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China Railway Group to invest US$2 billion in Bandar Malaysia

An artist’s impression of China Railway Group Ltd’s regional centre in Bandar Malaysia. - Pic by The Star. An artist’s impression of China Railway Group Ltd’s regional centre in Bandar Malaysia. - Pic by The Star.

State-owned construction group, China Railway Group Ltd, has officially announced that it will invest US$2 bilion (RM8.1 billion) to build its own regional centre in Bandar Malaysia.

This comes three months after it won the bid with joint-venture partner Iskandar Waterfront Holdings (IWH) to acquire 60% of equity in Bandar Malaysia for RM7.41 billion from 1MDB Real Estate Sdn Bhd (1MDB-RE). The announcement was made in the presence of Prime Minister Datuk Seri Najib Razak earlier on Monday.

The US$2 billion is for the development of an integrated complex in Bandar Malaysia.

It was reported that CREC is one of the front-runners of the High Speed Rail project from KL to Singapore which will which include Bandar Malaysia as its main hub.

CREC is one of the world’s largest engineering and construction firms, and also has businesses, among others, in industrial manufacturing, real estate development, and resources and mineral products. As of 2015, it is ranked number 71 in the Fortune 500, with a turnover exceeding US$100 billion per annum.

 

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To recap, 1Malaysia Development Bhd (1MDB)'s wholly-owned subsidiary 1MDB-RE will be selling 60% of wholly-owned Bandar Malaysia Sdn Bhd to a Consortium comprising Iskandar Waterfront Holdings Sdn Bhd (IWH) and China Railway Engineering Corp (M) Sdn Bhd (CREC) for RM7.41 billion

Bandar Malaysia is a master-planned urban redevelopment of Malaysia's first airport in Sungai Besi. The township is the country's strategic real estate development leveraged to capture high multiplier effects and to spur a vibrant economy.

It will be developed over a 15 to 25-year period at a projected gross development value (GDV) of RM150 billion. The development is designed to become Malaysia’s new international landmark when completed.

The Bandar Malaysia development received planning approval from Dewan Bandaraya Kuala Lumpur (KL City Hall) on 26 October 2015. The “approval-in-principle”, granted based on Bandar Malaysia’s masterplan, is for a mixed-use development with an average gross plot ratio of 4.05, across the entire 486 acres site.

The development, located about 7km from Kuala Lumpur City Centre (KLCC) and just a little over 1km from 1MDB's high-profile Tun Razak Exchange (TRX), is expected to serve as a catalyst for the transformation of Greater Kuala Lumpur, as it is aimed to be the city's gateway for the proposed High Speed Rail (HSR) project between Kuala Lumpur and Singapore, and possibly up to Bangkok in the future.

Tan Sri Lim said that the development should attract MNCs due to its efficient transportation between Singapore and Bangkok.

“It gives us the best opportunity to build something that can attract foreign businesses here. Once the HSR is done, its only an hour to Singapore. And if we have a connection to Bangkok, it is another two hours. This will open up a destination for them as their regional office in Bandar Malaysia."

“We need to bring that kind of tourism. With the spillover effect, it will help stop Malaysia’s brain drain of talents as well,” he said.

Bandar Malaysia will be the country's future leading transport-oriented development (TOD) as it becomes a central transport hub in the city via Mass Rapid Transit (MRT) Line 2 and Line 3, KTM Komuter and the Express Rail Link (ERL).

There are also advanced plans by the government to improve and provide new highway connections to 12 other highways from the city centre to the south that will seamlessly link Bandar Malaysia to other areas within Greater Kuala Lumpur.

According to Bandar Malaysia's website, it aims to become a beacon for international businesses seeking to establish a footprint in Malaysia and the ASEAN region. Its masterplan includes a blueprint for creating quality city living, establishing a global business and financial centre, and creative enterprise hub, and becoming a retail, lifestyle and tourism destination.

The main feature of Bandar Malaysia is that it will host an integrated underground city modelled after Montreal's Underground City in Canada, which is the largest underground complex in the world.

A massive 32km tunnel-network of pedestrian walkways spread over more than 12km squared, the city beneath downtown Montreal in Canada intersects with seven metro stations, two commuter train stations and a regional bus terminal. The passageways allows approximately half-a-million people daily to reach some 2,000 shops and restaurants, 10 major hotels, museums, theatres and universities.

"Everything will be in the basement except for commercial buildings such as our towers and the landscape park, which will be above the city. Bandar Malaysia will be five times bigger than KLCC and its park, which is about 100 acres altogether," said Tan Sri Lim.

The underground city in Bandar Malaysia will become the world's second largest and will completely shelter its inhabitants from tropical weather conditions.

Bandar Malaysia will be home to a Global Business District, an international financial centre and managed business park with features including smart offices, robust digital infrastructure, future-proofed work spaces, a comprehensive security masterplan and more.

Supporting these will be a One-Stop Government Service Centre whose aim is to facilitate commerce and enterprise, and the Executive Learning Institutions that aims to produce talent required to support leadership development of the nation.

Its Retail Lifestyle Cluster will introduce a new shopping experience. Experiential shopping concepts will be combined with ground-breaking architecture to create a vibrant shopping experience which would capture both global and local fashion designers, artisans and traders, hence emerging as an entrepreneurial centre for trendsetting ideas.

The public realm of Bandar Malaysia will be leveraged upon to create a memorable shopping experience, with landscaped retail boulevards with wide pedestrianized corridor that can double up as fashion runways and parade grounds for events and festivals.

The Creative Enterprise Hub in Bandar Malaysia will be a natural home for companies operating in the high-end services industries - arts and culture, science & technology, multimedia, fashion and design. This is made possible by Bandar Malaysia’s strategically planned commercial, office, R&D centres and incubator spaces.

There is more to a thriving creative hub than just workspaces. The people working here will have an outlet for their creativity, with its strong cultural offerings in the form of theatres, cultural museums and studios, turning the hub into a magnet for talent, both local and foreign.

Bandar Malaysia's GLEW Tourism Hub encapsulates its ambition to target specific sectors of the tourism industry: the Gastronomy, Leisure, Entertainment and Wellness tourism markets. Each of these segments will have its own respective requirements, from vibrant retail clusters and magnificent food courts showcasing Malaysia’s diverse gastronomic and culinary culture, to serene parklands and amenities promoting health, wellness and community congregation.

The Affordable Living Enclave will be Bandar Malaysia's answer to providing the supporting workforce with quality homes, safe and secure environment, eco-friendly lifestyle and sustainable living. This enclave will offer an immediate population catchment to meet the needs of the entire development.

 

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1MDB further clarified that whilst the Government of Malaysia has designated Bandar Malaysia as the terminus for the HSR project, the sale of equity in the Bandar Malaysia project is not in any way linked to the eventual award of the HSR project, nor has 1MDB or the Government of Malaysia made any representations or agreements to that effect.

1MDB and the Consortium both confirmed that HSR is an entirely separate project, whose award will ultimately be determined jointly by the Governments of Malaysia and Singapore, per a separate process, that is and will not be linked or be contingent on, in any way, to the sale of 1MDB equity in the Bandar Malaysia project.

 

All images courtesy of Bandar Malaysia Website.

 

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