Tuesday, 29 March 2016
End of a 20-year wait
THE STAR
KUALA LUMPUR: The development of 19.4 acres touted as Kuala Lumpur’s last major strategic parcel of land will finally take off in June this year after a 20-year wait.
The first phase of the RM8.7bil mixed development Bukit Bintang City Centre (BBCC) will kick off by the middle of the year, following the securing of partnerships with Japanese retail property developer Mitsui Fudosan (Asia) Pte Ltd and Zepp Hall Network Inc, a unit of Sony Music Entertainment (Japan) Inc.
The development on the former Pudu prison site, which the Urban Development Authority (UDA) had taken over in 1996 but could not develop due to huge financial demands, will commence with the launch of a 45-storey block of strata offices and two blocks of serviced residences. The serviced apartments will comprise 680 entry-level units sized 450 sq ft upwards.
The price is said to be around RM1,600 per sq ft (psf), which is lower than most projects in the city that have an average price of RM2,000 psf.
Construction work on the office and serviced apartment blocks is set to commence by the third quarter of this year, while the 1.4 million-sq-ft lifestyle mall located at the heart of the project, with an estimated gross development value (GDV) of RM1.6bil, will start work in early 2017.
The mall, which will bring in popular Japanese brands, is expected to open its doors to the public in early 2021.
BBCC Development Sdn Bhd, a joint venture (JV) between land owner UDA Holdings Bhd, Eco World Development Group Bhd and the Employees Provident Fund (EPF), yesterday signed the head of terms agreement with Mitsui Fudosan Asia and Zepp Hall.
Mitsui Fudosan Asia will jointly build the mall with the BBCC consortium, each investing 50% of the cost. The investment by the Japanese company is its biggest retail investment to date outside Japan.
Located next to the mall will be a live concert hall to be operated and run by Japan’s Zepp Hall Network.
The Malaysian consortium will be building the RM400mil entertainment block and Zepp Hall Network is set to lease the concert hall for up to 20 years.
“We will be looking at further investments as an option.
“It (Zepp Hall Network) will firstly be looking at leasing the place, and later we will talk about the possibility of it entering a JV with us, maybe in co-developing the hall and co-owning the property.
“These are some of the available options,” said BBCC Development CEO Datuk Richard Ong yesterday.
He told reporters that the total GDV for phase one would be about RM4bil.
“The mall will cost RM1.6bil, plus the entertainment block will total RM2bil.
“We also have the strata offices and serviced apartments that we will be launching for sale, together with the four-star hotel block, which we are planning to turn into serviced apartments.
“Those will cost about RM2bil, so combined, the GDV for phase one is RM4bil,” he said, adding that the entire development is expected to be completed within two phases.
Asked about the possible superstition surrounding the BBCC project, due to the project being a redevelopment of the former Pudu jail site, Ong said they had done the necessary rituals.
“We have done quite elaborate, dignified and comprehensive site-blessing ceremonies, which cover Islamic prayers, and in October last year, multi-faith prayers involving Christianity, Hinduism, Taoism, Buddhism and Sikhism.
“At the same time, we are looking at the fact that this development brings together the retail and entertainment elements, and once we finish with phase one, it will be a very vibrant site.
“From our market engagement with the public, there isn’t much concern about the history of the site.
“We absolutely do not think it will be a problem at all,” he added.
Asked about how the lifestyle mall would compete with other major, established shopping malls in the heart of the city, Mitsui Fudosan Asia deputy managing director and chief regional officer for Malaysia, Takehito Fukui, said it was looking at three areas to differentiate itself from existing Malaysian malls.
He said the mall would present a unique lifestyle concept, which had not been seen in other Malaysian shopping malls, and it would bring in Japanese tenants who are popular among Malaysians, as well as first-to-market tenants.
“Thirdly, our difference is the high-quality operation of the mall itself.
“We have tremendous expertise that we have built up in Japan in running and operating shopping malls, and we will bring this expertise here,” he said.
He said there would be 300 stores within the mall and that they are expecting sales of RM1.5bil per year upon commencement of the premises.
The consortium also signed a memorandum of understanding with Singapore’s The Ascott Ltd to explore future possibilities of partnership.
The signing ceremony was witnessed by Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor, UDA Holdings chairman Datuk Dr Mohd Shafei Abdullah, EPF deputy CEO Datuk Mohamed Nasir Ab Latif and Eco World Development Group chairman Tan Sri Liew Kee Sin.
