KUCHING: Suria Capital (Suria)’s joint venture (JV) with SBC Corp Bhd (SBC) to develop Jesselton Quay’s (JQ) is finally taking shape with the latter planning to launch the first phase of commercial properties at the waterfront project in Kota Kinabalu soon.
To recap, the group had entered into a JV with SBC in May 2013 to develop 16.25 acres of its 23.25-acre land around KK Port with a minimum net saleable value (NSV) of RM1.8 billion over eight
years.
According to AllianceDBS Research Sdn Bhd (AllianceDBS Research), under the JV agreement, SBC is responsible for all costs and matters relating to the 16-acre waterfront development, JQ, which will comprise shops, service suites, a retail mall, hotel, and office towers.
As landowner, Suria will receive a minimum guaranteed return of RM324 million or 18 per cent of total GDV (whichever is higher) in eight scheduled payments throughout the development period. Nonetheless, the development project has faced delays pending regulatory approvals.
“We gather from management that the group has finally obtained the development order for the project. Management is in the process of submitting the building plan and subdivision application to the authority, and approvals are expected in the coming months,” said the research house.
As such, the development is expected to be launched in the later part of this year.
“We are positive on the news that the group has finally obtained the development order after a long delay, as further project deferrals could disrupt the scheduled payments to Suria from SBC, which could pose downside risk.”