June 28 (Bloomberg) -- Khazanah Nasional Bhd. and Temasek Holdings Pte, the state-owned investment companies of Malaysia and Singapore, will jointly develop $9.8 billion of projects in southern Malaysia and downtown Singapore.
The S$11 billion ($8.8 billion) Singapore developments will include hotels, apartments, offices and shops in 501,020 square meters (5.4 million square feet) of space in two main areas of the city’s downtown, the two companies said in an e-mailed statement yesterday. The 3 billion ringgit ($980 million) project in Malaysia’s Iskandar region will have homes, retail space and “wellness-related offerings,” they said.
“The development in Iskandar with Temasek will be highly complementary and builds on the momentum of existing and planned projects in Iskandar Malaysia, in which Khazanah has been involved since 2006,” Khazanah Managing Director Azman Mokhtar said in the statement.
The property ventures come as Malaysia agreed to move its railway station in the city-state’s central business district to a northern Singapore site close to a bridge that connects the two countries, ending a decades-old dispute over land usage. The two nations, united between 1963 and 1965, had bickered over issues including a new bridge to link the two nations and the price Singapore pays for water from Malaysia.
The joint venture for the Singapore developments, M+S Pte, will be 60 percent owned by Malaysia’s Khazanah and 40 percent held by its counterpart Temasek. CapitaLand Ltd. and Mapletree Investments Pte, both units of Temasek, as well as UEM Land Holdings Bhd., partly owned by Khazanah, will build parts of the Singapore developments, according to the statement.
The Malaysian project, which will be run through a 50-50 venture between Temasek and Khazanah called Pulau Indah Ventures Sdn Bhd., will consist of 1.4 million square meters of space, the two companies said.
The Singapore state-owned investment company manages S$186 billion of assets, including controlling stakes in six of the 10 biggest publicly traded companies by market value in Singapore, according to data compiled by Bloomberg.
Khazanah, which has 75 billion ringgit of assets, said earlier this year it’s seeking to build new businesses and list them within five years to accelerate job creation and economic growth in Malaysia.
The train service by Keretapi Tanah Melayu Bhd., Malaysia’s railway operator, will be moved next month, the governments said in a joint statement yesterday. Singapore and Malaysia also agreed to develop a rapid transit link system by 2018.
Singapore previously had said that Malaysia, under a 1990 Points of Agreement, agreed to relocate the downtown station to a north-central site and later a northern location in exchange for land that will be jointly developed by the two sides. Malaysia interpreted the agreement differently and negotiations to settle the issue had stalled.
--Editors: Linus Chua, Lars Klemming
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