WCT Acres Sdn Bhd, a unit of WCT Bhd, has entered into a 99-year lease purchase agreement with Medini Land Sdn Bhd, a subsidiary of Iskandar Investment Bhd (IIB), for an 18.12-acre land for RM99.47mil.
The land, situated in Medini North in Johor, will be used for a proposed mixed commercial development with an estimated gross development value of approximately RM1.5bil.
The development which comprises offices, retail spaces and apartments will be carried out over the next five years.
At the signing ceremony, WCT managing director Taing Kim Hwa said works for the land would commence after the completion of the deal and expected it to be in another six to twelve months.
He said the project would give the company reasonable returns.
“As a developer, we work on a 20% to 30% margin,” he said, adding that it was targetting both local and foreign investors.
The land has a gross floor area of 2.76mil sq feet that works out to be RM36 per sq ft.
Last month, Mah Sing Group Bhd entered into a lease purchase agreement with IIB for a 8.2-acre land for RM74.7mil or RM34.90 per sq ft. Maybank Investment Bank Research said in a note dated Oct 19 that the price Mah Sing paid for was around 40% more than the RM24.70 per sq ft paid by Sunway and RM25 per sq ft E&O paid last year for a land in Medini.
“The surge in land cost may be attributed to the rapid progress in the area,” the research house noted.
After these two agreements, IIB will be announcing another four investment transactions this year.
It was reported that the transactions involved land sales or joint ventures between IIB and several Malaysian public listed property developers and a Singapore property developer.
IIB president and chief executive officer Datuk Syed Mohamed Syed Ibrahim said Medini had received RM3bil worth of investments including a significant amount from Singaporean investors.
Besides the latest agreement, WCT has other projects in Medini.
Taing said: “WCT also plans to develop 1.7mil sq ft of prime office space, neighbourhood retail and service apartment components on a 10.3-acre parcel we recently purchased in the 142-hectare (350.9 acre) Medini Business District located next to Medini North.”