Chin Hin Group Property Bhd has set its sights on expanding its real estate portfolio with the acquisition of a prime freehold land parcel in Penang. The approximately 1.218-acre plot, which is strategically located, is slated to become the site for a new multi-storey serviced residence development. Chin Hin Group Property is acquiring this promising asset from Ivory Properties Group Bhd for a sum of RM40 million.
The transaction marks a significant step forward for Chin Hin Group Property as it seeks to leverage its expertise in property development and capitalize on the demand for modern, well-located residences. The planned serviced residence is expected to cater to the evolving lifestyle needs of residents and contribute to the vibrant real estate landscape of Penang.
This exciting venture also involves the construction works for the development, which will be executed by a member company of the Ivory group, serving as the turnkey builder for the project. The collaboration between Chin Hin Group Property and Ivory Properties Group is poised to bring together the strengths and expertise of both entities to create a remarkable living space.
Chin Hin Group Property has officially solidified its intent to acquire the land parcel, with the signing of a binding term sheet with Ivory Properties’ wholly-owned subsidiary, Ivory Gleneary Sdn Bhd (IGSB). Under the terms of the agreement, either Chin Hin Group Property or a subsidiary designated as a special purpose vehicle (SPV) will enter into a sale and purchase agreement with IGSB. This agreement is expected to be finalized within 60 days from the date of the term sheet, marking the formal commencement of the acquisition process.
Furthermore, the SPV will enter into an exclusive rights agreement with a designated entity within the Ivory group of companies. This exclusive rights agreement will grant the designated entity an irrevocable exclusive right to acquire a 20% stake in the SPV, fostering collaboration and shared ownership in the development.
The purchase of the Penang land parcel is anticipated to be financed through a combination of internal funds and bank borrowings, demonstrating Chin Hin Group Property’s commitment to prudent financial management and strategic growth.
As the property market in Penang continues to evolve and attract interest from investors and residents alike, Chin Hin Group Property’s foray into this development is poised to add value and diversity to the local real estate landscape. This strategic acquisition aligns with the company’s growth objectives and underscores its commitment to delivering quality real estate solutions to meet the evolving needs of the market.
At the close of the market on Friday, Chin Hin Group Property’s share price remained steady at 89 sen, reflecting the company’s market value of RM490 million. Year to date, the stock has experienced a 22% decline.
Meanwhile, Ivory’s share price also concluded unchanged at 7.5 sen, contributing to the company’s market capitalization of RM37 million. The development collaboration between Chin Hin Group Property and Ivory Properties Group is poised to unlock new opportunities and create a positive impact on the real estate sector in Penang.