PETALING JAYA: Opportunities for construction and infrastructure works worth up to RM50bil are up for grabs, as Bandar Malaysia plans to roll out the transit-oriented development (TOD) and launch project tenders in 2017, according to CIMB Research.
In its published note, the research house said key events to watch out for at the RM200bil gross development value mega development include official launch of phase one perhaps in the middle of 2017 and international tender for TOD’s phase one.
“We think initial tenders could be called in earliest by end 2017,” said CIMB Research, maintaining its overweight rating on construction sector for Bandar Malaysia.
It said Bandar Malaysia intends to house the KL terminus of the planned KL-Singapore high-speed rail (HSR), which will be integrated with the TOD that spans 60 acres.
“The TOD could shape up to be a scaled-up version of the 72 acres KL Sentral, functioning as a hub for other public transport components including MRT2, HSR and ERL,” said CIMB.
It pointed out that Bandar Malaysia’s master plan incorporates an integrated ‘underground’ city that sprawls over a gross floor area of 63m sq ft. Overall, the site covers 486 acres, almost five times the size of KLCC’s site including the park.
“While the residential and commercial components could attract property developers at a later stage, overall construction and infrastructure opportunities could be as much as RM50bil over several years given the project’s greenfield nature,” CIMB noted, adding that Malaysian Resources Corp Bhd (MRCB) was looking to collaborate with Bandar Malaysia on the TOD.
MRCB had previously inked a memorandum of understanding with Bandar Malaysia to explore ways to co-develop TOD.
“We also consider WCT to be the more prominent earthworks contractor given its experience in Refinery and Petrochemical Integrated Development and the Tun Razak Exchange,” reckoned CIMB.
Among domestic rail contractors, CIMB is of the view that Gamuda will remain the biggest proxy for construction and its top big-cap pick. Other major infra works inclde access roads, earthworks, water and sewerage treatment plants and substantial piling works that suggests potential spillover to local players.
To recap, in July 2015, three key agreements pertaining to Bandar Malaysia were inked relating to the funding structure for phase one, which is about a third of the total 486 acres, shareholders agreement and TOD.
The Bandar Malaysia fund is a consortium of four local banks and four international banks to fund the mega development.
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