- The British government is reported to be looking at
putting its 1.22ha (3 acres ) land – where the current High Commission sits –
in the market as early as next week. The land is located in Ampang, i.e. within
the embassy enclave and just few minutes away from KLCC Twin Towers.
- Recall that British High Commission (BHC) is relocating to
Menara Binjai as part of the British government’s spending cuts.
- The report also quoted unnamed sources saying the land
price could go up to RM400mil or a scorching RM3,050psf.
- Parties which may be interested in acquiring the land
include Boustead Properties, IOI Group, HSC Healthcare Sdn Bhd and Sri Mersing
Hotels Sdn Bhd – a company linked to Robert Kuok.
- This is almost comparable to the new record price achieved
by Mulpha Land for the sale of its Jalan Sultan Ismail land, a whopping
RM3,300psf or RM104mil for a 0.72acre piece of land.
- However, the premium to the land price may be warranted
given the land comes with an approved development order whereby Mulpha Land
actually had plans to build a 23-storey Grade A office tower with an NLA of
270,000sf.
- Therefore, we would like to believe the BHC land should be
priced closer to M2,200psfRM2,600psf, at what Dijaya Corporation and Sunrise
paid for parcels of land near KLCC.
- We maintain our contrarian OVERWEIGHT stance on the
sector, whereby we expect a strong return of pent-up demand to take place given
the normalisation of the impact of lending guidelines and continued
urbanisation, while several prolific projects, including IJM Land’s Bandar
Rimbayu, will kick-start buying momentum.
- Our top pick is IJM Land (FV: RM3.80/share), given that
the unveiling of Bandar Rimbayu would drive its new sales by at least 50% to
about RM2bil for FY13F. We also have BUY on IGB Corporation (RM3.50/share) and
HOLD on S P Setia, BRDB, Sunway Bhd, CMMT, Pavilion REIT and Al Aqar Healthcare
REIT.
Source: AmeSecurities
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