KUALA LUMPUR: Eco World Development Group Bhd
(EcoWorld) said its wholly-owned subsidiary Paragon Pinnacle Sdn Bhd had inked a deal to dispose of 58 acres of leasehold industrial land in Eco Business Park V in Selangor to Pearl Computing for RM266.1mil.
Additionally, the group said another of its business units, Quantum Alpha Sdn Bhd, will build and lease the shell and core of data centres and associated structures on about 92.44 acres in Eco Business Park V to Pearl Computing.
EcoWorld president and CEO Datuk Chang Khim Wah said the sale of the 58 acres presents an opportunity for the group to realise the value of its matured industrial land bank and host another hyperscale data centre operator at one of its industrial parks.
"Since FY24, we have entered into 4 notable sales of industriallands to market leading data centre players, which demonstrates the suitability of our business parks as ideal sites for digital and high-tech operations," he said.
He added that the collective proceeds from these sales amount to RM1.586bil.
The completion of the land deals will improve the group's cash position, which stood at RM1.36bil as at Oct 31, 2024.
EcoWorld said it intends to quickly redeploy this substantial boost to its cash reserves to expand its landbank for development while actively pursuing strategic opportunities to grow its portfolio of recurring income assets in a meaningful manner.
With regards to the lease agreement with Pearl Computing, EcoWorld said it the contract will be for an intial term of 20 years with a renewal option of up to 10 more years.
The total value of the rent payable by the lessee over the term is estimated to be up to RM4.8bil.
"The lease which will commence upon completion and delivery of the project is expected to provide Quantum Alpha with stable recurring income over the term.
"Accordingly, this is an ideal asset to serve as the cornerstone of EcoWorld Malaysia’s recurring income aspirations as it will deliver sizeable fixed rental income revenues over the next 20 to 30 years," said Chang
He added that discussions are underway with various parties to jointly undertake the project, which will result in EcoWorld holding an 80% stake in Quantum Alpha.
