Friday 29 Mar 2024
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KUALA LUMPUR (Aug 21): Lifestyle property developer Eastern and Oriental Bhd (E&O) is on the lookout for Tier 1 and Tier 2 investors, either local and foreign parties, to enter into joint ventures (JV) to develop its 253-acre Phase 2A land in Seri Tanjung Pinang 2, Penang (STP2A).

This is part of plans to raise substantial cashflow, while reducing its risk exposure, seeing it has another 507 acres of land to reclaim over a period of time.

Its managing director Kok Tuck Cheong said E&O has demonstrated its ability to secure Tier 1 investors such as Kumpulan Wang Persaraan (Diperbadankan) (KWAP), which entered into a strategic partnership for the disposal of a 20% stake in the development land in Phase 2A for RM766 million in August last year.

“As the reclamation of Phase 2A gains further momentum, we are getting to target completion by end of this year or (by) the first quarter of 2019. We have started our marketing efforts to secure in Tier 1 level and/or investors who want to take up plots of land to either go into joint ventures or develop on its own. All this would raise substantially, money for the group’s cashflow,” he told reporters after the group’s annual general meeting today.

Kok added that E&O is also keen to work with Tier 2 investors such as property groups or funds that want to take up a direct stake in a particular plot of land. For example, within the commercial precinct of STP2A to build a hospital, medical centre or hotel.

“They can do it with us or on their own,” Kok said, adding that the first launch of service apartments and neighbourhood retail space is expected in the second half of 2019.

Meanwhile, the reclamation of Phase 2A, the first of three islands in the second part of the total 760-acre STP2 reclamation, off the coast of Tanjung Tokong, is 95% complete and has received land titles.

“We are not limiting ourselves to any particular investor. The land is starting to materialise, so the question whether we can complete the reclamation is behind us. Certainly, it is easier to talk to investors now than before.

“So the team is starting to mobilise efforts to ensure we target selective investors that would have an interest and would put their money into developing STP2A,” he said.

Kok added whether it sells half or 100% of the land, it would receive a cash infusion to its cashflow, while reducing its risk exposure.

At 2.59pm, E&O shares were up one sen or 0.66% at RM1.53, with 52,500 shares done, for a market capitalisation of RM1.99 billion.

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