Sunway Velocity to contribute RM1bil upon completion (Update)

PETALING JAYA: Sunway Bhd will see the book value of its investment properties balloon by about RM1bil after the completion of the shopping mall, hotel and office tower at its integrated mixed development Sunway Velocity along Jalan Cheras.

Central region property development division executive director Ong Ghee Bin said the investment cost for phase two, which included a 1.4 million sq ft shopping mall, hotel, office tower and corporate office, was RM1.5bil.

The whole development is a joint venture with landowner Fawanis Sdn Bhd with a gross development value of RM3.8bil which comprises three phases. Phase one and three consists of serviced apartments, retail shops and office suites.

Based on recent analyst reports, Sunway's investment properties' book value was registered at the range of RM575.2mil to RM644.9mil.

It is learnt that Fawanis has a stake of about 30% in the properties, which implies that Sunway will be able to recognise some 70% of the RM1.5bil in its book and be able to record RM1.05bil which can possibly be more than double its current portfolio.

Its other investment properties are Monash University Campus, Sunway University College, Sunway Giza shopping mall, Sunway Hotel Georgetown, Sunway Hotel Phnom Penh, Sunway Hotel Hanoi, Sunway Lagoon Theme Park and Lost World of Tambun.

Other assets it previously owned had been injected into a separately listed entity, Sunway Real Estate Investment Trust (REIT).

Asked if the new properties would be injected into the REIT, Ong said there was a possibility but the Sunway team would run them for the first few years to ensure they were successful before considering sponsoring them to the REIT.

He also said the group's expertise in running and managing shopping malls, hotels and offices would bolster investor confidence in the sustainability of the development's continued vibrancy.

Ong said the shopping mall, slated for opening end-2015, would be an exciting lifestyle shopping mall.

He also said the management would time the opening to capture the year-end festive season crowd.