KUALA LUMPUR, April 6 — Titijaya Land Bhd has signed an agreement with The Ascott Limited for two of its property projects, one each in Penang and Glenmarie, Shah Alam.
Its Group Deputy Managing Director, Lim Poh Yit, said the projects would have a combined gross development value (GDV) of RM4.1 billion.
The term of the agreement is for a period of ten years, whereby both parties will have the option to extend it for an additional five years, on the condition of a mutual agreement from both companies. Throughout the term, Titijaya will remain as the rightful owner of the land, property and facilities. Titijaya will benefit from Ascott’s global track record in the serviced residence industry such as their design and development capabilities, extensive market network and operational capabilities.
“We see this strategy as the way forward and the results will be seen in the 2018 financial year (FY2018) as the construction will kickstart in 2017,” he told reporters after the signing ceremony here today.
This is Titijaya’s first collaboration with an international company and the partnership would positively contribute to its bottom line.
The project in Penang, strategically located near the Bayan Lepas Free Trade Zone and Penang International Airport, comprises 200 units of serviced residence ranging from studio to two-bedroom apartments.
The Glenmarie project consists of a 250-unit serviced residence that comes with a choice of studios and one- or two-bedroom apartment. It will be located at the intersection of three major highways — Elite Highway, Guthrie Corridor, and New Klang Valley Expressway. It is close to the Subang Skypark Airport, Shah Alam Stadium as well as industrial estates and business parks such as the Hicom Glenmarie Industrial Park. The property will be part of a mixed-use development that houses offices and one of the largest shopping malls in Glenmarie.
Both serviced residences will offer guests complete facilities such as a gymnasium, swimming pool, launderette and residents’ lounge.
Titijaya has been continuously in search for strategically located land banks, which will cater to the needs of their customers. Ascott’s participation in Titijaya’s two upcoming property developments echoes its endorsement and recognition towards Titijaya’s project track record as a whole.
“Ascott is popular with multinational companies as its network of international serviced residences and support systems offer easy, speedy and cost effective solutions for managing the accommodation needs of staff across multiple cities. Hence, we will bring our expertise into these two prestigious developments by Titijaya.” Mr Philip Lim, Ascott’s Country General Manager for Malaysia commented.
Meanwhile, Lim said, the company planned to launch two more projects in the second half of this year.
“We also expect the performance in the second half to be better as the costs of the construction materials, such as steel and concrete prices, have come down and this will also offset the higher cost of labour,” he said.
He said presently, the GDV of on-going and coming projects stood at RM8.6 billion while the company’s sales target for residential and commercial units stood at RM150 million as at Dec 31, 2015.
Previously, Titijaya had scaled down its target sales to RM400 million for the financial year 2016 (FY2016) as compared with RM500 million in FY2015 due to the soft economic condition.
The property developer’s current unbilled property sales stood at RM680 million for residential and commercial segments.
*Image Caption: (L-R) Lim Poh Yit, Deputy Managing Director, Titijaya Land Berhad; Tan Sri Dato’ Lim Soon Peng, Group Managing Director, Titijaya Land Berhad; Ronald Tay, Chief Executive Officer, Ascott Residence Trust Management Limited and Philip Lim, Country General Manager, Malaysia, The Ascott Limited.