THE developer of Tun Razak Exchange (TRX) has said the first phase of the sprawling 70-acre financial district will be operational by the first quarter of 2019, dismissing concerns of an investor fallout by recent revelations that over RM3 billion from the project had been allegedly misappropriated to pay off 1Malaysia Development Berhad (1MDB) debts.

“We don’t have any issues with investors. We have received numerous inquiries from international and local looking for opportunities to locate themselves here,” TRX City chief executive officer Azmar Talib said.

“The government has made it very clear that TRX has been segregated from 1MDB. TRX is under the Ministry of Finance now. That’s why our business is continuing,” he told reporters during a tour of the construction site today.

Azmar Talib said that the first phase will include occupancy of skyscraper Exchange 106 and the adjacent Menara Prudential.

“To date, 80% of the first phase infrastructure has been completed,” he added.

Finance Minister Lim Guan Eng said last week that over RM3 billion in government funds was misappropriated from the TRX project to pay off 1MDB debts.

Lim said the previous Barisan Nasional government, since 2012, had guaranteed borrowings, extended advances and provided transfers to, as well as purchased land from, TRX City, amounting to RM3.688 billion.

Of those transfers, RM3.067 billion was misappropriated by 1MDB, mainly for its loan repayments. 

Lim however, said Putrajaya will press ahead with the project, injecting an additional RM2.8 billion to complete it as there would be “wide ramifications” otherwise due to the number of investors involved.

He added that the penalties for not completing the project would be a payment of RM3.51 billion in compensation claims. 

Azmar has since lodged a police report on the matter. 

On the RM2.8 billion government injection announced last week to keep the project going, Azmar said that it would be given in phases based on completions.

“They won’t give a us lump sum. The RM2.8 billion is meant for the entire infrastructure which will be completed in 2024. We will get as and when we progress,” he said.

The total land value of TRX is estimated at RM7.6 billion, with total cost of development at over RM6 billion.

Phase two infrastructure – which consists a public plaza, streetscapes, a 10-acre park, a mall, and new headquarters for HSBC Malaysia and Affin Bank – will be completed in 2020. 

Indonesian property developer Mulia International is developing Exchange 106, the tallest building in Southeast Asia. 

Azmar said the north parcel, consisting some 50 acres has yet to be commercialised. 

“Each one is about one acre or so. When we sell rights, we sell with the masterplan. We won’t unlock and sell everything. We also don’t sell strategic plots. 

“We can only develop these lots when the infrastructure is ready. Then at right time, we will unlock them,” he said.  

“We want to be a financial centre. So many are interested to be with TRX and people know that TRX will be the future central business district of of Kuala Lumpur,” he added. – June 28, 2018.