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Thursday, December 31, 2009

Ho Hup sees RM400m GDV for Jalil Green City

HO Hup Construction Company Bhd, the country's oldest construction company, expects a gross development value (GDV) of RM400 million for phase one of the Jalil Green City project.

The mega integrated lifestyle development project comprising eight phases of development will commence construction next year.

The first phase, consisting of eight-storey offices, five-storey offices and signature offices is expected to be completed in three years.

"We expect to finish all eight phases of development over 24 hectares of land between eight and ten years.
"Total GDV for the entire project will be RM1.6 billion," said Ho Hup Managing Director Lim Ching Choy to reporters after the company's extraordinary general meeting (EGM) here today.

The remaining seven phases will consist of unique suites, shopping mall, "class A" office lots and residential projects.

Lim said the company was now in the final phase of securing a RM120 million bank loan for the project.

"Next year will be bright for us after sustaining several years of losses. We expect a huge turnover from this project and from one or two other deals which we hope to secure. We are optimistic of securing medium-sized government projects which we tender for recently," he said.

Lim was confident the projects would return Ho Hup back to its glorious days before the financial meltdown.

"Our market share currently is lower than a sub-contractor but we will hopefully increase it by the end of next year to a significant level," he added.

Meanwhile, Ho Hup expects its property division to contribute 70 per cent for the group's annual turnover next year.

"We have no specific contribution percentage for now as it is not significant like it was before.

"The property division, before the company's financial meltdown, was contributing 80 per cent annually to group turnover," he said.

Ho Hup is driven by its three arms namely its property, construction and trading divisions.

Earlier, at the EGM, shareholders approved the resolution to dispose two parcels of freehold vacant land in Hulu Langat and Kuala Lumpur.

When asked about the internal tussle between the management and major shareholders, Lim said the company was currently focusing on a new direction for the company next year.

The tussle was made public in the media by major shareholder Low Tuck Choy, who alleged the Ho Hup management sold two parcels of lands in Balakong and Bukit Jalil below market value.

"The 2.2 hectare land in Balakong for instance, has a lot of disadvantages. There is no proper road or pathway to the land. Besides there is a river and drain reserve which the new owner will have to give up to the government, as required by the law, if he wants to develop the land.

"I believe the RM30 per square feet price tag is not low after considering all these obstacles that the buyer will have to face," Lim reiterated.

He said the company was open to further negotiations and welcomed the support and response of shareholders at each annual general meeting or EGM.

Low, however, was not present at the EGM.

By Bernama

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