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Putra Place going under the hammer
12/01/09 NST By Andrew Wong

In 10 days time, the Putra Place integrated commercial complex opposite the Putra World Trade Centre in Kuala Lumpur could find a new owner, should the auction to sell it be successful.

Notices placed in major dailies since last week highlight the fact that Commerce International Merchant Bankers Bhd (CIMB) has had to resort to the asset sale in order to recover monies owed by Metroplex Holdings Sdn Bhd, once a prominent developer with a string of townships and commercial buildings under its belt.

The freehold Putra Place, sitting on 4.44 acres of freehold land and comprising a 23-storey office tower and the 25-storey Legend Hotel cum service apartment block sitting atop an eight-level shopping centre known as The Mall, carries a reserve price of RM634.5 million.

In September 2007, the Employees Provident Fund(EPF) was supposed to have bought the complex excluding the hotel portion for RM438.33 million. However, the fund had to abort the transaction that was two years in the making as Metroplex "was unable to conclude the deal".

Business Times then reported EPF as saying it "saw the investment as viable given the location next to the prime Bukit Tunku area" but that one of Metroplex's creditors had "obtained an injunction to stop the sale in the hope that a higher price could be fetched".

Earlier in 2006, Metroplex was restrained by the Kuala Lumpur High Court from selling its assets which would have cleared some of its RM1.1 billion debts.

While the current reserve price is a substantial RM196 million more than EPF's bid, the inclusion of the hotel portion still makes purchase by an investment fund or a Real Estate Investment Trust an attractive proposition.

Based just on the nett areas of 505,806sq ft for The Mall and 317,549sq ft office, the price equates to a value of RM770psf, while the 2005 income of the two components can already generate a gross annual yield of 4.7 per cent.

Among the tenants of the complex is Parkson Grand departmental store and Cold Storage supermarket.

The auction is scheduled to be conducted by Raya Realti in the Jalan Duta court complex on Jan 20.

For more information, call Messrs Tommy Thomas, CIMB's solicitor, at 03-2287 3540, quoting reference tt/aa/elm/2003 2504.

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