CMS Land enters into JV to develop Hotel on The Isthmus
Kuching, Tuesday, 2 December 2010 – Cahya Mata Sarawak subsidiary, CMS Land Sdn Bhd, has entered into a new joint venture with 4 entities to build, own and manage a four-star hotel and serviced apartments on The Isthmus in Kuching. Announcement of the Joint-Venture Agreement with Premier Cottage Sdn Bhd, Boulevard Jaya Corporation Sdn Bhd, Hikmat Majusama Sdn Bhd and Isthmus Developments Sdn Bhd was made yesterday, 1 December 2010.
As part of the Joint-Venture Agreement, CMS Land will inject two parcels of vacant land located on The Isthmus totaling approximately 10.5 acres to Isthmus Developments for a total consideration of RM10 million. This is to be satisfied via the issuance of 10 million new Shares in Isthmus Developments. This will lead to CMS Land maintaining an eventual shareholding equivalent to 10.3% in Isthmus Developments.
The proposed new hotel development will comprise a four-star hotel with 381 hotel rooms and 96 units of serviced apartments. The total cost of the hotel, including outfitting, furniture, fittings and equipment, but excluding financing costs and contingencies, is estimated to be RM380 million. Building works is expected to commence in the first quarter of 2011, with targeted completion by end 2013.
CMS Land is the land owner and property developer for The Isthmus, which is intended to be Kuching’s new central business district (CBD). Incorporated in November 1996 with an issued and paid-up capital of RM20 million, CMS Land is a 51%-owned subsidiary of CMS Property Development, which in turn is wholly-owned by CMS. The other shareholder of CMS Land is Sarawak Economic Development Corporation. The principal activities of CMS Land are property holding, property development and construction.
Current developments on The Isthmus include the award-winning Borneo Convention Centre Kuching (BCCK), a marina jetty and a corporate head office building. Other mixed commercial and residential developments and tertiary educational institutions are planned for the 275 acre land bank situated 8km to the east of Kuching city centre.
In addition, the new hotel will act as a catalyst to accelerate further developments of the area into a vibrant commercial hub and satellite city for Kuching. This is in line with CMS Group’s plan to expand its property arm.
Development of the new hotel and serviced apartments located within The Isthmus will support the BCCK to attract more users. In recent years, the Sarawak State Government has been actively promoting the State as a destination for conventions and tourism. This, coupled with the relative affordability of air travel into Sarawak, will augur well for development of the hotel.