Mah Sing’s new Penang land acquisition and GDV of RM528 million

Mah Sing’s new Penang land acquisition and GDV of RM528 million

*Header image is from AI generation and is not M Cora.

My recent finding: Penangites are rich or people just love Penang island

I travelled to Penang recently and visited two different high rise developments. One has sold whatever is necessary and has a long list of potential buyers. It does have certain size which is less popular which is still available. Another one informed that they are selling very well and that their buyers are mostly foreigners who love Penang.

If you are also one of those who love Penang properties, here’s another upcoming one by Mah Sing. It is said that this piece of land is also very near one of the LRT station too. The name of the development is M Cora and it is a mixed-development. Yes, this is within Penang island, so this is definitely a high-rise development yeah. With just 2.83 acres land, there’s no way for landed homes to be built or the property price will be out of this world and everyone can look, see but not buy.

Article in thestar.com.my Mah Sing Group Bud’s wholly-owned subsidiary Enchanting View Development Sdn Bhd is acquiring 2.83 acres of leasehold land in George Town in Timor Laut, Pulau Pinang, from Penang Development Corp for RM51.8mil.

In a stock exchange filing, the property devleoper said the land will be used to develop a new mixed-development project named M Cora, which is expected to have a gross development value of RM528mil.

“Backed by a strong balance sheet and the continued momentum of its M-Series projects, Mah Sing is committed to expanding its footprint through a diversified project portfolio from fast-turnaround niche developments to large-scale townships. 

“The group is confident that the project to be undertaken on the land will further strengthen its market position and contribute positively to its future growth and earnings outlook,” it said. Article in thestar.com.my

Land cost versus GDV is around 10 percent

The land was bought for RM51.8 million. Meanwhile the projected GDV is RM528 million. Calculation wise, the land cost is around 10 percent of GDV. If any developer were to buy land at a cost which is too high and yet the GDV is low, then the cost of land to GDV could be high and this will impact the developer’s margin. When land cost is very high and the GDV is low, then one way the developer could still complete the development would be to reduce the quality of the materials used for the project. This is definitely not a good thing to have. Thus, it’s always good to note the land price and also the GDV which the developer has announced.

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