Property Deals Of The Year: Controversial deals

This article first appeared in The Edge Malaysia Weekly, on December 31, 2018 - January 06, 2019.
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THE sale of two tracts made it to the Top 10 property deals of the year, according to some of the real estate agents surveyed, because of the selling prices and the parties involved. However, they were not without controversy.

The first was the purchase by Bank Negara Malaysia of 55.79 acres, close to its headquarters in Kuala Lumpur, from the previous government for RM2.066 billion. It may have been a good deal for the government but critics had raised questions about the price, timing of the purchase and the size of the land. (See “Unanswered questions on Bank Negara land deal” on Page 35.)

Another deal that was considered good for the vendor but put the purchaser under scrutiny was a 1.87-acre parcel in Jalan Kia Peng, Kuala Lumpur. The land, which was previously owned by the German Embassy, was bought by Malaysian Resources Corp Bhd in April 2015 for RM3,188.25 psf, or RM259.15 million, and sold three years later to the Social Security Organisation (Socso) for RM3,973.77 psf, or RM323 million.

Did Socso need to invest in an asset that will not see any income generated until it is developed? Despite the institutional fund’s explanation that the land purchase qualifies as an alternative asset relevant to Socso’s strategic asset allocation, many continue to question its decision.

Also worth keeping an eye on is the outcome of the controversy surrounding the Sri Maha Mariamman Temple in USJ25. The land on which the temple sits is owned by MCT Bhd, which is 66.25%-controlled by Philippines-based multinational conglomerate Ayala Corp. Moves to relocate the temple at end-November triggered a riot. Tan Sri Vincent Tan Chee Yioun then started a fund-raising campaign to purchase the land from the developer and let the temple remain where it is.

Another piece of news that made people sit up was the announcement by businessman Tan Sri Ting Pek Khiing about a proposed RM30 billion project in Langkawi. How does the businessman, who is a bankrupt, plan to execute the project?

 

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