KUALA LUMPUR (Feb 10, 2014): UEM Sunrise Bhd and Kuala Lumpur Kepong Bhd (KLK) will jointly develop 1,214ha of land at Iskandar Malaysia, Johor, with a gross development value (GDV) of RM20 billion. The development will involve two parcels of land worth RM1.74 billion, said UEM Sunrise executive director Datuk Izzadin Idris. Both companies has plans for mixed property developments on 1,012ha and 202ha in Kulai Jaya and Johor Baru respectively. KLK, an oil palm plantation firm, owns the Kulai Jaya tract which is also known as Fraser land. UEM Sunrise is the owner of the Johor Bahru site, also known as the Gerbang land. Fraser Metropolis will be developed by Aura Muhibah Sdn Bhd, a 60:40 JV company between UEM Land and KLK Land. The development with an estimated GDV of RM15 billion, which consist of residential, industrial and commercial components, will be built over 15 years and potentially be the next modern city within Iskandar Malaysia. Gerbang Nusajaya will be developed by Scope Energy Sdn Bhd, a 60:40 joint-venture company between KLK Land and UEM Land. The planned residential and commercial developments with an estimated GDV of RM5 billion will be built over eight years, and is expected to benefit directly from the fast growing economic activities in Nusajaya. UEM Sunrise executive director Datuk Izzaddin Idris said the two property projects will be launched in 18 months. "Like any property projects, it will take time because we will have to make submission for development approvals. Given the current situation, we are not in rush to launch the project," he told a press conference here last Friday after UEM Sunrise's wholly-owned UEM Land Bhd and KLK's wholly-owned KLK Land Sdn Bhd signed the agreements to jointly develop the plots of land. Izzaddin said the synergistic partnership between the two, who are among Malaysia's largest land owners, will enable UEM Sunrise to enhance its landbank supply with more prime assets to accelerate the group's future growth. Worth noting is that the total land area of KLK's Fraser Estate is 2,023ha, which Izzaddin said both UEM Sunrise and KLK plan to jointly develop in future as well. "The agreement that we signed today is for the first half of 1,012ha. If and when the remaining 1,012ha of land development kicks in, at least we will have a master plan that has already approved, so that the development can proceed faster than today, that is the whole idea," he said. KLK CEO Tan Sri Lee Oi Hian said the JV with UEM Sunrise is KLK's maiden foray into Iskandar Malaysia that allows the group to diversify its geographic footprint. "These joint developments are also KLK's first development outside of Selangor and the Klang Valley, as a move to unlock the value of our property development potential in Peninsular Malaysia," he said. On another note, Lee said KLK's property division is expected to contribute 15% to the group's profit within five years, up from 5% currently. However, he said it is too early to talk about the possible spin-off listing of KLK's property unit. "We are too small to list now. We have to work harder before even we can consider the idea of listing," he explained.