Kuala Lumpur – Mah Sing Group Berhad (Mah Sing) will be developing a new 185 acres prime industrial development named Mah Sing Business Park, Sepang with an estimated gross development value (GDV) of approximately RM728 million.
Mah Sing Business Park, Sepang will be developed by Fusion Heights Development Sdn Bhd, a subsidiary of Mah Sing South Sea Industrial Development Sdn Bhd (MSSSID, a 70% owned subsidiary of Mah Sing). Besides the initial 10% downpayment, the balance 90% of total purchase price of RM100,732,500 or RM12.50 per square foot (psf) for 185 acres is payable 3 months after completion of conditions precedent.
The landowner Premier Land Resources Sdn Bhd also grants Fusion Heights Development Sdn Bhd the option to purchase an additional approximately 376.65 acres (Option Land) for RM12.50psf within four years of the Sale and Purchase Agreement (SPA). The potential GDV for the entire 561.65 acres is up to RM2 billion, encompassing comparable development components.
Fusion Heights Development, MSSSID and the landowner intend to enter into a shareholders’ agreement for the subscription by the landowner of 20% of the shareholding in Fusion Heights Development (equivalent to 500,002 ordinary shares).
The landowner’s participation as a shareholder adds credibility and confidence to the success of Mah Sing Business Park, Sepang. The staggered investment structure with the initial purchase of 185 acres with option for the remaining 376.65 acres within 4 years, along with the upfront locking of the fixed cost of RM12.50 psf, helps mitigates risk. It also creates growth opportunities without placing excessive pressure on the balance sheets and liquidity.
Location Map of Mah Sing Business Park, Sepang (Source: Google Map & Mah Sing)
The land is planned to be an industrial development comprising customized factories, industrial lots, cluster, semi-D and detached factories catering to medium and light industrial businesses. The development is set to attract industry players from high-tech manufacturing and value creation manufacturing sector to set up their facilities here.
In line with the Group’s quick turnaround strategy and subject to authorities’ approval, the development of Mah Sing Business Park, Sepang is expected to commence in the second half of 2024 and to be developed over a span of 3 to 4 years. The acquisition will fuel the growth of Mah Sing’s industrial development portfolio and strengthen its competitiveness in Malaysia’s industrial development landscape.
MSSSID – A one-stop solutions provider for industrial real estate properties
The acquisition also represents a strategic move for the Group, building upon the foundation laid by the formation of joint venture company MSSSID in September 2023. MSSSID provides one-stop development solutions for industrial real estate properties, from sales and marketing, leasing, project construction and management, as well as customization to investors’ need and investment.
Sun Jian Wei the chairman of MSSSID is also the President of the Malaysia Jiangsu Entrepreneurs Business Association. Mr. Sun has established good connections with potential investors from JiangSu Province and neighbouring Shanghai. JiangSu Province has a well-established and diverse industrial landscape, with key sectors ranging from manufacturing to technology and services.
Industrial hub in Sepang district
The land has good connectivity to air transportation, situated just 10km from Kuala Lumpur International Airport (KLIA), which provides flexibility on logistics where businesses can choose the suitable mode of transport for their goods and services, which also leads to cost optimisation. Proximity to air transportation facilitates international trade which allows businesses to reach global markets easily. Logistics hub such as Cainiao Warehouse by Alibaba Group, Pos Aviation E Commerce Hub and DHL Global Forwarding are located at the same area. Sea transportation wise, the land is located 65km to West Port and 75km to North Port.
The land is strategically located in the Integrated Development Region in South Selangor (IDRISS) zone, an initiative under the First Selangor Plan 2021-2025. With an estimated GDV of RM1 trillion, IDRISS is Selangor’s strategic blueprint aimed to boost economic developments in Sepang and Kuala Langat districts. In November 2023, the Selangor government has approved 13 projects with an estimated development area of 17,398.56 acres under IDRISS.
Strategically located at the central of Klang Valley and populated areas
The land is located at the central of Klang Valley and close to populated areas such as Bandar Baru Salak Tinggi, Putrajaya, Cyberjaya, Subang and Shah Alam, which can provide business executives and workers the convenience of living near the city center and access to ready amenities. Mah Sing’s landed residential development M Senyum is located at Bandar Baru Salak Tinggi. Also known as the Airport City, Bandar Baru Salak Tinggi is well connected to major accesses and highways such as KLIA Expressway, ELITE Highway, North-South Expressway, Putrajaya-Cyberjaya Expressway, Jalan Banting-KLIA and KLIA Extension Highway.
Bandar Baru Salak Tinggi has ready amenities such as ERL Salak Tinggi Station which offers a twice-hourly KLIA Transit service to KLIA / KLIA2 and KL Sentral, Bandar Baru Salak Tinggi Stadium, Nilai Medical Center and KIP Mall, Kota Warisan. Apart from that, there are also 6 universities nearby namely Xiamen University, INTI International University, Nilai University, Manipal International University, University Kuala Lumpur and Islamic Science University of Malaysia.
Favourable environment for industrial projects
Malaysia has been the focus of foreign investors and Mah Sing’s push into industrial projects is timely, especially with the launch of Malaysia’s New Industrial Master Plan (NIMP) 2030 to build Malaysia’s industrial capacity and resilience for long-term, sustainable growth.
In the first 9 months of 2023, Malaysia recorded RM225 billion in total approved investments of which foreign direct investment (FDI) accounted for RM125.7 billion or 55.9% of total approved investments. The manufacturing sector took the lead for FDI, contributing RM84.8 billion or 85.0% of approved investments in that sector.
The industrial property market is widely lauded as a bright spot for the property market in 2024 and Mah Sing’s acquisition of Mah Sing Business Park, Sepang is a strategic move to capitalize on the country’s industrial growth potential.
NIMP’s mission-based approach aligns perfectly with Mah Sing’s vision for Mah Sing Business Park, Sepang. Guided by Mission 3 of NIMP, which aims to transform industrial estates into eco-industrial parks, Mah Sing is committed to creating a sustainable and customized industrial park that caters to the evolving needs of businesses.
Mah Sing’s Founder and Group Managing Director, Tan Sri Dato’ Sri Leong Hoy Kum said, “It is within Malaysia’s favourable environment we make this strategic acquisition, as we strongly believe Malaysia and Mah Sing is the preferred country and partner for these enterprises looking to efficiently invest and grow across this region.
We intend to build a world class Mah Sing Business Park offering customized factories as well as industrial lots, cluster, semi-D and detached factories. Drawing upon our 30 years of successful experience in property development and over 40 of manufacturing expertise and partnerships with numerous Fortune 500 clients, we are well-positioned to utilize our networks and resources, providing a holistic, all-in-one solution for investors seeking to establish manufacturing facilities in Malaysia. We believe this acquisition bodes well for the Group’s future growth and earnings prospects. Besides outright sales, we can potentially look at long-term lease for warehouse, logistics distribution centers, data center and other high-tech, high value manufacturing facilities which will provide potential recurring income for the group.
We will be able to leverage on Mr Sun’s vast experience and network with potential investors, and with the landowner for cost and risk sharing as well as potential future collaboration on other lands.
Besides a mainly Malaysian clientele, Mah Sing has attracted international investors from China, Singapore, Australia, Indonesia and others for their properties. Mah Sing’s manufacturing division has partnerships with numerous Fortune 500 clients, giving it a good perspective of manufacturers’ requirements.
The acquisition of the new land will increase Mah Sing’s prime landbanks to 2,471 acres, with total remaining GDV and unbilled sales of RM27.56 billion. To date, Mah Sing has successfully completed and delivered five industrial parks, which include Mah Sing Integrated Industrial Park in Mutiara Subang, iParc in Bukit Jelutong, iParc 2 in Shah Alam, iParc 3 in Bukit Jelutong and iParc, Tanjung Pelepas.
Malaysia’s proactive policies to attract FDI
Malaysia’s proactive policies such as Industry 4.0, NIMP 2030, and Digital Economy Blueprint have attracted high-tech enterprises from many countries, leading to increased investment in Malaysia. The strategic shift in supply chains from China to Southeast Asia, known as the China Plus One strategy, has further benefited Malaysia, as China-based companies seek to diversify their investments and manufacturing operations. Besides prospective investment from China, the establishment of a Comprehensive Strategic Partnership (CSP) between Malaysia and Japan further enhances the bilateral relationship between the two countries, providing opportunities for cooperation in various sectors. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has also played a significant role in attracting FDI into Malaysia.
Furthermore, Malaysia’s commitment to establishing a best-in-class investor journey for ease of doing business, as part of the Madani Economy’s vision and objectives, ensures a conducive environment for businesses looking to invest in the country.
With an impressive track record of attracting foreign investments and a well-defined industrial growth plan, Malaysia, particularly Sepang, presents lucrative opportunities for industrial development. Mah Sing’s acquisition of industrial land in Sepang aligns perfectly with Malaysia’s industrial vision and positions Mah Sing Business Park as a prime investment opportunity for both local and foreign investors.