Tanco Holdings Bhd, a property developer, has more than a hundred unsold units at Splash Park Suites in Negeri Sembilan that it has been unable to sell since the groundbreaking ceremony in May 2014.
Splash Park Suites, located in Tanco's Palm Springs Resort City in Port Dickson is made up of two towers with a total of 830 fully-furnished suites.
The first tower has 413 apartments. Although the building is nearly complete, 119 units remain unsold.
Tanco, which staged a turnaround to return to the black with a net profit of RM11.77 million in the second quarter of its financial year ending June 30, 2023, from a net loss of RM2.83 million in the corresponding quarter a year ago, recently appointed its associate company Gplex Realty Sdn Bhd (GRSB) to market the unsold portion of Splash Park Suites.
It said that the appointment of GRSB is to use the latter's networks of sales teams, banks, and database of potential buyers to facilitate the rapid sale of the project's remaining unsold units.
This would allow it to recoup revenues from such sales after a lengthy hiatus complicated further by the effect of the Covid-19 pandemic the previous year, the company said in a stock exchange filing on Mac 29
Tanco said that the appointment's approximate transaction value (the anticipated sales commission to GRSB) could reach RM4.9 million, resulting in a percentage ratio of 2.85 percent.
Its group managing director Datuk Seri Andrew Tan Jun Suan is an indirect major shareholder of both Tanco and GRSB, making the purchase a related party transaction (RPT).
GPSB is a 50.1 per cent subsidiary of Palm Springs Resort Management Berhad, which is an indirect company of Tanco. Googolplex Holdings Berhad owns the balance 49.9 per cent equity stake in GPSB.
Tan also serves as a director of Palm Springs Development Sdn Bhd (PSD), which owns the land for the Splash Park project, comprising Splash Park Suites, a water amusement park, and a hotel.
The total gross development value of the Splash Park project is estimated at RM600 million.