Tanco, CNECC win RM700m Pulau Indah warehouse complex job

Tanco Holdings Bhd's construction arm, Tanco Builders Sdn Bhd, and CNECC Engineering (Malaysia) Sdn Bhd have accepted a RM700m letter of award from Jaroses Partners Sdn Bhd to build an industrial warehouse complex on Lebuh Raya Pulau Indah, Klang. Tanco announced the award on 5 November.

What will be built

The site is PT 154764, Pulau Indah (KS 13), Mukim Klang. The complex comprises:

• two single-storey ambient warehouses;
• one single-storey cold storage warehouse with a compressor room;
• a single-storey office, a canteen and surau, and a guard house;
• a 33kV TNB substation, a pump house and electrical rooms, and a sewage treatment plant.

The filing does not give the land area or the floor area, so the contract sum cannot be turned into a cost per square foot. The contractors must aim for at least LEED Gold green certification. If the project misses it because they did not follow the employer's green consultants, a penalty comes off the contract sum.

Timeline

• Earthworks: six months, starting only after Jaroses gets planning permission and early earthworks approval.
• TNB substation: due 12 months after the earthworks finish.
• Buildings and the rest: 18 months, starting after building plan approval and the official notices to start work.
• Defects period: 24 months after practical completion.

Who does what, and who carries the risk

The contract uses the PAM 2018 standard form. The RM700m includes taxes, except service tax on construction work. The contractors must give a 10% performance bond (RM70m) and corporate guarantees from Tanco and from China Nuclear Industry Huaxing Construction Co Ltd, CNECC Malaysia's ultimate parent. Delay damages are capped at 10% of the contract sum.

Under their consortium agreement, Tanco Builders deals with Jaroses, the authorities and the contracting licences. CNECC Malaysia does the design, procurement, building, commissioning and defect repairs, pays for the performance bond and carries the costs and risks. Tanco Builders gets a fixed fee, which was not disclosed, and its liability is capped at that fee. Tanco said its revenue from the project will be limited to that fee, not the RM700m.

The parties

• Jaroses Partners Sdn Bhd was set up on 14 November 2023 to run an integrated automated warehousing logistics hub. Its owners were not disclosed.
• CNECC Engineering (Malaysia) Sdn Bhd was set up in 2012 as Zhonghe Huaxing Development (M) Sdn Bhd and took its present name in May 2024. It is owned through a Singapore company by China Nuclear Industry Huaxing Construction.
• Tanco Builders and CNECC Malaysia agreed in December 2025 to bid together for logistics warehouse and mega-storage jobs. Tanco called this contract a concrete result of that partnership.

Pulau Indah has seen other warehouse deals this year: SSF Home is buying 13 acres there, and Axis-REIT bought three warehouses and leased them back.