More multinational firms are investing in Kuala Lumpur’s 70-acre Tun Razak Exchange (TRX) despite the scandal surrounding 1Malaysia Development Berhad (1MDB), reported Bloomberg.
For instance, HSBC Holdings announced earlier this month that they will spend US$250 million to construct their local headquarters in Malaysia’s newest financial district, revealed Azmar Talib, CEO of land owner TRX City Sdn Bhd.
After four years of wooing, the global bank’s pledge to invest in TRX marks a “very significant milestone”, he said. There is also another financial firm that has inked a long-term lease for an office block there, but Azmar did not provide any details.
Previously, TRX City was a unit of state investment fund 1MDB. But it was carved out and taken under the wings of the Ministry of Finance due to the corruption scandal involving its parent firm.
“It did have an impact in the past,” Azmar said, referring to the negative perception regarding 1MDB, whose funds amounting to US$6 billion were allegedly embezzled.
“However, we are now in a better position,” he noted. “The transfer (to the Ministry of Finance) has provided us more stability and has boosted confidence in the development.”
In fact, construction at the RM40 billion TRX is proceeding 22 hours per day and its maiden office building is poised to be completed by end-2018. It will also feature the only interchange for two train lines in the city centre.
Moreover, Australia-based developer Lendlease Group is developing a retail mall with a rooftop park the size of around seven soccer fields in TRX’s lifestyle quarter, while Indonesia’s Mulia Group is building the 106-story Signature Tower. This is expected to be taller than the Petronas Twin Towers once it is completed by mid-2019.
According to Azmar, they have monetized around 70 percent of the available land in TRX, and the land owner is not rushing to dispose the remaining four plots under the current phase.
Work on the new financial district began in 2013 and it is targeted to be fully completed in the next 15 to 20 years.
“TRX is a very strategic and important development for Kuala Lumpur to be successful and on par with other international cities,” said Knight Frank Malaysia’s Managing Director Sarkunan Subramaniam.
The new buildings being built in TRX would encourage multinational corporations to establish a presence here in Malaysia, given that there are many old buildings in the capital that lack modern amenities, he explained.
Image sourced from TRX
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