Malton going into more high-end projects

It is embarking on brand building initiatives


Yeoh Teng Tatt and Tracey Lai showing a model of the VSQ project.

MALTON Bhd is making efforts to further strengthen its branding in the residential and commercial property segments with a line-up of more exciting projects over the next two to three years.

The company is looking at adding more value to its land bank of more than 600 acres in various parts of the country.

“At present, some 70% of the company's projects are high-end while 30% are projects in the various existing townships, including in Puchong and Bukit Rimau, Shah Alam,” chief operating officer Yeoh Teng Tatt told StarBiz.

He said that having multiple projects at the right addresses would drive the company's earnings over the next three to five years.

“We are moving into more prestigious developments and will offer more superior and higher end products as part of our brand-building initiatives,” he added.

Malton director of sales and marketing Tracey Lai said the company had RM2.1bil worth of new projects lined up for launch in the next two to three years, including the unveiling of new phases in existing developments.

“For the current financial year ending June 30, Malton is targeting sales of RM400mil compared with RM120mil recorded last year,” Lai said.

Niche developments to be launched this year include Ukay Springs, an upmarket residential enclave on 56 acres in Hulu Klang, comprising 150 units of 2½-storey semi-detached house and bungalow.

In Sungai Long, Malton will build high-end residences on a 67-acre site worth a gross development value (GDV) of RM330mil, while in Taman SEA, plans are afoot to build 35 bungalows, semi-detached houses and zero lot residences.

A mixed commercial development on 2.7 acres in Taman Maluri, Cheras, will comprise service apartments, office suites and a retail mall worth a GDV of RM195mil.

In Penang, a 36-storey condominium block on 0.7 acre along Cantonment Road will mark Malton's maiden entry into the state's property market. The RM47mil project will be launched later this year.

Malton's recently launched projects include Pearl Villas, comprising 42 units of 3-storey semi-detached villa and two bungalows on 4.8 acres in Petaling Jaya's Section 16, with a GDV of RM110mil.

Another flagship project is Amaya Saujana @ Saujana Subang in the vicinity of the Saujana Golf & Country Resort comprises three blocks of 13-storey residential suites. The project has a GDV of RM250mil.

Planned as a resort lifestyle development, Amaya offers generous spaces in its unit layout and its surrounding landscape. The initial soft launch of phase one has attracted 80% take up rate so far.

Meanwhile, an integrated commercial project is underway on a 2.6-acre plot in Jalan Utara, Petaling Jaya, which used to be the site of a Lutheran Church.

V Square (VSQ) features two blocks of corporate tower, a block of corporate business suites, and two blocks of corporate offices, with retail space on the ground floors. The project will have a GDV of RM207mil.

“Vibrant, vital and visionary, VSQ is designed to offer a stylish working environment in a prime location,” she added.

Lai said Malton was also the project development manager for The Pearl @ KLCC, which comprises a high-end condominium project along Jalan Stonor in Kuala Lumpur.

The 41-storey block of 177 luxurious condominiums is located on a 1.8-acre site, opposite the Embassy of Vietnam, within the KL City Centre enclave.

The spacious residences, including seven duplexes and three penthouses, will have built-up areas from 3,000 to 20,000 sq ft.

“Its international architecture design and futuristic concept have won admiration from many interested buyers, including foreigners and expatriates.

“Besides state-of-the-art security system, the residences will be fitted with smart home features. There will also be a well-equipped clubhouse,” she said.

In Seremban, a 17-acre plot will be developed into bungalows and shop offices worth a GDV of RM160mil.

By The Star - StarBiz - (by Angie Ng)

Revamped Magna Prima on stronger footing

SECOND board construction player Magna Prima Bhd is on a much better footing from three years ago when it was making losses.

With a turnaround plan in place after a reshuffling of the top management and the board of directors, the company turned in a net profit of RM26.58mil for the financial year ended Dec 31, 2007 (FY07) compared to a net profit of RM119,000 the previous year. Revenue increased by 326% to RM344.44mil.

Magna Prima has three current projects: the 88-acre leasehold Metro Prima in Kepong, a joint venture with landowner Kuala Lumpur City Hall that is almost completed; The Avare, a freehold 41-storey luxury condominium project located in the vicinity of KLCC; and the three-acre leasehold MagnaVille in Selayang comprising three blocks of 22-storey condominiums.

It is also the turnkey contractor for Muafakat Kekal Sdn Bhd, the developer of the Dataran Automobil project in Shah Alam, a joint venture with landowner Selangor State Development Corp. Taken together, all the projects have unbilled sales of RM250mil and ongoing gross development value (GDV) of RM1.7bil.

Magna Prima chief executive officer Lim Ching Choy said the company was now in the second phase of the turnaround.

Lim Ching Choy

“The first phase involved streamlining the company's resources into three business divisions and hiring new management teams for the divisions,” he said.

In the second phase, integrated-lifestyle developments, comprising commercial and residential elements, would be the way forward as the company makes plans to transfer to the main board by 2009.

As such, two more projects had been lined up for launch this year that would provide not only greater earnings visibility for the next two to three years but also recurrent income from certain commercial properties that the company would retain, Lim told StarBiz.

The projects would be launched from land that the company acquired late last year in two locations - a 4.78-acre leasehold parcel in Section U1 of Shah Alam and two parcels of freehold land totalling 10.23 acres in Jalan Kuching, Kuala Lumpur.

Now the company is embarking on its second phase. “We don't have a large landbank and we're small compared with the likes of SP Setia Bhd and other listed property developers, so we need to find our niche,” Lim said.

He said the estimated RM135mil Shah Alam project, whose proposed name is Dataran U1 Shah Alam, would be an integrated three-in-one project comprising shops, small office home office units and serviced apartments. “This project will be launched by May and will have a two-acre landscaped park on the third floor of the retail podium,” Lim said.

He said the yet-unnamed Jalan Kuching project would be launched by August. “This will be an integrated five-in-one project comprising 3-storey shops, a 3-storey retail podium, an 8-storey office tower, two blocks of serviced apartments and a 250-room hotel with an estimated GDV of RM1.1bil,” Lim said, adding that the company was looking for a joint-venture partner for the mall, which would be retained for recurrent income.

Both projects are scheduled for completion in 2011.

“We've not gotten into any serious negotiations yet although we have three potential partners in mind, one of which is local. We hope to conclude a deal in the next six months,” Lim said.

He said the mall, with an estimated net lettable area of 1million sq ft, would be modelled along the lines of malls that had been coming up throughout the South-East Asian region in the past two to three years.

Lim said there may be another integrated project on the cards should negotiations for a project located in Kuala Lumpur's Golden Triangle be successful.

“Hopefully in the next one or two months we'll be able to conclude the negotiations, which will be a joint venture with a landowner,” he said, adding that the project would include a Grade A office tower among its components.

Lim said the company would continue to pursue the strategy of sourcing for projects in matured areas of the Klang Valley. “We'll continue to look for areas in which we can develop high-density projects, this is the model we'll continue to work on, and going forward we'll most likely enter into joint ventures with institutional and private landowners in order not to burden our finances,” he said.

Lim said efforts were being made to balance out the revenue stream from the various divisions in the company. “Property development currently contributes 75% of revenue, but going forward we'll like to see a more balanced revenue contribution and hope that construction will contribute at least half,” he said.

At present, most of the construction jobs were from the property development arm but in the future, as the company's brand-building exercise and quality became better known, more projects would come its way from outside. “We'll continue to concentrate on civil works for our construction arm,” he said.

By The Star (by Fintan Ng) (posted on 17th March '08)

Wireless@KL project to start in May

The "KL Wireless Metropolitan" or "Wireless@KL" project to transform Kuala Lumpur into a "wireless city" with world-class communication channels will begin in May, city mayor Datuk Ab. Hakim Borhan said yesterday.

“In line with the Wireless@KL project, a community website, KUL.COM.MY, will also be set up and updated regularly to provide the relevant information to city dwellers,” Ab.Hakim told reporters after the signing of a memorandum of agreement (MOA) on the Metropolitan Kuala Lumpur portal project between Kuala Lumpur City Hall (DBKL) and Synapse Technologies (M) Sdn Bhd.

The agreement is under the initiative of the Malaysian Communications and Multimedia Commission (MCMC) on behalf of the government, which has provided a grant of RM500,000 to City Hall for the purpose.

On December 17 last year, City Hall signed a memorandum of understanding on Wireless@KL with MCMC and Packet One Networks (M) Sdn Bhd to enhance broadband facilities for City Hall offices and community centres and both public and residential areas in the Klang Valley by 2010.
"Wireless@KL uses WiMAX technology and for the first phase of this project 1,500 Wi-Fi zones will be developed,” Ab. HAkim said.

He also said the KUL.COM.MY portal will be a “one-stop source of information” on Kuala Lumpur for people in and out of the country. The information will cover social, development, economic, trade, education, entertainment, tourism and other aspects, he said.

Ab. Hakim said the portal will use the “broad spectrum approach” where it will collate and upgrade information from various sources for user convenience.

By Bernama

Firm targets China and Vietnam

Venturing overseas has become a viable option for many Malaysian property companies to widen their earnings base and establish a stronger brand image in the region.

Developers with good track records and interesting project concepts to “export” to other emerging markets are making a beeline abroad.

According to Malton Bhd chief operating officer Yeoh Teng Tatt, the company is eyeing China and Vietnam to introduce its brand of properties to the growing middle class and newly rich population.

“We are talking to potential partners in those countries for possible joint ventures to undertake projects. Having established its name in building townships and niche residential projects, including gated and guarded projects in the Klang Valley, Malton is looking forward to replicate its success in other potential markets outside the country,” Yeoh pointed out.

It has also made a name in the commercial property market, including through the construction and project management for shopping malls such as Pavilion KL and commercial buildings such as Menara Uni Asia. Malton's construction arm, Domain Resources Sdn Bhd, was also looking to undertake building infrastructure projects overseas.

Although construction jobs currently contributed some 60% to group revenue, he said, the line-up of more exciting property projects in the next two to three years would most likely make property the bigger contributor.

Malton director of sales and marketing Tracey Lai said the company would be lining up more interesting products for its existing Bukit Rimau township and in Mutiara Puchong and Mutiara Indah. The 385-acre Bukit Rimau township will see more high-end houses launched this year.

“Instead of selling bungalow land, the remaining land will be turned into ready-built bungalows complete with interior designs and furnishings. Each of these tastefully designed bungalows will be going for between RM1.7mil and RM2mil,” she added.

Since the launch of Bukit Rimau in 2002, property products worth RM404mil have been launched to date while sales amounted to RM378mil. The RM780mil project will comprise mainly bungalows, semi-detached houses, townhouses, super-link terraced houses and apartments.

The remaining 40 acres will feature the commercial precinct comprising three-storey shop offices, service apartments, retail lots and hotel suites. The two gated community projects in Puchong - the 64-acre Mutiara Puchong and 83-acre Mutiara Indah will also see more new launches this year.

By The Star (posted on 17th March'08)

Enhancing professionalism among real estate agents

“FOR the year 2008, we want to be vocal, to say things, to take action. We want to enhance professionalism, to develop the business further, to be dignified,” says K. Soma Sundram, president of the Malaysian Institute of Estate Agents (MIEA).

The longstanding unresolved issue of illegal real estate agents is becoming quite a frustrating issue for MIEA. With 10 to 15 unregistered real estate agents for every registered agent, the loss of revenue to the real estate industry and the government is tremendous, he says. Nevertheless, MIEA is relentless in efforts to deal with the problem.



“Illegal agents have always been an issue, but the Customs Department has agreed to work with us to educate the public and also to act on the illegals,” says Soma. According to him, the illegal agents do not pay service tax and as such, Customs are interested to act on them. “It is also a good thing for the public to know that estate agents are liable to collect service tax of 5% of the service fee, payable to Customs. Before, only those who have reached a certain threshold of RM150,000 in transaction and above have to pay service tax. Effective January 1 this year, there will be no threshold and every agent is liable to collect the 5% service tax,” he says.

“Now, every agent has to pay as long as they collect a professional fee. In the past, we used to pay it with our own fees. This is a good move for agents. Those below the threshold had 0% service tax, so they didn’t have to compete with the rest. Now that it is standardised, it has become a level playing field,” says Soma.

On behalf of MIEA, Soma had written a letter to Prime Minister Datuk Seri Abdullah Ahmad Badawi last year, highlighting the plight of the real estate agents and requesting for a meeting to discuss the issues and to take the necessary steps to eradicate the problem. The letter was also
forwarded to several other governmental departments. However, it failed to stir any response from the authorities.

Estate agents are governed by the Valuers, Appraisers and Estate Agents Act 1981 (Act 242) and illegal agents caught can be slapped with a RM25,000 fine and/or jailed for three years. However, until this day, not a single illegal agent has been brought to court. “The courts have the authority to penalise these people, but no one is really concerned with resolving the issue and as such we have taken the matter into our own hands,” says Soma.

“This year, we will also raise issues, such as the representation of estate agents in the Board of Valuers, Appraisers & Estate Agents Malaysia, issues affecting estate agents in practice, talking to the public about the profession itself, educating our members to ensure that the level of professionalism goes up, and discussing whether real estate agents should be involved in property management,” says Soma.

“We want to reinvent the real estate agency profession,” he says. “Another one of our frustrations is the representation of estate agents in the board,” says Soma, adding that one of the things he hopes for MIEA to achieve is to set up a Board of Estate Agents to better represent those in the profession.

Having said that, he feels that the outlook for the real estate market is good. “I’m very confident that the market will be very good for the next 1 ½ years. There are no complaints from real estate agents, which is an indication of the market doing well, and the government’s focus over the last two years on incentives such as the Real Property Gains Tax (RPGT) and the launching of the various economic corridors, all encourage the market tremendously,” he says.

As the year 2008 unfolds, there will be a slew of new things coming in for MIEA. “We have purchased our own building, located at 3 Two Square. It is about 2,100 sq ft and costs around RM600,000. We settled our payment in February and by May, we plan to move in. We’ve been wanting to have our own building,” says Soma. The premise is located at Section 19, Petaling Jaya.

Also for the first time, MIEA has formed a strategic alliance with OCBC and AIA for a year. “OCBC will be providing us with training on the loan packages and they will work with the real estate agents to promote that. AIA has come out with a Mortgage Reducing Term Assurance policy.

It’s a new policy which we feel our clients will benefit from,” says Soma. According to him, the alliance will help enhance the professionalism of real estate agents and provide added value service to the clients.

“OCBC has given us RM100,000 sponsorship while AIA has given us RM50,000,” he adds. In line with its goal to increase the level of professionalism, the institute will be introducing the MIEA Industry Awards of Excellence this year. “We want to recognise agents who have excelled in their profession, who have done well in their fields whether it is residential, commercial or industrial.

We will also give recognition to the top real estate negotiators,” says Soma. According to him, the awards will be presented during the MIEA annual dinner scheduled for June 20. Nominations will begin after its annual general meeting (AGM) in April and an independent judging committee will be appointed.

Soma says MIEA also intends to officially take on the role of training and certifying real estate negotiators by introducing a government-recognised course.

“Negotiators are people employed by estate agents. They’re not required to be registered at the moment, and we feel that the training is inadequate. Things work more or less in-house, and not all negotiators are sent for the currently running negotiator’s course,” he says.

“In order for industry standards to go up, it must start from the guy who meets the client. And it’s not the estate agent. We want to take over the role of training the negotiators, certifying them and registering them under the board,” says Soma. Certified real estate negotiators will be issued a card, which is renewable every year. They would also be required to go through courses in order to renew the cards, a move made to maintain industry standards.

“MIEA has, over the last many years, registered some 2,000 negotiators and certified them as Certified Real Estate Negotiators (CREN). We have suggested to the board that MIEA should be doing the registration and we are in the midst of presenting them a working paper,” says Soma.

He also wants agents to extend their horizons overseas. According to him, a lot of foreigners have been entering the country due to government incentives such as the changes done to the Malaysia My Second Home (MM2H) programme. However, only 10 out of 300 real estate agents are involved in the programme, says Soma.

“The real estate agents are the best people to go out there and talk about Malaysia, to talk about the programme itself, and to talk about property. All this while, real estate agents have been quite inwardly focused and this has been the attitude for a long time.

“Some agents have taken the opportunity and some of them are doing very well. They know about the programme, but we need to educate them, show them exactly how they can ‘exploit’ this for their benefit. Agents must go overseas to talk to people, we can’t be expecting them to come over and knock on our doors,” says Soma.

Last but not least on MIEA’s plate is the introduction of a multiple listing service, where a central database would be set up and all properties listed by estate agents who are members of MIEA would be published, in hopes for a more organised system and fair competition for agents. It is currently sourcing for avenues to publish the listed properties.

“We hope to introduce this as it will totally open up the market. It is viable and it can happen. Holding cost is expensive; the system would also speed up sales. The turnover of agents would improve too,” says Soma.

By theSun (by Yeong Ee-Wah)

IJM’s new unbilled sales in Penang at RM160mil

The Nautilus Bay project

PENANG: IJM Properties Sdn Bhd has about RM160mil of unbilled sales from its new property launches in Penang since November 2007.

The amount was part of its total unbilled sales of some RM580mil, managing director Teh Kean Ming told StarBiz.

“In Penang the contribution comes from Nautilus Bay, a landed residential scheme located off the Jelutong Expressway, and Platino, a luxurious condominium project in the MetroEast mixed-development scheme next to the Penang Bridge,” he said.

The RM190mil Nautilus Bay project, completed recently, comprises 78 three-storey terrace houses with built-up areas of 2,600 sq ft.

Priced between RM780,000 and RM1.2mil, the Nautilus Bay is about 85% sold.

“The buyers are mainly locals and Singaporeans,” Teh said.

He added that Nautilus Bay was IJM’s first project in Penang to employ build-and sell concept and having obtained certificate of fitness.

On Platino which was launched last November, Teh said the scheme comprised two tower blocks of 228 detached condominiums.

“There are five units on each floor with built-up areas ranging from 1,800 to 2,800 sq ft.

“We have sold about 60% of the units, which are priced from RM700,000,” he said, adding that the project was scheduled for completion in 2010.

By The Star - StarBiz - (by David Tan)

New Strategies

Dijaya lays foundations to move ahead

DIJAYA Corp Bhd is on the threshold of further growth under the helm of MD Tong Kien Onn, who took over from P.K. Koh.

Tong is currently putting down new foundations to move ahead. He is taking on a more aggressive move as competitors have sprouted and managed to establish themselves as major players in the property sector.

“We were (well) known at one time. We still are but compared to these several competitors who have marched on, I would like Dijaya to be a name that people can identify with,” he says. The completion of the Tropicana City at the end of this year will help but Tong is laying down other strategies to propel the group forward.

The completion of the Tropicana City at the end of this year will help Dijaya

The group has property launches totalling some RM890mil planned for the first half of this year. Over the last year, Tong has been buying up land to replenish its depleting land bank. He has paid RM96mil for three pieces of land outside the inner city development, which he refers to as the second tier.

Located in Balakong, Sg Long and Jenjarom in Banting, the land spans some 190 acres.

Analyst Kevin Khoo from Insider Asia says the company is “aggressively expanding its land bank at low prices.”

Besides its land purchase and launches of close to RM900mil in Tropicana and Sg Buloh for the first six months of this year, it is also excited about its move to India soon.

“When I took over, I spent the first six to nine months looking for land and exploring opportunities overseas. We hardly bought any land the last 15 years. Tropicana and Damansara Indah kept us busy for a while. Today, we are at the tail end. We have four pieces of land, of which only one is for residential development in Tropicana itself, near the Lien Hoe building,” says Tong.

He says the company will adopt the concept of a guarded and gated community for these projects. The company has 93.4 acres in Jenjarom, 66 acres in Balakong, Selangor and 26.7 acres in Sungai Long, Cheras.

“We aim to have some elements of Gita Bayu and Desa Park City in Jenjarom and Balakong but have not worked out the concept for Sg Long yet. We are still looking for more land in Sungai Buloh. The focus of development will be around Sg Buloh area over the next five to eight years,” he adds. He opines that there is a market for such developments in the second tier townships.

“There are people with a lot of money out there,” he says.

“In property development, it is crucial to have good pieces of land and this is becoming scarce and expensive. The second thing I did was to look overseas ... my focus is India and Vietnam.”

Tong says while he is keen to go abroad, he is cautious because it is not as simple as it sounds or as many make it out to be. The company has teamed up with a local partner in a 54:46 joint venture to build a high-rise residential project in India.

Phase 1 will be launched in the second quarter of this year. The total gross development value is RM800mil. They are still exploring in Vietnam.

In addition, another step taken by him over the year is to have a bigger budget for landscaping in their projects. In Villa Green 3A semi-detached units, the budget was increased from RM200,000 to RM600,000. A total of 50 out of 80 units were sold. These will be ready by the end of March.

“When a company offers lifestyle homes, there is a certain ambience that is needed. Having more trees, and more mature ones, lends a new feel to the place and this is what people want. If they are going to part with millions, it is our part to do the necessary.”

For the newer developments, the landscape architects will be brought in at an earlier stage instead of at the tail end of a project.

Along with this new emphasis, the company will continue with its bread and butter projects, which is middle to upper end residential development and lifestyle commercial projects.

In the next several months, it will launch its condominium Tropicana Grande, a contemporary 300-unit condominium of 39 storeys. Average size is about 3,000 sq ft, priced at around RM500 per sq ft. The project has a GDV of RM390mil.

It will also launch Tropicana Avenue, which comprises nine to 11-storey shop offices on 2.8ha, priced at RM300 to RM350 per sq ft for office space and between RM600 and RM700 per sq ft for the shops (GDV: RM210mil)

On the cards is Tropicana Gardens, a six-storey lifestyle shop offices project fronting Persiaran Surian on a 17.6 acres. It will have 80 units of shops and about 140 units of offices. This will be launched at the end of 2008.

On its up and coming Tropicana Mall which fronts the LDP in Petaling Jaya (opposite Dijaya’s headquarters), Tong says they will keep the 12-storey office block for leasing purposes at about RM4 per sq ft. The office block has a floor plate of about 8,000 sq ft so it is quite unlike some of the new projects that have come up around Petaling Jaya.

“We need something that will give us a recurring income. We will also be leasing out the mall and after paying off the loan, I get RM20mil to RM30mil annually from the mall. We will sell all the 600-odd apartment units, which is currently 75% sold,” says Tong.

By The Star (by Thean Lee Cheng)

East Ledang homes see good sales

East Ledang's twin villa show unit

IN less than a month, UEM Land Sdn Bhd’s (UEM) latest property development, East Ledang at Nusajaya, Johor has sold almost half (48%) of its first phase that was launched late February.

“Fifty percent of our buyers are locals, mostly from Johor and are high income professionals while the other 50% are foreigners, mostly from Singapore,” said Wan Abdullah Wan Ibrahim, managing director of UEM Land.

The RM1.2 billion development takes up 275 freehold acres in Nusajaya and will be developed in seven phases comprising a total of 861 homes. The first phase offers a total of 139 units comprising 52 twin villas and 87 link duplexes.

The twin villas have built-up areas ranging between 3,700 sq ft and 4,400 sq ft while the link duplexes have builtups of between 2,600 sq ft and 3,000 sq ft. The homes are priced at RM870,000 and above and RM458,000 and above respectively.

“Work has already begun at Phase 1, which we are confident of delivering within 18 months. The entire East Ledang would take us between five to seven years to complete,” said Wan Abdullah, adding that Phase 2, comprising semidees and bungalows, is targeted for launch in August.

According to him, the project has an “East meets West” concept, blending tropical gardens and colourful flora from the East with security and ICT technology. The gated development comes with 24-hour CCTV surveillance, guarded and access card entrances, patrolled perimeters, as well as home security systems that come with panic buttons linked to the Central Monitoring System.

Another feature of the project is its 31 themed gardens including a 20-acre forest, wetland gardens, lake gardens and a large lake. “The Central Garden in Phase 1, with its 100-year-old multi-hued Frangipani trees whose whorled trunks resemble sculptures, is one not to be missed,” said Wan Abdullah.

Residents of East Ledang will receive membership for the clubhouse, “The Ledang”. Located at the estate’s entrance, the clubhouse features dining, recreational and spa facilities with a business centre, convenience shopping and a range of concierge-style services. Members may also enjoy panoramic views of East Ledang from “The Tower” at the clubhouse.

Located in south Johor, East Ledang is part of Nusajaya, a 24,000-acre regional city touted to be the largest fullyintegrated urban development in South-East Asia. Nusajaya is located within the Iskandar Development Region, which is connected to Singapore via modern expressways, 20 minutes away from Johor Baru and about three hours car drive to Kuala Lumpur.

Nusa Idaman, UEM Land's other project also within Nusajaya, will be completely launched this year. To date, it has launched six out of eight phases and handed over the first three phases. The remaining two phases will be launched within 2008, said Wan Abdullah. The RM417- million project is expected to house over 2,000 units upon completion.

UEM Land is the master developer of Nusajaya, which is expected to house 500,000 residents by 2025.

By theSun (by Yeong Ee-Wah)

Affordable terraced homes in Sungai Buloh

A show unit of the Camellia designed terraced home

LOOKING for an affordable terraced property in the Sungai Buloh- Kepong area? More 2-storey
terraced homes will be offered at the upcoming launch of the leasehold 200-acre Taman Desa Bukit Indah in Sungai Buloh, Selangor by Magilds Park Sdn Bhd, a subsidiary of Petaling Tin Bhd.

Following the successful take-up of its Camellia designed 2-storey terraces that was launched last month, the developer plans to introduce more of such terraced homes in June, Petaling Tin CEO Leong Choong Wah (pix) told PropertyPlus.



“In less than a month, we sold about 90% of the 83 units of Camellia terraces. Most of our buyers are from the surrounding Kepong and Sungai Buloh areas," said Leong.

"Apart from the affordable pricing, they were also attracted to the location which is about 15 minutes from nearby commercial amenities in Kepong like Jusco and Carrefour. Even 1 Utama is
about 15 minutes away.” The 3+1-bedroom, 3- bathroom Camellia homes have a land area of 22ft by 80ft and built-up of 1,600 sq ft. Prices for the homes start from RM216,000. The gross development value (GDV) is about RM20.9 million for the Camellia phase.

Construction works on the project have started. For its upcoming launch, the developer would be
offering 113 units of 20ft by 65ft terraces with a built-up area of 1,400 sq ft. According to the developer, prices are slightly below RM210,000 for the standard 3+1- bedroom, 3-bathroom units.

“This phase will have a GDV of about RM21 million. Since the launch of the RM214 million Taman Desa Bukit Indah in 2001, we have sold and delivered 47 industrial lots amounting to about RM36 million and 235 units of 20ft by 70ft link houses. These link homes are valued at about RM39 million,” said Leong.

Taman Desa Bukit Indah will take another five years to complete. There are midend condominiums and shoplots in the master plan, he added.

Taman Desa Bukit Indah is located near the Sungai Buloh hospital and the KTM Komuter station. It also enjoys easy access to the Damansara Puchong, MRR2 and New Klang Valley Expressway highways.

Meanwhile, at its ongoing leasehold 26.5- acre project at Taman Kelab Ukay in Ampang’s Ukay Heights, Leong said it is busy planning for the last few remaining phases of the RM125 million development.

“We will be offering superlinks, terraces, bungalows and zero lot bungalows for these final phases that will be launched by year-end or early next year. The entire development will be completed by 2011,” he added.

First to be launched in the final phase will probably be the superlinks which is in the final stages of approval.

“We are hoping to obtain the approvals for the 24ft by 90ft 3-storey superlink homes at Taman Kelab Ukay soon and we plan to launch them later in the year,” said Leong.

“There will only be 15 units within a gated scheme. Tentative pricing has been set at about RM680,000,” he said, adding that the maintenance fee has not been set. The built-up area for the superlinks is 3,200 sq ft and would have a GDV of RM10 million.

The developer has also lined up 21 units of 22ft by 80ft 3-storey link homes with a GDV of RM11 million as well as 17 bungalows and 15 zero lot bungalows with a total GDV of RM55 million in the same development.

By theSun (by Loo Pik Kwan)

Hospitality BOOST

Real estate consultants believe that the local hospitality sector would continue to expand in tandem with tourism and foreign investments growth.

AS the government continues to promote foreign direct investments into the country, a growing number of commercial properties’ transactions led by foreign buyers can be seen particularly in the Klang Valley.

While these foreign investors, such as those from the Middle East and Hong Kong, have interests in office buildings and shopping centres, much growth has been seen in the number of hotel acquisitions too. It was reported that the country recorded hotel transactions worth about US$376 million (about RM1.2 billion) last year, or 3.5 % of the total US$10.8 billion (RM34.5 billion) made across Asia.

Global hotel investment services firm Jones Lang LaSalle Hotels said the Asian hotel market witnessed 83 major transactions, valued above US$5 million (about RM15.98 million) last year and that it was more than double the previous high of US$5 billion (RM15.98 billion) transacted in 2006. It attributed strong local economies and expanding leisure markets as the factors of Asia’s well-performing hotel sector.


Sales of (from left) Crown Princess KL, The Westin KL, and Sheraton Subang Hotel & Towers were concluded over the last two years.

At the recent first Malaysian Property Summit 2008 organised by the Association of Valuers & Property Consultants in Private Practice Malaysia in Kuala Lumpur, real estate consultants expressed belief that the local hospitality sector would continue to enjoy more upside fuelled by tourism market growth and growing foreign investments.

According to data from Zerin Properties, foreign investments in hotels grew by 64% to RM878 million in 2006 while the total investments by locals only amounted to RM153 million. Last year, 62% of the total value of hotel transactions which amounted to RM756 million were by foreigners.

Among the hotel transactions which have been over the last two years include the 571-room Crown Princess Kuala Lumpur which was transacted at RM240 million or RM420,315 per room, 100-room Grand Centrepoint for RM12.5 million or RM125,000 per room, and the 452- room The Westin Kuala Lumpur that was sold for RM455 million or a whopping RM1 million per room.

In suburban Subang Jaya, the 502-room Sheraton Subang Hotel and Towers was sold for RM140 million or RM278,884 a room.

According to Zerin Properties CEO Previndran Singhe (pix), hotel funds as well as foreign investment funds are the main drivers for hotel properties here. “Some hotspots for hospitality investments include city centre areas like KLCC, Penang and Johor Baru which has offerings that include hotels and serviced apartments ranging from high to mid-end,” said Previndran, adding that the foreign investors’ interest is growing outside the Klang Valley.



Resort properties in Penang such as the 350-room Ferringhi Beach Hotel was sold for RM43 million (or RM122,857 per room) and 96-room Midtown Hotel was transacted at RM12 million (or RM125,000 a room). Other examples include the 258- room Holiday Villa sold for RM55 million (or RM213,178 per room) in Langkawi; the 160-room Holiday Villa in Kedah was sold for RM31 million, and Kuantan’s 100-room Holiday Villa was purchased for RM21.87 million.

Malaysian Association of Hotels (MAH) executive director Sarjit Singh (pix) believes that investors here are driven by the country’s good climatic conditions. “They see the potential in opening hotels here as it is expected to perform better this year.



With the government’s growing emphasis on the Meetings Incentives Conferences Exhibitions market, participants of such conferences usually tend to bring their families and end up staying longer to do shopping and other tourist activities,” Sarjit told PropertyPlus.

With the government’s extension of Visit Malaysia Year (VMY) 2007 to Aug 31 this year, both Previndran and Sarjit are confident of tourism growth this year.

“As Malaysia is still very much perceived as a value-for-money destination, the growth in our tourism market is also driven by lowcost carriers like AirAsia. The 9/11 incident actually also benefitted us as there are more travellers to this side of the world as well. In fact, another boost for the industry is when the government allows for the open-sky policy,” said Previndran.

Apart from tourist arrivals, Sarjit said that the length of time tourists spend in the hotels is also important. “The number of room nights and the amount of money spent in the hotel are also important to the industry.

The Tourism Ministry is beginning to lure tourists from niche markets, those with money and will stay at least a week, such as from Monte Carlo, Greece, Latin America and even Africa,” said Sarjit, adding that Malaysia is well-known as a paradise of sales.

“The government’s efforts to promote the country through the carnival sales have borne fruit and the extension of VMY 2007 to Aug 31. The government has spent a lot of money on VMY 2007 publicity and based from our members feedback, they are quite happy. Between the months of July and September last year, more people came, especially those from the Middle East, and occupancy levels were more than 90%,” said Sarjit.

Some 20.7 million tourist arrivals were recorded last year while the shopping receipts amounted to RM45.7 billion, which is the second largest foreign exchange earner for the country. These numbers surpassed Tourism Malaysia’s targets of 20.1 million visitors and foreign exchange earnings worth RM44.5 billion. The bulk of tourist arrivals were from Asian countries including Singapore, Thailand, Indonesia, Brunei, China, India and Japan.

Although tourists to Malaysia seem to be proximity-based, Previndran said that tourists from the Middle East and Emirates were the largest shopping spenders.

“They spend about US$776 per day while tourists from India registered as the highest spenders in hotels,” he added. For 2008, the Ministry of Tourism have set higher targets for both tourist arrivals and shopping receipts, amounting to 22.5 million tourists and RM50 billion, an increase of five and two per cent respectively from the original expectations.

Incoming supply
Over the next three years, Klang Valley will see an addition of about 5,600 hotel rooms housed in less than 20 hotels with 4- and 5- star rating. Those that will be completed this year include Hotel Grand Mercure Putrajaya Lakeside (owned by the French-based Accor Group), Maytower Hotel Serviced Apartments (owned by Mayland Group), Royal Chulan Tower Hotel & Residence (owned by Boustead Group) and Gardens Hotel and Residences (owned by IGB Group).

According to MAH’s latest data on upcoming hotels and rooms supply for the period between 2008 and 2010, those completed in 2009 would include Bluestone Group Malaysia’s Rendezvous Hotel Kuala Lumpur and Sepang Goldcoast’s Golden Palm Tree Resort & Spa in Sepang.

The data also revealed that a 400-room 5-star hotel would be completed in the Kuala Lumpur city centre area in 2010.

More than 1,300 rooms would make up those from the other states throughout the period and there would be three Accorowned hotels in East Malaysia.

From the latest leisure stock report for 3Q2007 obtained from the Valuation and Property Services Department’s National Property Information Centre (Napic), there are 2,184 hotels in the country offering a total room supply of 151,014 rooms. The total comprised 1- to 5-star rated hotels at 26% (568 units with 99,532 rooms); orchidrated hotels at 14.4% (315 units with 9,207 rooms) and unrated hotels at 59.5% (1,300 units with 42,227 rooms).

It also reported that the average occupancy rate of five-, four- and three-star hotels was well maintained at 65.4%, 60.8% and 62.6% respectively.

Future trends
Previndran feels that the country would soon be experiencing new hospitality trends that have been taking place on the international front. “For example, limited service and branded budget hotels [like the Tune brand] are very popular overseas and these are managed by well-known hotel brands including Holiday Inn and Marriott.

Serviced apartments are also another type of limited service offering,” he said, adding that the sector’s growth would be in tandem with the growth of low-cost carriers.


Other trends that would benefit the local hospitality sector include spa resorts and Syariah-compliant hotels. “Foreigners will enjoy the spa-themed resorts which are considerably more affordable here. There is also a big market for ethnic-based hotels with Islamic architecture here, and in the Middle East there are about 26 Syariahcompliant hotels. Extreme sports-themed resorts and hotels which leverage on the abundance of nature in the country will also be popular here,” said Previndran.

By theSun (by Loo Pik Kwan)

Homes shunned at auction

LONDON: The residential property market took a turn for the worse last week but the evidence is likely to be missed by most homeowners.

According to the Royal Institution of Chartered Surveyors (Rics), just 57% of the 7,669 homes that went up for auction in 4Q2007 were sold for the reserve price.

This figure was 12% down on the same quarter in 2006 and marked the lowest success rate at auction for three years. Most homeowners may feel safely detached from auction figures, but they have implications for the wider market. For a start, despite the dip in sales, the number of homes that went to residential auction was up 15% on the year before, says Rics. That was due to repossessions which, the Council of Mortgage Lenders (CML) reports, reached 27,100 in 2007 – up 20.9% on the previous year. Rics forecasts that repossessions could rise a further 50 % this year as a result of last year's rate hikes and the credit crunch.

But still more pessimistic commentators claim the new auction figures are proof that the wider market is destined for a crash. "The value of a property is not the latest monthly average but the price of the last one that was sold," says Jonathan Davis at website Houseprice-crash.co.uk. "If
they are not selling at the current reserve prices, sellers have no choice but to reduce these prices and put them back up for auction. This process brings the value of all property downwards – especially as many auction bidders are now not from the trade but novice investors holding out for a bargain. Auctions are the retail market."

And that's not where the impact of the Rics figures end. According to Allsop, the UK's biggest property auctioneer, around half of the typical 400 homes sold at any one auction have already been repossessed by lenders. With house values down and mortgage profits escaping through the back door, banks must recoup losses from somewhere and fears are mounting that this will be in the form of higher rates and stricter lending criteria. Ultimately, it may be the average homeowner – who has probably never been to an auction – who will be hit in the pocket when they try either to switch their mortgage deal or take out a new home loan when moving.

Oliver Gilmartin, economist at Rics, says: "While tighter credit conditions will be most acute for those with a poorer credit history, less generous loan amounts and the introduction of upper limits on some advances could equally hit the mid-tier of the market, which would increase the number of properties languishing on auction books." A spokeswoman for the CML denies the new auction figures will have an impact on lending conditions as only a "minority" of repossessed properties end up being sold at auction anyway. "Lenders have to get the best price for a property, which often means they are marketed and sold through estate agents."

But Gary Murphy, a partner at Allsop, says the overall market is "considerably weaker" than the auction one. "Repossessed homes are often offered by private treaty first but go to auction when the price cannot be achieved," he says.

Auctioneers also like to distinguish themselves from their rivals. "Sale success is a question of whether the auctioneer is giving the right advice to their clients about reserve prices," says Murphy, adding that Allsop sold 88% of its 415-lot catalogue in February and 84% in December.

Broker Savills has also reported healthy figures. In a residential auction last month, it sold 75% of stock, raising over £25 m (about RM163 million). Charles Smailes of the National Association of Valuers and Auctioneers adds that quarterly numbers are a snapshot of "times gone by" rather than an indication of the current market.

"The market was post-credit crunch and still reeling from the American sub-prime and Northern Rock debacles. Auctions are a very public and honest evaluation of what is going on at the time – and that's why I am sure that the 1Q2008 figures will be more optimistic." However, with both the Halifax and the Nationwide reporting that house prices fell yet again in February, people can't be too careful. "Homeowners will need to be vigilant about meeting payments for all sorts of utilities, cards and loans," warns Melanie Bien, director of Savills.

"They would also do well to pay down their mortgage and reduce the loan to value if they have any spare money. This will make it easier for them to remortgage when the time comes," adds Bien.

By The Independent

Worst housing market in a decade

LONDON: Britain's housing market is facing its worst conditions in more than a decade, according to the Royal Institution of Chartered Surveyors (Rics). Surveyors are reporting falling prices, with February the seventh month in a row when sentiment has been negative.

The net balance of surveyors reporting falling rather than rising values climbed to 64.1% in February, up from 54.8% in January. This figure is only marginally higher than the historical nadir reached in June 1990. Such powerful anecdotal evidence reinforces data from the Halifax and Nationwide indices which have shown a pattern of gently declining prices.

Only Scotland is bucking the gloomy trend. Philip Shaw of Investec Securities said: "Housing demand has fallen off a cliff over the past year, with no signs of an imminent stabilisation in activity, let alone a recovery."

The decline in prices is driven by a lack of demand linked to the credit crunch, rather than a jump in supply of new housing.

Buyers are finding it tougher to raise mortgages. Banks and building societies have tightened up their lending criteria for fear of a rise in bad debts. They have also been "hoarding liquidity" to shore up balance sheets, and some have been badly affected by the collapse in demand for securitised mortgage-backed securities.

The Government has been hinting it may offer some kind of quality assurance ("Kitemarked securities") to unfreeze the market. Additionally, the UK's "sub-prime" lenders have disappeared. These factors have been reflected in a marked drop in mortgage approvals recently. Falling house prices will tend to exacerbate the credit crunch and could create a vicious circle.

The shortage of buyers has left a glut of unsold houses and flats. The stock of property on surveyors' books jumped by more than 8.5% in February, the fifth successive monthly increase of that magnitude. The ratio of sales compared to the stock of unsold property fell to 26.5%, the lowest since September 1996.

By The Independent

Auction caution

Buyer beware: Before buying a house at an auction, the buyer needs to be aware of the issues and complexities involved.

Looking at the advertisements in the daily newspapers, it would appear that a large number of properties are being auctioned off every weekend. The indicated prices appear to be way below the market price, making it appear like an attractive purchase.

Is it safe to buy a property at an auction, and is the buyer adequately protected by the law? Can properties be auctioned off without a court order?

Well, court approval is only required if there is a precondition in the loan agreement requiring approval of the court before it can be sold. Otherwise the court is only involved if the land has a charge registered under the National Land Code.

Right to sell
Almost all the auctions in the advertisements include a reference to a bank, a financial institution or a borrower. This would suggest a loan default scenario. The words “assignee” and “assignor” in the advertisements suggest that the property in question does not have separate individual titles to enable a charge to be registered.

Where there is no individual title and the loan is granted on the basis of a loan agreement and a Deed of Assignment, the lender is entitled to dispose of the property on the strength of a Power of Attorney, unless there is a restriction.

In fact, most such documents allow the lender to dispose of the property without any prior court approval. The agreement may not mention an auction but the auction mechanism is utilised to make the intended disposal known to a wider audience to get the best price and show transparency.

Before buying a house at an auction, the buyer needs to be aware of the issues and complexities involved. The offer price may appear to be cheap but there could be other aspects that could increase the cost of the transaction.

Contractual relationship
To start with, the property may not necessarily be available at the indicated price. This is merely the reserve price at which the bidding will start. Depending on the property and the buyers it has attracted, the price could end up much more than the reserve price.

An auction creates a setting to put in place a contractual relationship between the parties involved. The process starts with the publication of an advertisement.

Following the advertisement, the auctioneer invites bids for a particular item for sale and starts the ball rolling. This is referred to as an invitation to a treat. If a bid is made pursuant to such invitation, that in law constitutes an offer, the auctioneer is free to accept or reject. However, the sale by an auctioneer is concluded when he announces its completion by the fall of the hammer or in any other customary manner.

The next question that arises is: what are the terms and conditions on which the property is purchased? When property is purchased from a developer, there is the standard Sale and Purchase Agreement, if it is a housing accommodation. When a property is acquired through a sub-sale, the terms are set out in the Sale and Purchase Agreement, which is the result of negotiations between the parties.

Conditions of sale
However, the scenario in an auction sale is different. This is because the property is sold based on the Conditions of Sale, which become the terms on which the property is transacted.

These Conditions of Sale are always available before the auction takes place. An individual bidder at the auction ought to obtain and familiarise himself with these terms and conditions before the bid. This is because if the bid is successful, he will be deemed to have entered into a contract on those terms.

An example of a clause in a Condition of Sale which illustrates the risks a bidder must assume when he purchases a property, reads as follows:

“The property is sold on an ‘as is where is’ basis without vacant possession subject to (a) all express and/or implied conditions, restriction-in-interest affecting the Master Land and that which may be imposed/endorsed on the document of individual strata title to the property upon the issuance thereof, (b) all easements, covenants, charges, caveats, liabilities, (including but not limited to liabilities to the local authorities incurred but not ascertained and any rates made but not demanded) and any adverse claims in respect of the Property; and (c) all tenancies, lease, occupiers and rights (if any) of any tenant or occupier, subsisting thereon or therefore without any obligations arising to define the same respectively.”

It is a common and acceptable practice to purchase a property subject to express and implied restrictions endorsed on the document of title. But if there are tenants on the land, the bidder has to take the responsibility of evicting them and bear the costs incurred with the added risk that compensation may not be recoverable. The same would apply in the case of a need to have a caveat removed.

This is different from purchasing a property from a developer or an ordinary individual where the vendor has an undertaking that the property is free from encumbrances which could include caveats, and that the seller will hand over the property to the buyer with vacant possession as part of his obligation.

To reinforce the rights of the seller or rather the seller’s lack of obligations, such Conditions of Sale often provide a condition binding the purchaser to admit that he has inspected the property and is buying it in the condition that it is in. An example of a Condition of Sale which exonerates the seller from handing over the property with vacant possession has a clause which reads as follows:

“The successful purchaser shall at his own costs and expense take possession of the property after the payment of the balance purchase price. The assignee/lender or its agents have no obligation to deliver vacant possession of the property and the successful purchaser is prohibited from entering the property before the payment of the balance of purchase price and/or late payment interest.”

Need for caution
It would be in the interest of the bidder to visit the property and inspect it to familiarise himself with the condition of the property. The photographs in the newspaper or leaflet may not convey the real state of the property which the bidder expects to acquire.

These are just some of the conditions of sale. A detailed examination of the Conditions of Sale in auctions could disclose a host of responsibilities which the seller may exclude himself from.

In conclusion it must be said that a valuable property may well be acquired at an auction. However, there is a need to make adequate inquiries and investigations, and consider all the factors in order to end up with a good bargain.

By The Star (by Bhag Singh)

New residential development in Mont'Kiara

Artist's impression of Selayang Point, BTC Development's ongoing project

KUALA LUMPUR: Sabah-based developer BTC Development Sdn Bhd (BTC Development) will be launching its first Mont’Kiara residential development in Kuala Lumpur early next year.

BTC Development manager Hii Ik Tiing (pix) told theSun that plans for the 3-acre freehold project, located behind the Garden International School, has since been revised to comprise 30 strata-titled landed units and a clubhouse. He said the gross development value (GDV) is now approximately RM100 million with prices close to RM1,000 psf.



“We will submit the plans by next month and hope to get the development order by end of the year,” said Hii. The project was originally planned to be a RM70 million development comprising
30 units of 2- and 3-storey townhouses, semidees and bungalows to be sold at RM500 psf.

The new plan is based on a “modern rainforest” concept and the homes will be Mediterranean-styled homes. Each unit will be built according to the terrain, which is on sloping land. “Due to the shape of the land, each unit will be different from the other. That is the uniqueness of this development,” said Hii.

“We have also engaged a well-known foreign architect and designer to come up with the plan and we hope to sell it partly or fully furnished, complete with the interior design,” he also said.

Targeted at the local market, Hii said that the gated and guarded development would be extensively landscaped and some units, on which the terrain allows, would also feature lifts and swimming pools.

He also said the units will range between 2-storeys and 5-storeys, with built-ups between 3,200 sq ft and 7,000 sq ft.

BTC Development, previously known as Borneo Trading and based in Sabah, has so far developed small residential projects in Sibu and Kuching. Its first project in Peninsular Malaysia is the ongoing Selayang Point development in Selayang Jaya, a RM110-million mixed development.

According to Hii, Selayang Point is a freehold project comprising 375 condominium units and 71 retail shoplots housed in a 23-storey building, and 17 units of 3-storey shopoffices in a separate
building located in front of the high-rise building.

First launched in late 2004 is Tower A, which houses 189 condominium units, the retail shoplots and shopoffices. “The condos and retail shoplots in Tower A are both 90% sold and there is only one shopoffice unit left,” he said.

Meanwhile Tower B, comprising the remaining 186 condominium units, have been 60% sold since its launch in June last year, said Hii. “Our buyers are mainly from Selayang, Kepong and Rawang,” he added.

Sized between 1,010 sq ft and 1,141 sq ft, the 3-bedroom, 2-bathroom condos are available in four designs, with prices ranging between RM158,000 and RM220,000.

Meanwhile, located on the first two floors are the retail shoplots sized between 375 sq ft and 1,800 sq ft. These are priced between RM112,500 and RM1 million.

Maintenance fee, including sinking fund, is 12 sen psf. As for the shopoffices, which has a lot size of 24ft by 65ft, prices begin at RM988,000, with corner units costing RM1.8 million. A total of 150 basement and 70 outdoor parking bays will be allocated for the commercial units while the residential units would have 412 bays.

“Each unit comes with a parking bay and residents may purchase additional bays at RM10,000 each,” said Hii, adding that there will also be amenities such as a swimming pool, rooftop garden and children’s playground. Completion of the entire development is expected in June.

By theSun (by Yeong Ee-Wah)

Are changes in store post-election?

An artist’s impression of Penang Global City Centre, one of the projects which may face uncertainty following the recent election results

PETALING JAYA: Is further volatility in store for the main stock index as business confidence takes a beating in view of not only a change in the makeup of the 12th Parliament but also in the legislatures of the more economically important states and in the Federal Territory?

On Monday, following the general election of March 8, the KL Composite Index (KLCI) fell 123.11 points, or 9.5%, to close at 1,173.22, wiping out RM86bil, or 8.7%, from the bourse's total market capitalisation of RM984bil as at March 7.

The selling also saw a temporary halt in trading mid-afternoon when the circuit breaker installed by Bursa Malaysia in March 2002 was triggered after the KLCI fell 10% from its previous close on March 7.

Big-cap stocks with high foreign shareholding as well as plantation and construction stocks were among those that saw their share price fall on that day.

A number of the companies whose share prices dropped that day were either government-related or involved in projects approved by the Government.

However, the plunge in the KLCI was also in tandem with the fall in the main indices of major Asian bourses, which reacted to Wall Street's fall last Friday following a US government report that showed a widening trade deficit gap for January due to the high price of crude oil, which surpassed US$109 per barrel in electronic trading and settled on a record US$108.75.

Besides oil, crude palm oil has also seen movement in prices, this time downwards. It was trading near RM4,500 a tonne not too long ago but is now hovering between RM3,300 and RM3,400.

Political analyst Francis Loh Kok Wah, who is an associate professor at Universiti Sains Malaysia, told StarBiz the wave of selling on Monday was a knee-jerk reaction compounded by problems in the US.

He said if any Government projects were to be reviewed, it would be due to the process in the award of contracts.

“If it were through closed tenders, executive fiat or due to a corporation's political connections, then a review is justifiable,” he said.

Loh said the development corridors did not need to go through any form of parliamentary process.

“As I understand it, these corridors do not need it unless there're questions arising over issues like the environmental impact,” he said.

Universiti Kebangsaan Malaysia political science department head Dr Ahmad Nidzammudin Sulaiman said if there were to be any impact on government-linked companies, it would not be direct but through less federal budget allocations for states under non-Barisan Nasional (BN) administration.

»If the award of the contracts were through closed tenders, executive fiat or due to political connections, then a review is justifiable«PROF MADYA FRANCIS LOH KOK WAH

A lower budget allocation for these states would mean fewer projects for government-linked companies.

He said this was going by past trends when Sabah was under Parti Bersatu Sabah, then an opposition party and with the present situation in Kelantan under Parti Islam SeMalaysia.

Citi Research analyst Zheng Kit Wei said in a research note that in the near term, the election results would likely be unsettling for equity and currency markets on fears of greater political instability, which may provide a good reason for profit taking by foreign equity investors.

“There is also more uncertainty over the future of the Northern Corridor Economic Region with Perak, Kedah and Penang now in opposition hands,” he added.

Zheng said it was too early to tell whether this would mark the start of a steady slide of BN dominance or whether the results would serve as a wake-up call for it.

By The Star (by Fintan Ng)

Foreign investors may wait and see

PETALING JAYA: Foreign investors may take a wait and see approach following the dismal performance of the ruling coalition Barisan Nasional in the 12th general election, until the state and federal governments are well established, said local property consultants. In the polls, Selangor, Penang, Kedah and Perak fell to the opposition.

However, they said investments in the property sector and in other sectors would improve in the long run if there are signs of better corporate governance and transparency in doing business here.

Zerin Properties CEO Previndran Singhe expects an overall positive impact as real estate is a long-term investment.

"The outcome of the elections proved that the country is democratic and its citizens, politically matured. I do not foresee any negative affect on foreign investments, as investors will notice that
Malaysia is democratic and practises good corporate governance," he said.

“The public should be made to understand that with a simple majority, the federal government can continue to implement its policies and amend legislations, except the constitution.” However, Previndran added that certain projects could be affected in terms of timing, as they may require state approvals.

City Valuers & Consultants Sdn Bhd general manager CY Lim also expects the election results to have a general positive impact on the property sector. He said foreign investments would continue to remain positive, as investors would expect a more transparent administration.

“We also hope that the new state governments will clean up red tape and delays at the land office in Selangor,” said Lim.

Real Estate and Housing Developers Association (Rehda) president Ng Seing Liong said the dip in the Kuala Lumpur Composite Index (KLCI) on Monday was inevitable as people were shocked at the unexpected outcome of the election. The KLCI took a dive to close 9.55% or 123.11 points lower, to 1,173.22 on Monday.

“We do not expect much changes in policies as the federal government is intact but we foresee that whatever changes there may be, would be for the better,” said Ng.

He hopes that Selangor, now under a coalition led by Parti Keadilan Rakyat (PKR), will be more proactive in creating a conducive business environment including implementing development-friendly policies.

"There will be heightened expectations on both incumbents and newcomers to improve the nation's competitiveness by enhancing the delivery system and efficiency, and the efforts will benefit the economy and image of Malaysia as an investment destination for foreign investors," said Ng.

He added that the local governments should not forget their social responsibility and that building affordable houses for the hardcore poor irrespective of race is essential.

Commenting on whether the economic development corridors such as the Northern Corridor Economic Region (NCER) would be affected, Ng said that while the development corridors may be temporarily affected, he foresees medium and long-term positive effect.

By theSun (by Rosalynn Poh)

Guocoland: KFH option on Singapore apartments lapses

PETALING JAYA: Kuwait Finance House (M) Bhd (KFH) is believed to have decided not to exercise the option on 97 apartments at the 210-unit Goodwood Residence development in downtown Singapore, given the softening in the city-state's private residential property market.

The apartments were supposed to be sold to a fund managed by KFH for US$818.4mil, or at S$3,000 per sq ft.

Goodwood Residence, developed by Guocoland Ltd, is a premier residential development on a 24,845-sq-m freehold plot fronting Goodwood Hill.

A Guocoland statement issued on Monday said the options were not exercised and had lapsed.

“Both parties are presently in discussions, with a view to granting fresh options for units in the development,” it said, adding that the private residential property market in Singapore was currently cautious.

KFH did not respond to StarBiz's queries.

Meanwhile, industry observers said Singapore's property market had shown signs of softening and take-up rates had slowed since January as a result of the US subprime market woes.

According to Abbey Woods Sdn Bhd chairman and managing director Datuk Wong Choon Kee, the market had seen substantial price appreciation in the past one year, with a new price benchmark of more than S$4,000 per sq ft set by some of the recently launched luxury residential projects.

SC Global Developments' Ardmore Apartments, launched in the last quarter of 2007, were sold at an average price of S$4,400 per sq ft while the company's The Marq on Paterson Hill fetched S$5,100 per sq ft.

Wong said Singapore's luxury apartment market was well supported by good fundamentals and the limited supply would continue to drive up prices in prime districts.

“Singapore is seen as the new Switzerland, with stricter secrecy laws making it an ideal investment destination for high net worth individuals.

“Niche projects in Sentosa Cove are favoured by buyers and developers. Going forward, prices of commercial and residential properties in prime locations will remain high although sales volume will, at best, be at slightly lower levels,” Wong said.

KFH is also an active participant in the Kuala Lumpur property market, especially around KL City Centre.

The Islamic bank is focusing on the super high-end residential and other investment grade commercial properties with potential for capital appreciation.

In January, KFH offered to buy 50% of the Menara YNH tower block for a whopping RM920mil, which translates into RM1,258 per sq ft – one of the highest prices among recent property transactions in Kuala Lumpur.

Last August, KFH, together with Khazanah Nasional Bhd and Jumeirah Capital, were awarded a 99-year leasehold concession to develop the 624-acre Cultural Cluster in Iskandar Development Region.

By The Star (by Angie Ng)

Lee to quit as Country Heights MD

TAN SRI Lee Kim Yew said he will quit his post as group managing director of Country Heights Holdings Bhd, but denied that he was selling his shares in the property company.

"That is not true. I'm not leaving. I'm not selling off my shares. In fact, I have been accumulating shares of Country Heights," he told Business Times in a telephone interview yesterday.

Lee, who founded Country Heights, was responding to a recent news report that said he may relinquish his executive role in the group following an internal restructuring exercise that is under way.

The report had said that Lee planned to concentrate on running his privately-held and profitable companies involved in property development and oil palm plantations.

"My shareholding is around 46 per cent and I'm still a board member. There would be a change of management, a change for the better," he said.

Lee said that in the interest of corporate governance, it was better to leave the daily operations of Country Heights to professionals.

"I will leave it to the new team to do what is best for Country Heights. As the biggest shareholder, I'm optimistic of their capability," he said.

Lee added that Country Heights' businesses will be re-categorised into hospitality, development and property, and the three divisions will have their respective chief executive officers reporting to the group managing director.

Country Heights has hired recruitment firm Korn Ferry to help it find a group managing director.

Analysts were not surprised that Lee is relinquishing the daily operations to professionals to concentrate on his privately-held companies.

"Country Heights has slipped off the radar screens of many investors for a long time. If you exclude the one-off gain from the sale of its shopping centre last year, you can see that the group is not making money," an analyst with a foreign research house said.

Country Heights has seen profits decline from RM12.44 million in 2003 to RM10.87 million in 2004 and RM6.66 million in 2005.

It fell into the red in 2006 with a net loss of RM32.69 million.

Last year, it posted an unaudited net profit of RM107.94 million, thanks to an estimated gain of RM102 million from the sale of the Mines Shopping Fair to Singapore's CapitaLand Ltd for RM432 million cash.

By New Straits Times (Business Times)

Quill Capita gets 'outperform' rating

ALLIANCE Research Sdn Bhd initiated coverage of Quill Capita Trust (QCT) with an "outperform" rating, saying it has a defensive blue-chip tenancy profile and a strong parent in CapitaLand Ltd.

"With its tenants locked in for a long term on master lease agreements with step up agreements, the real estate investment trust (REIT) provides stable earnings with mild growth even without acquisitions," the local research firm said in a report yesterday.

"QCT management has proactively sought ways to improve asset quality and improve rental yield with some of its tenants, providing investors with further upsides for the future," it added.

Alliance Research said the strong multinational corporation presence in QCT tenancy profiles, with the likes of DHL, IBM, HSBC, BMW and Technip as its anchors, proves its earnings quality.

In terms of value, these key tenants occupy 84 per cent of the total property investment value.

Alliance Research said the upside to QCT will come from aggressive acquisitions backed by its low gearing position and low financing costs.



"With a strong pipeline of office-related commercial properties, we believe there is room for yields to improve further amid its future acquisitions," it said, setting a target price of RM1.50 on the REIT.

By New Straits Times

Morubina’s Kinta Riverfront project ready by Sept 2009

Ting: Attracted buyers from Indonesia, Singapore and even China

PETALING JAYA: Ipoh’s first 5-star Kinta Riverfront Hotel & Suites on a fiveacre leasehold site along the Kinta River has registered sales of close to 80% of its serviced apartments. Developed by Morubina Sdn Bhd, a member of the Morubina Group of Companies, the project comprises a 19-storey hotel with 313 rooms and a 20-storey serviced apartment offering 239 suites for sale. The entire project has a gross development value of RM120 million and would be completed in Sept next year. Piling works for the project have commenced.

According to the developer, sales have been encouraging since its launch in June last year. Morubina’s managing director Ting Sing Yiew told theSun that its buyers were drawn to the project’s 15-year guaranteed rental scheme. “They found the scheme, which guarantees an annual rental yield of 7%, attractive. We also conducted road shows overseas and have attracted about 40 buyers from Indonesia, Singapore and even China,” said Ting, adding that it has set up sales offices in Medan and Guangzhou due to the overwhelming response. Its local buyers, however, are mostly from Perak and Ting said that most purchased it for investment reasons.

For the serviced apartments, which are unfurnished, the developer is offering two types for sale. The Type A design, totaling 126 units, has views of the riverfront and comes with a built-up area of 1,223 sq ft. Prices of the three-bedroom unit ranges between RM338,999 and RM438,999. Those with the heritage view is the two-bedroom 808 sq ft Type B design which totals 108 units and range from RM199,999 to RM299,999.

There are also five penthouses which come in two designs. With built-up areas of between 1,602 sq ft and 7,393 sq ft and prices from RM730,000 and RM2.8 million, buyers have a choice of between the fully furnished (with three bedrooms) or the partially furnished (with two bedrooms) units.

The developer is also offering an additional fixtures and fittings scheme priced at RM38,000 for Type A units and RM25,000 for Type B units. The maintenance and utility fee is free for those who opt for the guaranteed rental scheme. Those who purchase for own use need to pay 20 sen psf monthly.

The developer says that buyers need only pay an upfront instalment amounting to 20% of the selling price for the project, which employs the build-and-sell concept. The balance payment would be upon the issuance of the Certificate of Fitness for Occupation.

Meanwhile, the hotel component, to be managed by Morubina, would have presidential, royal, family and deluxe suites. “We are also offering standard facilities like any other 5-star hotel. We have a grand ballroom which accommodates 1,600 people, which is the biggest in Ipoh. There are five restaurants, a business centre, two basement car parks, pools and sporting facilities too,” said Ting. Other amenities include Wi-Fi broadband access, spas as well as safety elements such as closedcircuit televisions.

According to Ting, the Kinta Riverfront Hotel & Suites is a tourism-related project and it has since been given a Temporary Occupancy License by the state government to further develop both sides of the Kinta River, covering a 1.5km- stretch from Jalan Raja Musa Mahadi up to Jalan Sultan Iskandar.

“We will be building six mini-bridges, a replica of famous world bridges, along this stretch, costing some RM2 million. There will also be more than 300 shops, bazaars, food and beverage outlets, as well as an open-air auditorium,” said Ting, adding that the cost of developing the riverbank area amount to some RM30 million.

By theSun (by Loo Pik Kwan)

Repossessions to rise by 50% in 2008

LONDON: The number of home repossession is expected to rise by 50% this year, according to the Royal Institution of Chartered Surveyors (Rics).

Figures released by Rics show that the number of properties offered at auction, usually an indication of distress, was close to historically high levels last year with 7,732 properties placed under the hammer.

However, a smaller proportion were reaching their reserves: in 4Q2007, only 57% of properties were disposed of successfully, compared to 69% in the same period a year ago.

The overall number of residential properties offered at auctions rose by 15% in 2007, while the number of repossessed properties rose by around 20%, indicating that many have struggled to service their mortgages following last year’s interest rate hikes and tougher refinancing conditions.

There also seems to be an emerging “London effect”. Success rates at auctions for London property fell to 63% in the last few months of 2007, down from 80% in the same period a year before.

Rics economist Oliver Gilmartin said: “Fears over further house price falls have taken some stimulus out of achieved sales at the auction house, as specialist lending has all but evaporated... we expect a tougher year for many at the margins in 2008 .”

Recently, the Nationwide Building Society reported a 0.5% fall in house prices for February, which is a greater drop than the 0.3% recorded in January. Year on year, Nationwide said that prices were now up just 2.7%.

By The Independent

Firms with overseas jobs more resilient

IJM Corp’s Al Reem Island Development project in Abu Dhabi, the United Arab Emirates

PETALING JAYA: Construction firms that rely mostly on government jobs would be the most vulnerable to political changes but some companies will be better positioned to weather the uncertainties.

OSK Research analyst Jeremy Goh said earnings of companies such as Hock Seng Lee Bhd, whose projects are mainly in Sarawak, should remain resilient.

“We also remain positive on companies like IJM Corp Bhd and Zelan Bhd, whose operations are focused mainly in the oil-rich Middle East.” he said.

When contacted by StarBiz, Zelan chief executive officer Albert Chang said: “Almost all of our projects are foreign-based. In fact, we have not had any direct government projects for the past 20 years.

“The current uncertainty in the local scene does not have any bearing on us as we’re mainly focused on the Middle East.” he said.

IJM Corp is another construction player that has the bulk of its order book from overseas.

Chief executive officer and managing director Datuk Krishnan Tan told Reuters yesterday that the company had an order book of RM6bil, of which 40% was from overseas.

Tan said notwithstanding some erosion in margin, he saw a steady flow of work from India and the Middle East.

TSR Capital Bhd, whose core business is in construction, remains quite unfazed by the looming uncertainties as most of its projects are in the Federal Territory.

Managing director Tengku Datuk Mustapha Tengku Mohamed said: “We are still confident of prospects as most of our projects are Federal projects.”

The construction sector is poised to be a key driver of the country’s economic growth as projects worth billions of ringgit are being planned for implementation under the Ninth Malaysia Plan.

However, the impending change in administration in Penang, Perak, Kedah and Selangor, which have come under opposition control, has given rise to uncertainties in the award of public contracts.

There are also concerns whether the implementation of projects that have already been awarded would be delayed as the newly-elected state governments have said projects would be reviewed.

By The Star (by Yvonne Tan)