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Tuesday, September 29, 2009

E&O set to cash in on improved mart

High-end property developer Eastern & Oriental Bhd (E&O) is well-poised to capitalise on the improved market conditions, managing director Datuk Terry Tham says.

"Our strong brand and proven track record has helped with successes achieved at our recent property launches," he said in a statement today.

E&O's new launches since June, namely the St Mary Residences in Kuala Lumpur and Seri Tanjung Pinang's seafront terraces and serviced residences, achieved at least 80 per cent take-up rates within a few weeks, he said.

He said the resounding response to these launches provided the impetus for the company to unveil the second block of St Mary Residences, Tower A, via a soft launch in Singapore and Hong Kong in August and September.
"The official launch of St Mary Residences Tower A is slotted for early nex tmonth and will be followed by the Phase One launch of the Seri Tanjung Pinang Condominiums later in the month," he said.

Tham said that with the stream of property launches lined up for the next 12 months, E&O expected its financial position to continue improving in the next quarter and in the year ahead.

This would be supported by E&O's strengthened internal position, achieved through its pre-emptive balance sheet management strategy and rebounding economic conditions, he added.

E&O registered a net profit of RM5.7 million and revenue of RM73.9 million for the first quarter of the financial year ending March 31, 2010.

Tham also said the RM200 million that the group expected to raise through a one-for-two rights issue (irredeemable convertible secured loan stocks) which is expected to be completed in November, coupled with the disposal of existing inventories and non-strategic assets would ensure that the company would be well-funded to drive the development of its upcoming launches and capitalise on opportunities.

By Bernama

Higher local interest in Malaysian property

Domestic interest in Malaysian property is now higher compared to that from overseas in contrast to a year ago, an analysis by showed.

The property website analysed its visitor traffic data over the last three months and compared it with the status last year.

The data is pertinent because in 2008, 82.7 per cent of visitors were from Malaysia, while in 2009, that proportion rose to 85.2 per cent.

Over 80 per cent of the visitors were interested in buying or renting property in Malaysia, said in a statement today.
While there was increased interest from Malaysian property buyers, it was less among those from countries such as Singapore, the United Kingdom, India, Australia, Japan, the United Arab Emirates (UAE) and Pakistan, it said.

Asim Qureshi, the chief executive officer of Think Media Sdn Bhd, the company that owns, commented that the data provided mixed signals.

"On one hand, it indicates the confidence of Malaysians in investing in property has increased in contrast to those from overseas.

"This is to be expected because Malaysia’s property market has been stable. The Malaysian experience of seeing property as an investment has also been more positive compared to those of most other countries," he added.

"However, the negative is that we are not seeing as many foreigners interested in Malaysian property," he said.

According to Qureshi, Malaysia is doing a good job of getting the Malaysian story across overseas in marketing itself as the gateway to Asia, the lack of a property gains tax, liberal ownership rules as well as a strong banking sector.

"These are all strong pull factors for the country. However, the weak global economy must be the prime culprit for the lower level of foreign interest this year. There is not much Malaysia can do about it, except wait," he said.

On a positive note, he said, there was some increased interest from China, Vietnam and Thailand, though Hong Kong’s level was unchanged.

"In my view, this should be a hint for both the government which is trying to promote Malaysia’s real estate abroad as well as developers trying to do the same.

"The focus should increasingly be Asia. Asia is leading the world out of recession. Asian investors will likely play an increasingly important role in Malaysia’s property market in future," he highlighted.

Eddie Chen, the head of Marketing of Think Media Sdn Bhd, pointed out that’s absolute visitor figures have risen by 409 per cent from this time last year.

"This is the result of a shift from people searching for property in traditional classifieds to searching online.

"The shift has been dramatic and in my view, it’s merely the tip of the iceberg. We are conservatively expecting traffic to increase at least a further 300 per cent between now and 2010,"

By Bernama

Growing demand for Aussie homes

PETALING JAYA: Australian properties have always attracted a sizeable number of Malaysian investors and the reasons are obvious.

The country’s close proximity to Malaysia, strong economy, political stability and the number of Malaysians studying Down Under make it probably one of the most favoured destinations for many locals – for a long or short stay.

A property analyst from Australia said these factors aside, one of the main reasons for Malaysians (with permanent resident status) buying Australian properties had been the steady property capital appreciation over the past decade or so with impressive double-digit capital growth per annum posted in all states.

He said even with the global economic downturn, the Australian economy remained robust, thanks mainly to the Government’s A$42bil stimulus package.

The analyst said on record, Australia was the only developed country in the world that did not experience a recesssion.

One of the measures taken by the Australian Government was to allocate A$6.4bil for the housing sector to help Australians own their homes.

And this is where many property developers, real estate agents and those related to the construction industry, as well as ordinary Australians and those with permanent residence, have benefited significantly during the economic downturn.

In fact, in recent times, a number of Australian companies have found it lucrative to market their properties in Malaysia.

One such company is Shac live + invest, which had a two-day launch and exhibition of three of its properties in Kuala Lumpur during the weekend.

Deniz Sivasli... ‘The uptake of Australian properties has been phenomenal.’

Shac managing director Deniz Sivasli said the company had conducted several launches and exhibitions here since 2007 and found Malaysian property investors very receptive.

“Property sales here have been very encouraging, which is why we are back again to promote the balance of our unsold units in three of the projects, which are located in prime locations in Melbourne,” he said.

The three projects are the Grantham Melbourne in Brunswick (about 20 unsold units), High Apartments in Prahran (three units) and EDGE Sandringham (18 units).

All the units are fully furnished and are going from A$179,000 to A$369,000 each. Shac’s marketing agent in Malaysia is AP Properties Sdn Bhd.
Sivasli said the uptake of its properties had been phenomenal, especially since the Government’s initiative to increase the grant for first-home owners.

“In Victoria, first-home owners can expect to receive A$32,000 from the Government for the purchase of their first house, provided they meet all the criteria and sign the sale and purchase agreement by Sept 30,” he said.

It is understood that after the date the full grant will not be available.

“We know there are a number of Malaysians with permanent Australian resident status who are eligible for the grant and have not purchased property in Australia,” he noted.

Sivasli said most first-home buyers were either young Australians, retired singles or new migrants/permanent residents, who wanted a place near the city.

On the yield, he said generally Australian properties had a yield of 3.5% to 4.5% per annum, depending on location but, based on track record, the properties sold under Shac had annual yields of around 6.6%.

He also said Australian properties would generally double in value in seven to eight years.

“Shac is able to get better than average yield because our company is a boutique property developer and we build customised properties in selected areas within the city after an in-depth study on the needs of a particular community and its disposable income,” he said.

On the impact of the stronger Australian dollar in recent months (A$1=RM3.01 as at Sept 25), he said it would have an impact on sales but potential first-time home owners should think long term and also factor in the grant.

They needed to deposit only 10% of the purchase price and 80% financing from Australian banks was available, he said.

“We even brought our bankers to the exhibition to make financing easier for our potential customers.”

Ian Chen... ‘Houses and apartments in Victoria are much sought after by Malaysians.’

Jalin Realty International Pte Ltd chief executive officer Ian Chen said Australian properties were much sought after by Malaysian and Singaporean investors.

“We have been marketing Australian prime properties for several years and the market is definitely good,” he said, adding that many Asians, including Malaysians, were familiar with Australia and its lifestyle.

Jalin Realty is a real estate and marketing agent for Australian property developers that offer luxury and top-of-the-range properties to high-end net worth individuals.

Chen said houses and apartments in Victoria, especially in the city of Melbourne and suburbs, were much sought after, especially by Malaysians.

“The auction ratings for homes in Victoria are about highest among all the states,” he said.

On the impact of the strong Australian dollar, he said many of Jalin Realty’s customers were very affluent.

“The cost of the property is not the first priority to most of our customers. Often it is whether they like the property and its location. These factors count a lot more to them.”

Besides properties in Victoria, the company also markets prime properties in the Gold Coast.

Figures from the Housing Industry Association, released on Sept 24, showed new-home sales nationally increased by 11.8% in August – the best monthly result in over 3½ years.

By The Star (by Danny Yap)

Tabung Haji to set up hotel, complex in Terengganu

Lembaga Tabung Haji is setting up a hotel and complex for pilgrims near the international airport in Kuala Terengganu, Terengganu to help strengthen its product offering in the east coast.

"With the current market situation, investing in real estate is one of the areas that we are exploring. We are starting to look at providing infrastructure in the east coast," its chief executive officer, Datuk Ismee Ismail, said.

"We believe there is good potential for hotels in Kuala Terengganu looking at the number of direct flights available to Mecca," he said at the launch of Tabung Haji Uniteller Service in Kuala Lumpur yesterday.

Ismee said Tabung Haji is in the midst of finalising the design and building plans. He added that it would be viable to have a 3 or 4-star hotel with more than 250 rooms.

The hotel would cater to pilgrims in Kelantan and Terengganu performing the Haj annually, and to the public outside the Haj season.
It is estimated that it would cost the pilgrims fund between RM80 million and RM100 million to build the hotel and complex.

Tabung Haji is expected to start construction in the first half of next year.

This is the second hotel and complex for pilgrims that Tabung Haji is planning to develop this year.

Tabung Haji also plans to build a hotel, complex and conference centre at the Kuala Lumpur International Airport in Sepang, to facilitate Haj pilgrims.

The ground breaking ceremony is expected to take place soon and construction would start in the fourth quarter.

People familiar with the matter said the KLIA project is worth around RM150 million.

It was reported that there are plans to relocate the Tabung Haji complex in Kelana Jaya to the KLIA, with the Kelana Jaya complex being turned into a Tabung Haji hotel, specifically for Haj courses.

Tabung Haji currently owns hotel and complex for pilgrims in Kota Kinabalu, Sabah and in Penang.

By Business Times (by Sharen Kaur)

Berjaya Land Q1 profit jumps 76pc

The property developer posts a net profit of RM78.11 million in the first quarter, with sales falling slightly by 1.17 per cent to RM952.63 million

Property developer Berjaya Land Bhd (BLand) said first-quarter net profit jumped 76 per cent from last year, as earning contributions from its gaming business was able to offset the lower profit contribution from the hotel and resorts division.

It registered a net profit of RM78.11 million in the first quarter, compared with RM44.37 million same period last year. Sales declined marginally by 1.17 per cent, to RM952.63 million during the quarter.

"The lower revenue was mainly due to the lower revenue reported by the hotel and resorts division that was adversely affected by the outbreak of A(H1N1) influenza as well as the prevailing global economic crisis.

"The higher profit for the current quarter was mainly attributed to the higher profit contribution from the gaming business arising from lower prize payout and significant net investment related income," said BLand in a Bursa Malaysia filing yesterday.
However, compared against fourth quarter last financial year, sales were lower mainly due to lower sales from its gaming business, while net profit was higher against fourth quarter ended April 30 2009, mainly due to higher profit contribution from its hotel and resort division.

BLand has some 47 per cent stake in number forecast operator Berjaya Sports Toto Bhd.

The company expects the financial performance for its remaining quarters to be "satisfactory".

BLand shares closed unchanged at RM3.78 yesterday.

By Business Times

Sunway gest RM147.36m Putrajaya contract

Sunway Holdings Bhd's wholly-owned subsidiary Sunway Construction Sdn Bhd has accepted the letter of award for a contract worth RM147.36 million from Putrajaya Holdings Sdn Bhd.

The contract is for the proposed design, construction and completion of a 16-storey three-star hotel and one block of 11-storey office tower.

The proposed project is expected to begin on Oct 7, with a construction period involving 36 months, the group said.

It is expected to contribute positively to the group's earnings for the financial year ending Dec 31, 2010, onwards.

By Bernama

‘Dubai house prices will continue to fall’

DUBAI: Dubai’s house prices, which plunged 47 per cent in the 12 months through June, will continue to fall because of “oversupply,” Jones Lang LaSalle said.

The problem “is likely to get worse before it gets better in some sectors and this will continue to place downward pressure on prices and rental levels in the short term,” the Chicago-based real estate company said.

About one-quarter of Dubai’s offices are empty, and average hotel occupancy rates dropped to about 65 per cent, according to Jones Lang LaSalle.

By Bloomberg