KUALA LUMPUR: Federal Hill, an affluent residential neighbourhood located across from KL Sentral, will see two RM1.4 billion high-rise residential towers scale up next year.
S P Setia Bhd will develop two prime land parcels totaling 2.67 acres in Setia Federal Hill in a joint venture (JV) with Mitsui Fudosan (Asia) Malaysia Sdn Bhd.
There will be roughly 1,300 apartments between the two residential towers. The developer said that the first tower will debut in 2024.
According to S P Setia, the launch represents a major opportunity for the company to grow even more and gain a firm footing in the much-sought-after Bangsar neighborhood.
Industry observers said the public is anticipated to show significant interest in the two-tower residential project due to its advantageous location, which is directly across from the multi-billion-ringgit KL Sentral transportation hub.
"The project is located not too far from Kuala Lumpur's downtown. However, I believe that a buyer is more concerned with the product's features, design, concept, and price," he told NST Property.
Based on initial management estimates, the 20.86-hectare Setia Federal Hill has an estimated gross development value (GDV) of RM20.19 billion due to its prime location.
The master plan by Rafael Viñoly Architects for the development aims to revitalise the site by incorporating an expansive elevated green roof that wraps around the surrounding context, connecting all development phases together.
Infamous project
In 2012, the proposed development gained attention due to concerns raised by environmental NGOs and residents regarding the sale of the land to S P Setia and the potential harm it would cause to the environment and existing heritage building structures.
Originally developed by the British during the colonial era, Federal Hill is a low-density residential neighborhood surrounded by 18 acres of secondary forest.
It used to be a swampy area. Rubber estates were first developed in 1896, and European government employees privately owned the majority of them.
Among the earliest government buildings to be developed at Federal Hill is the Bangsar Hospital (European Hospital), which was built in the early 1900s. It was later developed as the National Institute of Health (NIH).
Some 113 garden-style government bungalows were constructed in the 1950s, as well as four palaces owned by the Johor, Kedah, Perak, and Negeri Sembilan households.
The Malaysian Nature Society headquarters is the oldest structure still standing.
On November 29, 2012, Setia Federal Hill Sdn Bhd (SFHSB) entered into a privatisation agreement with the government to undertake the development and construction of a RM845 million integrated health and research institute (1NIH complex) on a 41.1-acre parcel in S P Setia's Setia Alam township in Selangor.
In exchange, the government swapped 20.86 hectares of prime land in Federal Hill for the purpose of developing Setia Federal Hill.
Initially, SFHSB was a 50:50 JV development between S P Setia and Mekar Gemilang Sdn Bhd, which is said to be linked to tycoon Tan Sri Syed Mokhtar Al-Bukhary.
Mekar Gemilang's stake in the project was purchased by S P Setia in 2018 for RM431.89 million in cash (RM1,050 per square feet).
S P Setia's acquisition of Setia Federal Hill was viewed positively by analysts as it will potentially increase future earnings of the company.
Collaboration with Mitsui Fudosan to improve Setia Federal Hill
The joint venture with Mitsui Fudosan, according to S P Setia president and chief executive officer Datuk Choong Kai Wai, is noteworthy for both businesses because it unites a reputable Malaysian real estate investment firm with one of the nation's leading developers.
"The collaboration will not only bolster the project's profile but also provide an exceptional opportunity for S P Setia to market to international clients. With their combined expertise and proven track records, the JV is poised to unlock the full potential of the development and redefine the skyline of Setia Federal Hill," he said.
According to Choong, he is optimistic that this joint venture will open the door for a remarkable development in Setia Federal Hill.