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Friday, March 7, 2008

Property market to keep drawing foreigners

KUALA LUMPUR: The property market will continue to attract strong foreign interest, says international property consultant CH Williams Talhar & Wong Sdn Bhd (WTW).

Managing director Goh Tian Sui said the economic slowdown in the US and Britain had drawn investors to Malaysia due to the higher dividend yield compared with its regional peers.

The exemption of the real property gains tax (RPGT) announced in Budget 2008 was also another pulling factor, he told reporters at the release of the WTW Property Market Outlook for 2008 & CEO Opinion Survey yesterday.

According to the survey results, 90% of respondents said the RPGT exemption would have a positive impact on the local property industry, while 96% thought the exercise would increase the volume of transactions in the industry.

It also showed 76% of respondents felt the flexible monthly withdrawal by Employees Provident Fund contributors would drive up the local property market.

Last year, integrated mall KL Pavilion, which is 49% owned by Singapore-based Pacific Star group, together with The Gardens@MidValley and Sunway Pyramid 2 contributed 63% of new local retail space, said Goh.

He added that local retail space grew by 14.5% to 36.87 million sq ft last year from 2006.

“We expect another seven retail centres in the Klang Valley to be completed this year,” he said.

Meanwhile, the residential market – principally in the KL City Centre area – remained the “star performer” in the property sector.

In the industrial sector, foreign investments rose 57% to RM21.8bil for the first nine months ended Sept 30, 2007 from RM13.9bil in the previous corresponding period, while domestic investment slipped 17%.

Goh said the top three foreign investors for the period were from Japan, Iran and Singapore.

“We expect the healthy demand for investment-grade properties to continue this year,” he said.

In the hospitality sector, WTW predicted hotel occupancy rate in the country to continue to be over 70% this year.

Last year, tourist arrivals increased to 20.97 million from 17.5 million in 2006.

By The Star

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