Anzo says developer is reviewing Paragon@KL Northgate project

KUALA LUMPUR (Feb 6): Anzo Holdings Bhd, which has been anticipating to secure a potential RM1.21 billion contract to build the Paragon@KL Northgate shopping centre in Selayang with a partner, is not going to see the project take off anytime soon.

The development is now being reviewed by its developer KL Northgate Sdn Bhd amid the soft property market, according to Anzo’s Bursa Malaysia filing yesterday.

Anzo said its wholly-owned unit Anzo Construction Sdn Bhd (ACSB) had been informed by KL Northgate that the latter had decided to review the whole development concept and development components in view of the “current real estate glut and the imbalance in supply-demand conditions”.

The review could take six to nine months, said Anzo.

The planned project had an estimated gross development value of RM3.6 billion and KL Northgate intends to award the construction job to ACSB, together with MCC Overseas (M)  Sdn Bhd, according to a letter of intent the developer issued last April.

“As the progress of the project, including the decision to revise the whole development concept and development components, solely depends on the direction from KL Northgate, ACSB as the tendering party will only be able to submit the tender documents upon KL Northgate finalising the contract document and pricing of the project, estimated by October 2018,” Anzo said.

Prior to this, on July 13, Anzo announced that ACSB had been informed by KL Northgate that the contract document was expected to be finalised by December. Subsequently, ACSB followed up with KL Northgate numerous times for the status of the contract, Anzo’s filing yesterday added.

Anzo shares closed up 0.5 sen or 6.25% at 8.5 sen yesterday, bringing it a market capitalisation of RM74.87 million. In the past 12 months, the stock has retreated some 62%.

This article first appeared in The Edge Financial Daily, on Feb 6, 2018.

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