Berjaya Land-mark on S. Korea's treasure island

RESORT CITY IN JEJU : Joint-venture project has gross development value of US$3.2b

BERJAYA Land Bhd's (BLand) landmark Berjaya Jeju Airest City project in Jeju is expected to further boost not only the company's footprint in South Korea but also the island's future as a prime tourist attraction.

"Jeju Island is a hidden treasure. It has high potential of growth thanks to its strategic location and clean environment. Our team at Berjaya is committed to ensuring the success of the Berjaya Jeju Airest City resort project," said BLand chief executive officer Datuk Francis Ng Sooi Lin at the launch of the Berjaya Jeju Airest City Promotion Centre at the Boutique Monaco Museum, Gangnam, here, yesterday.

Also present were Jeju Free International City Development (JDC) chairman Byon Jong Il, Jeju Special Self-Governing Province Investment Inducement Department director Moon Young Bang, media representatives from Malaysia and South Korea and more than 100 guests.

Berjaya Jeju Resort (BJR) is a joint venture that has been formed to oversee the Berjaya Jeju Airest City project, which has a gross development cost of around US$2.4 billion (RM7.32 billion) and a total gross development value of US$3.2 billion.

BJR is 72.6 per cent owned by BLand with the remaining held by Jeju Free International City Development (JDC), a government agency, at 19 per cent and Swan Street Partner LLP at 8.4 per cent.

So far, BLand has invested about US$140 million in the project, which is one of the largest foreign direct investments in South Korea's tourism industry.

The 74.4ha Berjaya Jeju Airest City is an integrated resort located by the coastline of Yerae-dong, Seogwipo City on Jeju Province.

Once completed, the site will boast of a 45-storey Landmark Tower, a casino hotel, a massive retail and shopping mall, a medical centre and entertainment and sports facilities.

Infrastructure works at the entire site have been completed, with Phase One of the project, the Gotjawal Village, set to begin by year-end.

The Gotjawal Village, which will cost US$250 million, comprises a 230-key five-star hotel, the upscale Seaside Maison and the Market Walk.

Seaside Maison will have 51 units of villa-type condominiums while Market Walk will have 96 units of low-rise commercial and residential condominiums.

At almost US$1,000 psf and sizes of up to 3,000 sq f each, they may well be some of the most expensive but exclusive real estates in the country.

"Gotjawal Village is located on the 'best stretch' of the Berjaya Jeju Airest City. Therefore, we are very confident of achieving a 25 per cent minimum return on our investment once it is completed," said Ng during a visit to the site of the Berjaya Jeju Airest City in Jeju on Thursday.

"We have received many enquiries regarding those units. Some of the designs are eccentric but this is apparently what the buyers wanted, especially those from Seoul," said Ng.

"We can't start selling the units yet until we have completed at least 20 per cent of the sub-structures of the Gotjawal Village, and I estimate that is in about three to four months from now.

"Also, as a further incentive, those who buy properties in Jeju will be granted a five-year visa and, after that, permanent residence status for themselves and their immediate family members," Ng added.

BLand senior general manager of properties marketing Mah Siew Wan said the company has conducted indepth studies as to why people would want to come to Jeju and what it has to offer.

"The result is that the people want something different," she said. "And we are giving them something different and unique."

The Gotjawal Village is the first of up to eight phases of the the Berjaya Jeju Airest City project, which also include plans for a medical centre, a shopping mall, a casino, a five-star resort hotel and the 45-storey Landmark Tower, the tallest building on Jeju Island once it is completed.

On the next step after the Gotjawal Village, Ng said BLand plans to develop either the casino hotel or the medical centre.

The Berjaya Jeju Airest City project is expected to generate almost 4,000 jobs upon completion within the next five years.

And this will be good news for the JDC, too, for it has been tasked with bringing development to the island and improving the livelihood of its population of 565,000 people.

Its investment strategy department director, C.M. Lee, said plans are afoot to bring the size of the population up to one million within the next five years.

As part of that initiative to develop the Jeju Free International City, the "special corporation" has implemented six strategies that called for the creation of a global education city, a healthcare town, a science park, a Myth & History Theme Park, a tourism port and a residence resort complex, of which the Berjaya Jeju Airest City is part of.

"We have attracted the North London Collegiate School and the Branksome Hall of Toronto to set up branches here. We are also in the midst of setting up a hospital offering quality services, including plastic surgery, which South Korea is famous for," he said with a laugh.

A science park that is tailored after the Multimedia Super Corridor in Malaysia has also been set up with the vision of utilising local biodiversity and green resources to foster knowledge-based industries.

The number of tourist arrivals have been on a steady increase over the past decade, especially those from Southeast Asia. JDC is confident that with the various available incentives, more tourists and foreign investors will flock here.

And this certainly bodes well for BLand's massive endeavour on Jeju Island.

By Business Times

Berjaya Land plans RM9.92bil casino and mall on Jeju Island

JEJU ISLAND: Berjaya Land Bhd's (BLand) US$3.2bil (RM9.92bil) Berjaya Jeju Resort will feature the biggest casino and shopping mall in South Korea, along with condominiums, villas, hotels and a landmark building once it is completed.

The first phase to be launched will be its 51 villas and 96 “market walk” units with a gross development value of US$250mil, with prices starting from US$1,000 (RM3,300) per sq ft.

Ng: Jeju Resort will create some 4,000 jobs

BLand chief executive officer Datuk Francis Ng is confident of generating 25% return from Phase 1 alone.

“In South Korea, we can only start selling the units once we have done 20% of construction works. We should be able to start selling in three to four months. However, our pre-marketing is already starting,” he said.

Ng said this at the opening ceremony of BLand's property gallery here.

He added that for the moment, Phase 1 would be fully funded by internal funds, although some financiers had expressed interest to provide loans. The entire Phase 1 should be completed in 26 months.

Right now, Jeju Island has the support of the Central Government of South Korea to transform the area into an international tourist destination, matching the likes of Hong Kong and Singapore.

BLand's wholly owned subsidiary Berjaya Leisure (Cayman) Ltd has a 72.6% stake in the project, while Jeju Free International City Development Centre has a 19% stake and Swan Street Partner LLP holds the remaining 8.4%.

Ng said the Jeju Resort, which has one kilometre coastline, would create some 4,000 jobs and would help provide more hotel accommodations currently not available on the resort island.

“We will have some three hotels in our resort. Right now, we are in talks with Ritz Carlton to be our partner for one of our hotels,” he said.

Since venturing into the project in 2008, BLand has pumped in some US$100mil (RM310mil) on the infrastructure works itself. It bought the 75-acre freehold land for US$62mil (RM192.2mil) or US$8 (RM24.80) per sq ft.

Currently, buyers who buy properties worth US$500,000 and above in Jeju Island will be entitled to permanent residency in the resort island.

On the casino front, Ng said the group was not in a hurry to proceed with the development as presently, the South Korean government had yet to issue domestic casino licences.

The local government of Jeju Island is in talks with the Central Government of South Korea to review the liberalisation of this domestic casino licence. Jeju Island is a self governing province in South Korea.

Meanwhile, for the shopping mall component, BLand intends to develop it on its own and look for a local partner.

By The Star

Posco to seal deal with Berjaya Land

Posco will take not more than 20 per cent stake in the development of Berjaya Jeju Resort on a 73.2ha site in Yeraedong in Seogwipo City, southwest of Jeju island.

BERJAYA Land Bhd (BLand), a property and gaming company, is close to inking a partnership agreement with South Korean steelmaker Posco Group on the acquisition of up to 20 per cent in the former's US$3 billion (RM9 billion) project in South Korea.

BLand is developing Berjaya Jeju Resort through its subsidiary, Berjaya Jeju Resort Ltd (BJR), on a 73.2ha site in Yeraedong in Seogwipo City, southwest of Jeju island.

BJR director Tan u-Jiun told Business Times in an interview that it expects to seal the deal with Posco by August or September this year.

"Posco will take not more than 20 per cent stake in the development and they will help to develop it," Tan said.

Posco, which is listed in Seoul, Tokyo, London and New York, is involved in railway development, construction of buildings and infrastructure and steel manufacturing.

This will be the first partnership for Posco in Malaysia and the agreement with BLand is via its unit, Posco Engineering & Construction Co Ltd.

Tan, the younger son of Berjaya group founder Tan Sri Vincent Tan, said the first phase of the project comprising 212 units of luxury villas and market place is slated to be launched by the end of this year or early next year.

"We are awaiting the final approval for the Environmental Impact Assessment on our revised masterplan. We expect it to complete in May," Tan said.

The integrated project will have 1,403 condominium units, villas and bungalows, 935 hotel rooms, a one million sq ft retail mall that will be the largest in Jeju, a medical facility and a market place which will comprise super luxury shops and single-storey residences.

The landmark tower will be a 45-storey hotel, which will be the tallest building on the island. Complementing that is a 505-room casino hotel, which will be South Korea's largest casino complex, Tan said.

"We are launching the villas and market place first to attract higher paying customers to the development. Once the market is guaranteed and it creates an aspirational image, we will release the medium-tier properties," he said.

Tan said BJR hopes to start constructing the villas and market place by August this year.

According to him, BLand has invested close to US$150 million (RM450 million) on infrastructure works for the project, which was completed in December last year. The project will take five to six years to develop.

"We are targeting the Koreans and Europeans. We don't think the European market will be strong because of the eurozone debt crisis but we expect same sales there. We are also targeting China and Japan," Tan said.

Berjaya Jeju Resort recently won an award in the category of mixed- used development for South Korea at the Asia Pacific Property Awards 2012.

By Business Times

Seoul’s residential market

I visited South Korea recently in connection with a valuer (called appraiser there) meeting and although this was not my first visit, I was nonetheless impressed with the generally high level of efficiency in the country. Hassel free, from the well organised public transport, to the high service levels in the hotel and retail sectors.

The smooth and efficient bullet train ride from Seoul to Gyeongju, covering about 400 kilometres in two and a half hours was also impressive.

Not so efficient, in my opinion however, is the housing market in Seoul. Possibly a bubble that will burst, if it does not deflate quietly (which is unlikely), or one that risks growing bigger and then bursting or deflating. Astute policy nudging and/or more in-depth, knowledge-based decision making by market participants are key to a smooth “landing”.

Greater Seoul has 20 million inhabitants and that is 40% of the population of the country, a rather high percentage for a capital city. The Korean Peninsula is mountainous.

The per capita GDP of the country is about RM60,000 (based on a conversion of 1:3) as compared with Malaysia's, which is about RM21,000. The average monthly household income in Seoul is RM12,000. In Greater Kuala Lumpur it is about RM6,000.

The average house price in Seoul is about RM1.4mil and this means that on average the house price is close to 10 times household income, and this is viewed with some consternation by Koreans. About 10 years ago the average house price was 6 times household income, also slightly elevated as measured based on a global long term benchmark for developed countries at three times.

Kuala Lumpur typically has house prices at a long term relationship of around 4 to 4.5 times annual household income, but in many hot spots, in the past few years, there has been a run up to more than 10 to 15 times when viewed from an average household. And it may surprise many, that despite frequent comparisons with high-end condominiums in Singapore, HDB flats in Singapore, that house the majority of households in Singapore, the relationship is only about three times.

Japan which neighbours Korea had a property bubble in the late 1980's and prices soared to close to 20 times annual household income, only to come down crashing, and 20 years later, most of the medium sized cities in Japan have a corrected and stable relationship of about five to six times but with the Tokyo suburbs closer to 10 times.

Net yields, the second driving fundamental in the housing market, in Seoul are nothing much to speak about, being about 2% per annum. In Kuala Lumpur yields have slipped below the 3% benchmark for the ubiquitous double story terrace house. This figure of 3%, in the hierarchy of property yields, is generally acceptable when capital appreciation possibilities are a possibility but when such possibilities dim then a higher return should be the order of the day.

My Valuer friends in Seoul opine that much has to do with “Chonsei” system in Korea that has led to the high house prices in Seoul, apart from a long, inordinate support for the construction industry that has now resulted in construction being a high 20% of GDP, and the other usual culprits of easy money and exceptionally low interest rates.

This system of owning houses for owner occupation and investment is predicated on rising house prices. Landlords, for example, rent out houses by getting the tenant to set aside in a finance company or bank a lump sum for rent over two years and take the interest as rent.

Interest, which in the past, and due to artificial constructs was high, has come down as the economy irons out these constructs as it modernises further. The landlords in the past were happy with this because their focus was on capital appreciation, which was sustained and high.

But of late, especially since the middle of the last decade, house prices have stopped rising. The market is now normalising and rents that drive values are taking hold and tying values to more normal returns. The process will continue further as the Koreans move inexorably towards a market where house prices are tied to household incomes and driven by rental returns.

The housing market in any modern economy is an important pillar. It is a store of household wealth and when it stalls or falls it has an impact, sometimes an outsized impact, on the economy.

In the United States, house prices went up (and was allowed to go up by design or mistaken notions) against governing fundamentals and are now on a downward trajectory to the detriment of the economy at large and the global economy. A recent article in the Wall Street Journal shows the pre-bubble average house price increase from 1988 to 2000 to be 3.6% per annum and it shot up to 10.4% per annum between 2000 and 2007, outstripping average household income increase.

The US Bureau recently revealed that median household income in the United States in 2010 fell to US$49,445, the lowest in more than a decade. In Malaysia, our country-wide compounded annual average house-price increase in the period 2000 to 2009 was about 5%, running neck to neck with household-income increases.

Regulators are obliged to cast a watchful eye on the housing market and know the driving fundamentals, and where and when needed, nudge the market through astute policy intervention.

Post 2008 Global Financial Crisis, most countries in the region, including ours, have taken policy measures targeted at the housing market as against mainly broad brush monetary policy measures of the past, to stamp out excessive speculation and keep the market tied or running not too far from underlying fundamentals. This no doubt requires constant monitoring of the market, and in particular, before and after any policy implementation.

On a broader perspective, the market should be allowed to function as a free market and any intervention kept to a minimum and only to iron out free market imperfections.

Elvin Fernandez believes in the free market and timely nudging by policy makers and key market participants to iron out any, and only where needed, imperfections in the system.

By The Star (by Elvin Fernandez)

N. Korea launches city facelift to mark anniversary

North Korea said Friday it had launched a construction project to change the showcase capital "beyond recognition" in the run-up to the centenary of its founder's birth next year.

The massive construction will centre on the Mansudae area of Pyongyang where the giant statue of late president Kim Il-Sung stands, the official Korean Central News Agency said.It will include a "monumental edifice", high-rise apartment blocks, public buildings and cultural and leisure facilities including a round people's theatre facing the existing Mansudae Assembly Hall where parliament meets.A restaurant will also be built to face Pyongyang's famous Okryu Restaurant, along with a park.

The new construction will match existing monumental edifices dedicated to the memory of the founder and his Juche (self-reliance) ideology, the agency said."This will change the appearance of the capital city beyond recognition," it added.

The North in 2009 announced plans to build 100,000 new high-rise apartments in three districts of the capital to mark the 2012 anniversary.The latest project has been announced despite chronic food shortages in the impoverished communist state.

UN agencies say six million people, a quarter of the population, urgently need aid.The North has vowed to become a "great, powerful and prosperous nation" by next year, the 100th anniversary of the birth of its founder who died in 1994.The country fosters an all-pervasive personality cult built around the late Kim and his son and current leader Kim Jong-Il.Kim Jong-Il is now grooming his own son Jong-Un as heir apparent.

By AFP

S.Korea announces multi-billion dollar plan for new city

South Korea's government Monday announced a 14.6 billion dollar blueprint to develop a new city as a science and education hub, dropping controversial plans to move several ministries there.

The country's biggest business group Samsung has signed a deal to move some operations to Sejong City, along with the Hanwha, Woongjin and Lotte groups, said Prime Minister Chung Un-Chan.

Monday's announcement officially scraps a plan announced in 2005 by then-President Roh Moo-Hyun to relocate nine ministries and four subsidiary agencies to the city 150 kilometres (94 miles) south of Seoul.

Roh's liberal government said the aim was to promote balanced regional development in a country where almost half the population lives in Seoul or surrounding cities.

The plan was also attractive to the Chungcheong region, whose traditionally uncommitted voters have often swung elections.

But the current conservative government decided not to go ahead with it, despite strong opposition within the ruling Grand National Party.

Chung's office said in a statement the previous plan "would have resulted in inefficiency and waste" of national resources.

"The government has decided to create an economic hub centred on education and science in Sejong City with public and private investments of 16.5 trillion won (14.6 billion dollars) in total," Chung said in a statement.

"We expect Sejong will grow into a self-sufficient city with a population of 500,000 with 246,000 new jobs by 2020."

The city is named after the revered 15th century monarch who invented the country's written alphabet.

By AFP

BLand may start work on S. Korean project next year

BERJAYA Land Bhd (BLand) is expected to start construction of its maiden US$3 billion (RM10.4 billion) mixed development township project in South Korea in the second half of next year.

"We are at the design stage now. We target to complete that and start construction next year," Berjaya Hotels & Resorts chief executive officer Joseph Won said in an interview with Business Times in Kuala Lumpur recently.

Won said he is bullish about the project, given that Jeju province is popular among people from Japan, South Korea and China.

BLand entered into a joint venture with Jeju Free International City Development Center (JDC) in 2008 to become master developer for the project in Jeju.

The resort-type township will be built within eight and 10 years on 74.4ha of land and feature 600 mid-rise apartments, 200 villas, a five-star hotel with 250 rooms and a casino hotel with 500 rooms, a casino, a shopping complex and a medical centre.

BLand, which acquired the 74.4ha land from JDC to undertake the project, has a 81 per cent interest in the development. JDC holds the balance.

Berjaya Hotels & Resorts, the leisure unit of BLand, is looking for properties to operate in Asia Pacific to build up its existing portfolio.

Future growth plans in the Asia-Pacific region will include Japan and Maldives, including South Korea.

"We are eyeing to set up city hotels in Tokyo and Yokohama in the longer term. Japan would definitely be on our radar," Won said.

BLand has a joint venture, also, in Maldives to build 90 to 100 chalets under the Ritz brand for US$125 million (RM433.7 million).

Its partners in the venture are Ritz Carlton and Far East Consortium International Ltd, holding 33 per cent and 10 per cent interest, respectively.

Berjaya Hotels & Resorts may operate the properties for BLand and its partners.

By Business Times (by Sharen Kaur)

BLand's world-class resort

BERJAYA Land Bhd’s (BLand) whopping US$1.8bil joint-venture project – Berjaya Jeju Resort – on Jeju Island is the largest investment undertaken by a foreign developer in South Korea’s tourism industry.

The resort-type residential complex will serve as a residential area with low-rise buildings and villa equipped with hospitals, care centres and other modern facilities.

Jeju Special Self-Governing Province Investment Environment (JIE) representative Woo Jin Cha says the world-class project will take Jeju to greater heights and serve as a turning point in Jeju’s rebirth as a global destination for recreation and tourism.

Jeju also known as the “Hawaii of the Orient” and “Gods’ Island” is developed by Jeju Free International City Development Centre (JDC), Woo said in a briefing to a group of foreign journalists recently. JIE is a unit of JDC.

Jeju attracts some 5.8 million tourists annually and has drawn an estimated US$3bil of foreign direct investments to date.

Woo says JDC is currently “designing” Jeju to be a free international city via six core projects.

They are the Jeju Science Park, Myth and History Theme Park, Seogwipo Tourism Port, Resort-type Residential Complex, Healthcare Town and English Education City.

By 2011, when the first phase of Jeju Free International City international project is completed, about one million foreign tourists will visit South Korea annually while domestic tourists are set to double to 9.4 million yearly.

By The Star

Berjaya Jeju Resort slated to be launched in first quarter 2009

BERJAYA Jeju Resort, which will be developed into a world-class integrated tourism and recreational destination on the honeymoon island of Jeju, will mark Berjaya Land Bhd’s (BLand) entry into South Korea’s property market when the project is launched in the first quarter of next year.

The development would be undertaken by Berjaya Jeju Resort Ltd, a 81:19 joint venture between BLand and Jeju Free International City Development Centre (JDC).

The joint venture company has invested US$30mil as initial paid-up capital in the development.

BLand chief executive officer Datuk Francis Ng said the development was a strategic investment because the geographical location of Jeju made it a well-connected city with a potential market of over 750 million people.

“Jeju’s free international city status coupled with various tax incentives, such as the five-year corporate tax exemption from the first year of profits, and the property tax exemption of 15 years for both Korean and foreign investors, are the primary factors why Jeju is seen as a good investment destination,” he told Malaysian journalists on a recent site tour of the project.

Other favourable factors include a friendly corporate investment environment, an effective legal system, and the availability of professionals drawn from the ranks of the more than 6,000 local graduates churned out there yearly.

“We are confident that our long term investment in South Korea will stand us in good stead for stronger growth and to partake in other related business activities in the coming years,” Ng added.

Located on 183 acres in Yerae-dong in Seogwipo City in southwest Jeju, Berjaya Jeju Resort with a potential gross development value (GDV) of US$3.5bil is targeted for completion in 2015.

Among the various components of the development will be 1,282 residences, including villas and apartments, worth a GDV of US$1.5bil; a casino, two hotels, shopping mall, an indoor arena and a valley resort and wellness resort.

Ng said the indicative prices of the residential properties in Berjaya Jeju Resort would be between US$500 and US$600 per sq ft.

The first phase of the development, comprising the North Gate mid-rise apartments, is planned for launch in the first quarter next year. The other precincts including the casino, casino hotel and shopping mall would kick off in two to three years.

BLand senior general manager for properties marketing Mah Siew Wan said as there was no restriction on foreign buyers to purchase property in Jeju, “we will be targeting buyers from China, Japan and Taiwan.”

“Our immediate target market will be Korean buyers, especially from Seoul. It is said that it is every Korean’s dream to own a home on Jeju island,” Mah said.

South Korea has a population of more than 70 million, of which 560,000 are residents in Jeju.

According to JDC chairman and chief executive officer Kim Kyung Taeg, Berjaya Jeju Resort would redefine Jeju’s waterfront and bring a whole new dimension to Jeju’s tourism industry.

“It is expected to foster an eco-friendly, high value-added leisure environment and is part of our vision to establish Jeju as an international city with world-class tourist destination developments,” Kim said.

The integrated resort development would be able to position Jeju as an important investment opportunity and also put the island on the world map.

By The Star

S. Korea to prop up building sector

SEOUL: South Korea said it would spend about US$4bil to prop up its wilting construction industry, the second major package this week as it grapples with the impact of the global financial storm on its economy.

President Lee Myungbak said the credit crunch around the world made South Korea’s economic situation even more grave than the Asian financial crisis a decade ago, which pushed the country to the edge of default.

“The overall situation is more serious than the 1997 crisis. Back then it was an Asian crisis but today the entire world economy is at risk,” a presidential spokesman quoted Lee as saying during a cabinet meeting.

“It’s not like any recovery of our own means we will have escaped the effects of the (global) crisis,” Lee said.

The latest package, which follows Sunday’s US$130bil rescue for the credit-squeezed financial system, will allocate over five trillion won (US$3.8bil) to the construction sector whose problems the government fears could ricochet through the slowing economy.

“It is feared troubles in sectors of the real economy, such as the construction industry, could make things worse in the financial sector as well,” the government said in a statement.

The money will be used to buy unsold new homes and land from domestic builders who want to pay off debt.

By Reuters

Seoul to spend US$6b to help builders

SOUTH Korea will spend as much as 8 trillion won (US$6 billion) to buy land and unsold homes, aiming to shield the property industry from a collapse that may worsen an economic slowdown.

State-owned Korea Housing Guarantee Co will buy 2 trillion of houses, the Ministry of Strategy and Finance and Ministry of Land, Transport and Maritime Affairs said yesterday in a statement.

Korea Land Corp will sell up to 3 trillion won of bonds to buy land from private companies. The rest of the funds will be used to provide debt guarantees and help low-income earners buy homes.

By Bloomberg

South Korea keen on tourism ventures with Malaysia

SOUTH Korea, which is developing its tourism and leisure industry as a future growth engine, is keen to draw from the experience and strength of Malaysian companies.

"The Chinese tourism industry provides huge potential for Korea and since Malaysia has a very advanced tourism industry, it holds a promising area for both countries to do more in the future," said South Korean Ambassador to Malaysia Yang Bong Ryull at a seminar on forging partnership between South Korea and Malaysia in Kuala Lumpur yesterday.


YANG: The Korea-Asean free trade agreement will be a catalyst to strengthen partnership

The seminar was to provide Malaysians an insight to investment opportunities in South Korea's Jeju Island's real estate, tourism, education and medical industries.

Bilateral trade between both countries expanded over 10 per cent, registering around RM50 billion last year and Yang estimates that it can reach RM100 billion in five years.

"The Korea-Asean free trade agreement signed last year will be a catalyst to strengthen our partnership to greater heights," he said.

"Joint ventures and strategic alliances between both are countries have been expanding and diversifying from manufacturing to more value-added and technologically advanced sectors such as information and communication technology, oil and gas, finance, property development, tourism and education," he added.

Korea Telecom Freetel, one of the largest mobile service providers in South Korea, is in a joint venture of 3G mobile service with U-Mobile Sdn Bhd in Malaysia.

Daewoo Securities Co has also entered into a strategic alliance with CIMB Investment Bank Bhd, providing cooperation in investment banking and asset management and developing a sukuk market in South Korea.

Woori Bank and Woori Investment, one of the largest financial groups in Korea, recently opened their first representative office in Malaysia.

Governor of Jeju special self-governing province Kim Tae Hwan also urged Malaysian companies to look into the development of tourism complexes, hot spring centres, animal theme parks and resorts.

So far, Berjaya Land, a Berjaya group subsidiary, has invested US$2.6 billion (RM8.76 billion) in developing a resort-style residential complex on Jeju Island.

Malaysian Industrial Development Authority deputy director general 1 Datuk Afifuddin Abdul Kadir said last year, South Korean firms invested in 32 projects worth US$325.2 milllion (RM1 billion) in Malaysia, in which US$31 million (RM104 million) were in new projects and US$294.2 million (RM99 million) were in expansion and diversification projects.

By New Straits Times (by Rupa Damodaran)

Berjaya in RM11b joint venture

RESORT-LIKE: Artist’s impression of part of the Jeju project.

BERJAYA Land Bhd is partnering the Jeju Free International City Development Centre (JDC) to develop a US$3.6 billion (about RM11 billion) resort-type residential and commercial complex in South Korea.

Berjaya Jeju Resort Ltd is an 81:19 joint venture between Berjaya Leisure (Cayman) Ltd and JDC.

Berjaya Jeju will be the master developer for the development of 74.37ha in Yerae-Dong, Seogwipo-Si, Jeju.

The Yerae Resort-type Residential Complex will be developed over eight to 10 years, Berjaya Land said in a statement yesterday.

The development, costing US$2.6 billion (RM8 billion) to build, will comprise 600 mid-rise apartments, 200 villas, 500-room resort hotel and serviced residences, and a full-fledged casino with 500 rooms.

Other components include a commercial facility and shopping; indoor arena and dining amenities; a health, medical centre and spa resort; cultural village; and other recreational, private and public facilities.

The casino, a key development, will be built in the early phase of the project.

Berjaya Jeju, which will have an initial paid-up capital of US$30 million (RM95 million), will enter into a sale and purchase agreement with JDC to buy the land from JDC for 72.1 billion won (RM230 million).

Following the acquisition, JDC is required to con-tribute not less than US$4.5 million (RM14 million) worth of improvements to the land in the form of infrastructure such as roads and parks.

Berjaya Land said that the development cost of the project will be financed through equity, borrowings and proceeds from the sale of housing units developed under the project.

JDC is a statutory agency established within South Korea's Ministry of Construction and Transportation.

It oversees the development of Jeju.

By New Straits Times

BLand-S. Korean JV to build US$2.6bil resort

PETALING JAYA: Berjaya Land Bhd (BLand) is teaming up with South Korea’s Jeju Free International City Development Centre (JDC) to build a US$2.6bil (RM8.2bil) resort-style residential and commercial complex with a full-fledged casino in Jeju province.

BLand told Bursa Malaysia yesterday its unit, Berjaya Leisure (Cayman) Ltd (BCayman), had signed an agreement to set up the joint venture, Berjaya Jeju Resort Ltd (Berjaya Jeju).

Berjaya Jeju would be the master developer for the 74.37ha site in Yerae-dong, Seogwipo-si, Jeju province. It will develop the project over eight to 10 years.

The development would have 600 mid-rise apartments, 200 villas, a 500-room resort hotel and serviced residences and a full-fledged casino with 500 rooms, an indoor arena, a health, medical centre and spa resort, a cultural village and other recreational, private and public facilities.

“The casino, which will be the key development, shall be constructed in the early phase of the project,” the company said.

BLand said the project would have a gross development value estimated at US$3.6bil, subject to the finalisation of the business plan.

The initial paid-in share capital of Berjaya Jeju would not be less than US$30mil, of which BCayman would subscribe for 81% and JDC the remaining 19%.

BLand said Berjaya Jeju would then enter into a sale and purchase agreement to acquire the land from JDC for 72.1 billion won (US$73mil).

After the land acquisition, JDC would contribute US$4.5mil for infrastructure such as roads and parks on the site.

In a separate statement, JDC said the JV would attract foreign tourists by developing high-end tourism products targeting Asia and the Middle East as well as South Korea by using Berjaya Group’s global marketing network.

JDC said the resort-style residential complex would make a 774.1 billion won (US$772.83mil) contribution to the Jeju economy and create 6,300 jobs.

By The Star

New age cities pave the way

The digital age and pressing environmental issues are shaping the way we will be living

Next year, two Asian cities situated miles apart from each other will showcase to the rest of the world their new epicentres for the 21st century. One will be along the Incheon waterfront in South Korea; the other in Abu Dhabi in the United Arab Emirates.

^The Songdo development has taken the digital route with its high-tech backbone

Masdar City sees the future as requiring green and clean living

In the former, 2,000 residents will soon be moving into homes currently being built on 1,500 acres of reclaimed land overlooking the Yellow Sea.

They won’t be “ordinary” homes – not at their price of US$500,000 (RM1.62 million). Instead, they will be “smart” and wired to facilities such as a medical station that can measure the vital health signs of the residents. And if residents so desire, their blood pressures and pulse rates can be transmitted securely to the Seoul National University Hospital, where doctors can provide personalised recommendations for daily exercise and diet.

That’s not all: Residents will also be able to receive traffic reports via their computers on what alternative roads to take should there be congestion in the city.

Digital city
Parents in this South Korean community can also monitor their children’s whereabouts via a mobile device, while teachers will be able to know if a student has completed an assignment via smart-card readers.

When the US$30 billion (RM96 billion) Songdo International Business District (Songdo IBD) ultimately becomes home to 65,000 residents (as well as another 300,000 made up of daily commuters, business people and visitors), it will be among the world’s most environmentally sustainable and technologically advanced cities.

Songdo IBD, South Korea

Its developer, New Songdo International City Development, LLC (NSIC) – a joint venture formed by Korean-based Posco E&C and United States-based Gale International – envisions Songdo to be the ideal 21st century city.

Master-planned as a “U” city (which is the abbreviation for “ubiquitous”, the local term for a digital city), it will boast the most advanced digital infrastructure imaginable, from blanket wireless Internet coverage and automated recycling to universal smart cards that can pay bills, access medical records and open doors.

The U-lifestyle
The city, designated a Free Economic Zone, will consist of some 50 million square feet of commercial space, 35 million square feet of residential accommodation, 15 million square feet of retail lots as well as hotels and schools.

To give room to breathe, 40 per cent of its space will be open, within which will be a 100-acre Central Park.

In Songdo’s business district, its architectural centrepiece will be the 65-storey, 1.3 million square feet Northeast Asia Trade Tower (NEATT) that will be annexed to a 400,000sq ft Convention Centre and 1.25 million square feet Retail Mall.

All the offices and residential units in the development will incorporate computers that will collect data from swipe cards and sensors and channel them to its “U-life” management centre, a facility to be operated by Songdo U-Life LLC, a joint venture between Gale International and LG Electronics’ subsidiary LGCNS – the creator of the city’s digital backbone.

Despite all the intelligence, NSIC is counting on success to come from Songdo’s location 20 minutes drive from Seoul’s international airport at Incheon.

Currently ranked number one in Asia and the world, this gateway to South Korea and indeed, Northeast Asia, is just a three-hour flight time from 60 of Asia’s largest cities and in a region holding 35 per cent of the world’s population with a combined gross domestic product worth an estimated US$1.3 trillion (RM4.2 trillion).

Carbon-neutral city
With Songdo aiming to be Northeast Asia’s financial and economic hub and Singapore and Hong Kong already anchoring Southeast Asia, it seems only obvious that either Dubai or Abu Dhabi in the Middle East be the hub for Northwest Asia.

Come 2009, Abu Dhabi, the world’s fourth largest oil exporter, will have a new “Green Community” development covering six square kilometres called Masdar City.

The brainchild of the Crown Prince of Abu Dhabi, Sheikh Mohammed Zayed Al Nahyan, it is part of the US$15 billion (RM48 billion) “Masdar Initiative” programme that seeks to position the capital as the global leader in clean energy and sustainable development.

Masdar City, which will be slightly larger than Songdo, has been master-planned by British architectural firm Foster & Partners to initially accommodate 50,000 people though the eventual population will be double.

In keeping with its green theme, it will be a carbonneutral city leveraging on the most modern innovations in energy efficiency, sustainable practices, resource recycling, biodiversity, transportation and green building standards.

Entirely self-sustaining
Even before it is completed, Masdar City will be a green development with a large photovoltaic power plant powering its construction. Later in its life, the land surrounding it will be used as wind and photovoltaic farms, research fields and plantations to ensure self-sustainability.

To encourage walking, it will also be car free and have a compact network of shaded pedestrian-friendly streets, where the maximum distance to the nearest transport link and amenities will be only 200m.

Living examples
Within the walled city will be a Special Free Zone (SFZ), an economic area with a minimum carbon footprint where 1,500 companies will enjoy special incentives such as onestop access to government services, full foreign ownership, no taxes and intellectual property protection.

Supporting the SFZ will be facilities and services such as the Masdar Institute of Science and Technology, the Research Network, light industries, laboratories and selected international tenants.

Both South Korea’s Songdo and Abu Dhabi’s Masdar City are two innovative initiatives responding to today’s most pressing issues: Energy crisis, environmental threats and the sustainability of developments.

Both carry the mission of being living examples of the urban conurbations of the future and the hope that one day, all cities in the world will be built like them.

By New Straits Times (by Lim Lay Ying)

Lim Lay Ying is managing director of Research Inc. (Asia), a company specialising in market research and consultancy for all facets of real estate development.

Mideast fund snaps up Sunway City condo

Sunway City Bhd has concluded its second en bloc sale - the Sunway Pallazzio Block B for an estimated RM220 million to a firm linked to a Middle Eastern fund.

The buyer for the property, which is under construction, is Radiant Splendor Sdn Bhd, a special purpose vehicle affiliated to the fund, sources say.

Sunway Pallazzio, an 80-unit super luxury condominium in Sri Hartamas, was sold at around RM750 per sq ft. The building is due to be completed in 2010.

The sale underscores the attraction of Malaysia's property market, which has been buzzing since the government lifted a sales tax and made it easy for foreigners to own property.

The source added that with the sale, Suncity could save up to RM10 million in promotional and marketing costs.

The announcement is set to be made this week.

Suncity's chief financial officer Koong Wai Seng declined to comment on the deal when contacted.



However, Koong noted that Suncity had completed its first enbloc sale - the Sunway South Quay deal with a South Korean investor - on December 27 last year.

This 249-unit luxury condominium in Sunway South Quay, was sold for RM170 million to Luxury Court Sdn Bhd, a joint venture between property developer CI Korea and Daol Fund.

Daol Fund is South Korea's First Real Estate Asset Management Specialists with US$10.7 billion (RM35.1 billion) asset under its management.

Established in June 2006 with a US$310 million (RM1.02 billion) real estate fund, it is backed by South Korea's four top-tier banks and two major securities firms including Worri Bank, Hana Bank and National Agricultural Cooperative Federation Bank.

The Sunway South Quay Korea community will be a twin city of the the US$337 million (RM111 billion) HongCheon Senior Leaders country project under development.

"With the Daol Fund, the likelihood of the option given to CI Korea to purchase another enbloc property next to the first property has increased," Koong said, adding that the price tag on the option is around RM200 million.

By New Straits Times

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