KUALA LUMPUR (Sept 8): Ho Hup Construction Co Bhd will develop a highend residential property project with a gross development value of US$200 million in central Yangon, Myanmar – its maiden project there.
In a statement, Ho Hup said its 70% subsidiary Ho Hup (Myanmar) E& C Co Ltd today signed a joint venture (JV) agreement with Zaykabar Co Ltd for the purpose.
Under the JV, Ho Hup Myanmar will have the sole and exclusive rights to develop the 191 units of villas and bungalows in Mingalardon Garden City dubbed “191 Z Villas”.
Ho Hup said its role in the JV is to provide technical expertise in design, construction and project management and it will not invest in the development land which is owned by Zaykabar.
According to the terms outlined in the JV agreement, Ho Hup Myanmar will develop the 191 Z villas in accordance with the approved layout plan into built up villas of 5,000 sq ft each on 10,000 sq ft of land, which will be undertaken in three phases.
Building works for the first phase is to commence within one month from obtaining the construction work order from the authorities and will be completed within two years from the date of the sale and purchase agreements entered into in respect of the sale of the villas.
“Construction of Phase 2 and 3 shall commence immediately upon each earlier phase having recorded sales of equivalent to more than 50% of the villas of that phase,” said Ho Hup.
Zaykabar’s entitlement in consideration for granting the exclusive right to Ho Hup Myanmar to develop the 191 Z Villas project is a sum of cash equivalent to the aggregate of the land cost, pegged at US$40 per sq ft and 60% of the total net profit of the project.
Ho Hup added that the capital outlay and investment of Ho Hup Myanmar in the JV is mainly initial working capital to commence construction of the villas, as thereafter the project is expected to generate its own cash flow and be self-funding.
Source: THE EDGE MALAYSIA