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Friday, February 25, 2011

Project to unlock prime land

The clean-up of the Klang River is beyond a massive beautification job as analysts say the project was likely to unlock land potentially for commercial development in areas surrounding it particularly near the city centre of Kuala Lumpur.

PETALING JAYA: The Water of Life project to clean up the Klang River, initiated by the Government under the Economic Transformation Programme (ETP), will unlock land in strategic locations for commercial development, say analysts.

An analyst with Affin Securities said the project was likely to unlock land potentially for commercial development in areas surrounding the Klang River; particularly near the city centre of Kuala Lumpur.

“We see this (unlocking of prime land) as a real possibility,” he said, adding that it would be difficult to estimate the value because details of the project have not been released.

An analyst with a local research unit concurred that the project was beyond a massive beautification job.

“The Government cannot afford to do projects purely for aesthetics costing billions. It will have to look for ways to make the project commercially viable, while befitting the environment and community,” he said.

He also said many issues would need to be addressed quickly, if the project was to go on as scheduled.

“One of the major problems we foresee in the implementation of the project would be land acquisition besides finding the money to fund the project,” he said.

An OSK Research note dated Feb 10 said the clean-up of the Klang River project was estimated to cost between RM8bil and RM10bil with phase 1 costing between RM1bil and RM2bil.

Ekovest co-founder and executive chairman DatuK Lim Kang Hoo confirmed that the company was the lead contractor of the project and that would start this year.

“We are still at the negotiation level, especially on the scope of work,” Lim said.

He agreed that the Water of Life project could unlock valuable land for commercial development in prime locations .

However, he declined to elaborate further, while MRCB was unavailable to comment at press time.

In a filing with Bursa Malaysia on Wednesday, Ekovest announced it had been appointed by the Government as the project delivery partner.

It said in a statement that Ekovest and Malaysian Resources Corp Bhd (MRCB), under a joint venture (JV), had received a letter of intent from the Government via the Kuala Lumpur mayor.

“This intention is subject to further negotiation between Ekovest Bhd and MRCB JV and the River of Life Joint Development Committee which was set up to govern the project on behalf of the Government in relation to the scope and cost of services of the project,” said Ekovest.

Ekovest and MRCB in a joint statement to Bursa Malaysia said the Water of Life project has been identified as one of the nine entry-point projects identified in the Greater Kuala Lumpur/Klang Valley National Key Economic Area under the ETP.

Ekovest is a building construction and civil engineering works company that have carved a named in construction projects such as the Danga Bay water front and property development in Johor.

MRCB is also engaged in construction related activities, environment engineering and property development.

By The Star

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