Building homes for the public and awarded with a piece of land in Cheras. The developer is Retro Highland (50 percent owned by SP Setia) and the public housing project is for Dewan Bandaraya Kuala Lumpur (DBKL). The gross development value (GDV) for that piece of Cheras land is RM11.03bil. Retro Highland is a special purpose vehicle for SP Setia and Tradewinds Corporation Bhd. It has signed a privatisation agreement with DBKL. The agreement covers the construction of 3,971 residential units, 112 units of shops/stalls, a market and other public facilities. DBKL will then award Retro Highland with a piece of 52.25 acres of land which will be used for an estimated GDV of approximately RM11.03bil and adevelopment period of 11 years. SP Setia said that the development is a public-private strategic partnership undertaking. This is part of the urban renewal initiatives under the KL Structure Plan 2020.
The 52.25 acre land is located at the southeast of the Chan Sow Lin area in Kuala Lumpur and immediately east of the Cheras LRT Station. It is about 8km to Kuala Lumpur City Centre and 3km to Viva Mall and is located alongside Jalan Loke Yew. The overall development entails the renewal of 5,650 residential units. The renewal of the 3,971 units are for Taman Ikan Emas cluster houses, Sri Melaka low cost flats, Sri Pulau Pinang low cost flats and long houses, Sri Johor low cost flats as well as common facilities, shops, stalls and a market. The agreed value of exchange is RM1.19bil comprising the construction cost for phase one of up to RM344.79mil and construction cost for phase two of up to RM835.12mil. There is also a cash consideration of RM14.99mil and should the construction cost of the development is lower than the cost estimated for phase one and phase two then DBKL will be paid an additional cash consideration for the difference.
I think this is a good ‘barter-trade’ where developers get prime pieces of land for the construction of good homes for the masses. Some would say that the number of units to be built is actually super-high but we must also bear in mind that as long as these units are nearby to public transportation and majority takes the public transport instead of driving, it will still be better than building in lower densities but in areas much further away. We can already see that many of the unsold units, even the affordable ones are due to them being in locations shunned by many. Urban redevelopment is certainly the right way to go. Just take the cue from many of the more advanced countries. It’s always a balance between price, distance, size and demand. All the redevelopment units are within Kuala Lumpur. Happy redeveloping my dear KL.
written on 7 May 2018
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