KUALA LUMPUR: Despite signs of a slowdown in the property market, the Bukit Bintang City Centre (BBCC) project, which is spearheaded by a consortium of UDA Holdings Bhd, Eco World Development Group Bhd and the Employees Provident Fund (EPF), is gathering steam. 

UDA chairman Datuk Johari Abdul Ghani told The Edge Financial Daily that the Kuala Lumpur City Hall (DBKL) had granted the development order (DO) for the master plan layout this month. 

“We will be starting site clearance to build our show gallery by the end of this month. It will take three months to complete. We will launch our first phase of the project sometime in December,” said Johari.

With that, Johari expects the first phase of the mega development, which sits on the tract of former Pudu Prison, to be launched by year end. 

Also, he revealed that once the DBKL grants the detailed DO, tenders for the construction works will also start soon. Johari anticipates to obtain detailed DOs for each individual component of the project, namely shopping malls, strata offices, hotels and high-rise residence units, which are planned for the first phase. 

UDA has pledged to have half of the construction works of the development to be given to bumiputera companies.

Johari said the value of the construction job to be awarded for the first phase has not been finalised yet. Over the span of eight years, the BBCC project will have an estimated total development cost of RM5 billion. It has a gross development value of RM8 billion. 

Should things pan out as planned, the mega project could be another reservoir of construction jobs in town, analysts said. 

Both Eco World and UDA hold a 40% equity stake in the special purpose vehicle (SPV) that undertakes the development project on a 19.4-acre (7.85ha) piece of prime land, which is strategically located between Jalan Pudu and Jalan Hang Tuah near the bustling Bukit Bintang area. The EPF holds 20%. 

Being the landowner, UDA will receive RM1 billion as development rights from the SPV for the redevelopment.

Meanwhile, Johari noted that the joint-venture (JV) agreement with the EPF is in its final stage of due diligence. “We expect the EPF to firm up by August.”

“The agreement with the mall operator and JV partner, Mitsui Fudosan Co Ltd, the owner of Premium Oulets in Sepang, is currently in the final stage. The same thing goes for the agreement with Sony’s subsidiary Zepp Entertainment,” he added.

He noted that technical specifications of the mall and entertainment centre will also be finalised soon.

The proposed BBCC will include a 2,500-capacity live event hall under Sony’s Zepp branding as its entertainment component. Zepp is a subsidiary of Sony Music Entertainment (Japan) Inc. It currently has six concert halls in Japan, which play host to many international artists.

This article first appeared in The Edge Financial Daily, on July 21, 2015.