Sunway Bhd seems to be gearing up for its massive township development in Kota Bahru, the state capital and royal seat of Kelantan.
In a filing with Bursa Malaysia yesterday, Sunway said that its subsidiary Sunway Medical Centre Kota Bharu Sdn Bhd (SMCKB) will develop a 200-bed hospital over 3.811 hectares of leasehold land in Kota Bharu for RM200 million.
Last September Sunway hinted that it may develop its fourth sustainable township in Malaysia, and the development could likely take place in Kelantan.
Founder and chairman Tan Sri Jeffrey Cheah told CNBC in a special interview that the group had been offered to develop a township in Kota Baru.
Cheah had said that Sunway could make a difference there and it would start the development by building a medical centre.
SMCKB has on July 28, 2020, entered into a Sale and Purchase Agreement (SPA) with Liziz Standaco Sdn Bhd to acquire the land with a 99-year lease expiring on August 20, 2102, for RM28.7 million.
Sunway said the proposed acquisition is in line with Sunway Healthcare Group's overall strategy to expand its network of tertiary hospitals, in particular to locations where private healthcare is underserved.
It also mentioned that a large catchment population is expected with "upcoming developments" in the vicinity which include residential properties, commercial properties, and corporate offices.
Sunway's maiden township, which is Sunway City Kuala Lumpur located in Bandar Sunway fully encapsulates the "livability" concept with the presence of seven key components — retail, hotel, offices, residences, education, healthcare, and leisure.
The group is also developing Sunway City Ipoh in Perak and Sunway Iskandar in Johor and they comprise retail, hotel, offices, residences, education, healthcare, and leisure.
Expanding the healthcare division
The expansion into Kota Bharu will be the Sunway Healthcare Group's maiden expansion into the east coast region and will further add to its brand visibility as a provider of high-quality customer experience.
Sunway said that over the longer term, the expansion will enhance the value of the healthcare group's portfolio of healthcare offerings.
The group said growth prospects for the healthcare sector is likely to be positive over the long term.
"Factors such as an increasingly ageing population, rising affluence, greater demand for more sophisticated treatment, outsourcing of public healthcare, and growing adoption of private medical insurance will fuel industry growth," it said.
Sunway said the necessary zoning approvals have been obtained under the Ministry of Health's Private Medical Practice Control Section.
It said the parcel of land is strategically located in a rapidly developing area of Kota Bharu and is within one kilometer from amenities such as Aeon Mall Kota Bharu, Platinum Wholesale Mall, and Tesco Kota Bharu.
Initiatives under the east coast economic region master plan to boost tourism and cross-border trade also make Kota Bharu a prime location for healthcare tourists by its relatively short distance to Thailand and accessibility to the Sultan Ismail Petra Airport, located about 10 km from the land.
Sunway said barring any unforeseen circumstances and subject to the approval of the relevant authorities and fulfillment of all conditions precedent, the proposed land acquisition is expected to be completed by the first half of 2021.