Greenland buys land in Danga Bay for RM600m

KUALA LUMPUR: The Greenland Group, one of China’s biggest state-owned developers and a Fortune 500 company, is making its first foray into Malaysia by acquiring a piece of prime waterfront land in Iskandar Malaysia for RM600 million.

The Chinese developer yesterday signed a sale and purchase agreement with Johor-based Iskandar Waterfront Holdings Sdn Bhd (IWH) for the purchase of a 13.96-acre (5.65ha) site in Danga Bay, with the purchase consideration translating into RM986.70 per sq ft (psf).

The site, located close to the Johor Baru city centre, has been earmarked for a “mixed integrated joint venture development with IWH”, said IWH in a statement yesterday.

Without elaborating on the details of the joint venture, IWH said the project has a gross development value (GDV) of RM2.2 billion and will be completed within five years. It is worth noting that Greenland’s land cost of RM600 million accounts for 30% of the RM2.2 billion GDV.

According to the statement, the Shanghai-based group is keen to expand its landbank in Johor and is finalising talks with IWH and its associated companies for two or three more land acquisitions soon.

“This follows a fact-finding visit in late February by a high-powered delegation from the company to explore investment possibilities in the booming southern growth corridor,” said IWH.

Greenland chairman Zhang Yuliang and vice president Xu Jing yesterday signed the land purchase agreement at the company’s corporate headquarters in Shanghai. IWH was represented by its managing director Tan Sri Lim Kang Hoo and group executive director Lim Chen Herng.

Greenland, which was ranked 359 in the Fortune Global 500 company survey last year, has been on a buying spree in recent years, acquiring big real estate projects in New York, Los Angeles, Sydney, London and South Korea.

The company, which is the builder of the world’s tallest residential tower at 131 floors in Wuhan in Hubei Province in China, is also building another iconic 88-storey tower in Nanjing, making it the seventh tallest building in the world.

“We are very happy to forge a partnership with IWH and share ideas on the development of land in Iskandar Malaysia. We believe this investment, by virtue of its strategic location and proximity to Singapore, will offer good returns on our investment.

“We also believe through this joint venture with IWH, both Malaysia and China can reap the benefits of economic cooperation for the mutual benefit of our people,” said Zhang.

IWH plans to leverage on Greenland’s forte in mixed commercial development, including high-end hotels and residential towers, to help transform Danga Bay in Johor into an integrated international waterfront city.

“We believe Greenland Group will pave the way for more China state-owned companies to invest in outstanding property projects in Iskandar Malaysia and IWH’s extensive waterfront landbank in Johor Baru,” said Chen Herng.

IWH, a public-private partnership involving the Johor and federal governments and local investors, is the master developer of some 4,000 acres of waterfront land on the eastern and western sides of the Johor Causeway.


This article first appeared in The Edge Financial Daily, on April 17, 2014.


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