KUALA LUMPUR/JOHOR BAHRU, 14 October – Damansara Realty Berhad (“DBhd” or the “Group”) said today it will form a joint venture with Country Garden Holdings Company Limited (“Country Garden”), one of China’s largest property developers, to develop a 53-acre freehold land parcel in Johor Bahru into an integrated township to be known as Central Park. The joint venture, DAC Properties Sdn Bhd (“DAC Properties”), will be 30% held by DBhd’s indirect wholly-owned subsidiary Damansara Realty (Johor) Sdn Bhd (“DRJ”) and 70% held by Country Garden Management Sdn Bhd (“CGM”), which is wholly owned by Hong Kong-listed Country Garden.
DAC Properties will develop Central Park over six to eight years, starting from the fourth quarter of 2016. The township, located in the Tebrau district and five kilometres to the northwest of Johor Bahru city centre, is targeted at young homebuyers in Malaysia. Besides residential units, it will also have commercial shop spaces and various amenities. The first phase will be launched in the 1st quarter of 2017. Central Park covers 53 acres of land, and will cater to a dynamic and vibrant community in Johor Bahru.
“Malaysia has always been a key market for us. We see a lot of potential particularly in Johor Bahru, where other major developments are coming up. The city is poised to become an international metropolis, and we are proud to be a part of its transformation,” said Mr. Fu Jinling, Country Garden’s Regional President (Malaysia). Country Garden’s flagship project in Malaysia is Forest City, a mega-development in Johor and its largest outside China, with a total gross development value of more than RM400 billion. Apart from Central Park and Forest City, Country Garden has two other real estate projects in Malaysia, namely Danga Bay in Johor and Country Garden Diamond in Kuala Lumpur.
The Central Park site is part of a larger 63-acre land parcel (“TDA Land”) that Bursa Malaysia-listed DBhd will acquire for RM141.53 million, following a development rights agreement it signed in 2002 and 2003 with Johor Corporation (“JCorp”). DAC Properties will pay RM130.3 million to JCorp for the 53-acre site. DBhd will pay JCorp RM11.23 million for the remaining 10 acres of TDA Land, which comprises completed shop offices and undeveloped land. Dato’ Daing A. Malek Daing A. Rahaman, DBhd’s Executive Vice-Chairman, said: “Country Garden has an impressive track record of property development in China, Malaysia and Australia.
This partnership represents a significant opportunity for DBhd to execute a largescale project alongside one of China’s most reputable developers. We expect Central Park to generate a significant and steady stream of income to the Group over the next few years.” “Apart from being an iconic landmark when fully developed, Central Park will also create massive job opportunities for locals in Johor, giving the economy a boost,” he added. Mr. Brian Iskandar Zulkarim, DBhd’s Group Chief Executive Officer, said: “We are very proud and excited to be part of this joint venture with Country Garden as it will enable us to showcase our abilities on a much bigger scale. At the same time, we will continue to drive synergies from DBhd’s other divisions in order to achieve balanced and sustainable growth.”
On a pro forma basis, upon completion of the proposals based on the audited accounts as at 31 December 2015, DBhd would record an increase in the net asset per share from RM 0.37 to RM0.51. The formation of the joint venture is subject to various terms and conditions, including the approval of DBhd’s shareholders and the relevant authorities in Malaysia. DBhd – an investment holding company specialising in property development – has ongoing developments in Kuantan and Putrajaya. It has a contract with Putrajaya Corp to develop 1,350 homes and 45 commercial units in Putrajaya at a gross development cost of approximately RM467.3 million. Its Bandar Damansara Kuantan site comprises 500 acres of land bank. On 26 September 2016, DBhd said it had secured a RM124 million contract to provide facilities management and catering services to Petronas’ Refinery and Petrochemical Integrated Development (“RAPID”) complex in Pengerang. The contract will be undertaken by a joint venture between DBhd’s subsidiary TMR Urusharta Sdn Bhd and L.C. Catering Sdn Bhd.