KUALA LUMPUR (Sept 25): Construction firm Taghill Holdings Bhd (KL:TAGHILL) signed a joint-venture agreement on Friday to develop a residential project on a Malay reservation land in Kelantan, with an estimated gross development value (GDV) of RM191.7 million.

In a bourse filing, Taghill said its wholly-owned unit Taghill Aman Sdn Bhd entered into the deal with the property's registered proprietor Mohamed Hasbullah Che Hussin, and beneficial owner SBJ Binajaya Development Sdn Bhd.

SBJ Binajaya is a company owned by four shareholders — Tan Huat @ Tan Liang Chong, Tan Wei Lim, Tan Chee Lim and Tan Chee Seng.

Taghill said the development on the 7.94-acre freehold land in the Kota Bharu district will comprise two apartment blocks totalling 639 units.

The project carries an estimated gross development cost of RM123.5 million, with construction expected to commence in the second quarter of 2027 and completion targeted by the second quarter of 2031.

Under the agreement, the landowners are entitled to a total sum of RM24 million, to be paid by Taghill. The company said the entitlement will be disbursed in tranches, including RM13.6 million earmarked for the settlement of existing financing facilities, with the balance payable upon approval of the development order and issuance of the certificate of completion and compliance.

Taghill said the payments to the landowners are expected to be funded through internal funds and bank borrowings.

Taghill, on its part, will be entitled to the developer’s portion of the project, and any unsold units, as well as full rights to undertake planning, construction, sales and project management.

The development is expected to contribute positively to the future earnings and net assets of the company over the duration of the project, said Taghill.

As at end-May, the company had cash and cash equivalents of RM101.14 million against loan and borrowings of RM197.7 million.

Taghill’s shares, which have fallen more than 7% year-to-date, closed unchanged at 6.5 sen on Friday, giving the company a market capitalisation of RM101.2 million.