KUALA LUMPUR (Feb 28): TRC Synergy Bhd's civil servant housing development project in the administrative capital of Putrajaya has been axed by Perbadanan Putrajaya Corp on grounds of national interest.

In an exchange filing today, TRC said it had on Feb 25 received a three-month termination notice from Perbadanan Putrajaya concerning the project, which was for a gross development cost of RM292.74 million.

It said the project was a 1Malaysia Civil Servant Housing Development (PPA1M) project in Precinct 18 within the administrative capital of Putrajaya, in which its wholly-owned subsidiary, TRC Land Sdn Bhd, was appointed a developer.

TRC Land accepted Perbadanan Putrajaya's appointment in December 2015. Subsequently, a development agreement was signed in July 2017.

The development was slated to have a total of three blocks comprising 500 PPA1M units, 316 public residential units, and 20 commercial units.

"The termination was made by PJC (Perbadanan Putrajaya) pursuant to Clause 26 (Termination on National Interest) of the development agreement. The company believes that the termination is consistent with the government's new initiatives to consolidate the development of affordable homes under the Ministry of Housing and Local Government," read its filing today.

In a separate statement, TRC managing director Tan Sri Sufri Mohd Zin said the group respects Perbadanan Putrajaya's decision on the termination.

"Except for costs and expenses that we had incurred for the project, which is claimable under the agreement, the decision is not expected to have material impact on the earnings, net asset, and gearing of the company for the financial year ended Dec 31, 2019," he said.

He added that the group remains positive and open with regards to current or future joint development opportunities with the government and its agencies, as well as the private sector.

Shares in TRC slipped one sen or 1.79% to close at 55 sen, for a market capitalisation of RM264.27 million.