KOTA KINABALU: Sabah Development Bank Bhd (SDB) is prepared to consider a substantial reduction in its RM300mil exposure to the long-abandoned PacifiCity development to support a credible rescue plan and attract investors to revive the stalled project.
In a statement on Tuesday (Sept 22), SDB said approximately RM300mil remains outstanding on the project, which it financed.
The state-owned bank explained that although the project land was charged to SDB as security, its registered owner is Majlis Kebajikan dan Sukan Anggota-Anggota Kerajaan Malaysia (Maksak).
"Notwithstanding the significant outstanding debt, SDB has indicated its willingness to consider a substantial reduction of its exposure to support a credible rescue plan and attract potential investors," it said.
The statement followed concerns raised by Parti Warisan vice-president Datuk Junz Wong and buyers on Monday (Sept 21) over the lack of a concrete solution for the project, which has been abandoned for years.
Wong said that although the landowner and SDB were both state-linked institutions, buyers were left feeling that there was insufficient progress to revive the development, especially after it was officially declared abandoned by the state government earlier this year.
Meanwhile, SDB said a High Court ruling on July 31, 2025 dismissed claims brought against the bank and found that it was merely the financier of the project.
The court ruled that responsibility for purchasers' losses rested with the developer, which has since been wound up.
Despite the ruling, SDB said it remained committed to working with the private liquidator, relevant authorities, purchasers and other stakeholders to explore practical options to revive the project.
"The successful revival of PacifiCity will ultimately depend on securing a financially capable investor prepared to undertake the significant investment required to complete the project," it added.
SDB said the proposal to reduce its claim could potentially improve the attractiveness of any future rescue plan, but stressed that a formal and credible proposal would first need to be submitted.
It also noted that no formal proposal had been received so far despite efforts to revive the project.
The development came under the administration of court-appointed liquidators following the winding-up of the developer and is currently managed by a private liquidator.
Since its appointment, the private liquidator has engaged with purchasers and relevant government agencies and conducted several tender exercises to identify potential investors, or "white knights", to take over and revive the project.
PacifiCity is a billion-ringgit integrated waterfront development on prime land along Likas Bay here.
It was to comprise residential units, office space, a shopping mall, hotels and commercial lots.
The project was hit by successive financial and development issues before the developer was wound up.
