(from left): Titijaya deputy group MD Lim Poh Yit and group MD Tan Sri Datuk Lim Soon Peng.
KUALA LUMPUR: Titijaya Land’s latest tie-up with The Ascott Ltd will enable it to tap into the latter’s global presence and expansive network, said AmInvestment Bank.
Titijaya entered into an agreement with The Ascott Ltd for two of its upcoming developments in Shah Alam and Penang (combined GDV: RM4.1bil). The Shah Alam development - Emporia@Monfort - has an indicative GDV of RM2.6bil. While the Penang development, located in Batu Maung, has its GDV pegged at RM1.5bil.
Under the deal, The Ascott Ltd will manage the serviced residence components of these developments. The contract will run for a period of 10years, with the option to extend for another five years.
The Ascott Ltd is the world's largest international serviced residence owner-operator with over 26,000 units in key cities around the world. “By extension, it will help elevate Titijaya’s branding and augment the future development value of both projects,” said AmInvestment in a note on Thursday.
Titijaya’s Emporia is located near the Glenmarie neighbourhood within the intersection of three major highways, i.e. ELITE Highway, Guthrie Corridor Expressway and NKVE. It comprises a five-storey shopping mall; SOHO; a hotel; and offices. The serviced apartment component will have 250 units.
While for the Batu Maung project, the 200-unit serviced residence units – ranging from studio to two-bedroom apartments – is within the integrated Areca@Penang development. Areca is located next to the Second Penang Bridge, and is just 10 minutes drive from Penang Airport and Queensbay Mall. Apart from the serviced residences, the development will also include SOHOs and condominiums.
It was reported that Titijaya aims to launch both projects by 2017. Emporia contributes RM1.51/share or about 33% of AmInvestment’s NAV while Areca chips in 18%.
The research house maintains its Buy call on Titijaya with an unchanged target price of RM2.72.
“There is more NAV upside, as we have yet to factor in two recent landbanking purchases in Bukit Bintang and Jln.Tuanku Abdul Rahman pending more details,” it said.
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