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Thursday, October 23, 2008

'Strong liquidity, firmer ringgit will boost properties'

SINGAPORE: The property market in Malaysia will be affected by the US financial crisis but strong liquidity and a firmer ringgit will help to weather the storm, a developer says.

Sime Darby Property Bhd managing director Datuk Tunku Putra Badlishah Tunku Annuar said for the country, liquidity would mean further access to mortgages.

However, lower interest rates would help to spur interest among consumers to buy house especially on the back of the economic uncertainties, he said.

“Malaysia will be one of the markets in the region that will be less affected by the crisis,” he told reporters here ahead of the launch of the rebranded Sime Darby Performance Centre here today.

Besides Malaysia, Singapore, which is the second biggest market for the developer, will also offer opportunities despite the current lacklustre property market, Badlishah said.

The company has a total landbank of 15,040 hectares in Malaysia, of which more than 75 per cent is for future development.

Last year, the Singapore business contributed 15 per cent to the developer’s bottomline while Malaysia’s operations accounted for 80 per cent contribution.

Among its successful projects in Singapore include the Orion, Balmoral Hills and the Sime Darby Enterprise Centre.

The company also has presence in Vietnam, China, the United Kingdom, the Philippines, Indonesia and Australia.

Badlishah said with the pressure of escalating material costs, the company planned to increase efficiency and procure centrally to help contain the external price pressures.

“We will be announcing some initiatives where we are tying up bulk purchases contracts with suppliers of raw materials so we can get good price for contractors. By doing so, we will be able to mitigate the cost increases.”

He said the company would also take a cautious stance on new property launches due to the slower demand.

By Bernama

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