KUALA LUMPUR: The Minister of Finance Incorporated (MOF Inc) has confirmed that it will jointly develop the Exchange 106 tower at TRX (TRX Tower) with The Mulia Group.
This follows the 51 per cent shareholding takeover of MOF Inc's wholly owned subsidiary, MKD Signature Sdn Bhd (MKD) in Mulia Property Development Sdn Bhd (MPD) in July 2017.
Construction of the TRX Tower is expected to be completed by the second half of 2018, MOF Inc said in a statement today.
MPD is jointly owned by The Mulia Group (49 per cent) and MKD (51 per cent).
MOF Inc further said the cost of the development of the TRX Tower will be borne by the two shareholders based on their respective proportions of shareholding outlined in the joined venture (JV) agreement.
The agency said MKD has made arrangement with the HSBC Bank for a standby line to finance its proportional construction cost of 51 per cent without any added premium by the JV company.
To recall, in May 2015, MPD bought 3.42 acres TRX land at the price of RM665 million from TRX City Sdn Bhd.
The sale of the TRX land to Mulia was done on commercial terms with no discount accorded to Mulia.
MOF Inc’s participation on the development of the TRX Tower was agreed at the onset to only materialise when the project has reached certain development milestone, the agency said.
"The strategic location of the TRX Tower and the iconic nature of the development gave strong impetus for the MOF Inc to participate in the development and management of the tower.
"With the entire TRX development area expecting to command a gross development value of RM40 billion, it is therefore vital for the MOF Inc to ensure that it secures another strategic position in the progress and success of TRX development," the agency further said.
TRX Tower will have a Nett Lettable Area of 2.8 million square feet space.
Upon its completion, the tower will be one of Malaysia’s three iconic structure, following PETRONAS Twin Towers and Permodalan Nasional Bhd’s (PNB) Merdeka 118.
TRX Tower is also set to be the 15th tallest building in the world by the time of completion.
Previously, MOF Inc has entered into a partnership with Lendlease (Australia) to develop the Lifestyle Quarter, a 17-acre mixed-use development area within the TRX with an equity structure of 60 per cent owned by Lendlease and MOF Inc owning the remaining the 40 per cent.
"The completion of the TRX Tower will serve as the catalyst for the development and construction of the surrounding commercial plots within the TRX," MOF Inc said adding that reputable organisations such as HSBC, Prudential Insurance, Affin Bank Bhd, Tabung Haji, Landlease (Australia) have already committed to take up commercial plots within the TRX.
Negotiations are underway for other international organisations to participate as well.
MOF Inc said the TRX Tower will be the crowning success for the Tun Razak Exchange’s synergistic role in positioning Malaysia’s growing prominence in the world of global finance.