Australian-listed property developer Kingsland Global Ltd has entered into a master cooperation agreement with a subsidiary of local developer Shukaku Inc to develop 10,000 square metres of prime real estate in Phnom Penh’s “central business district”, it announced Friday in a filing to the ASX.
The agreement provides the staging ground for a joint venture partnership between Kingsland – the parent company of Kingsland Cambodia – and Shukaku subsidiary Urban Global Co Ltd that would build a mixed-use development that includes a hotel, apartments, retail outlets and office space, it said.
Under its terms, Kingsland has five months to produce a plan that will outline the development schedule, phasing, costs of each phase, as well as an architectural design and capital expenditure of the proposed project. Providing both companies come to an agreement, Kingsland would then oversee development.
Upon execution of the agreement, a joint venture partnership would begin within 12 months, the announcement stated, with Shukaku holding the majority share at 51 per cent and Kingsland holding 49 per cent.
“The development of such a prime area in the [central business district] of Phnom Penh will be a milestone achievement for Kingsland.
Our master plan will outline a world class development that we expect will become an iconic landmark for the people of Phnom Penh and the citizens of Cambodia,” Kingsland’s managing director, Jeremiah Lee, stated in the release.
Neither Shukaku nor Kingsland Global was available for comment yesterday.While details of where the development would be constructed were not released, Shukaku has long been embroiled with the controversial Boeung Kak Lake site, where its chairman, ruling Cambodian People’s Party Senator Lao Meng Khin, was awarded a 99-year lease on more than 100 hectares in 2007.
The developer has announced plans to build Phnom Penh City Centre on the site, an “eco-city” set to include hotels, housing, a central business district and more.
The project has come under fire from conservationists for filling in Boeung Kak Lake with sand and from rights groups for its mass land evictions, turning some 20,000 people away from their homes.
Shukaku has struggled in attempts to bring in outside investors. In 2014, Singaporean developer HLH pulled out of $14.9 million deal to purchase 1.3 hectares at the Boeung Kak Lake site.
“If this agreement is for Boeung Kak Lake, this is not good news,” said Eang Vuthy of Equitable Cambodia, a human rights group that has defended local evictees.