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Saturday, April 24, 2010

Napic: Property deals rise to RM25.2bil in Q1

KUALA LUMPUR: Property transactions for the first quarter this year increased to 91,979 worth RM25.2bil, says National Property Information Centre (Napic) director Dr Zailan Mohd Isa.

Datuk Chor Chee Heung launching Napic’s property report. With him are Napic valuation director-general Datuk Abdullah Thalith Md Thani and valuation deputy director-general Abdul Hamid Abu Bakar.

“Last year’s record showed that 79,024 transactions worth RM16.92bil were done in the same period,” she told reporters after the launch of Napic’s property report yesterday.

“The transactions done in the first quarter this year covers all sectors that include residential, shopping complex, shops, offices and industrial building.”

Deputy Finance Minister Datuk Chor Chee Heung, who launched the report, said the outlook for property market this year would be much better than last year.

“The recent Budget has proposed various measures to spur the property market. Apart from providing new homes for the needy groups, the issue of abandoned housing projects have also been tackled.

“The 5% real property gains tax have also been reintroduced to prevent speculation on the price of houses. All these will contribute to the growth of the market,” he said.

Chor added that the Government wanted to spur the Islamic Real Estate Investment Trust (I-REIT) industry to increase foreign direct investments in the country, especially those by Middle-Eastern investors.

“The Malaysian REITS industry, in general, is still small compared with other countries like Singapore, which is worth US$15.1bil and Hong Kong US$8.3bil.

“Ours is worth just about US$1.43bil and we need to do more to increase the FDIs into our property market,” he said.

Chor also said the recent hike in overnight policy rate by Bank Negara would not give much impact on the property market.

By The Star (by Edy Sarif)

On lookout for signs of property speculation, overheating

As the property market makes its recovery, the government has one eye on potential speculative activities.

This is a risk because borrowing costs are still low while developers have their promotions to boost sales. This combination could induce people to bet on rising property prices, aided by an economic recovery.

Indeed, Valuation and Property Services Department director general Datuk Abdullah Thalith Md Thani said the government is concerned about the property market overheating.

However, he pointed out that the government has been taking preventive measures such as the Real Property Gains Tax (RPGT).
The 5 per cent RPGT is applicable to properties that are sold within five years of their purchase.

Still, the property market's recovery appears to be modest as the average price of a house based on The Malaysian All House Price Index, rose by 3.2 per cent to RM184,574 in the last quarter of 2009.

Houses in Kuala Lumpur are the most expensive at at average price of RM381,802, followed by Sabah at RM299,566 and Selangor at RM266,686 in the same quarter.

According to data from the National Property Information Centre, property transactions for the first three months of 2010 rose to 91,979 units, valued at RM25.3 billion, which is 52 per cent higher than in the first quarter of 2009.

Abdullah Thalith said the next three quarters will be better as people generally buy more properties in the second half of the year.

Demand for high-end units priced above RM500,000 will increase steadily. Last year, there were more sales for houses priced between RM100,000 and RM500,000.

By type, terraced houses will still be the most sought after as land prices are rising.

By Business Times

Malaysia property sector records strong Q1 recovery

Sales jumped 52 per cent to RM25.3 billion from a year ago, supported by the positive turn in the economy and new launches during the quarter

The property sector has recorded a strong recovery in the first three months of 2010, with sales jumping 52 per cent to RM25.3 billion compared with the same period last year

The recovery is supported by the positive turn in the economy and new launches during the period.

"We have began to get back on track after the economic recession episode last year. This year, with the stimulus package and improving market sentiment, we expect to grow better," said Deputy Finance Minister I Datuk Wira Chor Chee Heung in Kuala Lumpur yesterday.

Some 91,979 transactions were recorded during the quarter and residential properties make-up the biggest chunk, with some 54,683 units of homes sold. This is followed by agricultural (20,44 units); commercial (9,536 units); development (5,112 units) and industrial (2,178 units).
During the first quarter of 2009 some 79,024 units of properties were sold with a total value of RM16.6 billion.

According to "Malaysian Property Market 2009" report released by Valuation and Property Services Department Ministry of Finance yesterday the Malaysian property market recorded an overall modest performance last year.

However, market value decreased by 8.3 per cent to RM80.1 billion against RM88.34 billion in 2008. Transaction volume was also lower by 0.7 per cent to 337,859 transactions compared with 340,240 transactions previously.

The residential property sub-sector continues to spearhead market transactions and recorded 211,600 transactions worth RM42 billion last year.

In comparison to 2008, this was lower in volume by 2.4 per cent or 216,702 in transaction but higher in value by 1.3 per cent or at RM41.3 billion.

A number of states recorded positive growth with Sarawak capturing 32.7 per cent of the country's total transactions followed by Selangor at 30.6 per cent and Kelantan at 29.2 per cent.

On account of fewer units being launched two years ago, primary market sales performance of new launches strengthened slightly to 48 per cent in 2009 against 44.5 per cent earlier. Out of 45,909 new units that were launched, 22,055 units were sold.

Supported by various measures announced during the recent budget such as providing new homes for the needy and the newly launched scheme using savings from Employees Provident Fund account II to purchase additional home, Chor said the property sector is well on the road to recovery.

"The Government is also looking at various ways to push Islamic REITS and so far we have seen positive development, especially from Middle Eastern investors," Chor said.

By Business Times

Making Redang high-end getaway is not a sustainable solution

The recent suggestion by the Terengganu Mentri Besar that Pulau Redang should be turned into an exclusive getaway for the rich and famous must have peeved many average Malaysians who are left wondering what good would that do.

He also went on to say that new hotels must charge RM1,599 a night, ostensibly to protect the environment.

While the reason may be quite noble as he pointed out the need to protect the island’s natural habitat and marine life, turning it into a high-end escapade for only “the haves” will not guarantee that it will remain an unspoilt nature’s paradise.

Of course, we should not tolerate irresponsible visitors who litter the beach, step on corals, chase after or catch the fishes and other marine life, and breaking marine park regulations.

Although turning Pulau Redang into a high-end vacation paradise only for the rich may sound like a speedy and effortless solution for the state government, it is certainly not a sustainable solution.

The seemingly short-cut solution by barring the average visitors and “the non-rich and non-famous” from stepping on the island is not the answer to resolve the problem.

We cannot assume that the rich and famous are all well behaved and will be civic conscious to safeguard the island’s natural beauty.

We just need to turn the pages of the celebrity magazines and newspapers to know that they are also only human and have many faults and shortcomings.

How many times have we seen people in big expensive cars throwing their cigarette butts or rubbish from their speeding vehicles? Of course, people in other cars are also guilty of such uncivic behaviour.

Instead of assuming that the lower-income group and average people are the culprits for the deterioration of the island’s cleanliness and natural habitat, there should be more pro-active measures to inculcate the right attitude among the people to take care of the island’s surroundings and natural environment.

A more permanent solution will be to conduct a real study on why some visitors don’t behave civilly when on the island and flout the rules, whether written or unwritten.

Drawing up and implementing policies to protect and preserve the island’s natural environment will ensure visitors from all walks of life will toe the line and get to enjoy the island’s beauty.

A list of dos and don’ts while on the island will be a good start and it should be distributed to all visitors upon arrival.

Enforcement, including spot checks, should be conducted regularly to ensure those who break the rules are fined heavily, visitors included.

Resort operators should throw in their support and adopt more green-friendly operating measures. They can also adopt or foster certain parts of the island to ensure its proper maintenance and upkeep.

Ultimately, it boils down to the need to educate our people about the importance of civic consciousness and putting in their share to care for our natural environment.

Schools will be the right place to train our young ones on the need to respect and care for Mother Nature.

Adults, especially parents, are in many ways the resource centres for children and they should always set the right example and be the role models for the young to emulate.

Malaysia has many natural places of attractions and they are for everybody to appreciate and enjoy. All of us have a stake in helping to take good care of them for the benefit of future generations.

So, let’s start by being more civic conscious and do our part for Mother Nature.

Deputy news editor Angie Ng believes by keeping the country’s natural attractions open to all, the people will benefit in terms of stronger ties and respect for each other, regardless of their stature.

By The Star (by Angie Ng)

Hong Leong China project wins award

BEIJING: Guoson Centre, Hong Leong Group's (HLG) flagship project in China, has won the five-star "Best Mixed Use Development in China" Award at the 2010 Asia-Pacific Property Awards recently.

This is the first time a Chinese development has won the regional first prize in this category.

The Asia Pacific Property Awards is part of the International Property Awards to identify the best real estate professionals across the globe. It was held on Apr 16 in Hong Kong.

Guoson Centre was developed by GuocoLand China, the property arm of Malaysia-based HLG.
GuocoLand China is well-known as a "specialist in transportation hubs" for the ingenious site selection of all their developments.

The prize-winning development, Guoson Centre, is a large-scale, integrated mixed use development and is located in Beijing and Shanghai.

The 600,000-sq metre Guoson Centre at GuocoLand's Dongzhimen mixed development in Beijing houses Asia's largest transportation hub and features on-site check-in and customs service, a first in Beijing.

It takes 16 minutes by the airport express to get to the Beijing International Airport.

Meanwhile, the 500,000-sq m Guoson Centre in Shanghai is a 10-minute drive away from the Hongqiao transportation hub, one of the world's largest.

GuocoLand China group managing director, Violet Lee, said Guoson Centre, a mixed development, comprised an international retail mall, five-star British-style hotel, Grade A office towers, high-end residences and expansive Singapore-inspired "Garden City" landscaping.

Guoson Centre in Beijing has a 40,000 sq m sky garden, the largest in a commercial project in China.

The centre in Shanghai offers a water-inspired landscape.

The development contains all the facilities for people to work, live, dine, entertain, travel, shop, and even enjoy a healthy and green lifestyle.

"Guoson Centre has been designed as a city within a city. The Guoson Centre offers everything a person needs for an enjoyable life," she said.

By Bernama

REITs set to ride on recovering economy

PROPERTY is a relatively stable sector for investment, and with the better economic outlook, real estate investment trust (REIT) players are already looking to cash in on the improved sentiment.

Abas A. Jalil ... ‘The old perception that the REIT market is not active is no longer there.’

AmanahRaya-REIT Managers Sdn Bhd chief operating officer Abas A. Jalil claims that many investors are already starting to look at the REIT market positively.

“Previously, people perceived that Malaysian REITS had slow growth in returns,” he tells StarBizWeek.

“However, with the announcement of Sunway City Bhd (SunCity) and Qatar-based REITs, you will see more activities in the local (REIT) scene, which will in turn become the engine for the overall property growth in Malaysia.”

According to Maybank Investment Bank’s recent research note, the asset size of Malaysian REIT market could double to RM18bil by year-end due to three impending listings – the SunCity REIT (with an asset size of RM4bil), CapitaRetail Malaysia Trust (up to RM3bil) and Malaysia’s first cross-border REIT, the Qatar REIT (RM1bil).

Abas believes that the local REITs will spark more interest among investors and the sector will become more vibrant.

“The old perception that the REIT market is not active is no longer there. Investors’ understanding of this segment has also changed,” he says.

“Now they (investors) are seeing REITs as an alternative form of liquid investment that provide a very stable yield as well as a potential upside in terms of pricing.”

AmanahRaya-REIT is the manager for AmanahRaya Real Estate Investment Trust (ARREIT), which is targeting to grow its total assets to RM1.5bil in the next two years, from RM748mil currently, by injecting new properties into its portfolio and improving the value of its existing assets.

Abas, who is confident of achieving this target, says ARREIT has a good mix of tenants with good occupancy rates. It will acquire Selayang Mall in Selayang, Selangor, and Dana 13 in Ara Damansara, which are expected to boost its total asset value to RM1bil.

“ARREIT was listed in February 2007 with an asset size of RM345mil. In three years, we have reached RM1bil. I think this is a good achievement,” he adds.

He says ARREIT also became the first local to be rated by Standard & Poor’s in early 2010, earning a rating of BB+.

Stewart LaBrooy ... ‘Axis REIT Managers is on track to improve on last year’s performance.’

Axis REIT Managers Bhd chief executive officer Stewart LaBrooy says the local REIT market has often been criticised by foreign funds as lacking depth and liquidity, adding however that the new listings will make it more attractive.

Axis REIT announced early this year it was targeting to grow its total assets to at least RM1bil from RM907.7mil as at end 2009. LaBrooy says the target is achievable.

“We have also announced our first acquisition for 2010 – a RM30mil logistics warehouse at the Port of Tanjong Pelapas in Johor. This brings our total assets under management to RM957.78mil and we should be on track to cross the RM1bil target before year-end,” he says in an e-mailed response.

Axis REIT Managers is the promoter of Axis REIT. Its strategy currently is to acquire office and industrial assets that are syariah-compliant, focusing on properties in the Klang Valley, Johor and Penang, says LaBrooy.

“We have just disclosed our first-quarter dividend of 3.7 sen, which is much higher that our peers in the Malaysian market. We are on track to improve on last year’s performance as our recently refurbished Quattro West and Shah Alam SADC 1 welcome new tenants,” he says.

Kumar Tharmalingam says REITs are defensive stocks with longterm capital appreciation.

Hall & Chadwick Asia Sdn Bhd chairman Kumar Tharmalingam believes that the REIT market is looking buoyant and recommends it to anyone looking for stable returns.

“The REITs purchase quality assets and the investments are mostly in commercial buildings. These buildings are mostly in the city centre and the tenancy rate is always good,” he adds.

He says REITs are defensive stocks with long-term capital appreciation, adding that he is optimistic about the Qatar-based REIT.

“I think the prospects are good. The country has good oil reserves and is not affected by the world economy. The only problem is that the property is overseas and the investor needs to travel to Qatar to see them.”

By The Star (by Eugene Mahalingam)

AmFIRST REIT profit up on prudent management

KUALA LUMPUR: Am ARA REIT Managers Sdn Bhd recorded an after-tax profit of RM41.9mil for the financial year ended March 31 (FY10), up 11.6% compared with RM37.5mil in FY09.

Am ARA REIT manages AmFIRST Real Estate Investment Trust.

Chief executive officer Lim Yoon Peng attributed the better performance to prudent cost management, active asset management strategies and six well-located assets.

The company has proposed a final income distribution of 4.88 sen per unit for the six-month period from Oct 1, 2009 to March 31.

In a statement yesterday, Lim said the company, with its enhancement programmes, would position the properties to remain competitive in the market and increase the current occupancy levels.

Meanwhile, the revaluation exercise on all its six properties in the final quarter of FY10 has been completed.

Based on the unaudited results as at March 31, the net asset value per unit of AmFIRST REIT (after provision for distribution) will be RM1.35 upon incorporation of the revaluation surplus of RM12.14mil.

By Bernama

Second Penang bridge 24% completed

GEORGE TOWN: The construction of the RM4.3bil second Penang bridge is now 24% completed compared with about 7% in October last year.

A Jambatan Kedua Sdn Bhd (JKSB) spokesman said the 24% completion covered the works done for both package one and two of the bridge.

Package one involves a RM2.2bil contract work on the main span, substructures and foundation, which is expected to be completed in May 2012.

Meanwhile, package two is a RM1.55bil contract for the construction of the superstructure, scheduled for completion in 2013.

The final package involves RM350mil of land portion works, both on the island and mainland.

The JKSB spokesman said a contract agreement signing ceremony would be held in Kuala Lumpur on Monday between JKSB and CHEC Construction (M) Sdn Bhd, and UEM Builders Bhd.

It is learnt that JKSB managing director Datuk Prof Ismail Mohd Taib would sign the deal on behalf of JKSB.

JKSB is a special-purpose vehicle (SPV) formed by the Government to supervise and fast track the second Penang bridge project.

It is also a concessionaire appointed to oversee the construction, management and operations of the second bridge.

Last October, in a visit to the bridge site, Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop said the bridge completion had to be delayed by a year to 2013 due to re-designing works.

The 17km bridge will link Batu Kawan to Batu Maung on Penang island and will be the longest in the region when completed.

By The Star

Cement to cost 10pc more come May 1

The price of bagged cement is due to rise by 10 per cent to between RM15.50 to RM16.50 per bag from May 1. Each bag weighs 50kg.

Steel millers and cement manufacturers in Malaysia face higher production cost as world oil price had been on the rise.

Earlier this week, Tasek Corp Bhd, announced the 10 per cent retail price increase in a small advertisement.

When contacted, Master Builders Association of Malaysia (MBAM) president Ng Kee Leen said, "The cement manufacturers have been wanting to raise prices for the past year."
It is understood that bulk cement is also expected to go up by RM25 per tonne from May 1.

Builders are thinking of buying raw materials like cement from abroad as they are cheaper.

"As contractors, we have to control costs. We're looking at regional pricing. If we can get basic building materials like bagged cement and steel bars at a cheaper prices, we'll import," he told Business Times in a telephone interview from Taipei, Taiwan.

Ng was leading a 23-member delegation to participate in the 38th International Federation of Asian & Western Pacific Contractors' Association (IFAWPCA) convention to share Malaysia's initiative in promoting the use of environmentally friendly ways of construction.

"We're in talks with building material suppliers in Taiwan for more competitive prices. So far, the talks are encouraging," he said.

Following this, MBAM said pricier steel bars and cement will mean costlier construction projects, be it government funded or jobs procured from property developers.

"We're trying our best to minimise cost but we also have to pass on the material price increase to consumers," Ng said.

By Business Times