KUALA LUMPUR (Sept 4): Property developer Eastern & Oriental Bhd (KL:E&O) has on Thursday secured RM780 million in financing facilities from AmBank Group to fund the ongoing development of Phase 2 of Andaman Island.
The fresh loans, channelled to subsidiary Tanjung Pinang Development Sdn Bhd, will be used for land reclamation, infrastructure works and working capital across the remaining 507 acres of Andaman Phase 2, according to E&O managing director Kok Tuck Cheong.
“So far, we have spent RM1.5 billion mainly on Phase 1 and state-related reclamation works. Phase 2 is larger at 570 acres, but part of the infrastructure invested earlier is common and will benefit both phases,” Kok said at the press conference after the signing ceremony with AmBank’s business banking managing director Christopher Yap.
Kok added that further financing for Phase 2 of the project will still be required as it progresses, particularly to support vertical development once reclamation is complete. Overall, the total cost of reclaiming and building infrastructure across the 760-acre island is budgeted at RM4 billion, though this may vary with inflationary pressures, he added.
E&O is maintaining its target of completing land reclamation of Phase 2 by 2028, having reached 50% progress as of August, with coastal protection already finalised. The group is also still finalising the master plan for Phase 2, which is expected to feature a mix of residential, commercial and leisure components — including a mall, office space, serviced apartments, branded residences, five- to six-star hotels, and later, educational facilities.
As for now, Phase 1 of the Andaman Island has seen six projects launched — The Meg, Arica, Senna, Fera, The Lume and Maris. Of these, only The Lume and Maris are not yet fully sold, though both have surpassed 50% sales, according to Kok.
“The pace of sales is slower compared with the earlier launches, but demand remains solid. The earlier projects, as well as landed homes like Senna and Fera, were fully taken up quickly,” he said.
On a related development, Kok added that connectivity to the island will be boosted by the upcoming Gurney Bridge, an eight-lane link scheduled for completion next month. Kok said the bridge will cut travel time by 12 to 15 minutes during peak hours.
Just last month, E&O also confirmed pitching Andaman as the potential site of the proposed RM10 billion Penang International Financial Centre, for which it has submitted a proposal following a state call for interest.
Shares in E&O settled unchanged at 84.5 sen on Thursday, valuing the company at RM2.11 billion. Year-to-date, its share price has depreciated over 11%.