09-04-2011, 10:33 AM
Apr 9, 2011
South Beach project rolls on with new investor
THE much delayed South Beach project is all set to get off the ground, following a series of sales and restructuring that marked the exit of two originals investors and the entry of a new investor.
It began in February with news that Dubai World was selling its one-third stake in South Beach Consortium to City Developments (CDL) - which is also one of the original partners in the consortium.
The third partner, Elad Group, cashed out next by selling its one-third stake to Malaysia-based IOI Corporation.
Following this, another round of restructuring saw CDL paring its interest to allow IOI Corp to raise its stake in South Beach Consortium to 49.9 per cent. CDL, however, continues to hold a majority stake in the consortium with a 50.1 per cent stake.
Going forward, both CDL and IOI are expected to pump into South Beach Consortium an additional amount estimated at $500 million each.
The fresh funding is to redeem existing mezzanine notes that were earlier issued to South Beach Consortium, as well as for working capital and to finance the construction of the project.
South Beach Consortium is in the process of securing a new $1.6 billion financing facility to be provided by the existing consortium of banks that had previously extended an $800 million facility to the company in June 2009.
CDL, Dubai World and Elad Group had teamed up to buy the 99-year leasehold landmark Beach Road site opposite Raffles Hotel from the Urban Redevelopment Authority (URA) for $1.69 billion in 2007.
The project was originally scheduled for completion by 2012 at a total development cost, including land cost, estimated at $2.5 billion.
But it was delayed during the the global financial crisis, with CDL announcing in November 2008 that construction would be deferred until building costs eased.
The South Beach project is now expected to receive its temporary occupation permit in 2015, according to recent reports.
Under its agreement with URA, the consortium has up to nine years, or until around September 2016, to complete the project.
It will have 171 apartments, 560 hotel rooms, 632,164 sq ft and 158,014 sq ft gross floor area of office and retail space respectively.
IOI Corp, which is listed on Bursa Malaysia, has three broad businesses: plantation, resource-based manufacturing and property.
It is a leading global integrated palm oil player with operations stretching the entire palm value chain from seedlings to plantations to crop oil extraction to diverse value-added manufacturing.
Its real estate arm, IOI Properties, is also one of the leading property developers in Malaysia, with significant investment holdings of prime real estates.
South Beach project rolls on with new investor
THE much delayed South Beach project is all set to get off the ground, following a series of sales and restructuring that marked the exit of two originals investors and the entry of a new investor.
It began in February with news that Dubai World was selling its one-third stake in South Beach Consortium to City Developments (CDL) - which is also one of the original partners in the consortium.
The third partner, Elad Group, cashed out next by selling its one-third stake to Malaysia-based IOI Corporation.
Following this, another round of restructuring saw CDL paring its interest to allow IOI Corp to raise its stake in South Beach Consortium to 49.9 per cent. CDL, however, continues to hold a majority stake in the consortium with a 50.1 per cent stake.
Going forward, both CDL and IOI are expected to pump into South Beach Consortium an additional amount estimated at $500 million each.
The fresh funding is to redeem existing mezzanine notes that were earlier issued to South Beach Consortium, as well as for working capital and to finance the construction of the project.
South Beach Consortium is in the process of securing a new $1.6 billion financing facility to be provided by the existing consortium of banks that had previously extended an $800 million facility to the company in June 2009.
CDL, Dubai World and Elad Group had teamed up to buy the 99-year leasehold landmark Beach Road site opposite Raffles Hotel from the Urban Redevelopment Authority (URA) for $1.69 billion in 2007.
The project was originally scheduled for completion by 2012 at a total development cost, including land cost, estimated at $2.5 billion.
But it was delayed during the the global financial crisis, with CDL announcing in November 2008 that construction would be deferred until building costs eased.
The South Beach project is now expected to receive its temporary occupation permit in 2015, according to recent reports.
Under its agreement with URA, the consortium has up to nine years, or until around September 2016, to complete the project.
It will have 171 apartments, 560 hotel rooms, 632,164 sq ft and 158,014 sq ft gross floor area of office and retail space respectively.
IOI Corp, which is listed on Bursa Malaysia, has three broad businesses: plantation, resource-based manufacturing and property.
It is a leading global integrated palm oil player with operations stretching the entire palm value chain from seedlings to plantations to crop oil extraction to diverse value-added manufacturing.
Its real estate arm, IOI Properties, is also one of the leading property developers in Malaysia, with significant investment holdings of prime real estates.