KUALA LUMPUR (Aug 19): EcoFirst Consolidated Bhd (KL:ECOFIRS) said it is acquiring a 4.51-acre piece of freehold land in Kajang for RM35 million to undertake a mixed development.

The development will include serviced apartments, small office home office, small office virtual office, and shop offices, the property developer said in a bourse filing on Monday.  The project is estimated to have a gross development value of RM380.9 million.

EcoFirst said it is purchasing the land from Soils & Foundations Sdn Bhd by using internally generated funds and bank borrowings.

The group’s remaining landbank consists of 67 acres of freehold land in Gombak, which is currently awaiting rezoning approval for commercial and residential use.

Therefore, the acquisition of the Kajang land will enable the group to enhance liquidity and shareholder value while it waits for rezoning approval for the Gombak land.

EcoFirst expects to commence development on the Kajang land in the first quarter of 2025, with the development period spanning three to four years.

EcoFirst closed its financial year ended May 31, 2024 (FY2024) with a net profit decline of 12% to RM12.64 million from RM14.37 million in the previous year. The decline was primarily due to a provision for the writedown of an asset worth RM15.18 million due to "unfavourable" market conditions, coupled with higher administrative expenses.

However, revenue surged 427% to RM165.79 million from RM31.46 million in FY2023, mainly due to additional contribution from work done on its KL-48 serviced apartment project in the Jalan Chan Sow Lin area.

As of the end of May, EcoFirst had long-term borrowings of RM180.63 million and short-term borrowings of RM127.65 million, exceeding its cash and bank balances of RM29.86 million.

Shares in EcoFirst fell by one sen or 2.6% to 38 sen at Monday's close, valuing the group at RM447.16 million.