A government-linked entity bought part of the 70-acre Tun Razak Exchange (TRX) land, which the government had first sold to 1MDB at a nominal sum.
The whole of the Tun Razak Exchange, under TRX City Sdn Bhd, has since been transferred from 1MDB to the Minister of Finance Incorporated (MOF Inc), effective March 31.
The purchase was revealed by the Finance Ministry in a parliamentary written reply, which was distributed to MPs after the last Parliament sitting that took place from March 6 to April 6.
The written reply had listed six buyers which had bought parcels of land within the TRX.
It named all buyers except for the government-linked purchaser, merely referring to it as a “company owned by MOF Inc”, which had purchased a commercial parcel. The other five buyers were identified as Mulia Property Development Sdn Bhd, Affin Bank Bhd, Lembaga Tabung Haji, WCT Previous Development Sdn Bhd, and Lendlease.
The written reply said 30.45 acres in all had been sold for a total of RM3.5 billion.
According to 1MDB, the government previously sold the 70 acres of land to 1MDB for only RM230 million.
The written reply came in response to a question from DAP’s Petaling Jaya Utara MP Tony Pua , who had specifically asked about the size and value of the TRX parcel bought by the entity under the MOF.
It did not answer the specifics of Pua’s question.
However, as five of the six transactions were already in the public domain, some insight into the mystery government-linked entity’s purchase was obtained by subtracting the known sales.
According to previous reports, the value and size of the transactions mentioned by the Finance Ministry are as follows:
1) Mulia Property Development Sdn Bhd – RM665 million for 3.4 acres
2) Affin Bank – RM225 million for 1.25 acres
3) Lembaga Tabung Haji – RM188.5 million for 1.6 acres
4) WCT Precious Development Sdn Bhd – RM223 million for 1.7 acres
5) Lendlease Group – Unstated value for 10.2 acres
Lendlease is developing a 17-acre Lifestyle Quarter in the TRX in a 60-40 joint-venture with TRX City Sdn Bhd. The 10.2 acres of land that Lendlease bought is proportional to its 60 percent stake in the venture.
In total, the land size of the five transactions came up to 18.15 acres, leaving the remainder of sold TRX land at 12.3 acres.
It is unclear if this land was acquired by the Retirement Fund Incorporated (KWAP).
The Star had on May 11, 2015, reported that KWAP signed a Heads of Agreement to purchase land within the TRX.
The exact size was not revealed but the value of the planned purchase was placed at between RM1 billion and RM1.2 billion, or a rate of RM2,300 per square foot (psf).
This translates to a land size of around 10 to 12 acres, similar to the remainder of the TRX land that was sold to the anonymous government-linked buyer.
When news of KWAP’s proposed purchase broke, the fund did not make a denial but said it had yet to make a commitment on investing in TRX.
“KWAP reviews the investment opportunity in TRX as it would with any other property investments and the decision to review the project was commercially driven, based on its prime strategic location as the next Kuala Lumpur financial district,” it had said.
There has been no public information on whether the KWAP deal had gone through.