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Monday, July 21, 2008

Malaysia Property Inc to kick off in October

The soon to be launched Malaysia Property Incorporated (MPI), a joint public-private sector initiative to promote Malaysia's real estate internationally, will see the country getting into the limelight as a global property haven.

Promotional programmes that include road shows and conferences in the target markets of Britain, Japan and the Middle East have been drawn up and should take off later this year.

The Government has recently given the go-ahead for FIABCI Malaysia and Real Estate and Housing Developers Association (Rehda) to promote the country's real estate to foreign investors under the MPI umbrella.

Scheduled to kick off by October, the MPI will start off with a grant of RM25mil provided by the Economic Planning Unit (EPU).

Dr Richard Fong

FIABCI Malaysia president Datuk Richard Fong said the initiative, which was initially targeted for launch earlier, was delayed because of unforeseen circumstances.

“We are excited that everything is falling into place now and the MPI will be championing the country's real estate industry in the international arena,” Fong told StarBiz.

He added that Malaysia was still relatively unknown as a destination for international real estate investors.

Compared with other cities around the region such as Singapore, Bangkok, Phuket and Bali, Kuala Lumpur is getting just a tiny fraction of the investment in the region. This is despite the fact that Malaysia has the most attractive laws favouring foreign investment in real estate.

“The majority of the land is freehold and foreigners can buy any amount of residential properties priced above RM250,000. Our land laws are clear and transparent; there is also a waiver on real property gains tax.

“The Malaysia My Second Home (MM2H) programme is also not well known overseas. Most of the investors we met overseas are not aware of the benefits offered under this programme.

“MPI's objectives are aimed at creating awareness among the foreign investment community on the attractive conditions regarding investment in Malaysia's real estate,” Fong said.

Datuk FD Iskandar

According to Rehda vice-president Datuk FD Iskandar, the nine-member board on MPI comprising industry representatives is still working out the right package of incentives for developers to take part in the MPI initiatives.

“We are brain-storming and working out the key performance indicators (KPIs) to rate the effectiveness of the MPI programmes. The objective is for Malaysia to re-brand itself as an international real estate destination, be more transparent and attract more foreign investments,” Iskandar said.

Road shows and promotional activities in the target markets will bring together developers to showcase their property projects, especially high-end residences in the Kuala Lumpur City Centre (KLCC) enclave as well as offices and other commercial properties in the Klang Valley.

According to Iskandar, there has not been any long-term and effective initiatives in the past to promote and brand Malaysia as a major real estate investment destination, which explained why the foreign exposure in local property was still very low.

“Currently, Malaysia is being promoted on a piecemeal basis and the time is right for a well coordinated initiative such as the MPI to place Malaysia on the world map of investors,” Iskandar said.

Besides attracting high net worth investors for the MM2H programme, Iskandar said the MPI also wanted to attract foreign banks' data processing centres and back offices to set up their regional offices in Malaysia.

He said Malaysia was still a politically stable country and the current political developments showed that democracy was still very much alive in the country. Its other assets include a developed infrastructure system and a big pool of educated and skilled workers.

Rehda president Ng Seing Liong said if the objectives and direction for the MPI were on track, “this is definitely the right time for MPI to make a marked contribution to the local property industry.”

“Malaysia has quality projects that still lacked exposure in the international arena and there are many ongoing and planned developments that will be suitable for high net worth foreigners from other countries.

“The greater foreign interest will further add value and depth to our property market. KLCC residences, which are now fetching around RM2,000 per sq ft, are expected to move up to RM3,000 per sq ft with a few upcoming launches,” Ng said.

Yeoh Teng Tatt

Meanwhile, Malton Bhd chief operating officer Yeoh Teng Tatt said to promote stronger foreign participation, the Government should adopt a more open policy for foreigners and relax restrictions on foreign ownership of properties.

“Quality high-end properties in Malaysia are still considerably more affordable compared with most other countries and the MPI initiatives will augur well for local real estate to get into the radar screen of foreign investors,” Yeoh said.

By The Star - StarBiz - (by Angie Ng)

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