ONCE the bottling facility for soft drinks, including Sinalco and Kickapoo Joy Juice, a 55-year-old factory and the land on which it sits in Section 13, Petaling Jaya, are up for sale.

The Singapore owners of National Aerated Water Co (KL) Sdn Bhd may be able to get as much as RM50 million for the land, which has the potential to be developed into serviced apartments, industry sources say.

An information memorandum (IM) sighted by The Edge reveals that Savills Malaysia has been hired as the exclusive marketing agent to sell the land by way of expression of interest. When contacted, the agency’s senior director of capital market, Nabeel Hussain, confirmed the appointment of Savills but declined to provide details. The closing date to submit bids for the land is Nov 4.

Located opposite the headquarters and factory of Dutch Lady Milk Industries Bhd, the bottling plant ceased operations over a decade ago. The building sits on a leasehold parcel of 2.06 acres or 89,560 sq ft, and there are 41 years remaining on the lease. The corner parcel called Lot 54 has dual frontage as it faces Jalan 13/6, Petaling Jaya, and Jalan Professor Khoo Kay Kim, formerly known as Jalan Semangat.

According to the IM, based on Majlis Bandaraya Petaling Jaya’s (MBPJ) Special Area Plan for Section 13, the site has the potential for a mixed-use development with a permissible plot ratio of 3.25. The land is located within Zone 1 of the plan.

The Special Area Plan for Section 13 will facilitate the conversion of land use from industrial to mixed-use or limited commercial. Development activities on this site can include services, commerce, retail, residential, facilities and infrastructure, and utilities.

The invitation-for-sale document also states that the site offers superior development potential as “Section 13 is now demarcated as a key development area for Petaling Jaya with a number of incentives to support its transformation into a mixed-use development region”.

“At just over two acres, the site meets the minimum size required for the development of serviced residences in Selangor, and can potentially yield a development that is of low density and is more exclusive than some of the larger nearby schemes,” the document adds.

As for the land’s potential price, a good comparison would be Thriven Global Bhd’s development next door on the 1.99-acre Lot 53, which has 47 years left on its lease.

According to Thriven’s annual report, the net book value of the land as at Dec 31, 2018, was RM52.88 million or RM610 psf. A source says this places the valuation of Lot 54 at RM560 psf, which works out to about RM50 million.

Examples of developments within Zone 1 are the completed mixed-use Pacific 63 and serviced residences Avenue D’Vogue while those under construction include Atwater serviced residences by Paramount Corp Bhd and Ryan & Miho serviced residences by OSK Property Holding Bhd. Both Atwater and Ryan & Miho are located near the headquarters of Sin Chew Media Corp Bhd.

In April, a news report said Paramount had sold the Atwater units for RM820 psf. Based on a similar pricing, a back-of-the-envelope calculation for serviced apartments on the former bottling factory site gives a gross development value of between RM200 million and RM220 million.

British American Tobacco (M) Bhd also provides a handy comparison. It sold its factories and two parcels of leasehold land totalling 13 acres on Jalan 19/1, just 500m from Lot 54, to LGB Properties (M) Sdn Bhd for RM218 million or RM382 psf. The sale came with a tenancy agreement for the seller to continue to use the site for a year, after which the owner will build a mixed-use development on it.

National Aerated Water Co’s roots go back to 1929. According to reports, the company was run by the Ching brothers Kwong Yew, Kwong Kuen and Kwong Lum. They established a bottling factory in Serangoon Road, Singapore, in 1954, which became a landmark that was popularly known as the Kickapoo Building. In 1964, the Malaysian plant was opened at a cost of S$350,000.

National Aerated Water Co was wound up in the 1990s as the bottling industry faced high production costs due in part to rising fuel prices.

In December 2016, Selangor Dredging Bhd bought the Singapore factory and freehold land from National Aerated Water Co for S$47 million. However, a year later, it was decided that part of the main building would be gazetted for conservation in recognition of its heritage value. The remaining portion is being developed as Jui Residences Condominium.

A search on the Companies Commission of Malaysia’s website shows that National Aerated Water Co (KL) was registered in 1959. The major shareholders are Ching Chiew Wai (25%), Ching Chiew Leong (25.03%), Kwong Yew (23.28%), Ching Lai Yee (5.56%), Ching Lai Ping (5.56%) and Ching Kwong Hoong (5.19%). Others are Ching Chiew Mun (2.08%), Ching Chiew Yuen (2.08%), Ching Chew Foon (2.08%), Ching Pui Sim (2.08%), Ching Pui Yeng (1.04%) and Ching Pui Harn (1.04%). Chiew Wai, Lai Yee, Lai Ping and Wong Swee Mee are listed as directors of the company.