TIRSB, Ideal Property to redevelop Pulau Jerejak

MASTER PLAN: Island to get marina, hotels and other tourism-related infrastructure

TROPICAL Island Resort Sdn Bhd (TIRSB) — a 51:49 joint venture between UDA Holdings Bhd and the Penang Development Corp — has entered into an agreement with Penang-based Ideal Property Group to redevelop Pulau Jerejak.

TIRSB is the owner of the Jerejak Rainforest Resort & Spa (JRRS) on the island. The company had in 2004 appointed Bestari Hospitality Management to operate the resort.

In a statement issued yesterday, UDA Holdings said TIRSB had entered into a joint-venture (JV) agreement with Q Islands Development Sdn Bhd (QID), a subsidiary of Ideal Property Group, to redevelop JRRS and 32ha owned by TIRSB.

This confirms a Business Times report on August 30 that UDA Holdings planned to carry out the redevelopment project with a Penangbased company.

The 362ha Pulau Jerejak once housed a leper asylum for the Straits Settlements, a quarantine station and a penal colony.

“JRRS has been quite popular among local tourists and TIRSB believes that QID will be able to rebrand the operations, enhance the value and return this loss-making property back to profitability,” said the statement.

The statement further said a redevelopment master plan had been approved by Penang.

The plan comprises a bridge linking Pulau Jerejak to the main island, 1,200 units of residential development, a marina, four- and five-star hotels, a theme park, a 11.5km round island cycling track and “related infrastructure to promote tourism in the state”.

“As at April 30, TIRSB recorded accumulated heavy losses which it had incurred since it commenced the operations of JRRS in 2004.

“JRRS has been closed since May this year due to continuous operating losses,” it added.

UDA said it would ultimately have 100 per cent control of TIRSB upon completion of the Novation Agreement to ensure the successful transformation of Jerejak Rainforest Resort into an attractive tourist destination, which at the same time would involve other real estate activity.

Consequently and in accordance with the joint venture agreement between TIRSB and QID, the operation of Jerejak Rainforest Resort will be handed over to QID within six months after the formalisation of the terms and conditions of the agreement.

Construction of the redevelopment and the project is expected to be completed within eight to 10 years.

At press time, it could not be ascertained if the state-owned PDC would be exiting the just announced deal with a negative or positive yield.