China-based real estate developer, Qingdao Zhuoyuan Investment Holdings is investing 2.5 billion ringgit (794.4 million U.S. dollars) in Malaysia's southern Iskandar regional development zone in residential and commercial projects.

Qingdao Zhouyuan is a subsidiary of Hebei-based real estate developer, Zhouda Real Estate Group.

The company on Thursday signed an agreement with Iskandar Investment Berhad, the catalytic project developer of Iskandar Malaysia to be the first and the biggest foreign real estate investor in the development zone, according to Iskandar Investment Berhad's president and chief executive officer of Iskandar Investment, Syed Mohamed Ibrahim.

Under the agreement, Qingdao Zhuoyuan would build a residential project on a 7.256-hectare plot in a joint venture with Iskandar Investment and the sale of lease of another 3.896-hectare mixed residential commercial project in Iskandar Malaysia.

Construction of the projects, over three phases, would begin next year and completed in 10 to 15 years.

The Iskandar special development zone that spans of 2,217 square km in Malaysia's southern Johor state was gazetted as a high-impact development to lift the economy of the country.

Syed Mohamed said Iskandar Investment is currently in negotiations with two other Chinese firms for projects in the Iskandar development zone.