KUALA LUMPUR: TRX City Sdn Bhd, the master developer of Tun Razak Exchange (TRX), has garnered more than RM4 billion in the sales of development rights to five major companies.
Currently, the development rights sales secured are from Indonesia’s leading commercial property developer Mulia Group, HSBC, Affin Holdings Bhd, WCT Holdings Bhd and Lendlease of Australia.
TRX chief executive officer Datuk Azmar Talib said TRX is divided into two parcels of lands comprising the Northern and Southern, spanning an area of 57-acre and 13-acre, respectively.
"We are now focusing on the Northern parcel, which is made up of three quarters comprising Financial, Lifestyle and Park,” he said on the sidelines of the exchange documents ceremony with Mass Rapid Transit Corporation Sdn Bhd (MRT Corp) and Stormwater Management and Road Tunnel Sdn Bhd (SMART) in Kuala Lumpur, today.
TRX sits on an iconic 70-acre development, which is set to become a leading centre for international finance and business.
Azmar pointed out TRX has reached about 80 per cent of the commercialisation rate for the Northern parcel, with the remaining of four plots available including one hotel and two office blocks and one residential block.
“As a master developer, we do not want to unlock all these things upfront. Otherwise, we will loose the upside once the infrastructure is completed,” he added.
Azmar said TRX has achieved the economy of scale and critical mass for its development on the back of strong international brands, spanning across its development project.
“We have gone through the planning stage, commercialisation stage that brought in major investors. We are now in the implementation stage, while the last stage is brand building or development stage – to alleviate TRX as an international brand,” he said.
Azmar addressed the company is not short of enquiries or proposals from foreign investing parties who are interested to come. “However, we do have much more to unlock at this juncture.
“We also need the land apart from the strategic reason on the economic but we need the land for construction purposes.
“Otherwise, every plot of land will be constructed at the same time, which is going to be challenging for TRX. Currently, the construction in TRX development area is very tight,” he said.
With an estimated RM40 billion of gross development value (GDV), TRX development has a complex magnitude of construction, which is equivalent to a 8,000-acre development being compressed in a 70-acre.
“We brought in the right brand to help build TRX as strong international brand. 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 stressed that the government’s strategy is to make TRX as a financial centre; hence incentive will only be given for entity in the financial industry.
“There are so many players in petroleum and manufacturing who want to come into TRX. But, we have to focus on building up TRX as a financial centre. We want relevant people to the financial industry,” he said.
On the development divisions, TRX has four quarters comprising Financial, Lifestyle, Park and Urban – which has three business models including sales of development rights and re-development according to tenants specification or via joint-venture as well as mixed of any of these models.
“Our main focus is to deliver the infrastructure development. The commercialisation include build and lease the end product as well as sale from the development rights, according to our development specification,” he said adding that TRX is the price for the property benchmark in Kuala Lumpur city.
He pointed out the development progress is about managing the development risk.
“We can do the development upfront, but if we can’t commercialise it, we won’t get the investments. Doing business is all about managing the risk,” he said.
Azmar concurred the TRX’s development magnitude is huge and it has to be responsibly managed to provide sustainable result.
“We have to ensure the whole development project is sustainable in terms of economically, functionally and physically.
“We do our development based on sustainability aspect. We have got the plan and guided by the plan. As we go along, more investors would come in and give us ideas to improve our development to suits both requirements for physical ecosystem in the financial sector,” he said.