Putrajaya Ventures seeks partners for RM5 bil Ampang project

PUTRAJAYA Ventures Sdn Bhd (PVSB), a unit of Petroliam Nasional Bhd (Petronas), is in talks with potential partners to participate in the planned development of the former French Embassy site in Jalan Ampang.

The land has been earmarked for an integrated development with a gross development value in excess of RM5 billion.

“We have met a number of parties, but we are still at the preliminary stage,” says PVSB general manager Mohainee Tahir, adding that the company is in talks with several property developers.

She says these parties, who are excited by the project, are currently analysing the market scenario and studying the dynamics of the project to determine its viability.

The structure of the partnership will be finalised depending on the negotiations between the parties. “This [structure] is yet to be decided between ourselves and the respective partner. In selecting a partner, we will only engage those who have a similar vision for the development and who bring a clear benefit or expertise to the success of the project,” Mohainee tells The Edge via email.

“It is likely that we will have a controlling stake in the overall development. However, for each component, say retail or hospitality, we would want to be open as to what kind of stake we shall take,” she says, adding that this will depend what each party brings to the table. “All these decisions will weigh in on the design of the partnership structure.”

Mohainee says that while the group is able to fund the development from its own resources, a strategic decision has been made to engage potential partners for the various components and phases.

PVSB is a wholly-owned unit of Putrajaya Holdings Sdn Bhd, in which KLCC (Holdings) Sdn Bhd holds a 64.41% stake. KLCC Holdings is wholly owned by Petronas.

The remaining stake in PVSB is held by Khazanah Nasional Bhd (15.59%) and CIMB Group Nominees (Tempatan) Sdn Bhd with 20%.

In late 2014, the French Embassy called for bids for the eight-acre tract in Jalan Ampang. PVSB won the bid and paid RM894 million or RM2,600 psf for the land. The title was transferred in the second half of 2015, but the French embassy only vacated the land one year later, staying on as a tenant. “So we have only had the land for a few months now,” Mohainee says.

“Our current plans call for an integrated development with condominiums, office, retail and perhaps a small hospitality component. The planning is still very much underway, and given the size of the project, will partly depend on the various partners we are currently in discussions with.”

Asked why PVSB wants to launch the project at a time when the property market appears to be sluggish, Mohainee acknowledges that the current property market remains challenging and says PVSB will therefore focus on obtaining planning permission and identifying the most suitable partner.

“The launch of the project itself will not happen until 2018, by which time the market will have hopefully improved. But in any case, we are confident that with such a large site we can create open spaces and recreational areas that will place us miles ahead of the competition,” she says.

She adds that by 2018, work on the second mass rapid transit line should have started and the plans include looking at various ways to connect the site to the Ampang Park station which is just 200m away and serves as an interchange with the LRT.

Earlier this year, there was talk that PVSB was in talks to purchase a piece of land next to the French Embassy parcel. When asked about the status of this purchase Mohainee says “We have of course had numerous discussions with interested parties in the vicinity. Any acquisition or partnership that improves the ultimate development can be considered, but at the moment we have not entered into any transactions with anyone.”

Meanwhile, PVSB is yet to hire an architect firm for the project. However, it recently held a design competition, which included submissions from renowned international architects. “Several interesting ideas emerged from this exercise,” she says.

As for the target market for the project, Mohainee notes that Embassy Row has always had a distinct character, differentiated from that of KLCC. “While densities have crept up in the area over recent years, we are targeting those individuals who still prefer a city centre address, but want to be somewhat removed from the KLCC area.”

She adds that with eight acres and the nature of the site, which is rectangular with extensive frontage on two sides — Jalan Ampang and Jalan Sejahtera — it will allow for better planning of expansive common areas and open spaces. “And will enable [us to create] a real residential masterpiece,” she says.

This article first appeared in The Edge Malaysia on Jan 2, 2017. Subscribe here for your personal copy.