Petaling Jaya – Affin Bank Bhd is acquiring 54,266 sq ft of land within the financial quarter of the Tun Razak Exchange (TRX) international financial district for RM255 million to house its new headquarters.
1MDB Real Estate, the master developer of TRX, said the sale and purchase agreement (SPA) with Affin Bank was signed after extensive negotiations that began in 2012.
In a filing with Bursa Malaysia yesterday, Affin Bank said it had signed the land agreement with KLIFD Sdn Bhd. The purchase price is a 2.3% discount of the current market value, as appraised by an independent valuer, it said.
The SPA covers the development rights to build a commercial tower with a gross floor area (GFA) of 823,439 sq ft.
Affin Bank managing director and CEO Kamarul Ariffin Mohd Jamil said in a briefing yesterday, it anticipates another additional RM300 million for the development of the building, as it still needs to go through the process of designing, tendering and construction. Construction of the building is expected to complete latest by end of 2018.
“We have been sourcing for a suitable location that meets our requirements and with the right price. There was a need as the bank (together with the other entities within the Affin Group) had been growing, and we need more space to house everyone under one roof,” said Affin Bank managing director and CEO Kamarul Ariffin Mohd Jamil.
“It’s a reasonable price and only 0.4% of our total asset size,” he said, adding that it will be funded via internal funds.
He said Tan Sri Lodin Wok Kamaruddin, who is parent Affin Holdings deputy chairman, Affin Bank and Affin Islamic director, and the chairman of 1MDB Real Estate’s parent 1Malaysia Development Bhd, voluntarily abstained from all deliberations and decision-making with regard to the transaction.
“It (TRX) is already ongoing. There are already parties invested in the project. We’re confident that given the significance and magnitude of the project and despite the problems of 1MDB, it will still continue,” said Kamarul.
Approval from the board of Affin and Affin Bank has been obtained.
The commercial tower will be a 35-storey Grade A office block with 830 parking bays that will house Affin Group’s financial services entities including Affin Bank, Affin Islamic, Affin Hwang Capital, AXA Affin Life and AXA Affin General Insurance.
Spread over 70 acres of freehold land, TRX is a mixed-use development designed to be a new international financial district underpinned by residential, retail, leisure and cultural offerings.
To date, TRX has signed global property and infrastructure group Lendlease to develop the Lifestyle Quarter; Indonesia’s leading property developer Mulia Group to develop the Signature Tower plot; Lembaga Tabung Haji for a residential plot, and global leader in water management Veolia Water Technologies South East Asia to provide a water recycling and treatment plant.
Earlier known as Kuala Lumpur International Financial District, TRX was unveiled in 2010 as a component in the government’s Economic Transformation Plan with an estimated gross development value of RM26 billion. – The Sundaily
Bestfbkl: No Conflict of Interest??? or just another cash injection into 1MDB? Everytime 1MDB needs money all they need to is sell their land bank that they bought from the Government at a discounted price. How can 1MDB be allowed to sell the land while investigations are goin on. The price the government sold the land should be reviewed, 1MDB should be paying market rates, Then i would like to see them sell of the land so easily as they doing now.
