THE Malaysian Chinese Association (MCA) is looking for a buyer for Menara Multi-Purpose, which the political party purchased four years ago.

The proposal to dispose of the office block located in Capital Square in Jalan Munshi Abdullah, Kuala Lumpur, had been discussed at the party’s central committee meeting in mid-2014, according to sources.

It is understood that discussions with several potential buyers have yet to bear fruit.

According to the party’s constitution, at least two-thirds of the central committee members must vote affirmatively for the sale of any asset.

“If anyone offers a good price, they (MCA) are willing to sell. They are looking at a price which is above RM410 million,” a source familiar with the matter tells The Edge.

The party finds managing the property rather tedious and wants to monetise it, says the source.  

MCA president Datuk Seri Liow Tiong Lai did not respond to queries from The Edge on the proposed divestment.

MCA purchased the building in late 2011, during Tan Sri Dr Chua Soi Lek’s tenure as party president, for RM375 million from Multi-Purpose Holdings Bhd (MPHB), which was undergoing a restructuring exercise to demerge its number forecast operator business and financial services.

Thirty-one-year-old Menara Multi-Purpose offers 541,424 sq ft in net lettable area (NLA) and 414 car park bays. It was reported that a valuation of the 43-storey building by Henry Butcher Malaysia Sdn Bhd at the time of the sale in 2011 placed the property at RM384 million. MPHB’s original cost of investment was RM289 million.

The building houses Alliance Bank Malaysia Bhd’s headquarters and offices of MPHB Capital Bhd’s related companies.

Property valuers contacted by The Edge say the building may be able to fetch at least RM750 psf as it is freehold and enjoys a healthy level of occupancy.

Based on recent transactions in the vicinity, the building may be able to fetch as much as RM1,000 psf, but it would depend on the condition of the building and the surrounding amenities.

At a price range of RM750 psf to RM1,000 psf, it would place the price tag of the office tower at anything from RM406 million to RM541 million.

Menara Multi-Purpose was developed by Bandar Raya Developments Bhd as part of the Capital Square integrated development, which includes office buildings, a shopping mall and serviced apartments.

Adjacent to the office building is a 41-storey block called CapSquare Tower, which is owned by German-based Union Investment Real Estate Aktiengesellschaft. The building (not including two floors for mechanical and engineering works, the ground floor and three basement levels) has 601,574 sq ft in NLA and 461 parking bays. It was acquired in 2008, while it was being built, for RM439.3 million from Bandar Raya Developments Bhd.

The Capital Square development had an operating mall called CapSquare Retail Centre, which closed down after it was sold in 2013 to Hajra Properties Sdn Bhd. Hajra Properties is wholly-owned by the Jakel family, which also owns the textile retailer and wholesaler Jakel Trading Sdn Bhd. Hajra Properties paid RM300 million for the mall, some individual lots and a freehold five-acre parcel.

Hajra Properties has renovated, remodelled and renamed the retail component Jakel Square, which has close to one million sq ft in NLA. Within Jakel Square will be the country’s largest textile mall, the 330,000 sq ft Jakel Mall, scheduled to open on Feb 19. Another component is a 300,000 sq ft hypermarket by Middle East hypermarket operator LuLu International Group. Hajra Properties also plans to add a 320-room, four-star syariah-compliant hotel component.

This article first appeared in The Edge Malaysia Weekly, on February 23 - 29, 2015.

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