DPS Resources Bhd is further strengthening its foothold in the Melaka property scene by embarking on a joint venture (JV) to undertake a mixed development project targeting the medium and affordable market segment.
The company through its wholly-owned subsidiary Shantawood Sdn Bhd has entered into a JV agreement with Rembia Properties Development Sdn Bhd for the development and completion of the project comprising four pieces of freehold land measuring 25.91 acres in Mukim Rembia, Alor Gajah (Krubong land).
Shantawood, which has an issued and paid-up share capital of RM100 mil, is principally engaged in the manufacturing of furniture and roof truss, provision of kiln-drying services and trading of furniture as well as carrying out real property business and housing development-related services.
Meanwhile, Rembia Properties Development is principally engaged in real estate activities with both lease or own properties.
“The JV which boasts a gross development value (GDV) of around RM150 mil represents an opportunity for the group to build up its landbank and ensure sustainable growth for the DPS over the next few years,” commented the company’s managing director Edward Sow Yuen Seng.
A filing with Bursa Malaysia today shows that Rembia Properties will be entitled to RM19 mil from development of the project. This will be paid over a seven-year repayment period until Feb 25, 2028.
This is based on the land’s net book value of RM15.54 mil as of July 31, 2019 as well as the future potential development value of the Land.
“We are confident that the mixed development property will attract interests among home buyers and property investors as Krubong land is situated in a mature location,” Sow pointed out.
“Aside from that, the land is also ready for development, thus able to escalate our development and construction works.”
Given DPS Resources’ existing property development in Melaka, this JV project also fits into the company’s expansion plan.
Of significance is that the property market for Melaka is anticipated to recover gradually in 2021 with the allocation of funds from the state government to spur economic activities within the state.
The proposed infrastructure development plans as per the Melaka State Budget 2021 announced on Dec 9 last year entails the upgrading of the Kuala Linggi International Port as an oil & gas industry hub, Port of Tanjung Bruas as a container hub as well as the construction of the new Melaka International Airport within the Melaka Waterfront Economic Zone (M-WEZ) corridor.
Above all else, Sow added that the Melaka Rumahku housing scheme will also have a positive impact on the property development in Melaka.
At the close of yesterday’s trading, DPS Resources was up 0.5 sen or 4.35% to 12 sen with 7.4 million shares traded, thus valuing the company at RM85 mil. – May 19, 2021
