Johor in RM80bil joint venture with Lim to build waterfront city

(The Star) – Johor Baru’s coastline fronting Singapore is in for a major transformation that will have a gross development value (GDV) of some RM80bil and led by a joint venture between the Johor state and businessman Datuk Lim Kang Hoo.

A new vehicle called Iskandar Waterfront Holdings Bhd (IWH) is being created and it would be injected with massive landbank hitherto mainly owned by the Johor state and Lim. As a result of these injections, Lim would have 60% of IWH while the Johor state, through its vehicle Kumpulan Prasarana Rakyat Johor (KPRJ), would hold the remaining 40%.

The straight-talking Lim, who granted StarBiz an interview after numerous calls were made to his office, also didn’t rule out the listing of IWH.

“We are still preparing for it … One day it will be listed,” he said at his modest office in downtown Johor Baru.

He said the development would be undertaken over several years and would become a major economic engine of growth for the state.

IWH will oversee the development of the valuable landbank stretching 3,000 acres from west to east of southern Johor Baru to be transformed into an integrated waterfront city.

One of the assets being acquired by IWH was a 33.15% stake in Tebrau Teguh Bhd held by KPRJ. This led to concerns that the state was hiving off its assets to Lim.

“It’s a misperception. This is a consolidation exercise to put all the landbank into the holding company. In the end, what KPRJ will have is joint ownership of a much larger pie than what it had before,” he said.

“We and KPRJ are the master developers and we will take charge of the development of Danga Bay, Iskandar Waterfront, Tebrau Coast and the central business district development in Johor.

“To have a project of this size, the need for a strategic partnership with the state is necessary,” Lim said.

The entire waterfront project is part of flagship A of the massive Iskandar Malaysia development, which is spearheaded by Khazanah Nasional Bhd.

“The partnership we have entered into is driven to enhance the development of the southern tip of Johor which is the gateway to Malaysia from Singapore,” Lim said.

A key component of the project is for IWH to attract established world class developers to undertake different parcels. These parties are also expected to part fund the entire development, bringing in the much needed foreign direct investment, said Lim.

“We are aggressively trying to attract more local and foreign developers to invest in Johor. We are not into building townships but we want property developers to be our clients to develop the landbank we have,” he said.

The company has attracted developers such as Dijaya Corp Bhd, Singapore’s Azea Residences, Plazzo Hotels & Service, Waz Lian Group, Tune Hotel and Australia’s Walker Group.

It has been reported that Dijaya has committed to invest RM3.8bil to build a high-end mixed development while Singapore’s Azea Residences will work on four blocks of high-end apartments at a cost of over RM500mil. Australia’s Walker Group has also partnered with IWH to develop Senibong Cove into a high-end residential development modelled after the Hope Island project in Australia’s Gold Coast.

Lim said the project had received enquiries almost on a daily basis from both local and foreign developers.

“The interest level we see now is nothing like what we have seen in the past 15 years. We are swamped with serious enquiries and over the past year we have seen every developer from Malaysia going to Johor Baru and also some very big names from abroad,” he said.