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Thursday, August 21, 2008

MP Corp and MoF unit sign pact on Johor township

KUALA LUMPUR: Property firm Malaysia Pacific Corp Bhd (MP Corp) has teamed up with Amanah Raya Bhd (ARB) to develop 276ha in Iskandar Malaysia, Johor, into a RM6.6bil self-contained township called LakeHill Resort City.

“The gross development cost of the project is estimated at RM4.2bil and is anticipated to generate development profits of RM2.4bil with an estimated completion time by 2015,’’ MP Corp told Bursa Malaysia yesterday. ARB is a company under Minister of Finance Inc (MoF).

MP Corp said it expected to raise development financing and construction bridging loan of RM200mil to fast-track the development. Additional funds would be raised via cashflow and profits derived from sales and “subsidiary joint venture” of the 22 parcels of approved projects for the township.

ARB and MP Corp have “agreed that a further option to speed up the project is by way of public listing on Bursa Malaysia of the developer within three to four years.”

“LakeHill Resort City is targeted to be the home of the trading, distribution, entertainment, shopping and tourism hub of Iskandar Malaysia to boost investor and economic activities for Johor and the country,’’ MP Corp said in the statement.

The centrepiece of the development will be the Asia Pacific Trade & Expo City (Aptec), a four million gross sq ft permanent trade and expo city, touted to be the largest of its kind in Asia.

A total of 9,116 residential units and 1,022 commercial units are being planned at the township.

MP Corp announced that it would undertake an internal restructuring to facilitate the joint venture with ARB involving the sale of its 276ha land bank to a special purpose vehicle called Oriental Pearl City Properties Sdn Bhd for RM135.3mil.

An independent valuer, on July 29, ascribed a fair market value of RM450mil for the land involved, MP Corp said.

ARB’s wholly owned unit AmanahRaya Development Sdn Bhd (ADSB) will pay RM99mil for a 22% stake in the joint venture, while MP Corp will retain a 78% share.

MP Corp was entitled to seek a joint-venture partner in its 78% profit entitlement of the developer, the statement said.

“The project is targeted at Malaysia My Second Home buyers, expatriates, Singaporeans and affluent Malaysians, complemented by plentiful medium-cost housing adjacent and nearby LakeHill Resort City and Aptec,’’ it said.

MP Corp is developing 970 high medium-cost houses in Taman Nusa Damai next to LakeHill Resort and Aptec.

By The Star

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