KUALA LUMPUR: The mixed development project on Felcra Bhd’s 1.63-hectare land in Jalan Semarak here will continue despite a slight delay, said Economic Affairs Minister Datuk Seri Mohamed Azmin Ali.
He said the delay was due to Felcra’s cash flow problems and that efforts are being undertaken by its management to ensure that the project will proceed.
“If we receive good offers to monetise the assets, we will consider them. We will also be selling other properties, including apartments and commercial blocks.
“However, this depends on the offers that we get because we do not want to sell the assets if they are not profitable,” he said in reply to a supplementary question from Datuk Seri Ismail Mohamed Said (BN-Kuala Krau) during the Dewan Rakyat sitting today.
The mixed development project on Felcra’s land in Jalan Semarak comprises a 35-storey office block, a 40-storey serviced apartment block comprising 480 units, a six-storey trade centre and a two-storey convention centre, with a total gross development value of RM1.1 billion.
As at Sept 30, 2018, the project was 41.22 per cent complete, which was a 96-day delay from the original work schedule.
“Originally, the project’s contractor was to design, build and finance the entire project, and hand it over to Felcra once the office building and the convention centre are completed.
“However, after the project was awarded to a contractor, the contractor proposed for the land to be leased to the bank for financing purposes and Felcra disagreed by Felcra,” said Mohamed Azmin.
He added that in an effort to continue with the project, with approval from the Finance Ministry and endorsed by the Rural Development Ministry, the development concept was changed whereby the contractor would only assume the role as design and build contractor.
“Felcra became the developer and financier through its wholly-owned subsidiary, Felcra Properties Sdn Bhd. This has exposed Felcra to the financial liabilities risk,” he said. - Bernama
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