Paragon Globe proposes RM71.5mil purchase of Johor Bahru tract for industrial development

KUALA LUMPUR: Paragon Globe Bhd's wholly-owned subsidiary Paragon Business Hub Sdn Bhd has proposed to acquire a tract of freehold land in Plentong, Johor Bahru, measuring about 42.29ha for RM71.5mil.

The group said in a filing with Bursa Malaysia it expects to fund the purchase consideration via a cominbation of internally generated funds, bank borrowings and equity fundraising.

Following the completion of the acquisition, Paragon Global intends to develop the land into an industrial area with 171 units of industrial properties.

The project is expected to commence in 2024, and is projected to take eight to 10 years to complete.

The estimated gross development value of the project ranges from RM544mil to Rm626mil, while its gross development cost is expected to be about RM473mil.

Accordingly, the group is expected to derive an estimated gross development profit of between RM71mil to RM153mil over the duration of the development project.

"The proposed acquisition is in line with Paragon Globe’s strategic plan to grasp opportunities to create greater economic value and increase the earnings potential over the medium to long term," it said.