SP Setia buys land for RM381mil to replicate earlier success
Posted on | October 4, 2011
By THE STAR
PETALING JAYA: SP Setia Bhd, which is facing a takeover offer from Permodalan Nasional Bhd (PNB), has proposed to acquire land for RM381.2mil to replicate its successful township development in Setia Alam and Setia Eco Park.
The new land in Rinching, which is 673.3 acres and situated mid-way between Semenyih and Bangi old town, is forecast to have a gross development value (GDV) of RM4bil.
SP Setia had earlier bought 1,010 acres in Beranang for RM330mil on Aug 12.
The group is planning an up-scaled product mix at the Rinching land aimed at upgraders who are investing in the Semenyih-Kajang corridor.
SP Setia said the up-market project planned at the Rinching land would complement the mass market products to be offered in Beranang.
The Rinching project is close to the Beranang land which is forecast to have a GDV of RM3.5bil. The development would also enable the group to reap economies of scale on infrastructure spending and optimise amenities enhancement.
“Rinching’s close proximity to Beranang offers the group a fantastic opportunity to repeat the success with Setia Alam and Setia Eco Park in an untapped corridor,” said SP Setia president and chief executive officer Tan Sri Liew Kee Sin in a statement yesterday.
“The value which the group has created in the western Klang Valley corridor through our well-executed master planning and upfront investment in key infrastructure as well as amenities has benefited not just us but other surrounding developments.
“As a result, the landbank in Setia Alam and Setia Eco Park have become very valuable and we are now in a position to launch upmarket products in both projects,” Liew said.
He said the group’s branding was much stronger and it could muster strong support from house buyers to transform the location into a thriving township.
“We have been scouting very hard over the last year to identify suitable land bank in the Klang Valley where we can re-introduce the Setia Alam and Setia Eco Park winning formula but with the added benefit of the lessons learnt from our execution of numerous townships not just in the Klang Valley but also in Johor Baru and Penang,” he said.
Liew said the group intended to launch the Rinching project first as it had already been converted from agricultural to building land.
“Layout approval has been obtained by the vendor. However, the group will be submitting a revised layout to the relevant authorities to maximise the development potential of the land.
“Subject to the necessary development approvals being obtained, the target launch for the Rinching project will be in the fourth quarter of 2012,” he said, adding that the company planned to launch the Beranang project in 2013.
Analysts are positive about the acquisition but have voiced their concerns over the uncertainties surrounding PNB’s takeover offer for SP Setia.
“Who’s helming the ship when the development occurs is a critical question.
“What is the point of this land when you don’t have the right person to maximise the value,” said an analyst.
She said there was still uncertainty over how PNB would impact operations if it succeeded in its takeover bid.
PNB has launched a bid to raise its stake in SP Setia to above 50% from 33%.“The acquisition comes unfortunately at a bad time.
“However, the proposed acquisition would present a fantastic opportunity for the current management to ask for a better offer,” she said.
On the planned developments, she said the land was in a strategic location with direct access to the Seremban-Kajang Highway.
The land is also about 15 minutes from the proposed Bandar Kajang My Rapid Transit station along the Sungai Buloh-Kajang Line.
The road accessibility factor was a huge selling point for SP Setia to replicate what it had done in Setia Alam, and it might take the group at least five years to develop the township, she said
SP Setia also said it had appointed AmInvestment Bank Bhd as the independent adviser for the PNB takeover offer.
- Malaysia Property News
You might also like
|
|
|
|
|
Search
