YNH Property to finally launch the RM2.1bil Menara YNH?

Will YNH Property Bhd finally launch Menara YNH, its much delayed commercial project in Kuala Lumpur?

Menara YNH sits on about three acres with a wide frontage of 320 feet along Jalan Sultan Ismail.

YNH bought the land, located opposite Concorde Hotel during the 1997/1998 financial crisis and had planned to undertake a mixed development.

The development of Menara YNH has been delayed several times since 2006, as deals with potential buyers fell through, including one with Singapore property giant CapitaLand Ltd. YNH signed a Memorandum of Understanding (MoU) with CapitaLand to jointly develop the project on a 60:40 basis but the MOU was terminated in June 2007.

Kuwait Finance House (KFH) Bhd, another investor, had also pulled out of the project. It was reported that KFH had offered to buy a 50 per cent interest in the office component of Menara YNH, and aborted its plan to buy one of the two office blocks.

YNH said in yesterday’s filing with Bursa Malaysia that the project has a GDV of about RM2.1 billion (from RM2.3 billion estimated in 2018) and it will feature an office tower and a shopping mall.

It also said the approved development order had been obtained for Menara YNH.

YNH said it has the intention to keep 50 per cent of Menara YNH as an investment property and it will be used as the company’s future corporate headquarter.

It is unclear if the plan to have a hotel set up at Menara YNH is still in the works.

On February 4, 2015, the company had inked a Memorandum of Understanding (MoU) in relation to a proposed hotel to be branded as “Hilton Kuala Lumpur City Centre & Residences”, to be managed by Hilton Worldwide Manage Limited, at Menara YNH.

The company informed the stock exchange yesterday that there are no further changes in the MoU.

“The local and global economic climate remains challenging due to the uncertainties caused by the Covid-19 pandemic. The company’s project progress, as well as the hospitality arm, are affected by the pandemic. The stimulus package announced by the government, including the reduction of Overnight Policy Rate and re-introduction of house ownership campaign will make homeownership more affordable,” it said.

YNH said as such, the Board is cautiously optimistic that demand for property will be sustainable, given the strategic location and correct pricing of its properties.

The company has entered into several joint venture projects for the development of a few pieces of land located near Mont Kiara, Hartamas, Kuala Lumpur city center, Ipoh city, and Seri Manjung town.

“These developments are at the planning stage and have an estimated GDV of RM1.8 billion, and are expected to contribute to the company’s earnings for the next 15 to 20 years,” the company said.

YNH is also upbeat on its Kiara 163 mixed development project in Mont Kiara, comprising a 46-storey serviced apartment tower, a 44-storey hotel suite (718 units,) a small office versatile office (SOVO) block, a shopping mall, and a basement car park.

The Kiara 163 project has a total gross development value of RM1 billion.

The mall with 106 retail lots and the SOVO with 308 units have been completed with the latter fully sold. The serviced apartment is also fully sold while the serviced suites have about 30 per cent more to sell, the company’s website showed.

YNH has a proposed development in Genting Highlands, Pahang

In 2008, the company acquired 95 acres of development land at the highlands for RM16.05 million.

YNH said the advantage of this land, located next to Genting Highland Resort, is that it was acquired at a low price and it has ready infrastructure.

“The land has already been converted to a building title. The proximity to the existing Genting Highland Resort is an advantage as the proposed development will complement the existing infrastructure,” it said.

The company said it plans to build commercial units, bungalows, condominiums, and retail, targeting both local and foreign investors.

The estimated gross development value for the Genting Highland project is RM1.96 billion and YNH said it is expected to contribute to the group’s earnings in the next 20 years.

YNH’s revenue for the three months ended March 31, 2021, was RM62.23 million as compared with RM66.59 million in the previous year.

Pre-tax profit was RM3.69 million, lower than the previous year’s RM4.183 million due to lower contribution of profit from projects as a result of the pandemic.

The company’s performance for this year is mainly derived from profit recognition from sales of inventories in Pangsapuri Samudera, and progressive profit recognition of Kiara 163, it said.

Source: NST