By P PREM KUMAR / Pic by MUHD AMIN NAHARUL
Local companies have shied away from participating in the recent request for proposal (RFP) to be the master developer for the estimated cumulated gross development value (GDV) RM160 billion Bandar Malaysia project, according to industry sources.
Sources with knowledge on the matter said the foreign companies that had participated in the RFP did not engage any local firms in their proposals to redevelop the former air base site.
“The foreign companies (that had submitted their RFP) had not included a local company as a potential joint-venture (JV) partner.
“But the Bandar Malaysia project is a national landmark and of significance to the economy.
“A foreign company cannot undertake the project on its own. The government will not agree to this due to the project’s importance to the country’s landscape,” a source told The Malaysian Reserve.
The government — which decides the winning bids for the project — is expected to encourage the successful bidder to partner a local company and form a JV entity.
It was reported that nine companies had participated in Bandar Malaysia’s RFP and a majority of the firms are from China.
Japanese giants Daiwa House Industry Group and Mitsui Fudosan Co Ltd, as well as Chinese firms China Communications Construction Co Ltd (CCCC), China State Construction Engineering Corp Ltd, China Gezhouba Group Co Ltd, Greentown Overseas Ltd, China Resources Holdings Co Ltd and China Vanke Co Ltd are among those interested in the project.
TRX City Sdn Bhd and Bandar Malaysia Sdn Bhd — which are entities under the Finance Ministry — are the project owners.
The Bandar Malaysia RFP was called after TRX City terminated the RM7.41 billion share sale agreement (SSA) with the consortium of Iskandar Waterfront Holdings Sdn Bhd (IWH) and China Railway Engineering Corp (M) Sdn Bhd (CREC) in May this year.
The consortium was alleged to have failed to meet the payment deadline to honour the agreement. The consortium, however, denied the claim and said they have lived up to the spirit of the agreement.
The SSA with the IWH-CREC deal was part of 1Malaysia Development Bhd’s debt restructuring initiative.
One of the criteria for the recent RFP was the interested parties must be among the Fortune 500 companies with a combined revenue of RM50 billion or more in the past three years.
There are a few local construction giants that could participate in the Bandar Malaysia development.
Bandar Malaysia, located 3km from the Tun Razak Exchange project, involves the redevelopment of the 197ha site of the former air force base in Sungai Besi.
The project is envisioned to be an inclusive, public transit-oriented city that is
designed as a walkable community through a series of safe, secure and pleasant pedestrian and cycling networks, set against a back- drop of open spaces and greenery.
Bandar Malaysia was said to be developed over 20 to 25 years. Works on the first phase of development with a GDV of RM50 billion to RM60 billion was slated to begin early this year.