Tun Razak Exchange
Tun Razak Exchange (“TRX”), formerly known as Kuala Lumpur International Financial District (KLIFD), is a development with the developer-declared aim and promise to create one of the most liveable financial districts in Asia. It is being built upon 70 acres of land adjacent to the city center in Kuala Lumpur, Malaysia. It has been announced that TRX will feature offices, residential, retail and leisure spaces.
The developers marketing material promises that this shall be a world-class development built around the concept of a unique work-live-play experience.
Tun Razak Exchange has been described by its developer in its marketing materials as being designed with the future in mind and to incorporate technologies including district-wide digital connectivity, enhanced energy, water and waste management systems and e-services in its residential and commercial properties. As of March 2016 the developer has not provided specific details on any of these proposed facets.
The developer behind the development is 1MDB.
1MDB had not previously undertaken any real estate development projects, has no track record in real estate development and has not completed any buildings or infrastructure in TRX to date (March 2016).
1MDB is a Government-owned fund set-up by the current (2016) Prime Minister, Najib Razak, in 2009 to facilitate strategic investment in Malaysia and capital projects which aim to move Malaysia forward.
1MDB, is at the center of a global corruption scandal in which, according to reports and investigators in several countries, billions of USD of funds have been diverted to 3rd party individuals and companies. TRX itself was intrinsic to the web of funding initiatives used by 1MDB to raise these billions of USD of funds: the company raised funds through Islamic bonds and through a partnership executed with Aabar of the UAE for TRX. The bonds and the business relationship with Aabar are under investigation in several international jurisdictions under suspicion of fraudulent activities. 1MDB also entered into a joint venture with Lend Lease as part of the funding and commercialization of TRX. The joint venture was announced several months after the 1MDB scandal had already made international headlines. Lend Lease remains 1MDBs flagship partner to date (March 2016) despite the significant worsening and escalation of the financial scandal and associated political and social upheaval.
The Chairman of the Board Advisers of 1MDB is Najib Razak. The project has been named after his late father, Tun Razak.
Several government incentives including income tax exemptions, stamp duty waivers and cost rebates have been introduced to attract international corporations and expedite the process of setting up businesses within TRX.
The developer claims in its marketing material that the district is expected to attract 250 global financial services companies and create 40,000 skilled and knowledge-based jobs. This has not been further detailed or demonstrated.
The TRX has been identified by 1MDB and the Government of Malaysia as one of the many high-impact public-private partnership (PPP) projects that will help to drive the economic transformation agenda.[1]
The TRX development phase 1, which includes the Lifestyle Quarter which 1MDB is developing with its joint venture partner, Lend Lease, was proposed to open in 2017 according to the marketing material and press releases of the developer. Current progress at the construction site is significantly slower than the market expected. It will in fact not be possible for any significant components or indeed the infrastructure backbone to be completed by 2017.
Location
TRX is strategically located at the southern gateway to Kuala Lumpur’s city centre flanked by main arterial roads and is adjacent to the Golden Triangle – the city’s commercial, shopping and entertainment hub. The district will receive a shared Mass Rapid Transit (MRT) underground interchange, planned to be the largest in Malaysia, which it is intended shall be named after the new district. There are a number of RapidKL stations within a 20-30 minute walking distance, proposed though not yet commenced new highway connections and a proposed but not yet commenced direct road route to Kuala Lumpur International Airport.
The Master Plan
The Master Plan for TRX includes a total of 25 buildings and over 21 million ft2 of total building Gross Floor Area (GFA) spread across office, residential, hotel, retail, F&B and cultural offerings. TRX has a planned development period of 20–25 years and has been said to be planned for completion in phases, starting with the in-delay phase 1. Upon its completion, it is claimed in the developers marketing material that the district is expected to contribute towards job creation, attracting knowledge-based talent, increasing the number of world leading companies to the city, and drive greater economic growth for the country. To date no concrete evidence of these claims has been published. The developer further claims that TRX will "vastly support ETP’s (sic) goal to raise Malaysia’s Gross National Income per capita to USD15,000, create 3.3 million jobs and secure USD444 billion in investments by 2020".
At the center of the development is a signature tower which the master plan identifies as THE landmark of the TRX. It will have a height of 380m. The development of the signature tower was supposed to be undertaken by 1MDB itself, due to its national importance. However, the lack of funding resulting from the funding scandal resulted in the land being sold to an Indonesian company. The design for the signature tower, which will redefine Kuala Lumpur, has not yet been released.
Investors
In June 2014 the international property and infrastructure group, Lend Lease, was chosen by 1MDB RE to be the anchor investor partner in Phase 1. KIt will co-develop with 1MDB the Lifestyle Quarter in TRX, which is stated by the developer to consist of a 2 million ft2 retail mall seamlessly connected to a multi-layer central park, three residential towers and a hotel. In the 2nd quarter of 2015, despite the furore of the funding scandal and other claimed offences, an official signing ceremony was held to seal the joint venture partnership between 1MDB RE and Lend Lease. The ceremony brought together the Malaysian Prime Minister, Najib Razak, and the head of Lend Lease, Rod Lever, to cement and celebrate the 1MDB-Lend Lease relationship.
References
- ↑ "Najib's speech on 10MP". The Edge. 2010-06-10.
External links
- TRX Official site
- 1MDB Official site
- Tun Razak Exchange MRT Station
- 1Malaysia Development Berhad scandal
- Lend Lease Group