Bluestone sought after to revive distressed projects

21/01/2008 The Star

A show unit of the Taragon Puteri Cheras

K.H. SIM, dubbed the good Samaritan for abandoned projects in Kuala Lumpur, sees his outfit, Bluestone Group Malaysia, continuing to play a role to revive distressed projects.

Having taken three such projects under its wings since the company was established in 2003, Bluestone is still very much sought after by financial institutions, developers and property buyers to revive projects that have been abandoned.

However, Sim is careful on what he brings to the company, and thorough studies would be undertaken to ascertain any legal encumbrances and the potential rate of success of a project.

He explained that the process was very tedious as it involved a big group of stakeholders – the existing developer, buyers, creditors, contractors, material suppliers and the authorities.

“There could be many issues, some unsurmountable, unless much research is done. They have to be sorted out to ensure that any project we select is good for revival. In order for a higher success rate, the various parties should be willing to give and take. This includes the creditors taking a haircut.

“While we are happy to help house buyers fulfil their dreams of owning their homes, at the end of the day all the projects must meet our internal rate of return (IRR) and our partners’ IRR, too,” Sim said.

Bluestone also works with financial institutions to “rescue” non-performing loans (NPLs) of property purchasers.

The three projects that are under Bluestone – Taragon Yap Kwan Seng, Taragon Puteri Cheras and Taragon Puteri KL – are on their way to being resuscitated.


The former Menara Li Foong in Jalan Pudu which is being resurrected as Taragon Puteri KL.
Taragon Puteri Yap Kwan Seng, which was bought for about RM5mil in 2005 from a financial institution after the developer failed to service its loan, has been completed recently.

The 12½ -storey low-density project with 40 spacious apartments is positioned as a home within the city and is a stone’s throw away from the Kuala Lumpur City Centre.

Each floor consists of up to four corner units and is serviced by two lifts.

The standard unit sizes range from 1,767 to 1,895 sq ft while the sub-penthouses and penthouses are between 2,241 and 3,210 sq ft.

The residences that are priced from RM438 per sq ft will be handed over to buyers next month.

Meanwhile, the 3.3-acre project site where Taragon Puteri Cheras is located was originally meant for 300 apartments by the Li-Foong Group.

Since Bluestone took over the project, the development concept has been reviewed and it now comprises 141 private town villas and duplex units in three – and four-storey blocks within a gated community.

The houses, with built-up areas from 923 sq ft, are priced from RM155,000 to RM338,000. The project will be completed by March.

Taragon Puteri KL was formerly Menara Li Foong, which had been left uncompleted for more than a decade.


Artist's impression of Taragon Puteri KL when completed.
Located at Jalan Changkat Thambi Dollah, off Jalan Pudu, the project is being developed into a RM280mil integrated commercial development with a four-star hotel, service residences and retail space.

The project was taken over last year, and Taragon Puteri KL is on track for completion next year.

Taragon Puteri KL is being undertaken on a joint venture basis with Allco Funds Management (Singapore) Ltd (Allco FMSL), a 100% owned subsidiary of Australia’s Allco Finance Group Ltd which specialises in asset-based structured finance.

The project targets top executives and travelling businessmen who opt for luxury inner city living.

Sim said Taragon Puteri KL featured a unique 3-in-1 concept combining hospitality, retail and residences in one development.

One of the two adjoining blocks is dedicated for an international all-suites hotel and the other is a luxury service residences block. There are also limited retail units to serve the needs of hotel guests and residents.

The hotel block is leased by a four-star international hotel chain, Rendezvous Hotel International, which is a subsidiary of Straits Trading Company Ltd of Singapore.

The 371-suite hotel comes complete with a range of facilities, including conference and banquet, swimming pool and a fully equipped gym.

Meanwhile, the residential block comprising 152 service residences has generated sales of more than RM80mil.