PRG, Syarikat Perumahan Negara in MoU on RM5b GDV projects

KUALA LUMPUR: PRG Holdings Bhd which is currently focusing on the affordable housing segment, has entered into a three-way memorandum of understanding (MoU) to jointly develop projects with an estimated gross development value (GDV) of RM5 billion in that segment.

The MoU was inked between the company and Syarikat Perumahan Negara Bhd (SPNB) subsidiary SPNB Aspirasi Sdn Bhd (SASB) and Mimbar Nusantara Holdings Sdn Bhd.

Through this partnership, PRG will be constructing and financing projects allowed and identified by SASB while Mimbar Nusantara will bring to the table project consultation, advisory, facilitation and coordination services, among others.

The RM5 billion GDV encompasses the list of projects under SPNB.

“We are looking at a few projects. We have done some sort of due diligence and feasibility study on these projects,” PRG managing director Datuk Lua Choon Hann said at a press conference after the signing ceremony yesterday.
He said the group will announce its pick “at the right time”. The MoU remains valid for six months.

PRG and its joint venture partners are looking to embark on projects in the Klang Valley, as well as the rest of the country, which will be developed on SPNB’s landbank and by acquiring other land as well. These future projects will be financed with bank borrowings.

PRG’s revenue last year was mainly driven by its manufacturing arm which grew by 10% from RM89.0 million to RM97.9 million. Revenue for its property development and construction division dipped by 15.4% to RM34.1 million from RM40.3 million in 2015.

“In 2016, our numbers were more skewed towards manufacturing and hopefully in 2017 we will have a more balanced position,” PRG CFO Loi Kok Mun said.

According to him, the property division will start picking up as the first project from this joint venture is expected to be rolled out next year, while two of its existing projects, Picasso Residence, which is a luxury residence in Jalan Jelatek , and its joint venture residential apartment project in Subang U5, Selangor, are expected to start contributing in 2018.