By LIDIANA ROSLI
KUALA LUMPUR: Trive Property Group Bhd is banking on its first market mover advantage through its proposed mixed development project in Terengganu.
Executive director Kua Khai Shyuan is hopeful that the proposed East Coast Rail Line (ECRL), the existing Petronas Gas Export Terminal (PEGT) and the ongoing Terengganu Economic Transformation Programme (ETP) will yield positive spillover effects on the upcoming development known as the Kertih Project.
“We acquired this 20 hectares land in Kertih for RM20 million earlier this year when we completed the acquisition of the entire equity interest in Pakadiri Developer Sdn Bhd, which is the landowner of this land,” said Kua at the conclusion of the company's extraordinary general meeting (EGM) this morning.
“This was before there was a definite plan for the ECRL. At that point, our target market was only those who work or has connections to the PEGT. But now with ECRL coming up, we do expect land value to appreciate in Terengganu and we are lucky to enter the market when the price is still competitive.”
The Kertih Project, located within the vicinity of a new township called Bandar Baru Kertih Jaya, Kemaman, will hold an estimated RM284 million in gross development value (GDV) upon total completion of all three phases.
“We are hoping to begin works on Phase One, which comprises 211 units of double-storey terraced house and 68 units of single-storey semi detached house sometime in the second quarter next year,” said Kua.
“The GDV and gross development cost (GDC) for Phase One is at RM123 million and RM90 million, respectively. We are expecting some RM33 million in profit, upon the completion of Phase One.”
Kua stressed though that the company has no obligations to continue with Phase Two (estimated GDV of RM106 million) and Phase Three (estimated GDV of RM54 million) if sales for Phase One are not satisfactory.
“These are proposed planning. We are testing the market with Phase One and will only proceed if we are satisfied,” said Kua, adding that as landowner, the company might even sell off the remaining undeveloped land if that would yield higher returns.
Kua, whose background is in property development, said that the Kertih Project proposes an opportunity for the firm to diversify its business from solely being a green energy solutions provider.
“Solar and green energy would still be our main business for the time being. Venturing into property is just a means of diversifying our portfolio.”
The EGM held earlier was to gain the approvals of shareholders to raise as much as RM60.5 million by issuing up to 500 million new ordinary shares to Macquarie Bank Ltd.A total of 500 million subscription shares, representing 37.41 per cent of Trive shares and up to 27.22 per cent of the enlarged number of issued Trive shares, will be issued at 12.1 sen each; proceeds of which would be used to fund Phase One of the Kertih Project.
According to Kua, the company received almost 100 per cent approval for the fund raising exercise, which is expected to be completed within 24 months from the start of the subscription period.