TRX gains traction with over RM4b development rights sale
Sales were secured from Mulia Group, HSBC, Affin, WCT and Lendlease for Tun Razak Exchange
AYISY YUSOF KUALA LUMPUR email@example.com
TRX City Sdn Bhd, the master developer for the Tun Razak Exchange (TRX), has garnered more than RM4 billion in development rights sales to five major companies.
The secured sales are from Indonesia’s leading commercial property developer Mulia Group, HSBC, Affin Holdings Bhd, WCT Holdings Bhd and Australia’s Lendlease.
TRX chief executive officer Datuk Azmar Talib said TRX was divided into two parcels of land — North and South — spanning 23ha and 5.26ha, respectively.
“We are now focusing on the North parcel, which is made up of quarters comprising financial, lifestyle and park areas,” he said on the sidelines of a ceremony to exchange documents with Mass Rapid Transit Corporation Sdn Bhd (MRT Corp) and Stormwater Management and Road Tunnel Sdn Bhd (SMART) here yesterday.
TRX is a 28.3ha development, and is tapped to become a leading centre for international finance and business.
Azmar said TRX’s North parcel had reached 80 per cent commercialisation rate, with the remaining four available plots comprising one hotel block, two office blocks and a residential block.
“As master developer, we do not want to unlock all these plots upfront. Otherwise, we will lose out once the infrastructure is completed,” he added.
Azmar said TRX had achieved economies of scale and critical mass on the back of strong international brands, spanning across its project.
“We have gone through the planning stage and passed the commercialisation stage, which had brought in major investors.
“We are now in the implementation stage. The last stage is brand-building or development stage — to elevate TRX as an international brand,” he said.
Azmar said the company was not short of enquiries or proposals from foreign parties interested in investment.
“However, we do have much more to unlock at this juncture. Apart from strategic and economic reasons, we also need the land for construction purposes.
“Otherwise, every plot of land will begin construction at the same time, which is going to be challenging for TRX. Currently, the construction schedule in the TRX development area is very tight,” he said.
With an estimated RM40 billion of gross development value (GDV), the scale of TRX’s construction is complex, the equivalent to a 3237.5ha development being compressed into a 28.3ha space.
“We brought in the right brands to help build TRX as a strong international brand, but we also need to fill up the space in TRX with the right financial players to support us as a financial hub,” he said.
Azmar said the government’s strategy was to make TRX a global financial centre.
Hence, incentives would only be given to entities in the financial industry.
“There are many players in the petroleum and manufacturing industries who want to come into TRX. But we have to focus on building up TRX as a financial centre. We want entities relevant to the financial industry,” he said.
On the development divisions, TRX has four quarters comprising financial, lifestyle, park and urban areas, and have three business models, comprising the sale of development rights and re-development according to the tenants’ specifications, via a jointventure, or a mix of these models.
“Our main focus is to deliver infrastructure development. The commercialisation includes building and leasing the end product as well as sales from development rights, according to our development specification,” he said.
He said development progress was about managing development risk.
“We can do the development upfront, but if we can’t commercialise it, we won’t get investments. Doing business is all about managing the risk,” he said.
Azmar said TRX’s development was very large and it had to be responsibly managed to provide sustainable results.
“We have to ensure that the entire development project is sustainable economically, functionally and physically.
“We do our development based on sustainability. We have a plan that we are guided by.
“As we go along, more investors will come in and provide us with ideas to improve our development to better suit the needs of the financial sector,” he said.