He said the apartments, operated as a hotel, never turned a profit since 2014, a year after the purchase for RM538 million.
“After taking into account the operational losses and interest cost, Felda will lose about RM38 million if Grand Plaza is sold now,” Rafizi, who is PKR vice president, told a news conference at the office of Invoke centre for policy initiatives.
Rafizi said Grand Plaza, owned by Felda unit FIC UK Properties Sdn Bhd, made a profit only in its first year in 2013.
Financial statements of FIC UK Properties showed a loss of RM9 million in 2014, which rose to RM16.7 million the following year.
According to Rafizi, Grand Plaza was unable to generate profits despite charging a lower room rate of £133 (RM739.70) compared to the market rate of £200 (RM1,112.33).
He claimed Grand Plaza was expected to register a loss of RM11 million each year for 2016 and 2017.
“Since the purchase of Grand Plaza in 2013, the accumulated losses from its operations alone suffered by Felda are estimated at RM45 million,” he said.
Thus, he described the claim by Felda chairman Shahrir Samad that the sale of the apartments would not cause any losses as “arrogant”.
“This shows Felda does not understand the hardship of the people, who include its settlers, even when its finances continue to erode,” he said.
He said the purchase of Grand Plaza was done through an advance from Felda to FIC UK Properties, instead of using structured financing.
He said the advance came from the RM6 billion loan the Employees Provident Fund (EPF) made to Felda Global Ventures Berhad (FGV) before its listing, and which Felda had to bear the annual interest payment.
“The interest cost of the debt to EPF is estimated to total RM136 million since 2013,” he said.