Sunway buys Kelana Jaya land for RM286m

PETALING JAYA: Sunway Bhd (Sunway) is acquiring 17 acres (740,342 sq ft) of land in Kelana Jaya for a total of RM286 million with plans to build a RM1.8 billion mixed development comprising service apartments and retail shops.
Sunway Dimension Stones Sdn Bhd, a wholly-owned subsidiary of Sunway Holdings Sdn Bhd which in turn is a wholly-owned subsidiary of Sunway, entered into a share sale and purchase agreement yesterday with Kelana Resorts Sdn Bhd to acquire 100% of the issued and paid-up share capital of Cleaver Fortune Sdn Bhd from Kelana Resorts, at a purchase consideration of RM282.6 million.
Cleaver Fortune is the beneficial owner of four plots of leasehold land (collectively known as Land 1) measuring 731,634 sq ft in total. Land 1 carries a commercial land title with 99 years lease until 2106.
Sunway Dimension also signed a sale and purchase agreement yesterday with Kelana Resorts' wholly-owned subsidiary Viva Variasi Sdn Bhd for the acquisition of 8,708 sq ft of freehold residential land (Land 2) for a purchase consideration of RM3.4 million.
"The purchase consideration was arrived at pursuant to an open tender for the proposed share acquisition and the proposed property acquisition and accepted by Kelana Resorts and Viva. Sunway's bid price of RM386.31 per sq ft (psf) was arrived at after taking into consideration the development potential of Land 1 and Land 2 and Sunway's required internal rate of return," said Sunway in a filing with Bursa Malaysia yesterday.
The acquisitions will be funded via bank borrowings and internally generated funds, with completion slated by the second half of 2015.
Sunway has plans for a mixed development comprising seven residential blocks and a commercial podium with a gross development value (GDV) of RM1.8 billion.
The total built up area of the project is about 3 million sq ft with a plot ratio of four times and the average estimated selling price is RM800 psf.
"The first launch is expected to be in financial year 2016 over a development period of approximately five years," it said.
Sunway said the expansion of its landbank in the Klang Valley is in line with its objective to replenish landbank with land ready for immediate launch.
Sited next to Western Digital in the Sungai Way Free Trade Zone, the land is within the vicinity of the Kelab Golf Negara Subang, which has two 18-hole golf courses and is adjacent to a 15-acre water retention pond where its landscape will be enhanced by Sunway alongside the local authorities to provide residents with additional recreational activities.
It is about 600 metres from the Setia Jaya KTM and Sunway Setia Jaya Bus Rapid Transit-Sunway Line stations.
"Seventeen acres of land will allow us the flexibility and space to develop a contemporary mixed development with an unobstructed view of the golf courses and a concept focused on serene living amidst lush greenery and a beautiful lake," said Sunway's managing director of property development division for Malaysia and Singapore Sarena Cheah.
"It will be a highly sought-after development given its prime location and wide accessibility. It is also flanked by mature and affluent neighbourhoods of Petaling Jaya, Sunway Resort City, Subang Jaya and Shah Alam." she added.
To date, Sunway's unbilled property sales of RM2.5 billion combined with its remaining landbank of 3,380 acres with a potential GDV of RM50 billion that will keep the property division busy in the next 15 years.