KUALA LUMPUR: The Perak state government, which is a joint partner in the Sunway City Ipoh development, has asked Sunway Bhd to return the undeveloped portion of the land in their joint development agreement dated Sept 11, 1997, but Sunway wants to refer the matter to arbitration.
The property and construction group told Bursa Malaysia that its subsidiary Sunway City (Ipoh) Sdn Bhd (SCI) had on Friday last week received a letter from Perak State Secretary dated June 9 informing that the development agreement had lapsed.
“It also accordingly requests SCI to return the undeveloped portion of the land to the Perak state government,” it said without giving the size of the land.
SCI, which is 95.96% owned by Sunway’s unit Sunway City Sdn Bhd, is jointly developing Sunway City Ipoh with the Perak state government and Yayasan Perak, with SCI reportedly holding a 65% stake.
Sunway City Ipoh sits on 1,346 acres, of which only about 700 acres were net land for development, according to a news report.
The RM60mil Lost World of Tambun, one of Sunway’s two premier multi-park attractions (the other being Sunway Lagoon), is a major draw for the integrated township project.
“The effect of the said notice is not expected to have any material effect on the earnings per share and net assets per share of Sunway for the financial year ending Dec 31, 2016 and beyond,” Sunway said.
The Sunway City Ipoh township project, with an estimated gross development value of over RM1bil, was planned in 1995 but was shelved for nearly five years following the Asian financial crisis.
SCI in June last year said it would launch projects worth a total gross development value of at least RM500mil at its Sunway City Ipoh in Tambun within three years, including the Lost World Outlet Mall, serviced apartments and a hotel.