Mega Iskandar Deals are still ongoing for its future

Fresh from purchasing land in Plentong, Johor, worth some RM2.37bil from Iskandar Waterfront City Bhd (IWCB), Shanghai-based developer Greenland Holdings Group Ltd has now set its sights on about 1,200 to 1,400 acres of industrial land near the Tanjung Langsat Industrial Complex (TLIC).

Sources said the Tanjung Langsat oil and gas (O&G) terminal belongs to Johor Corp (JCorp), which is jointly operating the O&G hub with its partners Trafigura, Technip and MISC Bhd.

The land Greenland was looking to buy in Tanjung Langsat was leasehold and valued at some RM40 per sq ft as it was close to the Tanjung Langsat port, said the source.

However, Greenland, like most developers from China, has been coming up with generous offers for land in Johor. It still holds the record of paying RM991 per sq ft for 37 acres in Danga Bay last year.

“While no reclamation is required, Greenland will need to fortify the land for industrial purposes. The company is looking to diversify merely from property development into industrial development. Furthermore, it needs to create demand for its residential and commercial development projects,” said the source.

The 5,000-acre TLIC is located about 40km from Johor Baru, and caters to light, medium and heavy industries.

It is believed that a large portion of the land that Greenland is eyeing belongs to JCorp, an entity under the state government.

The industrial complex is supported by the Tanjung Langsat Port, which has oil-storage facilities, and a liquid and a dry jetty.

According to the TLIC website, its two dry cargo berths with depths of 10.1m can handle heavy-lift and oversized cargoes.

Currently, the liquid jetty with depths of 15m can cater for vessels ranging from 5,000 to 12,000 deadweight tonnes.

The Tanjung Langsat complex is specifically to cater for the industries related to palm oil, petrochemical, chemical, O&G, steel fabrication and marine. An area measuring 183.8 acres has been allocated for the Palm Oil Industrial Cluster.

The complex has attracted one of the biggest stainless steel manufacturers in the world – the Acerinox Group from Spain. Currently, more than 50 local and multinational companies have located their projects in TLIC.

Greenland is one of the three developers from China with interest in Johor. The other two are R&F Properties Co Ltd and Country Garden Holdings Co Ltd, with all three having undertaken large-scale property development projects.

Guangzhou-based R&F Properties is currently developing Princess Cove@Tanjung Puteri that will deliver some 3,200 residential units to the market. The China-based company had acquired the land measuring 116 acres from the Johor Royalty in 2014 at RM890 per sq ft.

Hong Kong-listed Country Garden, meanwhile, launched 9,000 residential units last year. Country Garden is also developing a 5,000-acre man-made island called Forest City on the Tebrau Straits.

Last Friday, IWCB and Greenland announced that they would jointly develop a mixed-development project in Johor Baru with an estimated gross development value of RM18.4bil.

IWCB’s unit, Southern Crest Development Sdn Bhd, had signed a conditional agreement with Greenland Tebrau Sdn Bhd (GTSB) to sell the freehold land, spanning 127.92 acres and partially submerged, for RM2.37bil (RM426 per sq ft).

GTSB is a 20:80 joint venture between IWCB and Greenland, and it will undertake the mixed development.

Should the entire disposal be subjected to a set-off arrangement, the cash proceeds to be received by IWCB is about RM1.9bil.

On the land disposal, IWCB said the group would recognise an after-tax gain of about RM1.2bil or RM1.80 per share in IWCB.

The original cost of the three parcels of land for IWCB was RM154.84mil.

Apart from this, Greenland had previously invested RM600mil in a 13.6-acre project in Danga Bay, which it is jointly developed with Iskandar Waterfront Holdings Sdn Bhd.

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