SHAH ALAM: Selangor State Development Corp (PKNS) is looking forward to build a 65-storey tower that is slated to be the tallest building in Petaling Jaya with a gross development value of RM800mil in the much-talked about RM3bil PJ Sentral development.
After more than eights months of court battle, PKNS reached an out-of-court settlement with Malaysian Resources Corp Bhd (MRCB) and Nusa Gapurna Development Sdn Bhd two weeks ago over the sale of its 30% stake in PJ Sentral Development Sdn Bhd.
This is after the High Court had dismissed PKNS’ suit against Nusa Gapurna and MRCB for alleged breach of shareholders agreement over the sale of its 30% stake in the company.
The remaining 70% stake in PJ Sentral is held by Nusa Gapurna and it is being injected into MRCB as part of an extensive corporate exercise which was proposed more than a year ago.
Under the exercise, MRCB acquired all of Nusa Gapurna’s development land, including its PJ Sentral project, in return for shares and cash.
This resulted in Nusa Gapurna emerging as a shareholder and its owner, Tan Sri Salim Fateh Din, helming MRCB as its group managing director.
PKNS contended that it was not getting a fair deal for its 30% in PJ Sentral and took the matter to court.
PKNS acting general manager Azlan Md Alifiah said after losing the court battle that the settlement was the best PKNS could get out of the current situation.
“Ultimately, you can’t win everything. If we could turn back time, of course we would not have inked the joint-venture agreement and develop the whole 10-acre parcel on our own,” he told StarBiz.
“But, now we are excited to build our own towers and to get at least a slice of that land back and retain our presence in Petaling Jaya as our original headquarters was located there. The state wants the building to be iconic and we will definitely deliver that.”
In the out-of-court settlement, MRCB will pay RM85.3mil in cash to PKNS for its 30% stake in PJ Sentral.
In return, PKNS will pay PJ Sentral RM91.1mil for the rights to build and own the tower within the development after MRCB had completed all the basic infrastructure and piling works.
Azlan said PKNS would start construction of the building after MRCB had completed all the basic infrastructure and piling.
“MRCB has two years to complete that and we are given five years to develop our three towers. We will occupy the tallest one, sell and rent out the remaining two towers,” he said.
Azlan said PKNS had made some modification of the tower development to suit its specifications since the development order was earlier approved.
“The buildings are poised to be an efficient and environmental-friendly property with Green Building Index (GBI) gold and Leadership in Energy and Environmental Design (LEED) certification.
“There will also be a podium block with some retail spaces,” he said.
Azlan explained that the construction of the towers would be done in an open tender basis and MRCB could put in its bid if it was interested.
Burying this dark episode behind, Azlan said PKNS was now not only focusing to sell property but was also looking at acquiring some more properties to be injected to its property management subsidiary, PKNS Real Estate Corp, that had recently completed the process of transfer of some PKNS assets into its portfolio.
“This is part of our efforts to evolve into a more sustainable business environment with recurring income from rental and lease.
““I do not deny the fact that, five years down the road, we might go into real estate investment trust,” he said.
~ By THE STAR
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