PROPERTY developer Hatten Land Ltd recently found a white knight in Singapore-based hospitality and investment firm Tayrona Capital Pte Ltd to revive its stalled RM2.2 billion Harbour City mixed development in Melaka.
Under the agreement signed last week, Tayrona Capital will invest US$23 million (RM96.5 million) in Hatten Land’s unit Gold Mart Sdn Bhd, which is developing Harbour City, through the issuance of new shares, according Tayrona Capital a 99% stake in the company.
In addition, Tayrona Capital will pay US$240 million to another company, Wealth Express Holdings Group (WEH), to complete the development and marketing of Harbour City. WEH is not related to Hatten Land’s directors and controlling shareholders.
Tayrona Capital will also pay Hatten Land US$60 million for the project’s intellectual property rights.
Harbour City is arguably the most ambitious of a series of projects by Hatten Land, which is owned by property developers from Singapore who have made Melaka their hunting ground since 2006. The company is listed on the Catalist board of the Singapore Exchange (SGX) and has business operations in Negeri Sembilan, Selangor, Singapore, Australia and China, according to its annual report.
Spanning six acres, Harbour City is a marine-themed development on the reclaimed island of Pulau Melaka, fronting the Straits of Melaka. It comprises a water theme park, touted to be the largest in Melaka when completed, as well as a mall and three hotel blocks.
The highly anticipated project was launched in 2015 and slated to be completed in the second quarter of 2020. Construction of the project has screeched to a halt, however, owing to a dispute with its main contractor, says Hatten Land in an email response to The Edge.
In a recent filing with SGX, Hatten Land disclosed that China Construction Yangtze River (M) Sdn Bhd, the main contractor of Harbour City, was claiming RM100 million from Gold Mart, which is still waiting for the appointment of an adjudicator by the director of Asian International Arbitration Centre.
“No timeline has been provided to Gold Mart for such an appointment. Any settlement with the main contractor will be paid by WEH from the consideration of the Tayrona-WEH transaction of US$240 million and not from the company, nor the consideration of US$60 million paid to the company,” it said.
So far, about 70% of the project has been completed.