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Monday, February 28, 2011

Ireka positive Aseana Properties will start to contribute in next two to three years

Ireka is involved in the construction of phases three and four of Sandakan Harbour Square in Sabah

KUALA LUMPUR: Ireka Corp Bhd is confident its 23%-owned associate company, Aseana Properties Ltd, which has been weighing down on the company's financial performance with its losses, will be able to contribute positively to the group in the next two to three years.

Ireka group executive director Lai Voon Hon said Aseana's portfolio included seven development projects in Malaysia and three projects in Vietnam. It also has a 16.4% equity investment in Ho Chi Minh City-based Nam Long Corp.

“Most of the projects in Aseana are only kicking off from this year and we see Aseana contributing positively to Ireka from financial year 2012 onwards.

“Going forward, the number of projects that will be able to contribute to Aseana's bottomline will increase.

“We are confident that beyond 2012, there will be quite a bit of profits coming in from Aseana,” Lai told StarBiz.

For the nine-month period ended December 31, 2010, Ireka recorded a pre-tax loss of RM10.26mil, compared with a pre-tax profit of RM8.16mil in the preceding year. Revenue was 7% higher at RM308.8mil.

The loss was in part attributable to a share of loss in Aseana Properties of RM7.5mil and a mark-to-market loss for share investment in Kinh Bac City Development Shareholding Corporation of RM1.6mil.

According to Lai, having Aseana as the property fund arm of Ireka is a good business model.

As the exclusive development manager of the fund, Ireka earns a fixed annual management fee and a performance fee from Aseana.

The fund holds all of Ireka's earlier ongoing property projects in Malaysia, leaving the parent company, which is also involved in construction, with an asset-light balance sheet.

“Aseana gives Ireka the platform to expand its expertise to emerging markets such as Vietnam and for the group to undertake more development projects as compared to Ireka undertaking the projects on its own.

“Listed on the London Stock Exchange, Aseana has a larger capital base and the ability to own more development assets or investments.

“Ireka currently manages a portfolio of current and upcoming projects with a total estimated gross development value (GDV) in excess of US$2bil,” Lai added.

He said with Aseana more mature now, Ireka was looking to beef up its property development division and was actively scouting for land in prime areas in Malaysia and Vietnam. It is also looking for joint venture opportunities with land owners.

Together with Aseana Properties, Ireka will soon commence on a number of new development projects, including a residential project in Jalan Kia Peng, Kuala Lumpur.

According to Lai, the plan is to raise the ratio of earnings contribution between the property and construction divisions to 50:50 over the next five years from 5:95 now.

As at Dec 31, 2010, Ireka's construction order book amounted to RM1.003bil with approximately RM430mil still outstanding.

Over the last nine months, the group has tendered for jobs totalling over RM1bil and has successfully secured three projects with total contract sum of about RM297mil.

Its local construction portfolio include SENI Mont' Kiara, a high end condominium project in Mont' Kiara; an integrated hotel cum office towers project at KL Sentral and the Kulai-Second Link Expressway Interchange.

It is also involved in the construction of phases three and four of Sandakan Harbour Square in Sabah, comprising a modern lifestyle mall and a hotel.

Lai said Ireka, which had been active in Vietnam's property market over the past four years, was ready to export its construction expertise there.

The group is confident Vietnam's property and construction markets would bounce back strongly in a year or two's time.

Lai said the construction industry in Vietnam was growing in tandem with the economic development of the country and demand for expertise in the infrastructure, commercial and residential segments would continue to rise.

Earlier this month, Ireka Engineering and Construction Vietnam Company Ltd (IECVCL), a wholly-owned subsidiary of Ireka Corp Bhd, secured a construction package to build a general hospital at the International Hi-Tech Healthcare Park (IHHP) in Binh Tan District, Ho Chi Minh City, in Vietnam.

The contract, valued at RM27.58mil, comprises the construction of a reinforced concrete structure and related ancillary works for the general hospital.

By The Star (by Angie Ng)

Bina Puri eyes RM250m revenue from property

The Jesselton Condominum. Bina Puri is on an expansion trail to strengthen its presence in Sabah. Inset: Bina Puri Holdings Executive Director Mathew Tee

KOTA KINABALU: Bina Puri Holdings Bhd is projecting a total of RM250mil sales revenue from its property division or 20% of the group's overall ongoing projects this year.

Bina Puri Holdings Bhd executive director Mathew Tee, 35, in a media Q&A session at Bina Puri's office at Alam Mesra here on Saturday said the contribution marked the construction group's effort to shift away from its core business activities to property development.

Of the amount RM66mil is from Sabah, said Tee adding that excellent performance of property market in Sabah had contributed positively to their property division from nothing last year to 20% of total gross development this year.

The group's other substantial property contribution came from its new property launches in the Klang Valley, Penang and Johor.

Tee said the company's shift towards property sector was part of its exercise to diversify and balance the group activities from mainly construction.

“We find that property division gives better profit margin. We foresee that in next five years Bina Puri will have a 50:50 mix between construction and property,'' said Tee adding that this year was a record year for Bina Puri Group with a revenue exceeding RM1bil.

The group bullish performance, he said, was due to large volume turnover of ongoing projects which was on average of RM350mil per year or about RM18mil per month.

For the past five years, the group secured on average of RM1.5bil projects per year.

Tee said the group's overall total ongoing projects was RM5.7bil with unbilled portion amounting to RM2.6bil.

Bina Puri's outstanding orderbook of RM2.5bil will roll out over the next two year.

Tee said the company is on an expansion trail to further strengthen its presence in Sabah. Bina Puri has been in Sabah for 15 years and had completed more than RM1.5bil worth of projects here. Currently, it has over RM600mil worth of ongoing projects here.

Tee said the projects include the construction of two high-end condominium; Jesselton View and One Jesselton at Kepayan, affordable housing scheme in Sandakan, Central Lecture Hall & Post Graduate Centre for Universiti Malaysia Sabah and an 8-storey medium-cost apartments in Menggatal.

He added that 28% totalling about RM2.8bil of the group's ongoing projects in Malaysia came from Sabah and Sarawak.

Bina Puri Holdings Bhd is a Bursa Malaysia Main Board company with 35 years of experience in civil and building construction both locally and internationally.

By The Star

Bina Puri unit secures RM1.1bil projects in Brunei

MIRI: Bina Puri Holdings Bhd's subsidiary, Bina Puri (B) Sdn Bhd has secured a total of RM1.1bil worth of projects in Brunei.

Bina Puri (B) Sdn Bhd chairman Datuk Ali Abdullah in a Q&A session in Kuala Belait, Brunei on Friday said the company had an unbilled portion totalling RM265mil until 2013.

He said it planned to secure another RM600mil worth of projects in the Sultanate this year.

He said currently, the company was awaiting the results for two tenders worth about RM192mil which would be known within the next three to six months.

He said, Bina Puri was working on another five tenders worth RM416mil earmarked for this year. Bina Puri, which is involved in construction and infrastructural development, started operations in Brunei in 2007.

“We are looking at the possibility of hopefully securing about RM600mil,'' he said adding that Brunei offered great investment potential especially in civil and construction works as well as hospitality management.

Ali said that among the ongoing projects secured were the construction of 2,000 units of houses for Brunei Economic Development Board (BEDB), which is due for completion in April; infrastructural and housing works in Kampung Lugu and the redevelopment of Ong Sum Ping serviced apartments in Bandar Seri Begawan.

He said Bina Puri group started collaborating with the BEDB in the RM692mil project in 2009, adding that the venture in Brunei accounted for 16% of its current projects totalling RM5.7bil.

By The Star (by Diana Rose)

Saturday, February 26, 2011

Building Asian cities in a sustainable way

The future of Asia is in its cities. It is the cities and the activities generated therein that will help the continent march forward. But in order for cities to thrive, it needs people. Although still one of the less urbanised continents, Asia's urban population has grown from 32% in 1990 to 42% in 2010, according to the United Nations Population Division.

By 2026, half of Asia's 3.7 billion population from India to China (excluding the Middle East) will be city dwellers.

Are the cities prepared to receive the exodus? But let's not go too far. Is Kuala Lumpur ready to welcome the expected 7.2 million that will be calling Greater KL their home? And what is needed to make KL ready?

By 2020, seven out of 10 Malaysians will be living in what will be known as Greater KL. If this is to materiaise, there is much work to be done. After all, that is just nine years away.

Depending on who one speaks to, there are various issues that contribute to a city's livability.

In a recent study commissioned by Siemens and performed by independent Economist Intelligence Unit (EIU), the Asian Green City Index examined eight categories, namely energy and carbon dioxide emission, land use and buildings, transport, waste, water, sanitation, air quality and environmental governance.

The study, carried over the past few months, covered 22 cities. The cities were chosen independently, without invitations by the respective governments in order to enhance the Index's credibility and comparability.

The study concluded that Singapore is Asia's greenest metropolis, ranked well above average. The study effectively equates being green with livability.

Kuala Lumpur was ranked average, together with Bangkok, Beijing, Delhi, Guangzhou, Jakarta, Nanjing, Shanghai and Wuhan.

Karachi in Pakistan, was ranked well below average while Ho Chi Minh in Vietnam was excluded for lack of available information.

Barbara Kux, a member of the managing board of Siemens AG and the company's chief sustainability officer, says the index is not about choosing winners, but sharing information to enable cities to cope and to plan for their future.

“The Asian Green City Index supports cities in their efforts to expand their infrastructures on a sustainable basis. We want to enable Asia's up-and-coming urban centres to achieve healthy growth rates coupled with a high quality of life. It is not about choosing winners,” said Kux.

Siemens Malaysia Sdn Bhd president and CEO Prakash Chandran says, overall, the index is a good reflection of where KL stands in terms of its sustainability.

“Ranking average overall is a great start for KL and this index is a stepping stone for us to move forward to improve our city's livability factor,” he says.

“With the current government plans and greater awareness, the index could not have come in a timelier manner. Siemens is eager to be part of national initiatives to boost KL's performance for the future. Ultimately, we want to be involved in the transformation of KL into one of the greenest, most liveable cities in Asia,” says Prakash.

Above average

Kuala Lumpur ranks above average for air quality and transport. It also scored well for better-than-average levels of sulphur dioxide, nitrogen dioxide and suspended particulate matter.

It lagged behind in waste and water management.

Head of research of Asian Green City Index and senior consultant for EIU, Jan Friederich, says Kuala Lumpur was given the thumbs up for transport because of its light rail system which measures 0.27km per sq km, making it the fourth longest superior network in the index, and second longest among cities in the mid-income range (GDP per capita of US$10,000-US$25,000). He based it on the length of the track, not usage.

While KL ranked positively in transport, there were negatives in the area of waste and water management. Friederich says there is a high usage of convenience packaging and low waste collection rate. It also does not seem to have strong policies on reusing and recycling, he says. Waste generation is 816kg per capita last year, more than double the index average of 375kg.

Water management was another negative. Water consumption is also high and Kuala Lumpur has one of the highest leakage rates with burst pipes, with leakages estimated at 37% compared with the index average of 22%, says Friederich.

So how prepared is KL to count among the cities of tomorrow?

As Kux puts it: “That's the nice thing about cities. Unlike corporates, cities share information and learn from one another.”

NOTE: The European Green City Index was launched in 2009. Last year, Siemens unveiled the Latin American Green Index.

By The Star

I-Berhad, foreign partner to replicate Lotte World at i-City

SEOUL: I-Berhad, an integrated ICT-based developer, will partner a foreign firm to replicate South Korea's Lotte World at its multibillion-ringgit i-City development in Shah Alam, Selangor.

The idea is to earn new corporate tenants at i-City and improve the company's earnings, said I-Berhad chief executive officer Datuk Eu Hong Chew.

Lotte World, built by Korea's Lotte Group in 1989, comprises a hotel, mall, the world's largest indoor theme park, an outdoor amusement park and retails.

When asked if I-Berhad will partner Lotte or has had any discussions with the group, Eu declined to comment.
"We are looking at the Lotte World concept, an attraction within the city, to build up i-City. We are looking at other things," he said on the sidelines after visiting some of South Korea's major attractions this week.

I-Bhd is building up its tourism products at i-City to generate new income stream. Eu said I-Bhd targets to be profitable in the current year ending December 31 2011 driven by growth within all its three divisions, the newest being tourism.

I-Berhad also targets to generate 50 per cent income from property de-velopment, and 25 per cent each from property investment and tourism.

The company, which has been developing i-City since 2005, was able to break even in the last two financial years mainly because it sold and rented data centres with a combined 500,000 sq ft of space.

"We will be adding new attractions this year. The idea is not to make money from tourism but for it to complement our knowledge centre. We believe having certain tourism products and new ideas will attract multi-national firms and small and medium enterprises," Eu said.

For the nine months ended September 30 2010, I-Berhad posted a net loss of RM1.73 million on revenues of RM6.4 million.

I-Berhad is planning to invest RM10 million this year to equip its existing SnoWalk attraction at i-City with real snow fall.

On Wednesday, I-Berhad signed a strategic alliance agreement with BK Korea, a super snow machine manufacturer, in Seoul for exclusive rights to use the later's machines in Malaysia.

At the signing, Eu said the snow fall will attract more visitors to i-City. Currently, SnoWalk, which has been operating since last December, is attracting 90,000 visitors per week.

BK Korea will assemble the equipment in Seoul and ship them to i-City in March.

By Business Times

MRT and real estate: A union on the right track

The introduction of a rail transit investment brings benefits to the transportation system and accessibility of the population to employment, retail, and recreational facilities. One of the most significant impacts of a rail transit project is the impact on property values.

Numerous accounts on the impact of rail transit on property values have surfaced over the past decades with varied results. Most often appear as isolated anecdotes in documenting the impact of rail transit on property values.

The most prominent way to gauge the value of a property is through the price or value of a home that you own or the rent that you pay. Noteworthy is that the amount of space devoted to residential property is generally greater than that devoted to other uses.

Given that the number of residential property owners and tenants are greater than the number of consumers of other types of real-estate, the effects of rail transit on property values are most acutely felt in the residential sector. Hence, most empirical research on the impact of rail transit on property values focuses on the impact on residential property values.

In a US-based 1999 study to examine the potential for housing near MRT stations, comparisons were made between the property values of new housing developments around several MRT stations and developments well outside of MRT stations. Housing units near the MRT stations were found to enjoy higher rents over those away from the MRT system. For example, one-bedroom apartment units within 500 metres of a MRT station in a suburb of San Francisco rented for approximately 10% more per square foot than one-bedroom units away from the station.

Given the positive correlation between rail transit service and property values, is there any potential for negative effects caused by the new transit infrastructure?

Examination of the effects of proximity to rail transit for two neighbourhoods in a Taiwanese city showed that proximity to rail showed a positive effect on property values on the west side, but a negative effect in the neighbourhood on the east side. In the neighbourhood on the west side, property values increased close to US$1,045 for every 100 metres.

The opposite held true for the east side. For every 100 metres closer to the MRT station, the property values dropped by US$965. This negative effect might be due to such factors as noise, perceptions of crime, traffic congestion and visual intrusion. In the case of the west side, the value of accessibility provided by the rail line more than compensated for these nuisance effects. On the east side, the value of accessibility was not enough to compensate for the nuisance effects.

Other studies found the rail transit shows positive correlation to property values to areas where the access provided by the transit service is valued.

In Miami, higher growth, higher priced neighbourhoods experienced greater positive effect than stagnant, lower priced neighbourhoods. In Atlanta, it appeared that the opposite was the case.

The higher income neighbourhoods did not appear to show value associated with being near rail while lower income neighbourhoods did show positive value with that association. While this might appear to be a contradiction, these facts highlight one of the primary reasons why rail transit imparts value to properties. This is the case for the high growth, higher valued districts in Miami and the lower income groups in suburban Atlanta. Positive property value impacts are primarily felt within limited zone around transit stations, generally a reasonable walking distance of up to one-quarter or one-half mile.

Enhancing pedestrian accessibility from the station to the surrounding area can increase the likelihood that properties will be within a reasonable walking distance of the station, hence experience a value benefit.

Improvements to station area accessibility can take the form of increasing the density of streets and pedestrian paths, improving safety, lighting, and other pedestrian amenities, and by providing additional station entrances and portals to allow direct access to the station from more locations.

Although the exact impact of nuisance variables such as noise and visual obstruction caused by terrestrial and elevated rail guide ways has not been extensively reviewed, several studies suggest that such nuisances do lessen the benefits that properties near the rail alignment and rail stations experience. Rail investment planning thus should seek to mitigate these types of effects through effective design and engineering. Rail transit investments have proven to create positive effects on property values. In fact, the effect of a new fixed guideway transit investment is two-fold. First, transit investments improve the convenience of accessing other parts of a region from station locations.

Second, rail transit accessibility enhances the attractiveness of property, increasing the likelihood that the property can be developed or redeveloped to a more valuable and more intense use.

Documentation of the impact of rail transit on property values primarily focuses on the first effect. Property value premiums due to increases in accessibility range between 3% and 40%.

Property value premiums due to increases in the ability to develop or redevelop property depend on the land use and amount of development allowed on the property.

Slight negative impacts of rail on property values are generally attributed to noise, visual intrusion, and the association of the rail right-of-way with industrial uses.

In the case of our 55km MRT project that will run from Sungai Buloh to Kajang, we expect that property values, for example undeveloped land in key hot spots such as on the north side of the line, would surge more than 100% especially near the four proposed interchange stations (Sg Buloh, KL sentral, Maluri and Kajang).

Rahim is executive chairman of Rahim & Co Group of Companies.

By The Star

It’s a small, small world

It is interesting to observe how things are becoming increasingly fluid and inter-connected these days as the whole world turns into a big global village.

With the easy connectivity provided by the Internet and 24-hour cable television that broadcast news as they are happening, it is as if people are living next door to each other even if they are actually thousands of miles apart.

With Skype, Facebook, Twitter and other social networking sites, the global village has grown even smaller and there is no stopping the massive integration and coming together of people from all walks of life and from different parts of the world in pursuit of some common goals and interests.

Travelling has also been made easier and more economical with the advent of low-cost carriers.

The rapid globalisation and borderless world we are living in today offers immense opportunities for more changes and advancements to be made in all fronts of the social, economic and political spheres.

The rapid pace at which people are moving and sharing information has certainly heralded greater awareness of things that are happening around us.

And with whistleblower website WikiLeaks, there is definitely a growing demand for greater accountability and transparency in the way governments, business corporations and communities operate. Irrespective of which side one comes from, we are after all one big global community. The people may be separated by physical distance and other differences, but they actually share many similar traits and aspirations - the need to thrive in a good and safe environment.

The rapid globalisation and coming together of people is increasingly evident in the real estate sector. This can be seen in the rising number of cross-border real estate transactions.

It is not unusual to find people owning multiple homes in different cities around the world as they form the growing population of global citizens. But the threat of inflation is spooking many governments in Asia and they are now on red alert to prevent asset bubbles from boiling over within their borders. Who can blame them when there is much liquidity in the system while the second round of quantitative easing in the US is believed to be driving liquidity to the various asset markets and pushing prices upwards. The speed in which this “hot money” flow into and out of countries has the potential to create another economic carnage of immense proportions if left unchecked. Much asset value will be washed out when these money retreat from our shores.

As it is, just at the press of a button, big sums of monies are crossing borders almost every second. While genuine investors should be welcome as they create jobs and contribute to the country's economic growth, those who only want to hype up the value of their assets for their own selfish gains should be reined in.

Locally, inflationary pressures and the inflow of foreign capital have started to drive Malaysia's property prices upwards and there is growing worry that many middle income earners will not be able to buy their own property, especially in the more upmarket and prime areas. They may have to resort to renting instead.

To address this problem, the opening up of Government-owned land for redevelopment should pay more emphasis to more affordably priced homes to enable the less well-to-do to own properties.

The planned township development on the massive Rubber Research Institute land in Sungei Buloh offers a golden opportunity to kick off a well thought out public housing scheme for eligible Klang Valley folks. It can then be used as a workable model for the other states to follow.

After all, the middle and lower income group still make up more than 80% of the local population.

Deputy news editor Angie Ng is convinced there will be more intermigration of people around the world as dictated by Mother Nature and climate changes.

By The Star (by Angie Ng)

Friday, February 25, 2011

Project to unlock prime land

The clean-up of the Klang River is beyond a massive beautification job as analysts say the project was likely to unlock land potentially for commercial development in areas surrounding it particularly near the city centre of Kuala Lumpur.

PETALING JAYA: The Water of Life project to clean up the Klang River, initiated by the Government under the Economic Transformation Programme (ETP), will unlock land in strategic locations for commercial development, say analysts.

An analyst with Affin Securities said the project was likely to unlock land potentially for commercial development in areas surrounding the Klang River; particularly near the city centre of Kuala Lumpur.

“We see this (unlocking of prime land) as a real possibility,” he said, adding that it would be difficult to estimate the value because details of the project have not been released.

An analyst with a local research unit concurred that the project was beyond a massive beautification job.

“The Government cannot afford to do projects purely for aesthetics costing billions. It will have to look for ways to make the project commercially viable, while befitting the environment and community,” he said.

He also said many issues would need to be addressed quickly, if the project was to go on as scheduled.

“One of the major problems we foresee in the implementation of the project would be land acquisition besides finding the money to fund the project,” he said.

An OSK Research note dated Feb 10 said the clean-up of the Klang River project was estimated to cost between RM8bil and RM10bil with phase 1 costing between RM1bil and RM2bil.

Ekovest co-founder and executive chairman DatuK Lim Kang Hoo confirmed that the company was the lead contractor of the project and that would start this year.

“We are still at the negotiation level, especially on the scope of work,” Lim said.

He agreed that the Water of Life project could unlock valuable land for commercial development in prime locations .

However, he declined to elaborate further, while MRCB was unavailable to comment at press time.

In a filing with Bursa Malaysia on Wednesday, Ekovest announced it had been appointed by the Government as the project delivery partner.

It said in a statement that Ekovest and Malaysian Resources Corp Bhd (MRCB), under a joint venture (JV), had received a letter of intent from the Government via the Kuala Lumpur mayor.

“This intention is subject to further negotiation between Ekovest Bhd and MRCB JV and the River of Life Joint Development Committee which was set up to govern the project on behalf of the Government in relation to the scope and cost of services of the project,” said Ekovest.

Ekovest and MRCB in a joint statement to Bursa Malaysia said the Water of Life project has been identified as one of the nine entry-point projects identified in the Greater Kuala Lumpur/Klang Valley National Key Economic Area under the ETP.

Ekovest is a building construction and civil engineering works company that have carved a named in construction projects such as the Danga Bay water front and property development in Johor.

MRCB is also engaged in construction related activities, environment engineering and property development.

By The Star

Malaysian Annual Real Estate Convention 2011 (MAREC 2011) is back!

Malaysian Annual Real Estate Convention 2011 (MAREC 2011) is back! Themed “Malaysian Real Estate Profession, Glocal or Global”, MAREC convention is dubbed the annual event and the meeting place for all colleagues in real estate business to catch up on the latest happenings and updates.

MAREC 2011 is designed to welcome not only real estate agents or negotiators but also to equip property buyers, landlords or persons in sales with knowlegable tips where and when to purchase in the escalating cost of a potential property and in the fast changing property deal. As we all have seen or heard landed properties have appreciated between 20 to 30 % depending on the location.

“Our expertise will touch on commercial properties , offices, industrial and others. Therefore, members of the public and property investors will be able to learn new skills or tips from our panel of elite speakers,” explains President of MIEA Julie Wong.

Knowledgeable speakers will be sharing their thoughts and ideas on how to improve sales and listing techniques under time management, methods to achieve maximum productivity, transforming your business through virtual assistance and positive tips for increasing profit in an informative discussion and sessions. These speakers are carefully selected and come from various countries to share their thoughts and insights. They will have speakers from Singapore, Indonesia,Thailand , America and our home born expertise.

Among the speakers is the newly elected National Association of Realtors (NAR) President, Ron Phipps who will share about the Real Estate Global Market Perspective,how do we embrace globalization, new technologies and developing business at international level. NAR of America have over 1.3 million members and MIEA will be having a linkage with their website on the listing and selling of properties .

Event details as follows:

Date : March 5 & 6, 2011
Venue : Sime Darby Convention Centre, Bukit Kiara, Kuala Lumpur
Fee : RM788 (MAREC members) RM888 (non member) RM488 (Negotiators)

To register for the tour, contact MAREC at 603 – 79602577.

By The Star

Thursday, February 24, 2011

Legoland aims for one million visitors

Siegfried Borst (left) and Zainal Ashikin Muhammad Rejab looking at a model of pre-war shop houses made of Lego bricks.

NUSAJAYA: Legoland Development, the operator of Legoland Malaysia Theme Park being built here, expects to see one million visitors passing through its gates in the first year of operations.

Legoland Malaysia Project senior director of operations Siegfried Borst said the company was confident of achieving the target based on the high number of family institutions in the region.

He said unlike in developed countries where the birth rate was declining from year to year, most Asian countries still recorded high birth rate.

“Our theme park targets families with young children aged between two and 12 years old and this demographic serves our business strategy well,'' said Borst.

He was speaking at a press conference after a tour for the media to preview the ongoing development at the Legoland site.

Borst said work on the RM720mil project was progressing well and the theme park was expected to open its doors to visitors towards the end of 2012.

The 26ha theme park will offer 40 interactive rides, shows and attractions. It is located in the centre of a 59ha site in Medini North, a zone dedicated to lifestyle development.

Legoland Malaysia Theme Park is the first component to be developed within Legoland Malaysia Resort. The whole project will also have a retail mall, themed hotel, business hotel as well as office and residential areas.

“We are yet to determine the entrance charges. Our next priority is to talk with potential trade partners to market our park,'' he said.

Borst said unlike other Legoland theme parks which only operated eight months a year and closed during winter, Legoland Malaysia would operate all-year round.

He said the main challenge in developing the park in Malaysia was the “sun and rain”, thus more covered pedestrian walkways needed to be built and trees to be planted.

The other Legoland theme parks are Legoland Billund (Denmark), Legoland Windsor (near London, Britain), Legoland Deutschland (Germany) and Legoland California (the United States).

Legoland Malaysia will have miniature replicas of iconic buildings and structures from across Asia. These include Petronas Twin Towers and India's Taj Mahal.

IDR Resorts director Zainal Ashikin Muhammad Rejab said Legoland Malaysia would create about 1,000 jobs for locals and bring spillover effects to Nusajaya. IDR Resorts is part of Iskandar Investment Bhd (IIB).

IIB had, in December 2008, signed an agreement with Merlin Entertainment Group, which will design and operate Legoland Malaysia.

Zainal said with the opening of Legoland Malaysia, IIB would position Medini North as a tourism hub in the 9,712.45ha Nusajaya.

“An indoor theme park is also coming up at Puteri Harbour just a few kilometers away from Legoland Malaysia and both parks will complement each other to attract visitors,” he said.

The government-backed IIB was formed on Nov 3, 2006 to drive commercial initiatives in Iskandar Malaysia via joint ventures and by offering its land.

By The Star

Tradewinds plans new set of 'jewels'

Tradewinds plans to demolish Crowne Plaza Mutiara Hotel and Kompleks Antarabangsa to make way for a new property project.

Tradewinds Corp Bhd, controlled by businessman Tan Sri Syed Mokhtar Al-Bukhary, plans to demolish two of its prized assets in Kuala Lumpur to make way for a "multi-billion-ringgit" mixed commercial development.

This means that the Crowne Plaza Mutiara Hotel and Kompleks Antarabangsa, both located on Jalan Sultan Ismail, will make way for a new property project.

Chairman Tan Sri Megat Najmuddin Megat Khas said the plan is in the advanced concept stage and could take more than a year to start. However, the development order for the site plan is already out.

"We have a very precious piece of land. The hotel together with Kompleks Antarabangsa is on a 2.43ha land," Megat Najmuddin told Business Times in a phone interview.
Tradewinds, he said, is looking at the possibility of building an office, retail and residence component on the land to provide the group with a recurring income stream.

On how high it would be or would it be just a single tower, he said it will be "something soaring".

Megat Najmuddin added that the cost of construction would be in the tune of "billions" of ringgit.

Based on Tradewinds's latest annual report, the hotel is 38 years old, while Kompleks Antarabangsa is 30 years old.

Crowne Plaza Mutiara is a 35-storey hotel with 565 rooms while Kompleks Antarabangsa is a 21-storey office building with five-split level car parks. As at December 31 2009, the net book value of the office building is RM159.83 million.

In April last year, Tradewinds's 85.1 per cent unit, Tradewinds Hotels & Resorts Sdn Bhd, entered an agreement to sell Crowne Plaza to Symbolic Supreme Sdn Bhd for RM384 million. Tradewinds owns 100 per cent of Symbolic Supreme. The transfer is to facilitate the development.

Based on recent land deals in Kuala Lumpur, the building together with the land may now be worth some RM1.5 billion.

The Crowne Plaza is managed by the InterContinental Hotels Group (IHG). It is understood that IHG may still have eight years remaining under the management contract.

Prior to IHG's management of the hotel, Tradewinds managed the hotel on its own for a short period under the name Mutiara KL.

The hotel first opened as the Kuala Lumpur Hilton.

Tradewinds also owns Hotel Istana, which is located a stone's throw away from Crowne Plaza and Hilton Petaling Jaya and Hilton Kuching.

Other properties under the group include Menara Tun Razak on Jalan Raja Laut, Kuala Lumpur.

By Business Times

SP Setia aims to raise up to RM1.2b for expansion

PROPERTY developer SP Setia Bhd's proposed private placement of up to 15 per cent of its paid-up capital is expected to raise up to RM1.2 billion to fund its existing and future expansion.

"We hope to raise between RM1 billion to RM1.2 billion from the proposed private placement," president and chief executive officer Tan Sri Liew Kee Sin said after SP Setia's extraordinary general meeting (EGM) in Shah Alam yesterday.

The exercise would only dilute minimally the company's share capital base, he added.

Liew plans to maintain his shareholding after the exercise. although another major shareholder, the Employees Provident Fund, wanted to raise its stake "a little bit more".
"We cannot speculate on the shareholding spread of these major shareholders," he said.

The EPF is its second largest shareholder with a 14.95 per cent stake as at December 30. Skim Amanah Saham Bumiputera is the largest, with a 20.11 per cent stake. Liew owns 9.19 per cent.

SP Setia said the private placement would involve a bookbuilding exercise, which includes a roadshow involving about 30 global funds.

At the EGM, shareholders approved the proposed placement and bonus issue on a one-for-two basis after the placement.

"This (private placement) will provide us with ample funds to strongly launch three sizeable new projects without having to forego exciting new landbanking opportunities which may come our way," Liew said.

The three major projects planned for launch this year are the KL Eco City - which is opposite the MidValley - Setia City in Setia Alam in Shah Alam and Fulton Lane in Melbourne. They have a combined gross development value of RM12.5 billion.

The group is also negotiating with the government on a swap deal to buy 16.2ha of prime land in Bangsar in exchange for a new health and research complex on a 22.28ha site in Bandar Setia Alam.

"Apart from projects which are already in the pipeline, we are still aggressively scouting for good landbank to lock in future growth," said Liew, adding that SP Setia has 1,494ha of undeveloped land at the moment.

Liew said SP Setia has achieved a quarter of its yearly target sales of RM3 billion in the first quarter ended January 31 2011.

"We are off to a running start on our current year sales target with RM737 million sales already locked in," he said.

By Business Times

Uda to invest RM200m in mall project

JOHOR BARU: Uda Holdings Bhd will invest between RM200mil and RM250mil to develop Angsana II commercial project, adjacent to its existing Plaza Angsana shopping complex here.

Chairman Datuk Nur Jazlan Mohamed said the project was in planning stage and construction was slated to begin by year-end.

“We are looking at a joint-venture basis and will be inviting interested parties to submit their proposals,'' he told StarBiz on Monday after witnessing the signing of service agreement between Telekom Malaysia Bhd (TM) and United Malayan Land Bhd's wholly-owned subsidiary Seri Alam Properties Sdn Bhd.

He said Uda was looking at developing the project on a joint-venture basis with land owners.

The proposed Angsana II commercial project will be the first shopping complex which incorporates a street-mall concept in Johor Baru.

On the Johor Baru city transformation, Uda had been “informally invited” to participate in the project, said Nur Jazlan, adding that the company was keen on it.

On another development, he said Uda had shortlisted 10 out of 14 local and foreign companies which had submitted their proposals to redevelop the former site of Pudu jail into an integrated property development project on a joint-venture basis.

“They are going to present their proposals before the board of directors this month, “ Nur Jazlan said, adding that names of the winners would be announced by the end of March.

By The Star

MRCB, Ekovest in ETP project

PETALING JAYA: Malaysian Resources Corp Bhd (MRCB) and its joint-venture (JV) partner Ekovest Bhd have been appointed the project delivery partner for the River of Life project.

The project has been identified as an entry-point project identified in the Greater Kuala Lumpur/Klang Valley National Key Economic Area under the Economic Transformation Programme, MRCB and Ekovest said in a joint statement to Bursa Malaysia yesterday.

It said the Ekovest BhdMRCB JV had received a letter of intent from the Government via the Kuala Lumpur mayor.

“This intention is subject to further negotiation between Ekovest BhdMRCB JV and the River of Life Joint Development Committee which was set up to govern the project on behalf of the Government in relation to the scope and cost of services of the project,” MRCB said.

By The Star

Shareholders okay SP Setia’s share placement proposal

Tan Sri Liew Kee Sin (right) at the press conference after the meeting. — Bernama

SHAH ALAM: SP Setia Bhd shareholders approved a proposal for the placement of up to 15% of its issued and paid-up share capital. This would involve the issuance of up to 152.52 million new shares, said SP Setia president and chief executive officer Tan Sri Liew Kee Sin after the company's EGM and AGM.

The company hopes to raise between RM1bil and RM2bil from the proposed placement which will be done via a book building exercise.

The placees are SP Setia major shareholders Amanahraya Trustees Bhd (20.12%), a wholly-owned subsidiary of Permodalan Nasional Bhd, the Employees Provident Fund (14.47%) and Liew (11.96%).

The proceeds from the placement will be used for three major new projects that are being planned for this year.

Some RM762mil will be utilised for its projects in KL Eco City, Setia City in Setia Alam and Fulton Land in Melbourne. These three projects have a combined gross development value of RM12.5bil.

The group is also negotiating with the Government on a land swap deal to acquire 40.22 acres in Bangsar in exchange for a modern integrated health and research facility to be constructed on 55.33 acres in its Setia Alam township.

On the National Institute of Health (1NIH), Liew said the project would stimulate growth in the Setia Alam township as there would be a few thousand civil servants working in the facility.

“They will be working, eating and playing within the township. Setia Alam will become like any other modern urban living place in Malaysia.

“We are now in discussions with the Government to build 1NIH. We will probably commence work in six months' time. Once we deliver 1NIH, then we will start to develop the Bangsar land,” said Liew.

Some RM245mil to RM430mil from the placement proceeds will be earmarked for 1NIH, the Bangsar land and further landbanking acquisitions.

Liew said the Bangsar land was very prime Government land. It would be a mixed residential development with the theme of being Bangsar's cultural centre.

“Bangsar is where the upper middle-class people live. We plan to build a museum for artists, a library and a performing arts centre,” said Liew.

Out of the 11 blocks of buildings in KL Eco City, SP Setia plans to maintain one office tower block of 515,738 sq ft and retail space of 313,605 sq ft for its own use.

“We want to tell our buyers, we will be there, and we will anchor the tower for you. The rental in the Gardens, Mid Valley, which is just opposite our development, is RM8 psf. We are hoping to achieve that same kind of yield,” Liew said.

SP Setia is the largest developer in Malaysia in terms of sales. For its year ended Oct 31, 2010, it achieved a new sales record when its revenue increased 40% to RM2.31bil, while net profit was up 47.06% to RM251.81mil.

It is targeting a 30% increase in revenue to RM3bil for its current financial year.

The group's shareholders also approved a proposal for bonus issue on the ratio of one new share for two existing shares held after the proposed share placement.

They also approved SP Setia's proposal to increase the authorised share capital to RM2.25bil comprising 3 billion shares from RM1.2bil comprising 1.6 billion shares currently.

By The Star

Hua Yang to expand to East Malaysia

Property development company Hua Yang Bhd plans to expand its presence to Sabah and Sarawak in the next two years.

Its Chief Executive Officer Ho Wen Yan said for now he saw Kota Kinabalu as the best entry point for the company to penetrate the new market.

"We have identified Kota Kinabalu as a growing vibrant city with strong economic growth in Sabah and Sarawak, due to tourism, plantation, timber as well as oil and gas.

"We are in talks with several parties from Kota Kinabalu, and expect to have at least one project there within one or two years," he told reporters after a media appreciation luncheon here, today.

The company plans to buy 100 to 300 acres of land in Kota Kinabalu with most of them to be in the outskirts. He said any land acquisition would be funded by internal funds or bank

Ho added the company would start off with a small project in Kota Kinabalu in order to test the market.

"We are looking for affordable residential development and township development. "The affordable segment is always very resilient. The RM90,000 to RM400,000 price range demands are currently very strong and we expect it will remain strong for the next two years," he added.

By Bernama

New development planned for Jelutong

The thriving Penang property market has gotten off to a robust start this year with a new development planned for Jelutong.

Tambun Indah Land Berhad has proposed to acquire the entire equity of Premcourt Development Sdn Bhd, and will undertake a mixed strata development project in the area through Premcourt.

The project, with a gross development value (GDV) of RM180mil, involves a 1.69ha piece of land in Jelutong.

Tambun Indah managing director Teh Kiak Seng said the project was located “in the heart of the island” and would feature modern apartments, office suites and shoplots to meet the demand for commercial and lifestyle properties in the central business district.

“We anticipate to commence development in the fourth quarter of the year.

“Targeted completion is by the fourth quarter of 2014,” he said in a statement.

Teh said he was optimistic on the outlook of the Penang property market in light of the government’s commitment to continuously improve the infrastructure and provide incentives to attract corporations to establish and expand their facilities in the state.

He said besides Premcourt, Tambun Indah had proposed to acquire Pridaman Sdn Bhd and Ikhtiar Bitara Sdn Bhd.

“Pridaman and Ikthiar have landbanks on the mainland.

“The purchase consideration for the acquisition of all three companies is RM11.6mil which will be through internally-generated funds.

“Development projects via these companies are expected to contribute approximately RM38.7mil in pre-tax profits from 2011 to 2014,” he said.

He said the proposed acquisitions would increase the group’s GDV by RM245mil and its landbank to 96.3ha.

The layout plans for the projects in Pridaman and Ikhtiar Bitara have received the necessary approvals from the relevant authorities and work is expected to commence soon.

By The Star

Link housing estates with more roads

The authorities have been urged to build more interconnecting roads between housing estates as a means to reduce the traffic congestion on the Damansara-Puchong Highway (LDP).

Barisan Nasional chief coordinator for Puchong, Datuk Lau Yeng Peng said motorists had to use the LDP not only to get out of Puchong but also to move from one housing estate to another within Puchong.

“It would help ease the traffic problems here if there were more roads between residential areas,” he said during a meeting he initiated with LDP concessionaire Litrak at his office in Puchong to highlight the long-standing traffic woes.

“Residents coming from the back end of Puchong go through the Plaza Puchong Barat toll plaza.

“Most of the time, they get stuck in a traffic jam immediately upon exiting the toll.”

He said to avoid this, many motorists headed to the Elite Highway using the route that took them past the Proton plant.

“Unfortunately, sometimes this route too gets jammed up in the morning, especially at the traffic lights that are right before the turning into Elite Highway,” he added.

Lau, who is Puchong Gerakan division chairman, also urged the Subang Jaya Municipal Council (MPSJ) to relocate several bus stops and taxi stands along the LDP so that traffic flow would not be interrupted.

“Traffic jam is not a new problem. It has been there for so long and we do not see any positive measures taken by the state government to overcome the problem,” he said.

At the briefing, Litrak CEO Sazally Saidi pointed out that since 1999, when LDP was built and started operations, it had undertaken RM900mil worth of enhancements on the LDP.

“From the initial 40,000 vehicles per day, traffic volume has gone up to 440,000 vehicles per day. “

Of that number, he said, some 260,000 vehicles passed through the Penchala and Sunway/PJS toll plazas while 180,000 vehicles passed through the Putrajaya and the USJ/PJ toll plazas daily.

Lau said other contributing factors to the jam were not only the increase in vehicles plying the LDP but also the spillover traffic from the Federal Highway where some one million motorists ply daily.

“If the Federal Highway gets choked up in the morning, the backflow can go as far as the Sunway toll,” he said.

Sazally assured that Litrak would be upgrading LDP in Puchong by widening road shoulders and building an additional flyover alongside the existing flyover near the Puchong United club.

By The Star

MK Land records higher Q2 pre-tax profit

MK Land Holdings Bhd posted a higher pre-tax profit of RM6.019 million for the second quarter ended Dec 31, 2010 from RM3.454 million in the same quarter of 2009.

Its revenue increased to RM66.067 million compared with RM48.448 million previously.

For the first six months ended Dec 31, 2010, MK Land recorded a higher pre-tax profit of RM11.631 million compared with RM4.791 million in the corresponding period 2009.

The company's revenue, however, declined to RM127.845 million from RM129.257 million previously.

MK Land expects an improving economic climate and a resilient property market to be the key drivers for its sales growth going forward.

The company anticipates a better financial performance for the financial year ending June 30, 2011.

By Bernama

Wednesday, February 23, 2011

Changing the face of Putrajaya

Towering: Skyscrapers in Putrajaya as seen from a distance.

The concept of Putrajaya is slowly changing with skyscrapers being built and Perbadanan Putrajaya (PPj) said the federal administrative capital was never planned as a low-rise development.

PPj City Planning Department director Omairi Hashim said Putrajaya was planned as a compact city especially on the Core Island where most of the ministries and goverment departments were located.

The buildings in the Core Island of Putrajaya are mostly five-storey tall.

Omairi said skyscrapers were the latest development and the masterplan was approved by the Cabinet in 1995.

“The skyline of the city along Persiaran Perdana (Boulevard) will rise to the maximum height of 40 storeys, becoming the landmark in the city,’’ he said.

He added that the development was being undertaken based on approved layout plans as set out in the Putrajaya Master Plan (PMP).

The master plan covers land use, categories of buildings, hosuing estates, mixed-use development as well green areas in Putrajaya.

Development on Core Island is based on plot ratio, gross floor area, building height and typology of each plot.

Omairi said building height was used to create an urban ambience at the Core Island.

“The PMP has always considered the ‘Flying Path’ determined by the Department of Civil Aviation and as such the buildings will be within the gazetted maximum height,’’ said Omairi.

Six skyscrapers, including four government buildings, are now being built in Precinct 4 and two in Precinct 5.

Omairi said apart from the Putrajaya Core Area, there were five main precincts which are designated as Putrajaya Core Area — Precinct 2, 3, and 4 in the Core Island and Precinct 1 and 5.

“The different height of buildings at the Central Business District (CBD), particularly along Persiaran Perdana (Boulevard) which links all the precincts on the Core Island are planned to create an interesting skyline,’’ said Omairi.

He said the building height of between 18 and 20 storeys in Precinct 2, would be scaled down to about 15 storeys in Precinct 3 and increased to a maximum of 40 at the southern Boulevard.

A long-time resident said he thought Putrajaya was meant to be unique with low-rise development.

“The tall buildings should not be along the Boulevard.

“The Putrajaya International Convention Centre (PICC) which was visible from the Prime Minister’s Office, is now partly blocked by the skyscrapers.

“The area has lost its uniqueness. Even the beauty of the Seri Gemilang bridge is lost,’’ said the resident.

He said the uniqueness of Putrajaya were the architectural buildings and the bridges and adding tall structures had defeated the purpose.

As for the Peripheral area, the approved building height for commercial development is between two and four storeys, while high-rise apartments will be allowed a maximum of 17 storeys.

By The Star

Red Carpet Boulevard designed by French architect

Dynamic: Red Carpet brings the outdoors, indoors to visitors.

In May, 500,000 Klang Valley residents and the immediate population of Kota Damansara will be in for a fresh and exciting experience when Encorp Strand launches Red Carpet Boulevard.

Inspired by the famous Champs-Elysees in Paris, Encorp Berhad’s Red Carpet Boulevard has been crafted by world-renowned French architect Nicolas Ayoub with a contemporary twist.

Its sculptured tree lines, French cafe-styled dining outlets and magnificent lights along the 800ft-long and 90ft-wide Red Carpet Boulevard are reminders of the elegant Parisian boulevard, while its glass canopy, suspended ‘flying’ red carpets above and climate-controlled environment provide a contemporary touch.

“The essence of Red Carpet Boulevard can be summed up in one word — experience. It is a versatile concept built around the experience of life and celebration, and an inspiration of Paris as an ‘emotion’ rather than a ‘city’. We can adapt this to the Malaysian culture because Red Carpet is all about the feeling of an experience,” says Ayoub.

The luxury in this landmark development is also the use of space, not just external but internal as well.

“The space at Red Carpet is dynamic rather than static. This flexibility is what we call ‘living space’, which is ideal for dining and entertainment in an urban setting. Red Carpet brings the outdoors, indoors to visitors. It is a unique embodiment of French cafe culture, combining exciting gourmet adventures with entertainment. It is a place to see and be seen, just like the Champs-Elysees!” added Ayoub.

Red Carpet Boulevard will be the longest and widest alfresco boulevard ever built in the Klang Valley, and it is poised to take its place as the most exciting dining and entertainment spot in the popular and prime “Damansara Belt” of Petaling Jaya.

The F&B outlets fronting the boulevard are second to none, providing alfresco dining and entertainment at its best. The boulevard has been designed to provide communities with a new experience in dining and entertainment. Although typically French in design and inspiration, the offerings will have an international flavour by F&B tenants offering a variety of cuisines and concepts.

A major attraction for Red Carpet Boulevard are its variety of both local and international thematic events and entertainment, which are currently being planned.

Red Carpet Boulevard is events-ready. Facilities such as state-of-the-art sound system,specially designed lighting and fibre optic cables have been seamlessly embedded for a complete ‘plug & play’ experience for those who wish to hold events such as performances, film premiers, fashion shows, product launches as well as music and cultural festivals. The entire Red Carpet area will also be equipped with high speed broadband infrastructure, offering free Wi-Fi access to its visitors.

“Red Carpet Boulevard is going to be a breath of fresh air simply because of its unique experience. What we are offering is essentially a winning combination of a complete dining and entertainment experience, which will be evident at every touch point when you first enter the Boulevard,” said Encorp’s executive chairman Datuk Seri Effendi Norwawi.

The immediate population within a 5km radius of Encorp Strand has a high average annual population growth rate, registering 10.9% between year 2000 and 2007 and it is projected to rise to over 500,000 by this year. A rapid growth of population in this area is expected due to the active residential development in this blossoming township and its surrounding neighbourhoods such as Mutiara Damansara, Taman Tun Dr Ismail, Desa Park City, Damansara Perdana, Sierramas, Valencia, Mont’ Kiara and Sri Hartamas. These communities have an above average spending power and tend to have greater expectations on quality shopping, dining, leisure and business activities.

More To Come At Encorp Strand

More components are progressing well at Encorp Strand, namely Garden Offices, the shopping mall and residences, all of which will transform this integrated development into a complete living, working, shopping, dining and entertainment experience.

Garden Office, which will be ready by 2012, is a unique vision for contemporary office space, where every unit as a corner unit and offers flexibility for both small and big business outfits. It has been designed with sky gardens on all blocks and 150-metre Skywalks, as well as green concepts and features such as rain water conservation, and natural sun shading.

The centre of attraction at Encorp Strand will be the lifestyle boutique neighbourhood shopping mall, which is expected to open in 2012. Offering the best selection of dining outlets, bistros, lounges and entertainment clubs of international standards, the European-inspired mall embodies an atmosphere that combines perfectly with the outdoor experience of the Red Carpet Boulevard.

Encorp Strand has attracted key anchor tenants for the mall. These include a cinema, bowling alley, fitness centre and grocer.

The Residences, to be built just above the shopping mall, will be the icing on the cake.

Characterised by its French architectural style, the 35-storey residential tower will exude high-end comfort, service, security and luxury with panoramic city views.

Residents will have the luxury of a complete 360 experience in their own backyard, complete with clubhouse amenities.

By The Star

Tuesday, February 22, 2011

Mah Sing may spend RM1b on properties

Mah Sing Group Bhd, the Malaysian developer that spent the most on land acquisitions in 2010, said it may pay more than RM1 billion (US$330 million) for new sites this year as the fastest growth in a decade spurs sales.

The developer is seeking to buy land with potential sales valued at RM7 billion to RM12 billion, managing director Leong Hoy Kum said in an interview in Kuala Lumpur yesterday. The properties, which will also include commercial buildings, will be developed in the next five to seven years.

Mah Sing is boosting acquisitions as home prices climbed 6.2 per cent to a record in the third quarter, according to government data. Mah Sing spent RM756 million buying 285 acres of land last year, more than double its 2009 investments and beating Malaysian rivals as it bet on increasing property demand with government efforts to boost economic growth.

“We have a war-chest of RM777 million to spend, land banking is part of our aggressive expansion strategy,” Leong said. “The economic outlook remains bright and consumers are more willing to buy big-ticket items like properties.”

Loans disbursed for home purchases in Malaysia rose to RM5.66 billion in December, the highest recorded in nine months, central bank data showed.

Shares of the Kuala Lumpur-based company have jumped 44 per cent this year, the best performer on the FTSE Bursa Malaysia Top 100 Index, which rose 0.9 per cent. SP Setia Bhd., Malaysia’s biggest developer by sales, climbed 6.2 per cent this year.

‘Big League’

“Mah Sing’s aggressive land-banking exercise will catapult it into the big league, making it too big for investors to ignore,” said Terence Wong, an analyst at CIMB Group Holdings Bhd., who rates the stock “outperform.” “For sales to climb over the longer term, it needs fuel to sustain that growth, which means it will have to keep expanding its land bank.”

Prime Minister Najib Razak’s government unveiled an economic transformation program in September aimed at attracting investment, including US$444 billion of programs this decade ranging from mass rail to nuclear power, led by private and government-linked companies.

Malaysia’s economy expanded 4.8 per cent last quarter, spurring full-year growth to the quickest pace in a decade and putting pressure on the central bank to take more steps to curb inflation. The central bank also placed a limit on the loan-to- value ratio for third mortgages in November, which Mah Sing said hasn’t derailed its investment plans.

“There is no property bubble yet,” Leong said. “We’re not overly concerned about inflationary pressures. Inflation is still at a level where the central bank believes is within market control.”

Mah Sing is targeting property sales to climb to between RM2 billion and RM2.5 billion this year, he said. The company sold RM1.5 billion worth of properties last year.

By Bloomberg traffic hits all-time high Malaysia, the number one property website in the country, hit an all-time high in traffic with more than 750,000 property hunters visiting its property website last month.

When compared with January last year, the website saw a 100 per cent jump in unique visitors, a 57 per cent increase in pageviews and an 84 per cent increase in visits.

In a statement today, the company attributed the growth to Malaysia's recent acquisition of, the launch of the brand's local vertical property websites, and

This also include the release of innovative products such as the iPhone and iPad real estate search applications and its network of distribution partners. Malaysia continued to be the favourite channel for real estate agents to advertise their properties.

Between January 2010 and January 2011, over 2,200 new real estate agents signed with the bringing the total to over 5,300 paying agent subscribers, a 74 per cent growth, since last year.

"Our performance in January 2011 not only marks the beginning of a great year, it is also a testament of our commitment to our customers and consumers.

"We have great plans for this year as we work to continously deliver innovative products, great service and unrivalled property hunting experience. I am confident we will continue to break even more records this year," said Country Manager Timothy Hor.

By Bernama

TM targets to provide more premises in Iskandar with HSBB

Mohd Roslan Mohd Rashidi (left) and Datuk Nur Jazlan Mohamed being briefed by Frankie Tan Kiat How (right) on the project after the agreement signing in Johor Baru.

JOHOR BARU: Telekom Malaysia Bhd (TM) plans to increase the number of premises which have access to its UniFi high-speed broadband (HSBB) service in Iskandar Malaysia this year.

Johor TM general manager Mohd Roslan Mohd Rashidi said it was looking to achieve 45,000 commercial and residential premises connected with the services by year-end from 4,500 premises now.

He said the areas of coverage would be extended from three presently to five more zones to offer wider coverage for the HSBB connectivity within Iskandar Malaysia for its customers.

The five new zones are the Johor Baru Central, Pelangi, Pasir Gudang, Skudai and Tampoi areas while the existing areas are Nusajaya, Permas Jaya and Senai.

“Last year was the pre-introduction of the services for our potential customers in Iskandar and this year we are going on the ground to push the services to them,'' Mohd Roslan told StarBiz yesterday.

He was speaking after signing a HSBB service agreement with United Malaysia Land Bhd's (UM Land) wholly-owned subsidiary Seri Alam Properties Sdn Bhd acting head Frankie Tan Kiat How for its project in Pasir Gudang.

The event was witnessed by Pulai MP Datuk Nur Jazlan Mohamed and UM Land group chief executive officer Pee Tong Lim.

Last year, TM signed similar agreements with Mudra Tropika Sdn Bhd for its housing scheme in Jalan Kolam Ayer, Johor Baru and Dynasty View Sdn Bhd for its Seri Austin project in Tebrau corridor.

“We are going to sign with 15 more developers in Iskandar Malaysia for similar services this year,'' added Mohd Roslan.

He said the company preferred to sign with developers to provide and install the HSBB connectivity for their new residential and commercial launches rather than having the system installed at the completed properties.

However, Mohd Roslan said it would not totally ignore the brown field area. The company would be selective in offering the service to such areas as it involved high cost of laying down fibre-optic cables compared to green field areas.

He said one area which required careful planning was the RM1.8bil Johor Baru city centre transformation project, where the masterplan to be unveiled in the second-quarter of the year would involve the redevelopment of Johor Baru into a vibrant city.

By The Star

Monday, February 21, 2011

Property, neighbourhood and the feel good feeling

We all get excited whenever a friend or a family member buys his first property, be it an apartment or a house.

We look forward to the house-warming party where we can freely give advice on how to transform the house into a home.

These days, however, I notice that the topic of conversation has shifted quite a bit.

The talk is more likely to centre on how much the property is worth, how much it will appreciate in six months, and where the next property hotspot is.

You get the feeling that if someone at the party is willing to offer him a good price, this new owner will be more than happy to move out immediately.

It is a reflection of the times, I suppose, when people have the means to either buy property to live in forever, or for short-term investment purposes.

Whatever the purpose, we have the right to be concerned whenever a new project is proposed, especially if there are serious social, health and environmental concerns involved.

It is not fair to always use the term Not in My Back Yard (NIMBY), or the derivative Nimbyism, pejoratively to describe opposition by residents to a proposal for a new development close to them.

In planning projects for the common good, we should allow active debate on the pros and cons.

But what if the main concern is more about the value of one's property being affected, as revealed in recent debates on the mass rail transit (MRT) project?

My colleague, Thean Lee Cheng, wrote last week that the 50km MRT line will affect 91,900 properties along the way. Of these, 82,700 units, or 90%, will be residential units with a total population of about 341,000. About 40% of these are located in the Sg Buloh-Semantan area, and 46% in the Cheras-Kajang area.

She quoted a source who argued that “if you can hear it, see it, feel the vibration, but cannot access it, your property will be negatively impacted. You want it (MRT) close, but not too close.”

Granted there will be an impact on property prices, but where are the loudest voices of protest coming from?

Many of us are blessed just to have a simple property that we can call home. We work hard to pay off the bank loan and probably another loan we take for our Malaysian-made car.

If there is an efficient public transport system, we might even be able to get by without a car. For those who never take public transport, they might still appreciate having fewer cars on the road.

When I first moved into my neighbourhood 25 years ago, there was plenty of open space where I would take my boys to play.

Over time, I watched the space being gobbled out by a potpourri of projects, some of which I appreciated, but not all. I am thankful for the park, the police station, the public health clinic, the stadium, the many banks, the little Giant and the big Giant, the fast-food joints, and of course the LRT line.

I am not too happy with the upcoming shopping complexes across the highway as I am quite sure it will create some havoc on the roads on my side.

But, on balance, as with anything in life, one has to take the good with the bad. We may not be able control the circumstances of what goes on in our neighbourhood, but we certainly can control our attitude towards these changes. That, after all, is what life is all about.

Deputy executive editor Soo Ewe Jin is reminded that NIMBY can also be used more generally to describe people who advocate some proposal (for example, austerity measures, a green lifestyle and a better transport system) but oppose implementing it in a way that would require sacrifice on their part.

By The Star (by Soo Ewe Jin)

JCorp selling land to repay part of debt

JOHOR BARU: Johor Corp will sell a parcel of land it owns in Johor as part payment for the RM3.6bil debt that is due in July 2012, says president and chief executive officer Kamaruzzaman Abu Kassim.

He also said the land had a market value of more than RM2bil.

The land was located within parts of Johor Baru that were earmarked for development under the RM1.8bil Johor Baru city centre transformation plan, he told Starbiz after the recent EGM of Kulim (M) Bhd - the main listed company under the JCorp stable.

It was reported that Johor will unveil the master plan for the Johor Baru city centre transformation project in the second quarter of this year.

JCorp also owns 3,237.48ha land in Sungai Belungkor, Kota Tinggi. It plans to sell 404.68ha, which is close to the Pengerang oil and gas hub, to the state government.

Petronas has been tasked by the Government to develop Penggerang and Teluk Ramunia into a new oil and gas hub in the region.

“We are hoping to get good prices for our land in the Johor Baru city area and in Sungai Belungkor,’’ he said.

Sources said JCorp’s land in Johor Baru was located near the Bukit Chagar and Lumba Kuda low cost flats as well as the Persada Johor International Convention Centre.

JCorp is also the land owner of the 1,698.87ha Tanjung Langsat industrial area in Pasir Gudang.

JCorp’s unit Tanjung Langsat Port Sdn Bhd manages Johor’s third port the Tanjung Langsat Port which handles bulk cargo such as liquefied petroleum gas and hazardous chemicals.

Kamaruzzaman’s statement about the sale of land indicated a change in strategy by JCorp. Late last year, Kamaruzzaman had said that JCorp would not be selling any of its assets to repay bondholders’ RM3.6bil when the papers are due on July 31, 2012. He had then said the plan was to refinance the debt.

But sources familiar with the situation said Kamaruzzaman was referring to speculation that JCorp would be selling its other key assets, such as QSR Brands Bhd (that owns KFC Holdings (M) Bhd and London-listed New Britain Palm Oil Ltd.

“The proposed sale of JCorp’s land does fit into the strategy of refinancing its debt. In situations where the debt is huge, it only makes sense that the borrower shows some commitment by making some payments as part of the refinancing plan. The sale could help JCorp pay off a portion of the RM3.6bil debt and refinance the balance,” an investment banker said.

Kamaruzzaman had explained that the RM3.6bil debt was due to some JCorp investment projects since 2000, mainly in landed and industrial properties.

JCorp is one of the country’s largest state economic development authorities and it has 250 companies.

According to JCorp’s 2009 annual report, it had RM705mil cash but RM6.62bil in debt.

It had also paid RM500mil in interests and RM1.7bil in loan repayments. Despite being perceived as asset-rich, it only booked RM5mil in dividend receipts in the financial year 2009.

By The Star

Saturday, February 19, 2011

MRCB plans RM300m condo project in KL

PROPERTY developer Malaysian Resources Corp Bhd (MRCB) aims to launch a high-end condominium project in Kuala Lumpur, worth an estimated RM300 million, by the end of this year.

The company has bought 0.4 hectare along Jalan Kia Peng, near the Petronas Twin Towers, from a land owner for an undisclosed amount.

MRCB chief executive officer Datuk Mohamed Razeek Hussain said on Wednesday in a statement that although it is leasehold land, it would be ideal for a residential development due to its prime location and scarcity of land within the Kuala Lumpur City Centre vicinity.

Mohamed Razeek said the company is now finalising the building design and layout plan.
The project, slated to be done in three years, will set a new benchmark in luxury development at the Jalan Kia Peng area along side other established residences, he added.

MRCB also plans to inject new ideas to ensure the project's success.

"With the injection of our concept, the residential development is expected to become yet another preferred residential address with an excellent choice of designs," Mohamed Razeek said.

MRCB, through its property arm MRCB Land, has more than RM5 billion worth of on-going property projects.

By Business Times

Bangsar Shopping Centre constantly reinvents itself to keep up with competition

Upgrades to the BSC in Bangsar are over as there’s no more space left.

BANGSAR Shopping Centre (BSC), which was developed some 20 years ago by Bandar Raya Developments Bhd (BRDB), is still a successful and thriving mall today.

This is despite having to face competition from malls such as Mid Valley Megamall, Bangsar Village I & II and Tropicana City Mall, which are all located within a radius of less than 5km.

John Sironic likens BSC’s lasting power to how Madonna has remained relevant after all these years.

BRDB group retail operations head John Sironic likens BSC's lasting power to how the Queen of Pop, Madonna, has remained relevant after all these years.

“The key is never to stay still, like the Madonna Principle. The reason she has been able to be around for so long (in the music scene) is because she's constantly reinventing herself,” he tells StarBizWeek.

“That's how we have been around for so long. We can't rest on our laurels. We need to keep reinventing ourselves and be up-to-date with the latest trends,” Sironic adds.

According to Sironic, BSC started off about two decades ago with just a single (East) wing.

“About 10 or 12 years ago, we added a new (West) wing,” he says.

In February 2008, BRDB invested RM250mil to upgrade BSC as it felt that the time was right to “reinvent.”

“The mall had been around for so long and it was starting to look a little old. So, we redressed the mall both internally and externally,” Sironic says.

Upgrades, which included a new annex and a 12-storey office block at the back of the mall, took over a year to complete.

“We completed the construction in July of 2009. The job could have been done a lot faster but to do that, we would have needed to close down the mall.

“But we did not do that because we did not want to cause inconvenience to our shoppers,” Sironic says.

The refurbishment of BSC saw the mall increase its floor space to 325 sq ft from 262 sq ft previously. The number of shops also increased to 170 from 126 before.

Sironic also says the addition of new stores was timely as people had become more affluent over the years and had better spending power.

“We felt that it was time to make the mall more contemporary and current. We also felt that we owed it to our tenants, some of which also upgraded to larger lots.”

Sironic says that during the upgrading process, BRDB also took the opportunity to “reshuffle” its tenant mix a little for the better.

“We did some retail zoning and decided to cluster certain tenants in certain areas. So now, you have tenants that specialise in information technology in one area, services for women on one side and home furnishing or jewellery in certain locations.”

The need for reinvention is necessary, especially as needs to compete with malls such as Bangsar Village I & II, which are arguably its closest competitors.

Bangsar Village I “opened its doors” in 2004. Sironic admits that BSC did experience a slight drop in shoppers when the new mall started.

“Initially, there was an impact as shoppers were curious to see what they had to offer. However, people are creatures of habit and after a while they go back to the mall that they had been shopping at for so long.”

Sironic argues that BSC is different from its nearest competitors.

“BSC has a large F&B (food & beverage) offering. The layout of our mall is also different. We have an open front and it is not shaped like a box.

“Even our entrance has no doors and this provides an inviting, resort-like feel.”

Despite conducting the renovations in the thick of the global financial crisis, Sironic says BSC did not see any real drop in shoppers.

“We think this was because we (BSC) have been here for quite a while and our customer base is quite loyal.”

BSC's shoppers generally comprise a more affluent crowd especially expatriates.

“We get a lot of expatriates because they live within the (Bangsar) area. Our mall has sort of become like their backyard. A lot of them come here in simple clothes, wearing a pair of shorts and slippers. We're not a shopping centre that requires you to dress up.”

Sironic says BSC has always positioned itself as a lifestyle, boutique mall that has niche tenants offering niche products.

“We are not intentionally expensive (in terms of product offering). We have small boutique retailers that don't necessarily attract a mass crowd.

“However, I think it is a misconception that we only attract expatriates or only high-end shoppers. You get a large local crowd as well and despite our niche tenant mix, we cater to all income segments.”

Despite having niche tenants within its premises, Sironic says BRDB is open to any kind of tenant that is interested in setting up shop at BSC.

“We don't want cannibalisation, in that we don't want to have tenants that offer the same kind of products. However, we're open to all tenants. We never say never. But for now, our retail mix is complete.”

Pulling in the crowd

One of BSC's key anchor tenants is Cold Storage supermarket, which is a popular attraction for shoppers.

Sironic says it is a misconception that prices of goods and products at BSC's Cold Storage outlet are overpriced.

“From the discussions that we have with them, we understand that they regularly conduct price checks with other competitors to remain competitive.”

Other than Cold Storage, Sironic says other tenants are equally important in terms of “pulling in the crowd.” “They also act as anchors in their own way.”

Many successful malls today have a cineplex as part of their tenant mix. Some time back, BSC had a couple of cinemas but no longer. Sironic says there are no plans to have a movie theatre at BSC.

“For cinemas to be successful, you need a huge area to accommodate multiple cinemas. Because we're not a large mall, we do not want to cater too much space only for movie theatres.”

According to Sironic, the average rental rate at BSC ranges from as low as RM3 per sq ft to RM50 per sq ft.

“It's a wide range and depends on location and usage,” says Sironic. According to him, about 32% of the mall's floor space comprises F&B tenants, which is unusually high for a typical mall.

“We have a wide range of F&B tenants, which include American fast food, coffee shops, fine dining, lifestyle and outlets that cater to a much younger crowd. We want to have a mall where anyone can come and just enjoy themselves.”

BRDB is also planning to open up a 10,000 sq-ft food court in BSC by mid-year.

It also plans to offer free shuttle services from the Bangsar LRT to the mall by next month.

“Once the food court opens and together with the new shuttle service, we expect to attract more customers into the mall, Sironic says.

Sironic says BSC organises three types of promotional events to attract shoppers. First, it hosts activities that are done by external parties.

Case in point is local Peugeot distributor Nasim Sdn Bhd which launched its 308 cc Cabriolet convertible at BSC last month.

“Other promotional activities are done by our tenants themselves and then, there are also calendar-based or festive events.”

Sironic says Christmas is often its peak period in terms of sales, followed by the Chinese New Year festive season.

“Christmas is also a big period because it's the year-end and a time when people get their bonuses,” he says.

BRDB's Grade-A office block, BRDB Tower, meanwhile, currently has a 50% take-up rate. Sironic says BRDB intends to fully lease the 12-storey block by the third quarter of this year.

“Our tenants include banks RHB and Al-Rajhi. There's also a gym and a neurological specialist coming, he says, adding that BRDB is offering “Grade-A” office rates to its tenants.

Sironic says BRDB targets tenants that can also take advantage of the mall's services and facilities.

For now, upgrades to BSC are over, he says. “There's just no more space. We've expanded as much as we can.”

However, setting up a new BSC in another location is definitely a possibility, he adds.

“A new BSC is possible. We're always looking for opportunities. It (setting up a new mall) could be done either independently or via a joint venture.”

By The Star

Asian property market surges 59pc in 2010

HONG KONG: A massive US$63 billion (US41 = RM3.04) was spent on property transactions in Asia last year, a 59 per cent rise from 2009, as the region's economies led the recovery from the global financial crisis, a report said.

Surging prices in Hong Kong and Tokyo made up almost half the total amount spent, according to the study, which comes as several Asian countries grow concerned that large inflows of foreign cash are causing asset bubbles.

The figures, from real estate consultancy CB Richard Ellis, are a huge increase from the US$39.2 billion spent in 2009, when the globe's worst economic crisis since the Great Depression sent property prices sliding.

"The Asian real estate investment market enjoyed an encouraging end to the year and prices for prime investment property have now recovered substantially," said Nick Axford, the consultancy's head of research for the Asia-Pacific area.

"The market outlook remains generally optimistic," he added.

Hong Kong accounted for US$15.2 billion of the total, while Japan's market saw US$14.2 billion in transactions.

Prices in Hong Kong have jumped 50 per cent in the past two years due to low interest rates, a strong economy and an influx of mainland buyers who make up a big proportion of purchases, especially of luxury homes.

Worries about a property bubble have prompted Hong Kong's government to announce a series of measures to cool the market, including boosting land supply and new stamp duties to keep out so-called hot money.

Asian economies have outperformed their Western counterparts in recovering from the global economic slump that started in late 2008, with cash-rich foreign investors and low interest rates stoking demand for Asian properties.


Proposals to reduce number of abandoned housing projects

The special task force to facilitate business (Pemudah) is suggesting ways to further reduce the number of abandoned housing projects in Malaysia.

As at June 30 2010, there were 423 housing projects that were being monitored by the Ministry of Housing and Local Government (MHLG). The projects are either delayed, ailing or abandoned.

In taking those responsible to task, MHLG has implemented stiffer actions by compounding and prosecuting errant developers and blacklisting some.

Under its 2010 annual report, Pemudah is proposing new ideas, which include raising the deposit required to get a developer's licence from the current RM200,000 by 5 per cent.

It also wants to make it mandatory for developers to take on the build-then-sell concept (BTS) and introduce the housing insurance scheme as suggested by the Real Estate and Housing Developers' Association of Malaysia (Rehda), to provide a boost to buyers.

"The government has intentions to review the deposit. One of the proposal is to increase 5 per cent of the construction cost.

"This will ensure only good developers enter the market," said Datuk Abu Bakar Hassan, deputy director-general (development) of the National Housing Department under MHLG.

On the BTS scheme, Abu Bakar told Business Times that the government is studying if it should be made mandatory.

Under this scheme, a buyer would pay 10 per cent down payment for a property, and the rest, after the project is completed.

But developers are complaining as they would have to build the properties with no assurance that buyers would stay, he said.

Abu Bakar said projects are often abandoned as a result of mismanagement, financing issues, mismatched development components and fraud by developers.

"Rehda is proposing that insurance companies take on the risk to protect buyers, if a project is abandoned. The issue is whether they are willing to do it," Abu Bakar said.

By Business Times