ISLAND & Peninsular Bhd (I&P) will shift direction by going big into high-end integrated commercial and residential property projects both locally and abroad as part of its efforts to boost future earnings, said managing director Dr Radzuan Abdul Rahman.
The move would also make up for the loss of contribution from its plantation division, which will be taken over by Golden Hope Plantations Bhd after the formalisation of an assets swap.
“Previously, we had been concentrating on affordable residential development activities in Peninsular Malaysia but there is a need for a paradigm shift to expand into new businesses and new phases of geographical expansion,” Radzuan told reporters after the signing of an agreement between its subsidiary Premier Pavilion Sdn Bhd and Bintulu Development Authority (BDA) in Puchong yesterday.
More details on the new direction would be unveiled after the group's master plan presentation to I&P's board in June, he said.
After the merger with GHope, I&P will become Malaysia's largest property developer in terms of land-bank of 19,053 acres by year's end, compared with 3,034 acres now.
Radzuan said I&P had been receiving a lot of enquiries and invitations from overseas groups to jointly develop property-related projects in their respective countries.
“Currently, we are still in the preliminary stage of discussion with a party from Medan, Indonesia, on the possibility of developing a prestigious residential project,” he said.
He said an I&P team would also be heading for the Middle East by mid-next month, at the invitation of “an Arab group'', to look into property development prospects there.
Under the agreement signed yesterday, I&P and BDA would set up a 70:30 joint-venture company to develop a RM105mil integrated residential and commercial complex in Bintulu, Sarawak.
“This 10-acre flagship project marks I&P's first property development venture outside Peninsular Malaysia, although we have already made inroads into Sarawak through our plantation division, Austral Enterprises Bhd,” Radzuan said.
“We expect the project to yield RM100mil in revenues over the next 10 years,” he added.
The Bintulu integrated development project would comprise two phases. Phase 1 includes 224,288 sq ft of retail space, a 19,519-sq-ft convention hall which can seat up to 800 people, 51,890 sq ft of office space in a nine-storey office complex, a 12-storey block of 38 apartments, a carpark and a cafe-lined promenade.
Radzuan said the construction of Phase 1, with a total built-up area of 693,176 sq ft, would start this year for completion in three years.
Phase II consists of an entertainment complex comprising a two-storey cineplex and a two-storey bowling alley occupying a total of 61,780 sq ft.
“Construction will begin no later than two years after Phase 1 is completed,” Radzuan said.
Meanwhile, BDA general manager Mohidin Ishak said the Sarawak Government's vision was for Bintulu to be a financially industrialised city by 2020.
“The Bintulu integrated residential complex is the latest development and forms part of our overall plan to turn Bintulu into a vibrant economic hub,” Mohidin said.
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