E&O secures RM780m in financing facilities from AmBank for Andaman Island Phase 2

• Phase 2 will comprise residential, commercial and leisure components such as shopping malls, office buildings, serviced apartments, branded residences, five- to six-star hotels, and later, educational facilities.

KUALA LUMPUR (Sept 4): Eastern & Oriental Bhd (E&O) has secured RM780 million in financing facilities from AmBank Group to fund the second phase of the Andaman Island project in Penang. 

The facilities, extended to E&O’s wholly owned subsidiary Tanjung Pinang Development Sdn Bhd (TPD), will support ongoing land reclamation, infrastructure works and working capital requirements.

According to E&O managing director Kok Tuck Cheong, the financing will be directed towards Phase 2 of the development, which covers approximately 570 acres of the man-made island. He noted that while earlier infrastructure works under Phase 1 have already cost RM1.5 billion, part of that investment will also benefit the second phase. 

“The total cost for reclamation and infrastructure across the 760-acre island is budgeted at about RM4 billion, though this may vary depending on inflationary pressures,” Kok said during a press conference following the signing ceremony with AmBank’s business banking managing director Christopher Yap.

Phase 2 reclamation works are now at the halfway mark, with coastal protection already completed. E&O is targeting the full completion of land reclamation by 2028.

The company is still finalising the master plan for Phase 2, which is expected to comprise residential, commercial and leisure components such as shopping malls, office buildings, serviced apartments, branded residences, five- to six-star hotels, and later, educational facilities.

The broader Andaman Island master plan spans 307.56 hectares along the Gurney Drive–Tanjung Tokong coastline and is designed to be developed in two phases over approximately 30 years. 

The first phase, covering 102.38 hectares, completed reclamation works in December 2019 and is expected to finish its infrastructure by 2025.

Take-up rate

To date, six projects have been launched under Phase 1—Arica, Maris, The Meg, Senna, Fera and The Lume. Most of these developments have been fully sold, except for The Lume and Maris, both of which have exceeded 50% in sales. 

Kok noted that demand remains steady despite slower take-up compared with earlier launches, particularly for landed properties such as Senna and Fera. Phase 3 of Fera and Senna has recently been soft-launched, while Phase 4 is scheduled for release soon.

E&O reported RM153.3 million in property sales for the first quarter of FY2026, with unbilled sales standing at RM1.34 billion. Andaman Island contributed 56% of the group’s sales during the period. Overall, the group’s development pipeline is estimated at RM17 billion, encompassing residential, commercial and leisure projects.

Connectivity to Andaman Island will also be enhanced with the Gurney Bridge, an eight-lane link scheduled for completion next month. The bridge is expected to reduce travel time by 12 to 15 minutes during peak hours.

As Penang girds itself towards the last lap of its Penang2030 vision, check out how the residential segment is keeping pace in EdgeProp’s special report: PENANG Investing Towards 2030.