Thursday, August 06, 2015

Lai Meng School Land up for sale again for RM400mil

Well guys, remember Magna Prima bought the Lai Meng school land back in 2009 for RM148.2mil cash? Now they are selling away the land for RM400mil and seem like they are not keen to develop the land.

By The Star Online

Magna Prima Bhd’s Lai Meng school property, located along Jalan Ampang, is still up for sale. It is looking for offers from interested buyers within a timeframe of about 1½ months.

Yesterday, the marketing agent of the real estate, Rahim & Co, put up an expression-of-interest advertisement to sell the 2.62-acre (1.06ha) parcel.

James Goh of Rahim & Co’s investment section told StarBiz: “While we have a target price of about RM3,500 per sq ft (psf), we are open to all reasonable offers.”

Interested parties can stipulate the terms and make the offer by 5pm on Sept 22.

Goh said a few big developers had called up to enquire about the sale since the advertisement came out.

At RM3,500 psf, the buyer will have to fork out about RM400mil for the land.

“The demand for development land in prime locations is still holding up well. This kind of opportunity doesn’t come by often,” he explained about the land which is 300 meters from KLCC.

The freehold land comes with approval for offices, a hotel and/or serviced apartments at a plot ratio of 1:12.

Earlier this year, Rahim & Co had managed to sell 1.87 acres previously owned by the German Embassy to Malaysian Resources Corp Bhd (MRCB) for RM3,188 psf.

MRCB had paid RM259.16mil for the parcel along Jalan Kia Peng through a tender process.

That said, observers noted that the challenging market conditions might hold buyers back from making the investment.

Developers would have to make serious considerations of what they want to do with the land because there is sufficient supply of houses in the vicinity, while there is still a glut in office space in Kuala Lumpur.

But Goh is optimistic of getting a buyer due to its strategic location.

Previously, StarBiz had reported that Retirement Fund Inc was interested in buying the land in April.

The pension fund had offered about RM3,300 psf, but Magna Prima’s group managing director Datuk Wira Rahadian Mahmud Mohammad Khalil told reporters that both parties had discussed the deal but it wasn’t finalised.

With the appointment of Rahim & Co as the developer’s exclusive marketing agent, the land deal could be done in a more proper and coordinated manner, Goh explained.

Magna Prima had bought the land five years ago for RM1,350 psf or RM148.2mil cash.

Back then, Magna Prima had also transferred 5.5 acres to the Lai Meng Girls’ School Association and agreed to bear the construction cost of the new campus, which ranged from RM20mil to RM30mil.

The Bukit Jalil land had cost the small-cap developer RM10mil.

Before the land sale, the developer, which has a market cap of RM366.2mil, had intended to carry out a mixed project with a gross development value of RM1.8bil.

Dubbed the Iconic Towers, the proposed project would be made up of two 60-storey towers, one of which is a mixture of serviced apartments, a hotel and offices, while the other is a grade A office with Green Building Index features.

Development of the project would cost a lot and the company decided to strengthen its balance sheet and re-focus on other niche projects. It also planned to sell a 20-acre parcel in Shah Alam and a seven-acre plot in Petaling Jaya.