"This land is very near Sunway Avila, which is currently under construction.
"Given the success of Avila (already 90%-sold) and the comparable land cost, we believe Sunway will be able to price its properties competitively for this project," it said in a note.
RHB said it was keeping its FY19-21 earnings forecasts as the project on the new land would only be launched in 2H21. It maintained its buy call on Sunway with a target price of RM1.95.
According to the research house, the 3.69-acre tract of freehold land came at a cheaper price than the land on which the existing Sunway Avila project sits, about 200m away.
"Given the consideration of MYR36.97m (payable over two years), the land cost of MYR230 psf is cheaper than the land upon which Sunway Avila sits, which cost MYR270 psf.
"However, this piece of land is for residential property titles, and has a plot ratio of 4x (vs 5x for Avila land).
"As the land is located at a slightly hilly area, the land owner will undertake the earthworks for the land," it said.
Sunway will jointly develop the land with the land owner, which has a 55% stake, into a 468-unit condominium project with a GDV of RM300mil. The site has an approved development order.
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