Malaysian Tycoon Is Back With Major Johor Project

Source : The Business Times, 28 November 2007

A LARGE tract of land along Lido beach in Johor Baru facing Singapore has been privatised and will help Malaysian tycoon Vincent Tan Chee Yioun form the nucleus of a RM2.7 billion (S$1.1 billion) integrated residential-cum-commercial Boulevard City.

The 122 acre development, which was launched by Johor Chief Minister Abdul Ghani Othman last night, is to be undertaken by a joint venture headed by Central Malaysian Properties (CMP), a private company owned by Mr Tan and his partner, lawyer-businessman Chan Tien Ghee.

The other partner in the joint venture is the Johor state government (5 per cent) which privatised the development to CMP in August last year for RM30 million in cash, according to executives familiar with the transaction.

The project is unique in the sense that it falls within the Iskandar Development Region (IDR), yet does not involve state agency Khazanah Nasional, the IDR's master developer. Indeed, it has been dubbed by CMP as 'one of the biggest private finance initiatives to date in the IDR'.

The development also marks the corporate return of Mr Tan, one of Malaysia's most aggressive tycoons during the 1990s and the controlling shareholder of the sprawling Berjaya group with interests in property development, retail malls, hotels, financial services, gaming and franchised food outlets.

But the 1998 Asian crisis stressed Mr Tan's empire and almost laid him low. Over the last nine years, however, the tycoon regrouped, restructured and pared debt. He has since expanded to Vietnam where his proposed developments have re-ignited investor interest in his once-shunned stocks like Berjaya Land and Berjaya Corporation. In that context, the present development represents a return to his glory days when the tycoon often ventured into projects in his personal capacity.

'This development will not only change the Johor Baru skyline but will also raise our city's profile internationally,' said Mr Ghani at last night's launch. 'The idea is to design and reposition Johor Baru as an international gateway to Malaysia.'

According to CMP's co-owner, Mr Chan, the development, which will include a 2.4 km boardwalk along Lido Beach, will have four main components - luxury condominiums, waterfront office suites, a hotel and a shopping mall.

Other notable features include a ice skating rink, a bowling alley, a 24 acre man-made lagoon for water-based activities and a 4.5 acre park. It will also include a 50,000 square foot indoor Snow Park and, because of reclamation that will narrow the Straits, a jetty for a water-taxi service to Singapore.

If successful, the project will rehabilitate a major stretch of Lido beach, often considered an eyesore by locals. All that remains to complete the rehabilitation of the beach area is the resumption of the long-abandoned RM6 billion 'floating city' proposed by Pilecon Engineering back in 1995 but was stymied by the 1998 financial crisis.

That could still happen. In 2005, Pilecon won its suit against the state government which sought to terminate its privatisation agreement with the company in 2004. According to news reports, Pilecon is now negotiating with the state government to revive the project. One reason for its eagerness: its land along Lido beach, valued at RM25 a square foot in 1993, is now valued at close to RM500 a square foot.