The property developer, known for developments such as VERVE Suites and Hijauan Kiara, both in the Mont Kiara enclave, had originally planned to develop luxury serviced apartments known as VERVE Suites @ KLCC on the 39,354 sq ft parcel.
However, BKP has now decided to sell the land — situated between the Auto Bavaria showroom and the headquarters of Weststar Maxus Distributors Sdn Bhd — and use the proceeds to diversify its portfolio into suburban areas within Greater Kuala Lumpur.
Last week, real estate firm Savills (M) Sdn Bhd (Savills Malaysia), which was appointed by BKP as the exclusive agent to conduct the sale, placed an advertisement in The Edge Malaysia business weekly inviting interested buyers to submit bids for the asset.
The parcel belongs to Pristine Springs Sdn Bhd, which is a subsidiary of Al Batha Bukit Kiara Holdings Sdn Bhd, the parent company of BKP.
“The land is 0.9 acres. It is a freehold parcel with an approved commercial title and a plot ratio of 9.2,” BKP chief operating officer L K Fan tells The Edge.
Although he did not say at what price BKP is hoping to close the deal, he indicated that the developer has based the sale price on the land being immediately ready for development as the necessary approvals have been obtained, as well as recent transactions of comparable parcels in the vicinity.
“Some of the notable transactions of smaller sites in the vicinity include the German Embassy parcel in Jalan Tun Razak (1.87 acres @ RM3,188 per sq ft), the Tropicana land in Jalan Bukit Bintang (3.18 acres @ RM3,280 psf), the Oxley Holdings land in Jalan Ampang (3.2 acres @ RM3,300 psf) and the former Conlay Club land bought by KSK Group in Jalan Conlay (3.65 acres @ RM3,573 psf),” Fan points out.
Malaysian Resources Corp Bhd won a bid to purchase the German Embassy parcel in Jalan Kia Peng, near the Petronas Twin Towers, for RM259.15 million two months ago. A year ago, Tropicana Corp Bhd sold eight contiguous parcels in Bukit Bintang to Offshore Triangle Sdn Bhd for RM448.4 million.
Based on a conservative price of RM3,000 psf, which is the lower end of the transacted price range, the 39,354 sq ft parcel may be sold for some RM120 million.
According to information made available to The Edge Malaysia, Pristine Springs bought the parcel in 2007 for RM26.76 million or RM680 psf from Glorious Reflection Sdn Bhd. If BKP manages to sell the land at RM3,000 psf, it is likely to make a handsome gain.
Meanwhile, Nabeel Hussain, associate director of Savills Malaysia, says the real estate agent has already issued 15 tender forms to interested parties, both local and foreign, over the past two weeks.
He adds that the site can be distinguished from the other parcels nearby as it has a higher plot ratio of 9.2 compared with plot ratios of between six and seven in the vicinity.
As the development order (DO) and building plan (BP) have been approved, the buyer will not incur additional costs such as development charges or fees related to the approvals. “The buyer would be able to save 9 to 12 months of approval time,” says Nabeel.
He points out that this would be an attractive proposition, particularly to foreign investors given the recent weakening of the ringgit.
Submissions for the tender close next Friday on 10 July at 12 noon.
- The Edge Property.com, 1 July 2015