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Friday, February 20, 2009

Genting to raise investment in S'pore resort

SINGAPORE: Genting International Plc, which is building a casino and theme park in Singapore, said the opening costs for the so-called integrated resort will have a "significant" impact on its earnings this year.

Genting expects to increase its investment in the resort to S$6.6 billion (S$1 = RM2.39) from S$6 billion, the company said in a statement to the Singapore Exchange. The additional investment will be funded from cash flow once the casino resort opens, it said.

The company yesterday reported it had a loss of S$124.8 million, or 1.38 cents a share, for the year ended December 31, compared with a loss of S$382.8 million, or 5.51 cents, in the year-earlier period.

Sales fell 14 per cent to S$643.8 million as revenue from its UK casino operations dropped.
Genting said the Singapore casino is "on track" to open by early 2010 and more than S$4.5 billion in construction contracts have been given out for the resort, which will include Southeast Asia's first Universal Studios.

Genting International is a unit of Kuala Lumpur-based Genting Bhd, Asia's largest casino operator.

By Bloomberg

Putra Heights interchange opens

KUALA LUMPUR: Sime Darby Property Bhd, a wholly owned subsidiary of Sime Darby Bhd, yesterday opened the Putra Heights Interchange, linking the area’s existing population to key townships and the Kuala Lumpur International Airport (KLIA) via the Elite Highway.

The completion of the 3km interchange, which cost Sime Darby Property RM65 million, would cater to the existing 28,000 population of Putra Heights and future residents, said Sime Darby Property’s managing director Datuk Tunku Putra Badlishah. The residential area is expected to have a population of 60,000 residents when it is fully developed by 2016.

The interchange, which adopted a closed-toll system, would lead to Putrajaya, Cyberjaya and the KLIA via the Elite Highway. The Elite Highway is operated by PLUS Expressways Bhd.

Closed-toll systems require users to pay toll charges based on the type of vehicles used and the distance travelled between a point of
entry and exit.

Speaking at the launch of the Putra Heights interchange yesterday, Works Minister Datuk Sri Mohd Zin Mohamed said the interchange would facilitate a smoother traffic flow for residents in the area.

Meanwhile, it was reported that PLUS had proposed to raise toll rates by 5%, where the increase would see the average toll rate to rise to 14.96 sen per km from the current 13.6 sen per km.

When asked on the toll hike, PLUS’ managing director Noorizah Abd Hamid declined to comment, citing that it was “up to the government to decide”.

Under the concession agreement, PLUS was to have a 10% increase in toll rates for three years beginning Jan 1, 2008 up to 2010, or the government would have to compensate the concessionaire. PLUS last raised its toll charges in 2005.

According to Sime Darby Property, the Putra Heights dual carriageway interchange was the second project built and fully funded by the company after a “trumpet” interchange along the Damansara-Puchong expressway, which is adjacent to the UEP Subang Jaya development.

“Putra Heights is an important and successful development for Sime Darby property. Hence we had committed to construct the interchange at our costs even though this was not a requirement by the authorities,” said Tunku Putra Badlishah.

Putra Heights is a freehold development launched in 1999. To date, over 6,400 unit of mixed properties comprising 5,000 double-storey link homes, 56 bungalow lots, 324 shop-offices and some 1,400 units of medium-cost apartments had been built in Putra Heights.

By EDGE Malaysia (Lim Shie-Lynn)

Shanghai’s industrial property fast losing shine

KUALA LUMPUR: Shanghai’s industrial property is fast losing its shine as the manufacturing sector bears the brunt of weakened demand, renminbi appreciation and rising cost of operations.

With the average price of industrial properties moving south, gross yields are expected to rise to around 10% this year.

While the government’s value-added tax (VAT) reform from production-based to consumption-based this year will stimulate investment, the impetus will be constrained by weak demand in the near term, said Hingyin Lee, the director of research and advisory of Colliers International, East China division.

Lee sees demand for premium quality warehouses and build-to-suit workshops staying firm. More companies will opt for the sale-and-leaseback model to reduce risk.

The vacancy rate in major industrial parks will hover at a low level. Average rentals are expected to be sustained by a relative scarcity in supply of high-quality warehouse facilities, said Lee.

DHL has decided to build a North Asia hub in Shanghai Pudong International Airport. This comes on the heels of the opening of a new international hub at the airport by UPS.

Meanwhile, the average rental of office buildings in business parks will be pressured from new supply coming onstream and a marked rental dip in the Grade A office market.

By The EDGE Malaysia (by Au Foong Yee)