Guideline for Assets Ownership “Leased & Owned Properties” for ALJ Land Holding
1. Existing Owned Properties: a. All existing owned properties ownership will be transferred to ALJLH, however lands which will be divested will not be transferred to ALJLH. b. ALJLH will charge the end-user businesses (Tenant) rentals as per market rates with anchor discount, subject to rental growth at 3.5% pa. c. Tatweer-ALJLH will raise project CAPEX budget approval for all renovation and construction works (Project) required by the tenant for the existing owned properties. d. Tatweer-ALJLH will earn a development management fee1 of 5% of the total project construction cost. e. Upon completion of the development work, the total development cost (TDC)2 will be bought by (transferred to) the tenant as a leasehold improvement which will be amortized in their books. f. For the project feasibility process purpose by end-user business, ALJLH will provide TDC only.
2. Existing Leased Properties: a. All existing leased properties contracts will remain under the end-user businesses (Tenant) name as a tenant. b. Tatweer-ALJLH will raise project CAPEX budget approval for all renovation and construction works (Project) required by the tenant. c. Tatweer-ALJLH will earn a development management fee of 5%. d. Upon completion of the development work, the total development cost (TDC) will be bought by (transferred to) the tenant as a leasehold improvement which will be amortized in their books.
1
Development management fees is 5% of (construction cost + soft costs (all other costs incurred on the project other than construction cost e.g. design, PM, supervision, statutory fees)), and wherever 5% fee doesn’t cover the associated cost, Tatweer-ALJLH will follow a cost plus model. 2 Total development cost (TDC)= construction cost + soft costs (all other costs incurred on the
