Thursday 28 Mar 2024
By
main news image

This article first appeared in The Edge Financial Daily, on October 30, 2015.

 

Tengku-Adnan_FD_30Oct15_theedgemarketsKUALA LUMPUR: The Kuala Lumpur City Hall (DBKL) is handing over the abandoned Plaza Rakyat property on Jalan Pudu here to Profit Consortium Sdn Bhd for RM740 million, said Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor.

He said DBKL will sign the sale and purchase agreement (SPA) with Profit Consortium today when he was asked about it at the Parliament lobby yesterday.

Profit Consortium is owned by Maxcorp Development Sdn Bhd, SW Land Sdn Bhd and Tan Sri Abdul Samad Alias. Maxcorp is the private vehicle of Major (Rtd) Anuar Adam who controls Tadmax Resources Bhd (formerly Wijaya Baru Global Bhd), while SW Land is the developer of Sungai Wang Plaza.

Earlier in reply to a supplementary question by Fong Kui Lun (DAP-Bukit Bintang) in Parliament, Tengku Adnan said the price Profit Consortium will be paying for the Plaza Rakyat site is RM740 million, of which RM700 million is the outright sale of the land and RM40 million is for the company to “resolve compensation issues with the 211 shoplot buyers”.

The minister said he has put a condition in the SPA under which the developer has to resolve the compensation issue with the 211 buyers of the shoplots in the project.

“Actually, the 211 buyers do not have the rights (to the property) because they purchased the shoplots from Plaza Rakyat Sdn Bhd (PRSB) which has gone bankrupt. However, we are a government that is concerned about its people and I have decided that RM40 million will be allocated (out of total sale price) to resolve their problems,” said Tengku Adnan.

“We carried out a closed tender process, and three companies bid for the project. A selection process was carried out, and the highest bid [from Profit Consortium] was chosen,” he said.

Apart from Profit Consortium, Ivory Properties Group Bhd was also reported to have expressed interest in Plaza Rakyat.

Fong had asked Tengku Adnan to state the reason why DBKL had failed to revive the Plaza Rakyat project until now.

To this, Tengku Adnan said the project had been abandoned since 1997 and that the Kuala Lumpur mayor had begun talks with several parties during that period to take over the project. A long legal process had then ensued between DBKL and PRSB to appoint a new company to revive Plaza Rakyat.

The site of Plaza Rakyat was only handed over to DBKL on Nov 6, 2014 after the legal process. Subsequently, a tender process was carried out to look for a suitable developer to revive the project.

To recap, Plaza Rakyat, a RM1.5 billion mixed development, was 30% completed about 15 years ago when the then-developer PRSB ran into difficulties during the 1997/98 Asian financial crisis, forcing it to abandon the project.

The government had reportedly decided to terminate PRSB’s contract in 2010, 12 years after the developer abandoned the project.

It was reported that the original plan for the development comprised a 79-storey office tower, 46-storey residential tower, 24-storey hotel and seven-storey shopping centre.

      Print
      Text Size
      Share