Breaking new ground with The Atmosphere

Artist impression of an aerial view of phase 2E or Lava, of The Atmosphere in Seri Kembangan.

The Atmosphere sets a new benchmark for commercial developments in Seri Kembangan, Selangor with its unique hybrid “shopping mall” design for its 20.1-acre commercial centre, says Tempo Properties Sdn Bhd chief executive officer Khoo Boo Hian.

This commercial centre is the second phase of The Atmosphere, which aims to integrate leisure, retail and office elements in a central hub.

“They are shopoffices but the commercial centre looks and feels like a shopping mall. This hybrid design is unique in Malaysia,” says Khoo.

Khoo: ‘The biggest headache for a commercial development is the car park’.

Khoo points out that the unique design of the commercial centre has resulted in “two ground floors”, with an elevated and landscaped boulevard on the second storey.

“With four-storey shopoffice blocks, usually the top two stories don't carry a lot of value. But with our boulevard level, the third level also becomes a ground floor. People come up to the boulevard level using the escalator, and they can patronise the shops.”

Beneath the boulevard level are two levels of covered car park bays, and it was this design element that led to the creation of the “two ground floors” for the centre.

“The biggest headache for a commercial development is the car park. We were toying around with the idea of a dedicated car park block, which is very inconvenient for people. So we spoke to the architects and authorities. We said ... can we have a situation where we do away with the back lane? So, we covered the back lane. That was how the boulevard level was conceptualised.”

Khoo says this also means patrons of the centre benefit from the covered car park and the open courtyard design with space for events.

Highlights of The Atmosphere's commercial centre include a 1.4-acre public park, covered walkways, public toilets, sheltered boulevards, alfresco plazas, open lawns, an open courtyard design for events, and high ceilings for retail outlets, 22 to 28-feet wide shop frontage as well as the spacious 20 to 30 feet wide walkways.

There are 1,600 covered and open-air car park bays. Areas in the commercial centre are inter-linked via covered walkways, escalators and lifts.

“You can walk from one end to the other without getting wet,” says Khoo.

The Atmosphere's commercial centre, with a gross development value (GDV) of RM370mil, was launched in 2009.

Unit prices ranged from RM1mil to RM4.5mil, and the average selling price was RM300 per sq ft.

Khoo says the 136 units in the earlier launches were sold out, and the final launch (phase 2E or Lava) has a 70% take-up rate.

“Investors have benefited in terms of capital appreciation as the units that have been handed over were sold on the secondary market with almost 100% appreciation in price.”

Phase 2E, which will consist of 54 retail and office units, is expected to be completed by end-2013.

Khoo also points out that phase 2E has a “three ground floors” concept with raised courtyard plazas.

The project also won the category of Best Mixed Use Development in the Asia Pacific region (including 5 stars for Malaysia) in the 2011 Asia Pacific Property Awards 2011 (in association with Bloomberg Television).

It is also the first commercial development in the South Klang Valley to be Green Mark certified by Singapore's BCA (Building and Construction Authority).

Khoo says this will translate into lower water and energy bills and maintenance cost, as well as an enhanced work environment.

“To get the Green Mark certification, we have features like heat reflective polycarbonate roofing from Korea to cover the boulevards, water and electricity saving fixtures and fittings, and reflective glass for the shop offices. Together with disabled-friendly features such as wheelchair ramps and tactile tiles, we spent an extra RM1.5mil. But we felt that it was necessary to enhance this development rather than just building another high-density commercial area.”

Khoo says the commercial centre is a strata-title development, “so investors pay some management fees but they get 24-hour security and tip-top maintenance.”

The Atmosphere has three phases of development, with the first phase being a Giant hypermarket on a nine-acre site.

“The Giant Hypermarket chain bought the land in 2008 for about RM30mil. The hypermarket opened two years ago,” says Khoo.

Another 6.1ha remains to be developed as the third phase on the 53-acre site of The Atmosphere, and Khoo says various options are being planned.

“We are looking at close to a GDV of RM1bil eventually for the 53-acre site,” says Khoo.

Khoo also points out that The Atmosphere is strategically located near to areas such as Prima Tropika, Alam Santuary, 16 Sierra, D'Alpinia, Taman Putra Permai and Taman Equine.

“We are in the heart of the Golden Triangle of South Klang Valley with Puchong, Putrajaya and Seri Kembangan forming the axis.” He says Seri Kembangan is a rapidly growing property hotspot, with high demand for commercial zones.

Khoo cites a Spectrum Research Asia report that last year said the residential population of Seri Kembangan within a 20-minute drive time zone was 1.6 million people.

The project is developed by The Atmosphere Sdn Bhd, a joint venture company that is 60% owned by Eksons Corp Bhd, with the remainder owned by Tempo Properties.

Eksons Corp, which is listed on the Main Market of Bursa Malaysia, is one of the largest manufacturers of tropical thin plywood in the Asia Pacific region.

Tempo Properties provides project management support and expertise.

Being different

Khoo says Tempo Properties is a boutique property developer that aims to create a win-win situation for investors, business owners and patrons in commercial developments such as The Atmosphere.

“We aim to provide investors with something that they don't know they want. We think differently.”

He points out that prices for units at The Atmosphere was the highest for commercial developments in the area.

“Our intention was to set ourselves apart, and come up with something that is unique.”

Tempo Properties has its roots in Yoon Hin Sdn Bhd which is a rice wholesaler in Seremban, Negeri Sembilan.

Yoon Hin diversified into property development by setting up Tempo Properties in 1995, and its first project was developing the 48-acre Taman Cenggal Utama near the Seremban International Golf Club in 1997.

Taman Cenggal Utama consisted of 492 units of residential houses and shoplots, and 179 units of low-cost flats.

It was completed at end-2003, and generated sales of RM65mil.

Meanwhile, in the heart of Seremban town, Tempo Properties recently completed the Medan Suria commercial development which consists of 34 units of three and four storey shop offices that generated RM27.5mil in sales revenue.

“With Medan Suria, we became the first developer in Seremban that does not have a back lane for our shops.”

“It took a lot of convincing to get approval from the authorities. Usually, shops have a back lane for rubbish collection. Our reasoning was - in shopping centres, you have food and beverage outlets without any issue. So, why do you need to have a back lane for shops? The project was well taken up, and the authorities were happy with the design.”

It should also be noted that The Atmosphere is adjacent to the 60-acre Taman Prima Tropika residential development, which was Tempo Properties' first foray in Selangor.

Khoo says 470 units of double-storey terrace houses and two-and-a-half storey terrace houses with a GDV of RM180mil have been built in Taman Prima Tropika.

These were launched from 2004 onwards at prices ranging from RM229,000 to RM379,000.

There are 4 ha left for development in Taman Prima Tropika.

Khoo says Eksons Corp and Tempo Properties have another joint venture company, namely Oval Rock Sdn Bhd for property acquisition and development.

Oval Rock is also 60% owned by Eksons Corp, with the balance held by Tempo Properties.

In January this year, Eksons Corp told Bursa Malaysia that Oval Rock had entered into an agreement with Azam Hartamas Sdn Bhd to acquire 22.7ha of leasehold land at Jalan Gombak, Setapak in Selangor for RM17.1mil.

“We might start a mixed development in Gombak in the third quarter of next year. We are also in discussions with a land owner in Cheras for eight acres,” says Khoo.

By The Star

Largest Mitsui Outlet Park to be built in KLIA

MALAYSIA Airports Holdings Bhd (MAHB) and Mitsui Fudosan Co Ltd will build the first upscale Japan factory outlet in Southeast Asia at the Kuala Lumpur International Airport in Sepang.

To be known as Mitsui Outlet Park KLIA, it will be built on a 20.25ha site, complete with F&B and entertainment facilities as its complementary components are based on strong themed attractions such as Knowledge and Attractions, Prime Time Complex and World Food Expo.

The park, the first Mitsui Outlet Park in Southeast Asia and 14th for Mitsui, will be developed over three phases at an estimated gross development cost of about RM335 million.

It will boast a total lettable area of about 47,000 square meters upon full completion, thus positioning the outlet park as the largest within Mitsui's stable of outlet parks.

The first phase of development is expected to begin within the first quarter of next year and is expected to open its doors to the public by end of 2014.

"The outlet park will offer a wide selection of leading brands including luxury brands, popular select shops, high grade and top Asian fashion, sports and outdoor items, fashion accessories and gifts at prices that are guaranteed to be below their recommended retail prices," MAHB said yesterday.

More than 240 famous international designer brands will be invited based on their presence in existing Mitsui Outlet Parks in Japan and China.

It will also offer top Asian fashion from Japan, South Korea, Hong Kong and Malaysia, thus setting it apart from the other retail centres in Malaysia in terms of breadth of brand diversity, it added.

Mitsui, a leading real estate developer in Japan, has been established since 1941 with global operations in the US, UK, Singapore and China.

It is mainly engaged in the development of shopping centres, hotels and office complexes.

The two companies signed a memorandum of understanding on the project yetserday.

"One of the most important benefits from this project is the opportunity to further expand our non-aeronautical or commercial revenue base, in line with our '2010-2014 Business Direction: Runway to Success'," MAHB managing director Tan Sri Bashir Ahmad said.

By Business Times

I-Berhad signs MoU with Thai retail developer to set up i-City Mall

Expansive: A night view of the Central World Mall Bangkok.

TO GIVE the local media an idea of what the new mall in i-City Cybercentre, Shah Alam may be like, I-Berhad held a media visit to two malls in Bangkok recently.

During the visit, which also saw the signing of Memorandum of Understanding (MoU) between Thailand’s largest retail developer, Central Pattana Public Company Limited (CPN) and I-Berhad’s wholly-owned subsidiary — I-City Properties Sdn Bhd, the media were taken on a tour of the Central World Mall Bangkok and the tastefully refurbished Central Plaza.

With over 550,000sq m of retail space, the Central World Mall which is the largest mall in South-East Asia, has 500 different retails including 35 different fashion brand flagship stores and 36 new brands.

It also houses six flagship stores, over 50 restaurants and a 21-screen cinema with an indoor parking facilities with 7,000 parking bays. The mall is also connected to a five-star hotel, the Centara Grand and the Bangkok Convention Centre and an office tower.

Using creative artwork and sculpture as part of the shopping complex’s interior, shoppers would have a fun experience while the clever zoning system with unique design and ambience makes it easy for them.

Although we had limited time at the huge mall, members of the media had a fun time rushing through the various zones. One needs more than an hour or two even to just skim through the floors.

Otherwise, the eight-floor mall has a tasteful combination of retail outlets and an impressive area for restaurants and food.

A tourist whom I had met at the mall described the place as enormous and said that he had never seen so many eateries in one mall before.

“Food is good and I can just spend the whole time here. There are the massages, all in one place and it’s connected to the hotel via the seventh floor carpark — it’s just a walk over,” said the tourist.

It is a workable concept that has been successful even in the Klang Valley with malls like 1Utama Shopping Centre and the Mid Valley Megamall.

Huge project: Chirathivat (left) pointing out to Lim an interesting feature of Central World Mall.

CPN president and chief executive officer Kobchai Chirathivat said the joint venture was the company’s stepping stone to further expand its business in Malaysia.

He said the Malaysian government’s consistent policies on foreign investments, the country’s gross domestic products (GDP) growth and the per capita income of Malaysians were factors that attracted the company to invest in Malaysia.

“We hope to bring the best experience we have in building and managing malls in Thailand and to hopefully be one of the best retail projects in Malaysia.

“As Asians, we have almost similar lifestyles so it will be very compatible to move across the border.

“We are very proud to be part of the Malaysian economic development,” said Chirathivat, adding that the mall was still in its designing stages and it would consider the demography and needs of the market as part of the design and concept.

Present at the MoU signing were I-Berhad executive chairman Tan Sri Lim Kim Hong, I-Berhad chief executive officer Datuk Eu Hong Chew and Central Group chief executive officer Sudhitham Chirathivat.

The event was witnessed by Selangor Mentri Besar Tan Sri Khalid Ibrahim and Selangor state executive councillor Teresa Kok.

The i-City mall with a space of 1.7 million sq ft is expected to open at the i-City Cybercentre in Shah Alam by the end of 2015. Construction will begin early next year.

The project with a budget of RM500mil, will be located within an 7.3ha plot in i-City and is set to complete the RM5bil Cybercentre’s offering as an international business hub by day and lifestyle haven by night.

By The Star

Are there too many malls in Penang?

PENANG'S retail scene appears to be on the boil, if the number of shopping or lifestyle malls which have sprouted or are being constructed are anything to go by.

Just how well these establishments and their tenants are doing is anyone's guess, even if some of the major ones found on the island and Seberang Prai appear to not be lacking in terms of human traffic.

The island is currently home to less than 10 shopping malls, while Seberang Prai has about half the number. Not all these establishments are raking in high profits. Those which are managed by professionals and boast solid anchor tenants are the ones who are finding themselves profitable.

Others have been known to be spiraling downwards due to poor management and inadequate planning. Tenants in these centres are finding themselves left with no choice but to move out or come up with novel ways of luring consumers to survive.

A check on the type of merchandise stocked in some outlets reveal that stock has not been refreshed for some time. Others, by virtue of in-store promotions and sales are seeing a little better business although the general consensus is that retail shoppers are not buying as much as they used to.

While some food and beverage establishments with vantage locations continue to see a constant flow of diners, others are lamenting the fact that things have slowed down.

Others doing relatively well as those offering entertainment options like cineplexes, beauty and fitness outlets and also good bookstores.

Some tenants who find themselves struggling appear to be those who are faced with increased rentals and a shrinking pool of patrons (who tend to flock over to the next mall when a new one opens).

For those those living in neighbourhoods within close proximity to shopping malls, especially on the Penang island, their regular gripes these days are centred on horrendous traffic jams in their areas, especially during long weekends and peak hour.

These residents are forced to contend with haphazard parking by those who opt not to park in the generous number of parking bays provided by shopping mall operators.

In order to save parking fees, shoppers have no qualms in parking illegally in a residential area for hours on end, sometimes even blocking the entry way of house owners into their own properties.

Questions being asked about Penang malls are:

* Does Penang need more shopping malls which essentially mirror each other when it comes to tenant mix?

* Are traffic dispersal systems taken into consideration by the local authorities when giving planning permission for projects which generate massive traffic flow into an area?

* Whose responsibility is it - the local government or the business operator's - to ensure that the quality of life enjoy by those living in the vicinity of malls are not adversely affected when a property developer decides to build a neighbourhood mall in their midst?

As traffic congestion in Penang is now getting to unbearable levels during festive and holiday periods, perhaps a review is needed on where future malls should be located, and if these malls are even needed in such great numbers in the first place.

Like most other Malaysians, Penang residents love their malls and their shopping habits sometimes have a tendency to spur a mall-building boom.

The financial shape of retailers and both national and international property developers must also be looked into when shopping malls are being proposed.

Also to consider should be the fact that Internet shopping has and continues to grow by leaps and bounds and that the retail sector would likely be one of the first casualties during an economic downturn.

This in turn, will likely see a state or country left with an increasing number of abandoned - or dead - malls.

By Business Times

Southkey Megamall maybe injected into IGB REIT

The upcoming Southkey Megamall in Johor Baru is expected to be injected into newly public-listed IGB Real Estate Investment Trust (IGB REIT).

The Mid Valley City-type mixed development is a joint venture between IGB REIT's sponsor, IGB Corporation Bhd and Selia Pantai Sdn Bhd. The project is expected to be completed in the next five years with a tentative gross development value of between RM6 billion and RM8 billion.

"IGB Corp has yet to receive approvals from the local authorities in Johor, but they have been very supportive of the project. If everything goes as planned, work on the new mall should start in the first half of next year," said IGB REIT chief executive Antony P. Barragry after its listing ceremony yesterday.

Barragry said after the Southkey Megamall is completed, IGB Corp will operate the business for some time before putting it into the REIT.

"The project will be greater than Mid Valley City as the potential brought through the rapid development of Iskandar Malaysia is enormous," he said.

IGB REIT made its debut on the Main Market of Bursa Malaysia yesterday with some 1.92 million shares traded at an opening price of RM1.37, a premium of 12 sen over its offer price of RM1.25.

Its share price closed at RM1.39 yesterday, up 11.2 per cent with 2,361,610 shares transacted

IGB REIT raised about RM780 million, making it the country's fourth-largest flotation this year, behind palm oil firm Felda Global Ventures Holdings in June, IHH Healthcare in July, and pay-TV company Astro Malaysia Holdings which is due to list in October.

Barragry said the listing of IGB REIT will provide investors exposure to a highly attractive initial portfolio, comprising two connected super-regional malls, Mid Valley and the Gardens Mall.

"We are committed to enhancing unitholders' return and value through the organic growth of our existing portfolio as well as potential acquisition of additional suitable retail properties," he said.

By Business Times

IGB REIT expects to have Southkey mall by 2015

KUALA LUMPUR: IGB Real Estate Investment Trust (REIT) expects the upcoming Southkey Megamall project that is being developed by IGB Corp in Johor Baru to be injected into its portfolio by as early as 2015.

IGB REIT Management Sdn Bhd chief executive officer Antony Barragry said the inclusion of the property would hinge on how quickly IGB Corp could develop the mall.

“We are still waiting for the approval from the state authority before building can commence.

“Realistically, we're looking at late 2015,” he said at a press conference after IGB REIT's listing on the Main Market of Bursa Malaysia yesterday.

IGB REIT opened at RM1.37, which was 12 sen above its offer price of RM1.25. It closed at RM1.39, with 236.16 million shares traded hands. It was also the most actively traded stock on Friday.

IGB REIT Management is the manager of IGB REIT, which is a unit of property firm IGB Corp. IGB REIT owns two shopping malls in Kuala Lumpur, namely the Mid Valley Megamall and the Gardens Mall.

Both properties have over 2.5 million sq feet of net lettable area with over 650 tenants and almost fully occupied.

The proposed Mid Valley City-type Southkey Megamall project is a joint venture between IGB Corp Bhd and Selia Pantai Sdn Bhd and has a tentative gross development value of RM6bil.

Barragry said he was optimistic about the development prospects of Johor.

“With a lot of development in Iskandar (Malaysia) we see good opportunities in Johor.”

Meanwhile, when asked to comment about a recent report that IGB REIT was looking for inorganic expansion opportunities such as acquisitions in the United States or Europe, IGB REIT Management chief financial officer Chai Lai Sim said the decision to expand overseas was up to IGB Corp.

“For opportunities overseas, it is up to IGB Corp to look for properties to acquire, while we (IGB REIT) look for opportunities locally.”

She also noted that IGB REIT had a gearing ration of 25.8%, which was in line with the industry average.

On IGB REIT's local expansion strategy, Barragry said: “We keep our eyes open and the (Malaysian) market is quite lively.

“The way forward is to keep looking for opportunities. If the right one comes, we'll be interested in pursuing it.”

By The Star

I-Bhd eyes developing a mall in i-City

BANGKOK: I-Bhd, the master developer of i-City, plans to seal a definitive joint development agreement with Thailand's retail developer, Central Pattana Public Company Ltd (CPN), within two months to develop a mall within its flagship i-City Cybercentre in Shah Alam, Selangor.

Chief Executive Officer (CEO) Datuk Eu Hong Chew said the mall, at a gross development cost of RM500 million and spans 1.7 million sq ft, is slated to start its physical construction works early next year and complete by end-2015.

He told the media after the signing ceremony for the memorandum of understanding agreement between I-Bhd's unit, I-City Properties Sdn Bhd and CPN here yesterday for the purpose of working towards forming a joint venture through a special purpose vehicle (SPV) to develop the mall.

"The mall will be developed through the SPV, in which I-Bhd holds 40 per cent stake while the balance of 60 per cent will owned by CPN," he said.

He stated that CPN was chosen for the tie-up due to its expertise and experience as the group is now operating 20 malls in Thailand including Central World, which is reputedly the largest mall in Southeast Asia at 5.9 million sq ft.

"We are proud that CPN has chosen i-City to be its first foreign joint-venture in mall development," he said, adding that CPN is one of the foreign companies that has a joint venture with them to develop the urban cybercentre township.

He said the company is currently looking for a partner to develop a data centre at i-City.

Elaborating on the mall, Eu said it would be located within a 7.27-hectare plot in i-City and would complete the RM5 billion Cybercentre's offering as an international business by day and lifestyle haven by night.

"Currently, we have already invested about RM250 million in the i-City Cybercentre project, " he added.

Besides the mall, I-Bhd has also developed other properties such as a hotel, office tower, serviced apartments, and small office home office including a water theme park which will open in November this year.

Meanwhile, CPN CEO Kobchai Chirathivat said the company is very keen to establish its name in Malaysia as the country offers huge opportunities for foreign companies to invest.

"We see Malaysia as the best place to start our business outside Thailand as the country provides consistent foreign investment policy. Also, Malaysia is at the forefront of developing countries among the other Asean countries " he said.

He added Malaysia is a good country to invest in as its average capital income is six per cent higher than Thailand, while its purchasing power is two times higher than its northern neighbour.

By Bernama

Reviving the phoenix

New-age: Artist impression of the Cheras Sentral. Chee (inset) says only the external walls of Plaza Phoenix are left.

Refurbishing an old building into something new and exciting is always a challenge. But at times, it isn't necessarily the biggest hurdle.

That is reserved for trying to revamp the image of the structure, especially if it has been stigmatised.

The formerly abandoned Plaza Phoenix shopping centre in Cheras is one such example, as it will probably be recognised as an ambitious (at its time of opening) but failed project that everybody today will probably remember for its bad points.

That's where Malaysia Land Properties Sdn Bhd (Mayland) comes in, which has taken upon itself to turn the unsuccessful Plaza Phoenix into a thriving, profit-generating, new-age shopping mall.

“A lot of people still remember it (Plaza Phoenix) as an old, rundown place that failed,” says Mayland retail general manager Michael Chee.

“At that time, the surrounding area in Cheras was not yet matured,” he tells StarBizWeek, adding that accessibility to the mall at the peak of its operations was also a major issue, as roads leading up to the shopping centre were always congested.

“We have a plan on how to market and progress the mall.”

Plaza Phoenix was opened in December 1994 but closed down in August 2005. In 2008, Mayland, helmed by Hong Kong-based hotelier and property developer Tan Sri David Chiu, acquired the mall.

“When we came in, the mall was abandoned and practically falling apart,” Chee recalls.

Since Mayland came into the picture, Plaza Phoenix, which is now known as Cheras Sentral, has been earmarked for a December launch. According to Chee, the mall already has a strong tenant mix to “pull in the crowds.”

“We already have an occupancy rate of about 75% to 80%,” Chee says, adding that the building has a built up area of about one million sq ft.

“For the retail portion, the gross lettable area is only about 500,000 sq ft. About 300,000 sq ft will be for walkways and car parks while the remaining 200,000 sq ft of space will be for the development of a hotel.”

Chee says Cheras Sentral will have around 1,250 car park bays.

Some 450 parking bays from Megan Phoenix, a building located behind Cheras Sentral that comprises office blocks and shop lots, will also be made available to mall-goers.

Among the mall's anchor tenants are TGV Cinemas (which has taken up about 2,000 sq ft), Jaya Grocer (27,000 sq ft), Celebrity Fitness (15,000 sq ft), Moon Palace Chinese Restaurant (20,000 sq ft) and Japan Home Centre (7,000-8,000 sq ft).

Chee says another 7,000 sq ft to 8,000 sq ft has been allocated for space dedicated to information technology products.

“We have Starbucks, Old Town White Coffee and Nandos, among others. We want to pull in the Gen-Y crowd, having lots of entertainment, leisure and food and beverage outlets in Cheras Sentral.”

Chee says Mayland is pumping in some RM125mil to revamp the mall, and with its tenant mix, expects to break even within the next five to six years.

“We may break even sooner than that,” he says, adding that the average rental rate at Cheras Sentral ranges between RM10 and RM15 per sq ft.

“The whole place has been redesigned. We've added a new tunnel to the car park, travelators and also glass elevators to give it a more modern look. It was a complete refurbishment. I think the only thing left (of Plaza Phoenix) are the external walls!”

To Mayland's (and Cheras Sentral's) benefit, the surrounding area has also been earmarked for development. Accessibility has been improved as the roads leading to the mall have been widened to reduce congestion.

Accessibility to the mall will also be enhanced with a proposed mass rapid transit (MRT) station sited across the road and linked via a pedestrian bridge.

“We're especially bullish about the location of Cheras Sentral because of the MRT station that's coming up,” says Chee, adding that MRT Co, the Government body overseeing the Klang Valley MRT, is also developing a multi-level carpark near the station.

“We will also be catering to a much more matured area today compared with when Plaza Phoenix was operating,” he says.

Chee notes that the prices of properties within Cheras had also escalated over the years, boosted by the developments (like the refurbishment of Plaza Phoenix) over the years.

“When we started refurbishing Plaza Phoenix years ago, people were auctioning their offices at Megan Phoenix and the starting price was RM200 per sq ft. Today, the properties are being auctioned off at between RM450 per sq ft and RM500 per sq ft.”

He says other developments had also “sprung up” over the years.

“Developers are also starting to come in and develop property within the area. Our project has improved the value of the offices there. We like to believe that we are the impetus for developers to relook into this place as a potential growth area,” says Chee.

He admits that the new commercial developments coming up within the area will create competition for Cheras Sentral.

“Today, there are malls springing up everywhere like grass after rain. Everyday, there are new brands and designs coming up. Within Cheras you already have Cheras Leisure Mall, Jusco, and Sunway Viva City is also coming up. We have some competition, but competition is always good. Gone are the days when you set up a mall and pray that people will come. Today, you need to be able to pull in the crowd. You need to have the right tenants in the right location for the right people. Otherwise, it becomes a mismatch. (But) we believe that Cheras Sentral has those elements.”

Cheras Sentral's success rate is also underpinned by the fact that Mayland is a unit of Hong Kong-listed Far East Consortium International Ltd.

By The Star

City within a city

Techno-city: Eu showing how i-City will look like on completion of the projects

I-BHD founder and executive chairman Tan Sri Lim Kim Hong has been in business for a great many years. Yet, he never fails to light up at the mention of his pride and joy the ambitious, steadily forming township of i-City.

With the exuberance of a young man, Lim, 62, is likely to take you by the hand and break into a short sprint as he points out upcoming attractions at his RM5bil, 72-acre development in Shah Alam, which was exactly what happened when StarBizWeek paid a visit there this week.

Seven years hence, I-Bhd's flagship project is set to harvest the first fruits of its labour.

I-City is currently best known for the rows upon rows of LED-lit trees that make a familiar backdrop to weekend family jaunts. The owners of the project believe this is the year it begins the journey to becoming a serious player in property development.

When finished, i-City will be many things to many people theme park, mall, hotel, residence, office and concert venue.

“We have over the past few years been working behind the scene to get all the approvals and infrastructure in place. We have that today, and moving forward we are going to reap the efforts of our investments,” group chief executive officer Datuk Eu Hong Chew asserts.

The story of i-City stretches as far back as 1993, when Lim bought a parcel of land in Section 7 of the then sleepy Shah Alam at RM4 per sq ft.

The freehold development is the brainchild of Lim, who has throughout his life been a trailblazer on many fronts despite adverse circumstances.

The youngest in a family of 10 children, he dropped out of school after standard six and worked in a furniture-making shop in his hometown of Muar, Johor, as an apprentice.

Lim later struck out on his own as a carpenter. At 21, he signed up as a mattress dealer with Dunlop and within a short time, he was the biggest dealer in the country. Soon after, Lim started Dreamland, Malaysia's first spring mattress brand, earning him the nickname “mattress king”.

Dreamland was subsequently listed in 1987 and Lim sold the business in 1993 for RM350mil. He invested the money in several regional ventures as well as in the land on which i-City sits.

I-City is the brainchild of Lim

I-Bhd, which is 61.2%-owned by Lim, used to be a white goods maker known as Sanyo Industries Malaysia Bhd before he acquired and renamed it in 1999.

His technology-based township, however, did not take off until 2005, hampered by the onset of the Asian financial crisis.

Today, Lim has the state on his side, so much so that it agreed to build three flyover interchanges that will link i-City to the Federal Highway, making it only the second development to have exclusive access to the bustling expressway after Mid Valley.

Not only that, the Shah Alam City Council has written to the Land Public Transport Commission requesting that one of the stations along the proposed Kelana Jaya-Klang line of the My Rapid Transit service i-City.

With only 20% of the construction in place, large tracts of bare land still dominate the landscape of i-City, although if everything goes on schedule, this will not be the case for much longer.

Day and night

I-Bhd will spend the next 10 years realising the masterplan designed by Jon A. Jerde, whose portfolio includes the ritzy Roppongi Hills neighbourhood in Japan and S P Setia Bhd's KL Eco City.

I-City is billed as an “international business hub by day and lifestyle haven by night”. Lim and his team are working to create an integrated mixed development the likes of which has no comparison in Shah Alam, and which many thought preposterous to do in a place better known for its sedate suburbia and factories than as a thriving nightspot.

A successful urban centre will always have a business as well as entertainment component.

“The perception then was that no one wanted to invest in Shah Alam,” recalls Eu, Lim's loyal aide of 20 years.

Because of this, i-City was a tough sell. Lim, for example, had to contend with an initially miniscule plot ratio of 1:3 and approved built up of five million sq ft, which would not allow the company to maximise its potential.

After much wrangling, Lim got the green light to raise i-City's plot ratio to 1:5, giving it a total gross floor area (GFA) of 13 million sq ft and RM5bil in gross development value (GDV).

I-City was the first and still the only private sector-led MSC status zone in the state.

It also signed a management and development agreement with the Selangor government to make i-City a “technopreneur campus”, which comes with a host of incentives such as a temporary occupation licence for some 30 acres of neighbouring land, 24-hour operation for approved outlets, lower bumiputra sales quota of 30%, and the expanded plot ratio.

“If you look at all the successful urban centres in the world, there is always a business as well as entertainment component. Look at Roppongi or Canary Wharf (in London). When you have both day and night activities, the place becomes vibrant,” Eu explains.

i-Appeal

The quarter ended June 30 marked the first time I-Bhd recognised revenue from the residential portion of i-City in its books. Its turnover in the second quarter improved 63% to RM10.94mil from RM6.71mil in the same period last year, and net profit to RM2.97mil versus a loss of RM129,000, boosted by a three-fold increase in its leisure segment and a one-off gain of RM1.8mil from the divestment of its i-Home trademark.

For the first half of the year, revenue climbed 73.5% to RM19.59mil from RM11.29mil, while net profit stood at RM3.79mil compared to RM294,000 of losses a year earlier.

In the notes accompanying its financial results, the firm said it recorded a profit of RM7.6mil from its leisure operations during the six months to June, which was triple the RM2.2mil achieved in the previous corresponding period due to stronger revenue from its upgraded SnoWalk, more visitors to the LED Lightscapes and new theme park attractions installed in the final quarter of 2011.

Nonetheless, Eu explains that the contribution from its leisure division, which has so far been I-Bhd's main earnings engine, should balance out as the company progressively receives cash from the sales of its residences.

“We have only accounted for less than 5% of our unbilled sales in the second quarter,” he points out.

I-Bhd in May launched 173 units of the West Wing of i-Residence, which has been fully sold. It unveiled last month a further 173 units of the East Wing in addition to 20 villas.

Also sold out were its 220 small office/versatile offices (Sovos), whose completion and handover is expected in two years.

In terms of pricing, Eu says i-Residence has set a new benchmark in the area at RM500 per sq ft.

Capital values in the vicinity, he adds, have appreciated in tandem. “When we were building in 2008, the semi-detached houses behind us were going for RM750,000 and RM300,000 for terrace homes. Now it has doubled to RM1.5mil and RM600,000.

“We have demonstrated that there is demand for high-rise living in Shah Alam, which has historically favoured landed property. When we wanted to do this, people were sceptical. But we have proven that if you have a nice product and environment, high rise is possible.”

Of i-City's total 13 million sq ft, 8 million has been carved out for residential-type dwellings, 2 million for the mall and three hotels, and the rest for offices.

I-Bhd plans to roll out RM500mil worth of projects with one million sq ft of GFA and hit RM500mil in sales per annum.

Eu calls i-City a “dual-track” project as the tourism and property development elements can operate independently of each other.

“Every developer wants a recurring income stream, that's how the theme parks came about,” he elaborates.

“Once everything is done, we will also receive recurring income from the investment properties, namely the mall, hotels and carparks.”

Quantum leap

By the middle of the next decade, after i-City has come to fruition, it is envisaged to have 30,000 knowledge workers, 25,000 residents and 40 million to 50 million visitors from five million now.

And while the small office/home offices (Sohos) and Sovos make up a significant chunk of its residences at 5.2 million sq ft, or 40% of the total built up, Eu does not think there will be a crunch in demand, citing the growing number of technopreneurs who eschew traditional offices.

In the near term, I-Bhd aims to launch 950 units of its RM300mil GDV Sohos in November alongside its Water World@i-City that will feature the country's only tornado ride.

Also in the works are a luxury 43-storey condominium sited on 1.1 acres in Kuala Lumpur's Golden Triangle in Jalan Kia Peng, which is slated to be revealed in the first quarter of next year, and Clarke Quay @i-City, the working title for what will be its riverfront complex inspired by the Singaporean tourist haunt of the same name.

“The authorities here are learning from Singapore and have decided to do away with the cemented banks of Sungai Rasau, which snakes past i-City. The plan is to widen and deepen the river to give it a natural look,” Eu explains.

The river will be the focal point for its leisure district comprising its one million sq ft regional mall, hotels, an amphitheatre and an F&B hub.

For the rest of the year, Eu is confident that the company can maintain its growth momentum.

He expects net profit to be double that of last year in the financial period ended Dec 31, 2012 (FY12) on the back of progressive recognition of unbilled sales from its apartments and better ticket sales from its rides and attractions with the looming year-end holidays.

In a May report, Kenanga Research estimates that I-Bhd could see solid earnings growth in FY12 and FY13 of over 100% to RM11.4mil and RM24.3mil respectively.

“For the past five years, the group has maintained its net cash position with a zero gearing balance sheet,” adds the research house, which has a target price of RM1.51 for the stock.

On dividends, Eu shares that there is potential for higher payouts in the future. It has been returning one sen to shareholders over the past two years for a yield of 1% to 3%.

“Last time we were thinking about how to settle the problems. Now we will settle shareholders,” Lim chips in.

For him, this is more than a business investment. “It is not only about returns. Without love, this will not be successful. Without love, we would have surrendered,” he says simply.

“The challenge for us now,” Eu sums it up, “is to continue to increase the GDV of i-City. We have 10 years left under the current plan. Our job is not to complete it, but to enhance it further so we will have many more years to go.”

By The Star

A place to have fun and live in

Snowman models in Snowalk at i-City.

I-BHD's City of Digital Lights, which opened its doors in 2009, has never failed to attract visitors. On average, it receives 90,000 visitors a week or about five million visitors per annum. Group executive chairman Tan Sri Lim Kim Hong recalls that the traffic jam at the entrance to i-City that stretched some 10km when it was first opened and parking was free.

Subsequently, I-Bhd charged RM3 per entry into the car park and the jam had eased to about 5km and now it costs RM10 per entry. He says the traffic buildup is now mainly during weekends, public and school holidays.

“I-City has become a landmark in Shah Alam. We're now a crowd puller,” Lim says. The soon-to-be developed mega shopping mall known as CityMall and Water World@i-City, which is opening its door in November, are set to attract more visitors.

I-Bhd will be announcing its joint venture with a shopping mall manager in two weeks which will help manage its CityMall. The mall will be built on 14 acres in i-City.

“We will make the announcement in two week's time. It will be an agreement with a mall operator,” group chief executive officer Datuk Eu Hong Chew tells StarBizWeek.

He says the “regional mall” with an estimated gross development value (GDV) of RM500mil, is scheduled to open in 2015 and investors are said to be conducting their due diligence exercise at the moment.

Last year, I-Bhd entered into a 30:70 joint venture with Everbright International China to co-develop 30 acres in i-City. The development will be done in two phases. Phase one involves 14 acres with a GDV of RM1.5bil and will comprise a giant shopping mall and 2 million sq ft of mixed residential, Multimedia Super Corridor (MSC) offices and educational institute.

The second phase has a GDV of RM2bil involving 16 acres.

“Everbright will be the contractor and builder of the mall. They will fund the construction and act as a financier cum contractor,” Eu says, adding that CityMall will have a lettable area of one million sq ft.

Eu says i-City will introduce some food and beverage outlets fronting Sungai Rasau as the Selangor government plans to upgrade the river. Once completed, there will be a 1km river frontage beside i-City.

Meanwhile, a six-acre Water World@i-City will premier to the public in November just ahead of the year-end school holidays. The water park will be a new boost to I-Bhd's leisure business, which is already a major cash generator for the company.

Lim says a tornado ride, the first of its kind in South-East Asia, will be a major attraction for the water park.

“Many do not realise we are not just a property developer but one of the few listed companies who have gone into the leisure business. We have invested RM30mil in leisure and theme park attractions so far.

“This year we are investing RM25mil in the Water World. Our plan is to invest RM100mil in the theme park in three to four years,” Eu says.

While I-Bhd's tourism element may not be huge, it is already getting a decent number of visitors to its theme park, various rides and attractions. Currently, Snowalk and the digital lights are the main attractions which draw people to i-City.

“Our track record so far is we have managed RM1 turnover for each RM1 of investment. We invested RM30mil this year in the theme park and expect RM30mil revenue. This is based on actual historical performance. We did not plan for it this way.

“For every RM1 of turnover we receive 30%-35% in terms of profit. We think we should be able to continue this. We reckon we should at least get RM100mil from our theme park yearly after it is completed,” Eu says.

I-Bhd embarked on the leisure business several years ago to provide the company with a recurring income stream once the development of i-City is completed in about 10 years.

Since the launch of City of Digital Lights, revenue from the leisure segment has grown from RM2.8mil in 2010 to RM17mil last year.

As at June 30, I-Bhd's efforts at enhancing its tourist attractions at i-City are paying off as profits have more than tripled year-on-year to RM7.61mil from RM2.24mil previously.

“When everything is complete, recurring income will come from the investment properties namely the mall, hotels and carparks. The theme park is separate as it is not under property development,” Eu says.

As it realises its need for repeat visitors, Eu says, I-Bhd will add new attractions every year to draw in the numbers. Last December, it brought in seven theme park rides and so far this year it has launched the 10,000 sq ft children's gym.

“At the moment we are still about 90% night in terms of visitor arrivals. We hope that by next year when the Water World is open it will be two thirds night visit and one third day visit,” he says.

Acknowledging that it has not done much marketing, Eu says it will be conducting more marketing once its Water World is open.

“A lot of the crowd comes by word of mouth. But once we finish the water park, there will be a critical mass for us to promote to. A lot of shopping malls would like to have an entertainment component. The difference for us is that by the time we open our mall, we already have a proven theme park,” Eu says.

Moving on, three hotels from luxury four star to boutique hotels are in the pipeline as long-term investment.

“At the moment there are three planned four-star, three-star and boutique hotels. The latter two we may manage ourselves although we haven't finalised this. However, for the high end one, we will probably get an international hotel operator,” Eu says.

By The Star

IGB REIT IPO set to be 4th largest this year

The Gardens Mall is one of the properties of IGB REIT.

KUALA LUMPUR: IGB Real Estate Investment Trust (REIT) has priced its initial public offering (IPO) to institutional investors at the top of an indicative range in a deal that will raise about US$260mil in the buoyant Malaysian market, according to sources.

The IPO was priced at RM1.25 per share, said sources with direct knowledge of the deal who were not authorised to speak publicly on the matter. The REIT had been offered to large investors such as pension and mutual funds at a RM1.15-to-RM1.25 range.

The deal is set to be the fourth largest IPO this year in Malaysia, and follows high-profile share sales by planter Felda Global Ventures Holdings Bhd (FGVH) in June and IHH Healthcare Bhd in July.

The institutional tranche of the offer was about 30 times oversubscribed, one of the sources said, underscoring the growing interest in Malaysian deals and the emergence of South-East Asian capital markets.

Equity issuance in Malaysia year-to-date stands at about US$7.9bil, compared with US$3.9bil last year, and Malaysian IPOs have gained 17% year-to-date on average, according to Thomson Reuters publication IFR.

The IGB REIT was likely to yield 5.1% to 5.2% a year, IFR reported, making it appealing to investors looking to bolster returns amid volatile stock markets and with global interest rates near record lows.

Demand was also buoyed by the relatively small size of the deal, compared with FGVH's US$3.1bil IPO and US$2.1bil IHH dual-listing.

The property trust owns two Kuala Lumpur shopping malls the Mid Valley Megamall and the Gardens Mall.

Meanwhile, MIDF Research has placed a fair valuation of RM1.43 per share based on the resilient earnings of Malaysian REITs. The research house said there had been strong interest in IGB REIT with the retail and institution portions of the offer for sale oversubscribed.

“Hence we believe our estimated fair value (capital gain potential of 14%) is not overly optimistic,” it said.

By Reuters

Hunza hires Singapore, KL experts for mall in Penang

GEORGE TOWN: Hunza Properties Bhd (HPB) is looking to conclude some 80 per cent of tenancy deals for its lifestyle shopping mall, which will be ready by the middle of 2013.

Executive chairman Datuk Khor Teng Tong said the company, which plans to hold and manage the mall, a component of its Gurney Paragon development here, has engaged experts from Singapore and Kuala Lumpur to ensure smooth operations of the mall, expected to boast new retail names in Penang.

"The rental income stream from the mall in future will enable the group to have a strong base of recurring income," he told a media briefing here on Wednesday.

Sited on a plot of 4.08ha freehold land, Gurney Paragon is an integrated development comprising two blocks of high-end condominiums, an office block, St Joseph's Novitiate, three-storey podium retail lots and a shopping mall which total some 700,000 sq ft.

Khor said about 57 per cent of net lettable space has been rented out to tenants such as food and beverage outlets and beauty and wellness operators.

Industry experts have also speculated that HPB is looking to list its Gurney Paragon lifestyle mall in a real estate investment trust on Bursa Malaysia some three years after the mall is in operation.

Of the total 220 Gurney Paragon condominiums, only 13 more units have been left unsold and the company is looking to sell these by the end of the year.

On the progress being made on HPB's 6.48ha plot of land acquired in Bayan Baru, Khor said the company expects to complete the required affordable housing units for affected squatters by 2014.

He said of the 800 who are entitled to be compensated, some 200 squatters were not owners of the squatter homes.

"We are looking to construct some 800 units of affordable housing so that squatters who are entitled to be relocated can move into their new units," he added, saying that the new units will be located within close proximity to their existing homes.

"Only once this is done will we break ground on the project, which is currently tagged at RM4 billion," he said.

Land cost and relocation of squatters are expected to cost some RM200 million.

By Business Times

I-Berhad to fast track i-City

The RM5 billion i-City project in Shah Alam, Selangor, is 20 per cent completed.

I-BERHAD is speeding up the developments of its RM5 billion i-City project in Shah Alam, Selangor.

Executive chairman Tan Sri Lim Kim Hong said the company had also been approached by several parties to replicate the i-City project in other cities.

"We will consider replicating i-City when the project is about 50 per cent completed. We expect to reach that in three to four years," Lim said after a dialogue session at Balai Berita, here, yesterday.

The 42ha i-City is a knowledge and tourism project with 18 office towers and residences, three hotels, a one million sq ft mall, a cybercentre, shop offices and retail units.

It will also have several leisure components like a snow walk, a theme park and a waterpark.

The project is 20 per cent completed.

Lim, who owns a 65 per cent stake in I-Berhad, has invested more than RM1 billion in the i-City project over the last five years.

In the next six months, I-Berhad will start building Soho (small-office-home-office) and Sovo (small-office-versatile-office) units, the mall and a three-star hotel.

There will be a total of 950 Soho and 220 Sovo units, with combined gross development value (GDV) of close to RM600 million.

For the mall and hotel, Lim said I-Berhad was expected to ink a deal within the next two to three months with international operators to jointly build and manage the properties.

Lim said in the next three years, the property development division would be the biggest revenue generator for the company,

I-Berhad aims to launch RM500 million worth of properties a year at i-City. This will give it a steady revenue of about RM500 million per annum from 2014.

Lim said he also expected the leisure division to hold strong, raking in RM50 million in revenue next year and up to 40 per cent in profit margin.

For the financial year ended December 31 2011, I-Berhad registered a pre-tax profit of RM1.84 million on revenues of RM27.3 million.

By Business Times

Great Mall of China set to become world's largest

BERJAYA Land Bhd's (BLand) The Great Mall of China (GMOC) is set to outdo others for the bragging rights as the world's largest shopping mall.

And BLand has every reason to be confident of GMOC's success, particularly in 'terms of demand for space leasing' as Beijing has high per capital income of US$12,447 (RM39, 200) in 2011.

By the World Bank's standard, cosmopolitan Beijing is already considered a wealthy city, on par with London, New York or many other rich cities around the globe.

GMOC, the world's biggest integrated mall complex, is estimated to be worth about RM7.5 billion on a 32ha site in China's Hebei Province.

It is expected to be completed in five years. GMOC has strategically positioned itself in an area where massive integrated public transportation project is due to take place.

One notable project is a big subway station, which is expected to be completed in 2018, linking it to neighbouring TongZhou.

TongZhou is about 20km away, and the subway will bring its distance to GMOC within 2km, reducing travel time to mere minutes from half an hour now.

Beijing's population of over 21 million people, excluding the population of its neighbouring cities such as Tian Jin, Hebei and Yan Jiao, which are also booming due to the country's sound economy, is expected to give rise to the project's popularity.

The vision for such a project of epic proportions is a timely investment by the Berjaya Group founder Tan Sri Vincent Tan.

Tan owns 49 per cent of BLand's subsidiary and GMOC operator Berjaya Great Mall of China Co Ltd (BGMOC) through Berjaya Times Square Cayman Ltd.

GMOC was planned at a time the Chinese market began witnessing a boom followed by the gross increase of the republic citizens' spending power worldwide.

Tan definitely knows his market.

The Berjaya Times Square, which is the eight largest building in the world in terms of floor area, is proof of the conglomerate's big dreams and visions.

Unlike other shopping malls in Beijing, which are mostly purely shopping driven, GMOC will be the first to break out of the ordinary shopping culture in China by housing three indoor theme parks.

GMOC will also impress its patrons with its many world-class amenities, including a multi-purpose convention hall to cater to all forms of business needs.

With Phase One due to be completed in October next year boasting of three all-weather and indoor theme parks namely Extreme Park, Family Park and Water Park, GMOC is poised to set the Malaysian flag sailing high globally.

By Business Times

Zecon sells mall to Tabung Haji

PETALING JAYA: Zecon Bhd announced that its unit Zecon Land Sdn Bhd, with Zecon Land's 51% owned subsidiary Zecon Petra Jaya Sdn Bhd, had entered into a sale and purchase agreement with Lembaga Tabung Haji (LTH) for the sale of a retail mall for RM155.85mil.

The retail mall, with a gross floor area of 774,859 sq ft, will be situated in Kuching, Sarawak and be developed by Zecon Land for LTH.

The development of the mall will be funded via a mix of internal generated funds and borrowings.

In a development agreement dated Jan 20, 2011, Zecon Petra Jaya had appointed Zecon Land to undertake the construction of an integrated mixed development known as the Vista Tunku Project on the project land. LTH had requested Zecon Land to construct the mall, with an anticipated completion date two years from commencement of works.

By The Star

Temasek eyeing Lido developer?

RM4B JOHOR DEVELOPMENT: Singapore group said to be in talks with Vincent Tan for a portion of his 47 per cent stake in CMP

SINGAPORE'S Temasek Holdings is believed to be eyeing a stake in Central Malaysian Properties Sdn Bhd (CMP), the project developer of Lido Boulevard.

Lido Boulevard is a RM4 billion integrated residential and commercial waterfront development overlooking the Strait of Johor.

It is understood that Temasek is in talks with majority shareholder Tan Sri Vincent Tan to take up a portion of his stake in the company.

Questions emailed to both Tan and Temasek were not answered as at press time.

The Crown Prince of Johor Tunku Ismail Ibrahim Sultan Ibrahim Iskandar is a 30 per cent share holder in CMP, while Tan owns a 47 per cent stake.

Its other shareholders include Datin Leong Foong Lai with a 9 per cent stake and Pasti Ekslusif Sdn Bhd with a 14 per cent stake.

Another source close to the deal said Temasek representatives had been to CMP offices for preliminary auditing.
The Lido Boulevard project is a joint venture between CMP and State Secretary Inc.

"One of Temasek's issue is whether the project is indeed being developed. They want to make sure that it's not just another abandoned project in Johor Baru," one source said.

Little has been heard of the project since late 2010, with many sure that it was a non-starter.

In a recent interview, CMP's chief executive officer Khoo Boo Teng, however, said mitigation work on the project was to start this week and likely to go on for another three to four months.
Reclamation work was expected to be completed in three years, Khoo said.

According to accounts filed with the Companies Commission of Malaysia, CMP's reserves are running in the negative of RM25.5 million.

Its assets stood at RM54.3 million, while liabilities were at RM79.56 million for the financial year ended December 2010.
No accounts were filed thereafter.

Should the Lido deal go through, it would be the second high-profile investment to have come into Johor Baru in recent months.

November 2011 saw Billionaire Peter Lim team up with Tunku Ismail to start a joint-venture company to develop a S$2 billion (RM5 billion) 10ha medical complex close to the Johor Customs, Immigration and Quarantine Complex.

By Business Times

All systems go for RM4b Johor beachfront project

LIDO BOULEVARD: Site mitigation works to start this week

TAN Sri Vincent Tan's multi-billion ringgit beachfront project Lido Boulevard, thought to be abandoned, will start site mitigation works this week.

It is estimated the entire development will have a gross development value of RM4 billion.

Overlooking the Strait of Johor, Lido Boulevard is an integrated residential and commercial waterfront development that spans 2.4km along the Tebrau Strait coastal line.

The development starts right after the abandoned JB Waterfront City, Lot One, and ends just before the Marine Department.

Little has been heard of the project after a portion of land which had been reclaimed caved in, resulting in the loss of a life in November 2010.

"We had to have a complete revamp after the whole incident. We took a bit more time to be more careful," Central Malaysian Properties Sdn Bhd (CMP) chief executive officer Khoo Boo Teng told Business Times recently.

Post-clean up works, he said there was a need to revisit its design work for, among others, roadworks along Jalan Skudai, the closest point to the coastline.

After a long and tedious process of submitting plans for approval, Khoo says after a fine-tuning of its masterplan, it is all systems go for mitigation works.

This includes rigging out the sea area it will reclaim with silt curtains and sheet piles to ensure that waste and debris, once work starts, do not get into the straits. This procedure will take three to four months to complete.

The project will comprise six parcels: Its high-end condominium towers Lido Residences, a 2.7km long and 10m wide boardwalk, a cultural centre, a hotel and retail mall, office suites and a 1.8ha to 2ha green lung.

The development will stretch 450m into the strait from the coastline.

The initial plans for a 50,000 sq ft snow park is still under consideration, says Khoo.

The development blueprint is based on the theme of a garden city with heavily landscaped garden, water features, park-like facilities and pocket gardens.

Reclamation work is expected to take about two years to complete.

The project is being developed in a joint venture with the Johor State Secretary Inc, an investment holding company of the state government.

Vincent Tan and Johor Crown Prince Tunku Ismail Ibrahim Sultan Ibrahim Iskandar are shareholders in CMP.

By Business Times

Cheras Sentral to get MRT connection

KUALA LUMPUR: Property developer Malaysia Land Properties Sdn Bhd (Mayland), which is redeveloping Phoenix Plaza in Cheras, will benefit from connectivity with the planned MRT station in three years.

"There will be a pedestrian bridge right across the road connecting the MRT station to the second level of our shopping mall," said Mayland retail general manager Michael Chee.

Renamed Cheras Sentral, the Phoenix Plaza shopping complex is now undergoing a RM125 million transformation.

Chee said the mall, with 500,000 sq ft of net lettable area, anticipates 85 per cent occupancy by the end of this year. Rent at the malls is expected to be between RM4.50 and RM5.00 per sq ft.

A strong tenant mix and strong support from existing strata title owners will see to mutual benefit, Chee told reporters after a tenancy signing ceremony with TGV Cinemas, Jaya Grocer, Celebrity Fitness, CYC World Mega Leisure World, Moon Palace Chinese Restaurant, K-Mix Karaoke and information technology company Dynamic Trial Sdn Bhd here yesterday.

Phoenix Plaza, which opened in 1994, closed in 2005 due to accessibility problem and inexperienced management.

Mayland, a company controlled by Tan Sri David Chiu, bought 85 per cent of the stratafied block of real estate in 2009 from Danaharta.

Chee said apart form refurbishing it, Mayland plans on adding a hotel and car parks.

The proposed hotel, which will carry the group's hotel brand - Silka or Dorsett - which will have about 300-odd rooms and is scheduled for opening early next year.

Mayland currently owns and operates the Sri Hartamas Shopping Centre.

By Business Times

Mayland to turn Cheras Sentral into bustling spot

PROPERTY developer Malaysia Land Properties Sdn Bhd (Mayland), which is set to open a second shopping centre by year-end, expects return on investment (ROI) in as early as five-and-a-half years.

Typically, a mall in Malaysia could take up to 10 years to see ROI and at best, in seven years.

Mayland, which owns and operates the Sri Hartamas Shopping Centre, is currently working on Cheras Sentral, the shopping complex which was previously Phoenix Plaza and is now undergoing a RM110 million transformation.

The projected time to recoup investment in Cheras Sentral is commendable even though the investment is possibly only a fourth of what it would take to build an entirely new mall and the renovated mall will have less retail space.

The previous mall, Phoenix Plaza opened in 1994 but closed in 2005.

Mayland's retail general manager Michael Chee is confident that the company will be able to make the mall, which once failed, into an bustling spot.

The mall, with 500,000 sq ft of net lettable area (NLA), anticipates 85 per cent occupancy on the opening day, which will be before Christmas this year. Rent at the malls is expected to be between RM4.50 and RM5.00 per sq ft.

Chee projects that the tenants within the mall will be able to rake in between RM150 million and RM200 million in sales in the first year of operations.

In an interview with Business Times, Chee, who has 25 years of experience in the shopping complex scene, said the mall had previously failed due to the mismatch between the tenants and the surrounding demography.

By taking this into consideration, as well as the needs of the growing Gen Y population, Chee feels he now has the right formula for the new upcoming mall.

"Cheras Sentral is being positioned to cater to the Gen Y, who tend to visit the malls on an average of one to two times a week and make it a social activity," Chee said.

He said that very often, people are judged by where they shop as it points to the status of the individual.

Cheras Sentral will include coffee joints, leisure and entertainment elements as well as health and lifestyle. It will house a karaoke, eight screens cinema and Celebrity Fitness.

The catchment for the mall include 1.6 million people within a 15 minutes drive, with 65 per cent of the average monthly household income at RM10,000.

The anchor tenant at the mall is Jaya Grocer, that will occupy 24,000 sq ft and a 15,000-sq ft Chinese restaurant that can seat 1,000 people.

Mayland, a company controlled by Tan Sri David Chiu, bought property in 2009 and took on the task of refurbishing it and adding a hotel and car parks. The entire investment is for RM160 million.

The hotel, to be either a three or four-star category, will carry the group's hotel brand - Silka or Dorsett and will have about 300-odd rooms. The hotel is scheduled for opening at year-end or early next year.

Chee said things could only get better when the MRT line is ready in three years.

By Business Times

Mayland in talks to acquire 2 malls

KUALA LUMPUR: Malaysia Land Properties Sdn Bhd (Mayland) is in talks to acquire two malls in the northern part of Peninsula Malaysia, as the group looks to grow its shopping complex business.

"Our discussions are in the preliminary stage. Together, both malls have a net lettable area (NLA) of 1 million sq ft," Mayland's retail general manager Michael Chee said of the mall he is in talks with.

Chee told Business Times that while the group prefers to acquire existing malls, it is also open to looking at greenfield projects.

The property developer model is to own and operate the shopping complex rather than be just a shopping complex manager.

Mayland's first shopping centre is the seven year old Sri Hartamas Shopping Centre which has NLA of 200,000 sq ft in Kuala Lumpur. The second mall Cheras Sentral will open at the end of 2012 with 500,000 sq ft of NLA.

By Business Times (by Vasantha Ganesan)