Someone stole the US$3bil meant for TRX infra

Pavither May 22, 2018

1Malaysia Development Bhd (1MDB) had issued US$3 billion worth of notes in April 2015 with a coupon of 4.4 percent per annum until its 2023 maturity. Part of the proceeds from the issuance should have been spent on building the infrastructure in the 70-acre Tun Razak Exchange (TRX), but this never happened.

“TRX did not see a single cent of it,” an unnamed source told The Star.

As such, 1MDB’s real estate arm TRX City Sdn Bhd had to dispose five plots there for a total of RM1.358 billion to fund the infrastructure. Of this amount, RM1.095 billion was “advanced” to the scandal-tainted sovereign wealth fund.

A report released by the National Audit Department earlier last week revealed that the 70-acre site for TRX was originally acquired for RM302.38 million in 2010, or approximately RM100 psf.

The source said TRX City Sdn Bhd had to do a lot of things to solve its problems, like gathering money to construct roads and tunnel systems in the upcoming financial district to entice local and overseas investors.

Then in 2014, Australia-based developer Lendlease agreed to acquire a 60 percent stake in TRX’s Lifestyle Quarter, while TRX City Sdn Bhd holds the remaining 40 percent.

This “boosted confidence” and gave the development “a lot of credibility”, noted the source.

But given the new government’s promise to review major project, Lendlease wants to talk with the new administration at “the earliest opportunity” over the fate of TRX, given that the prior administration had promised to relocate government-linked companies (GLCs) there to boost the project’s appeal and increase it viability.

Furthermore, the re-opening of the investigation into the multibillion 1MDB scandal had raised fears among the companies taking in part in TRX.

“Will TRX, as an international financial centre, be aborted? Will stakeholders be asked to go slow?” asked one of those firms.

Image sourced from The Star Online

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