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