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Monday, July 28, 2008

Glomac keen to build more Grade A office towers in KL

DEVELOPER Glomac Bhd may build more Grade A office towers in Kuala Lumpur after its first such project was snapped up even before it started any work.

The company is now looking for land in prime areas like Bangsar, Sri Hartamas, Damansara and the city centre, group executive vice chairman Datuk Richard Fong said.

FONG: The company is now looking for land in prime areas like Bangsar, Sri Hartamas, Damansara and the city centre.

Glomac has sold the Glomac Tower in Kuala Lumpur, a 40-storey building next to the Petronas Twin Towers, to Prestige Scale Sdn Bhd, a company run by a local businessman for RM1,160 psf or RM577 million. The deal was done at the end of 2007.

"Glomac Tower is the first en bloc sale for us off the plans. We got an offer from Kuwait Finance House and Prestige we could not refuse as it was a good deal. We hit record price, which had set a new benchmark for Grade A office buildings for the city centre," Fong told Business Times in an interview recently.

The land was acquired last year by Glomac Al Batha Sdn Bhd for about RM1,000 psf from the Tan family of the Continental Hotel group.

Glomac Al Batha is a 51:49 joint-venture firm held by Glomac and Al Batha Group respectively, one of the largest private business concerns in the United Arab Emirates.

On the construction of Glomac Tower, foundation work will start in August and done in 12 months, followed by the main building, which will be completed by August 2011.

Fong said the project will be affected by higher raw material prices, but it has enough margins to cushion the increase in construction cost.

"We didn't anticipate the cost to go up by so much. The increase exceeded our expectations, but still we are able to make a handsome profit," he added.

Glomac Tower was initially worth RM450 million. It was revalued when the net floor area increased from below 500,000 sq ft to 550,000 sq ft, Fong said.

Glomac Tower will have 30 office floors, two retail and three sky restaurant floors including an open-air rooftop restaurant, four levels of elevated car park and four levels of basement car park.

It will be built in compliance with the requirements of the Multimedia Super Corridor (MSC) so that an application could later be made for MSC status.

By New Straits Times (by Sharen Kaur)

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