Sabah Development Bank open to cutting PacifiCity exposure to revive stalled project

Sabah Development Bank Bhd said it is willing to consider a substantial reduction in its exposure to PacifiCity, a long-abandoned RM2 billion waterfront development in Kota Kinabalu, to help revive the project. About RM300 million remains outstanding, and no firm investor proposal has been received

KUALA LUMPUR (Sept 22): Sabah Development Bank Bhd said on Tuesday it is willing to consider a substantial reduction in its exposure to PacifiCity to support efforts to revive the long-abandoned project. About RM300 million remained outstanding on the project as at Tuesday, according to the Sabah state-owned bank.

The private liquidator has engaged with purchasers and government agencies and conducted several tenders to identify potential investors or “white knights” to revive the project. However, no investor has submitted a firm proposal to date, Sabah Development Bank said.

The lender is the financier of PacifiCity, a RM2 billion integrated waterfront development spanning 18.5 acres at Likas Bay, Kota Kinabalu, which was launched more than two decades ago. The project, developed by Pacific Sanctuary Holdings Sdn Bhd, ran into financial difficulties and stalled in 2023. Pacific Sanctuary has since been wound up, with the project now under the administration of court-appointed private liquidators.

Sabah Development Bank said the main challenge remains the substantial capital required to revive the development. The bank is also not the registered owner of the project land, which belongs to the Sabah State Government Servants Welfare and Sports Council, even as the property is charged to the bank as security.

Nevertheless, Sabah Development Bank said it remains committed to working with the private liquidator, relevant authorities, purchasers and other stakeholders to explore solutions for the project.