KUALA LUMPUR: YNH Property Bhd is working to plug a RM6.8 million shortfall in its sukuk reserve account as it steps up efforts to meet a RM170 million Islamic debt maturity due on Feb 26 next year.
The property developer said it had accumulated RM54.4 million in the designated reserve account as at Oct 27, against the required balance of RM61.2 million for October.
YNH Property said the difference arose from the scheduled accumulation of funds under the sukuk Wakalah arrangement and did not represent a missed principal repayment.
It is taking steps to meet the required balance within the stipulated contractual remedy period.
The funding challenge comes after MARC Ratings downgraded the group’s RM700 million Islamic medium-term notes programme and placed the rating on MARCWatch Negative.
YNH Property said its immediate priorities were meeting monthly reserve-account requirements, accelerating collections from ongoing developments and completing asset disposals to fulfil its financial commitments.
A key part of its funding plan is the proposed RM170 million disposal of its Desa Sri Hartamas land to Sunway Living Space Sdn Bhd.
The company is working with the purchaser and advisers to fulfil the remaining conditions precedent.
Upon completion, the transaction is expected to generate about RM105 million in net cash proceeds after settling the RM65 million loan secured against the land, subject to final adjustments and costs.
YNH Property is also relying on construction progress and sales billings at its Solasta Dutamas project in Kuala Lumpur and townships in Manjung, Perak, to generate progressive billings and cash inflows.
Group managing director Allan Yu Kai Leun said the company recognised that market confidence depended on meeting its commitments.
“Our responsibility is to turn project sales and asset monetisation into cash within the required timelines, while keeping our developments moving on the ground.
“The February 2027 sukuk maturity is a clear priority for management. We will communicate our progress through concrete funding and transaction milestones, so that our sukuk holders, bankers, and shareholders can assess our position based on facts,” he said in a statement.
Separately, YNH said its audited financial statements for the financial year ended June 30, 2026, published on Oct 30, received an unmodified audit opinion from Morison LC PLT, following qualified opinions in the preceding three reporting periods.
The board also approved the implementation of its Investment Governance Standard Operating Policies and Procedures during the financial year.
YNH Property has more than 324 hectares of undeveloped land, which it views as a longer-term development and monetisation pipeline rather than an immediate source of liquidity.