Company in the running for three big jobs

WITH a current construction orderbook of some RM7bil, Malaysian Resources Corp Bhd (MRCB) will be further entrenching its position as a transit-oriented developer, having tendered for some RM6.3bil worth of high-profile jobs.

It would also appear that infrastructure and environment-related projects may increase in significance for the company.

For now, the largest contributor to MRCB’s operating profit is its property development and investment segment, which contributes some 83% to operating profit. This is followed by the infrastructure and environment segments, which contribute 11% and 2%, respectively.

The company will be kept busy for the time being, as it has another unbilled portion of RM5.4bil in its construction orderbook.

It recognised some RM1.6bil in 2016, according to its annual report.

Thus, should it continue to recognise that sort of amount on a yearly basis, this would mean that the construction orderbook will last it for another 2½ years.

Hence, the need to start tendering for new jobs.

The three big jobs it is tendering for are the Bandar Malaysia integrated transportation terminal, the RM800mil 1,000 tonne-per-day incinerator project in Taman Beringin, Kepong, and the redevelopment of the KL Putra World Trade Centre (KL PWTC).

On the Bandar Malaysia project, MRCB announced on Jan 27 that it had entered into a non-binding memorandum of understanding with Wondrous Vista Development Sdn Bhd and Bandar Malaysia Sdn Bhd (now TRX City Sdn Bhd) to collaborate to develop the integrated transportation hub terminal at Bandar Malaysia.

Wondrous Vista is believed to be a private vehicle linked to Tan Sri Bustari Yusof from Sarawak.

Sources have said that the size of the land and the project requirements to build an integrated transport terminal have allowed MRCB to replicate the KL Sentral project in Bandar Malaysia.

According to the announcement in January, the MRCB-led consortium signed the agreement with Bandar Malaysia Sdn Bhd, which, in turn, is a 100% shareholder of Omega Cartel Sdn Bhd.

Omega Cartel is the registered owner of the 486 acres in Bandar Malaysia, out of which 60 acres have been earmarked for the purpose of an integrated transportation terminal.

MRCB said that together with Wondrous Vista and Bandar Malaysia, it intended to form a strategic alliance for the purpose of acquiring, constructing, developing and operating the transportation hub.

On the Kepong incinerator project, MRCB is in partnership with South Korea’s Hyundai Rotem Co for this project. A winner was supposed to have been announced in March, but so far, there has been no news.

Recent reports have suggested that it is now only up against another bidder, the DRB-Hicom Bhd-Malakoff Corp Bhd-Sumitomo Corp consortium. It would seem that the third bidder, UEM Environment Sdn Bhd (since renamed Cenviro Sdn Bhd) with Japan’s Mitsubishi Heavy Industries Ltd has dropped out of the race.

The third contract, which is more or less in the bag, is the job to redevelop the KL PWTC, which was announced by Prime Minister Datuk Seri Najib Tun Razak.

The project comprises the construction of new office buildings, the Putrade Hall and a six-star hotel with a 70-storey tower, as well as the redevelopment of the PWTC halls.

The 70-storey tower, which will be built on the Putra Bus Terminal site with a floor area of 1.2 million sq ft, will also become the new headquarters for Umno.

It will also comprise a mosque that can accommodate a congregation of 5,000 at any one time and a two-storey shopping podium.

Previously, the Prime Minister had said that physical construction work on the 70-storey tower would begin on May 11, 2017 in conjunction with the birth of Umno.

Apart from these projects and its property development, another source of income for MRCB will be its light rail transit 3 and Kwasa Land project delivery partner contracts, which allow it to extract a margin of between 5% and 6% over the next 10 years.

Having made a name for itself with its flagship KL Sentral project, its other future transit-oriented development projects are PJ Sentral Garden City, Penang Sentral, Kwasa Sentral, Cyberjaya City Centre and Bukit Jalil Sentral, and will feature transportation connectivity at their core.

MRCB also owns an urban development land bank of 400 acres with an estimated gross development value of RM49bil.

The group’s property investment activity, which is lumped under its property development segment, is via its 27.9% equity stake in MRCB-Quill Real Estate Investment Trust.