KUALA LUMPUR: UEM Builders Bhd said that the scope of work awarded to it by Jambatan Kedua Sdn Bhd (JKPP), the company that owns the Second Penang Bridge, over-lapped with the scope of work being negotiated by its parent company, UEM Group Bhd, with the government.
In a statement to Bursa yesterday, UEM Builders said that its parent company UEM Group Bhd (UEMG) was in negotiations with the government pursuant to an earlier decision made by the government to award the project to UEM group on a concession (build-operate-transfer) basis.
“We understand from UEM Group that the government has not withdrawn its instructions to them (UEM Group). As this matter may result in substantive contractual consequences, we will seek clarification from the government. In the meantime, we are not in the position to comment further on this subject but will stand guided by the government’s decision,” said UEM Builders.
Last year, the government awarded the Second Penang Bridge project to UEM Group on a concession basis. UEM group subsequently awarded the construction of the job to a joint-venture of Chinese Harbour Construction Company (CHEC) and UEM Builders with the former holding 51%. Both parties were supposed to firm up a shareholders’ agreement but could not do so as they did not see eye-to-eye on certain matters pertaining to the apportionment of cost.
The Edge Weekly reported that the government has established JKPP to award the constracts direct to the companies and oversee the construction. It was reported that CHEC was awarded a RM2.3 billion job while UEM Builders got an award for a RM1.3 billion job, much lower than the estimated RM2.2 billion it was supposed to get.
UEM Builders confirmed that had it received a letter from JKPP on July 30 informing that it had taken over the duties of the Special Task Force and offered certain works on the Second Penang Crossing Bridge project to UEM Builders.
By The EDGE Malaysia (by Mohd Yuzam Yusa)
Wednesday, August 6, 2008
Tuesday, August 5, 2008
Axis REIT eyes properties worth RM566m
AXIS REIT Managers Bhd, which manages the Axis Real Estate Investment Trust (Axis-REIT), is looking to buy properties worth about RM566 million, its chief operating officer and executive director Stewart LaBrooy said today.
“Our focus is in three regions — the Klang Valley, Johor Baru and Penang. We have properties in Penang and are looking to add one to two more good quality industrial assets,” he said.
Of the total, the company hopes to complete RM180 million worth of properties by June 2009, he said.
The company is negotiating for third-party assets worth about RM240 million and looking at several potential properties in the pipeline from private equity, LaBrooy said.
“The purchase of RM180 million worth of properties will be financed by the proposed placement of up to 120 million new units representing approximately 46.9 per cent of the existing units in Axis-REIT,” he told reporters after presenting the company’s first-half results ended June 30, 2008.
The exercise will increase the existing fund size of Axis-REIT from 255.901 million units to about a maximum of 375.901 million units.
The exercise will be in two tranches of 60 million each to match the acquisition timelines. The first tranche will be placed out in the fourth quarter while the second tranche in the second quarter of next year.
According to LaBrooy, the placement will be used to pare down borrowings, freeing up cash to enable the company to purchase the assets that are being lined up.
“At the current pricing, we are looking at raising up to RM200 million for both tranches. The placement strategy will also enable us to cross the RM1.0 billion asset under management for Axis-REIT,” he said.
By Bernama
“Our focus is in three regions — the Klang Valley, Johor Baru and Penang. We have properties in Penang and are looking to add one to two more good quality industrial assets,” he said.
Of the total, the company hopes to complete RM180 million worth of properties by June 2009, he said.
The company is negotiating for third-party assets worth about RM240 million and looking at several potential properties in the pipeline from private equity, LaBrooy said.
“The purchase of RM180 million worth of properties will be financed by the proposed placement of up to 120 million new units representing approximately 46.9 per cent of the existing units in Axis-REIT,” he told reporters after presenting the company’s first-half results ended June 30, 2008.
The exercise will increase the existing fund size of Axis-REIT from 255.901 million units to about a maximum of 375.901 million units.
The exercise will be in two tranches of 60 million each to match the acquisition timelines. The first tranche will be placed out in the fourth quarter while the second tranche in the second quarter of next year.
According to LaBrooy, the placement will be used to pare down borrowings, freeing up cash to enable the company to purchase the assets that are being lined up.
“At the current pricing, we are looking at raising up to RM200 million for both tranches. The placement strategy will also enable us to cross the RM1.0 billion asset under management for Axis-REIT,” he said.
By Bernama
Malaysian developers to build fewer houses
The government is expecting a 20 to 30 per cent reduction in the number of low medium-cost houses built this year as developers struggle with higher development cost.
Deputy Minister of Housing and Local Government Datuk Hamzah Zainudin said the country's housing sector is showing signs of slowing down as material costs have gone up by almost 30 per cent.
HAMZAH: The housing sector is showing signs of slowing down
"I feel that the number of properties will reduce substantially this year especially in the low medium- and low-cost sector," he told reporters after launching Raine, Horne and Zaki Property Management Sdn Bhd's 24 hour customer care centre in Kuala Lumpur yesterday.
The care centre, the first of its kind in Malaysia, is a 24-hour call and emergency assistance for residential property owners.
Hamzah said amid the current soaring prices, the government is unlikely to meet its target to build 50,000 to 80,000 low medium-cost houses this year.
He said "quite a number" of private developers have indicated to the government that they are unable to sell such houses at a fixed price of RM42,000 each.
The ministry is keeping the ceiling price of low medium-cost houses at RM42,000 each but is studying to see if the price can be increased.
"The Minister of Housing and Local Government will make an announcement very soon," he added.
To date, Hamzah said, only 20,000 to 30,000 of the low medium-cost houses are in progress.
On fears of stalled or abandoned housing projects, he advised developers that have just started or are within six months into a project to re-look at their cash flow and to launch projects by phases.
By New Straits Times (by Rupinder Singh)
Deputy Minister of Housing and Local Government Datuk Hamzah Zainudin said the country's housing sector is showing signs of slowing down as material costs have gone up by almost 30 per cent.
HAMZAH: The housing sector is showing signs of slowing down
"I feel that the number of properties will reduce substantially this year especially in the low medium- and low-cost sector," he told reporters after launching Raine, Horne and Zaki Property Management Sdn Bhd's 24 hour customer care centre in Kuala Lumpur yesterday.
The care centre, the first of its kind in Malaysia, is a 24-hour call and emergency assistance for residential property owners.
Hamzah said amid the current soaring prices, the government is unlikely to meet its target to build 50,000 to 80,000 low medium-cost houses this year.
He said "quite a number" of private developers have indicated to the government that they are unable to sell such houses at a fixed price of RM42,000 each.
The ministry is keeping the ceiling price of low medium-cost houses at RM42,000 each but is studying to see if the price can be increased.
"The Minister of Housing and Local Government will make an announcement very soon," he added.
To date, Hamzah said, only 20,000 to 30,000 of the low medium-cost houses are in progress.
On fears of stalled or abandoned housing projects, he advised developers that have just started or are within six months into a project to re-look at their cash flow and to launch projects by phases.
By New Straits Times (by Rupinder Singh)
More REITs can give trading a leg up
CAPITALAND Ltd’s plans to list a RM2bil pure-play retail real estate investment trust (REIT) on Bursa Malaysia later this year will add more depth to and attract greater trading interest in the local market, say industry observers.
Interest in REITs and equities has taken a beating as a result of rising inflationary pressures and uncertainties in the global and regional economies.
An analyst with a foreign brokerage said although there was still much liquidity in the local market, investors were keeping to the sidelines due to the poor market sentiment and lack of fresh leads.
“Local REITs generally lack liquidity as they are perceived to be too small in their issue and capital base, and REITs with larger asset size like CapitaLand’s will be able to attract greater trading interest,” she said.
Axis REIT Bhd executive director Stewart Labrooy said the market could do with more REITs to inject greater trading dimension and yield potential for investors.
There were currently 11 REITs listed on Bursa Malaysia, he said, adding that the participation of more players would contribute towards rebuilding Kuala Lumpur’s skyline and enhance professionalism among industry players.
“There is still much untapped potential in the local market and the onus is on industry players to harness their accretive yields potential by building their assets base through both organic and acquisition growth,” he told StarBiz.
CapitaLand’s announcement that it was on track to list its REIT in Malaysia by year-end will see the country’s first foreign-sponsored REIT on Bursa Malaysia.
“The market certainly needs more diversified types of REITs and, given its reputation in turning around slow-performing malls into profitable entities, CapitaLand’s debut will inject more exciting changes to the local retail market,” he added.
The Singapore-based developer is one of the largest retail real estate owners and managers in the region with more than 115 malls in Singapore, China, India, Malaysia and Japan.
CapitaLand has been eyeing a presence in Malaysia’s retail market for a while now and started building its asset portfolio last year.
The company had last August paid RM770mil to buy Gurney Plaza in Penang and RM435mil for the Mines Shopping Fair in Seri Kembangan, Selangor. Its latest acquisition was a 61.9% stake in Sungei Wang Plaza for RM595mil in June.
Enhancement works are ongoing to spruce up the facilities and add new space to the shopping malls.
CapitaLand has four listed trusts – CapitaMall Trust, CapitaCommercial Trust, CapitaRetail China Trust and Ascott Residences Trust – on the Singapore Exchange.
By The Star (by Angie Ng)
Interest in REITs and equities has taken a beating as a result of rising inflationary pressures and uncertainties in the global and regional economies.
An analyst with a foreign brokerage said although there was still much liquidity in the local market, investors were keeping to the sidelines due to the poor market sentiment and lack of fresh leads.
“Local REITs generally lack liquidity as they are perceived to be too small in their issue and capital base, and REITs with larger asset size like CapitaLand’s will be able to attract greater trading interest,” she said.
Axis REIT Bhd executive director Stewart Labrooy said the market could do with more REITs to inject greater trading dimension and yield potential for investors.
There were currently 11 REITs listed on Bursa Malaysia, he said, adding that the participation of more players would contribute towards rebuilding Kuala Lumpur’s skyline and enhance professionalism among industry players.
“There is still much untapped potential in the local market and the onus is on industry players to harness their accretive yields potential by building their assets base through both organic and acquisition growth,” he told StarBiz.
CapitaLand’s announcement that it was on track to list its REIT in Malaysia by year-end will see the country’s first foreign-sponsored REIT on Bursa Malaysia.
“The market certainly needs more diversified types of REITs and, given its reputation in turning around slow-performing malls into profitable entities, CapitaLand’s debut will inject more exciting changes to the local retail market,” he added.
The Singapore-based developer is one of the largest retail real estate owners and managers in the region with more than 115 malls in Singapore, China, India, Malaysia and Japan.
CapitaLand has been eyeing a presence in Malaysia’s retail market for a while now and started building its asset portfolio last year.
The company had last August paid RM770mil to buy Gurney Plaza in Penang and RM435mil for the Mines Shopping Fair in Seri Kembangan, Selangor. Its latest acquisition was a 61.9% stake in Sungei Wang Plaza for RM595mil in June.
Enhancement works are ongoing to spruce up the facilities and add new space to the shopping malls.
CapitaLand has four listed trusts – CapitaMall Trust, CapitaCommercial Trust, CapitaRetail China Trust and Ascott Residences Trust – on the Singapore Exchange.
By The Star (by Angie Ng)
Fuel least of builders’ worries
Last week’s announcement of a monthly review of petrol prices may not be very helpful to the housing and construction industries.
The Government’s move is aimed at helping ease inflationary pressures in the economy although critics feel that the 41% jump in petrol prices and 63% hike in diesel prices in June had set in motion an unprecedented inflationary trend.
Indeed, inflation hit 7.7% in June, the highest in 26 years
In less than two months prices of almost everything from a bowl of noodles, cooking gas, public transportation, hire purchase rates and electricity tariffs to raw materials for the construction industry increased sharply.
Many people are sceptical about the 7.7% figure as they think prices of most products and services have gone up 30% or more.
While industry players generally welcomed a possible downward revision of petrol and diesel prices, it may be a case of “a bit too little and too late.” Some wonder what real good it can bring when much of the construction industry’s woes like high steel bar and cement prices and shortage of essential building materials are still unresolved.
The housing industry, too, has been hit by threats of contractors walking off their jobs. Some have surrendered their projects while others have refused to even tender for new jobs for fear of further jumps in construction costs.
The low and medium housing sectors have reported even more sluggish sales and many of these projects can be expected to take longer to complete, or even stall/abandoned.
Although high-end projects are deemed more resilient, partly because of a higher mark-up and less likely to be badly affected by profit margin erosion, there is still a possibility that some of them might also be stalled or left uncompleted if the economic slowdown worsens.
While a downward revision of petrol and diesel prices might be a short-term relief, many fear that it could create even more uncertainties especially if prices fluctuate with each month’s review.
“It’s going to cause more confusion. I don’t see how it can help, like the Government giving RM625 to owners of vehicles of less than 2,000cc and spending so much of taxpayers’ money,” said a developer, adding that the lack of transparency and reports of wastage in government projects should be also addressed.
Another main worry, especially for those servicing housing loans, is whether the mortgage rates would inevitably go up as well. Fixed deposit rates have crept up slowly, and so will lending rates eventually.
Although Bank Negara has refrained from increasing interest rates, some banks have increased their rates for hire-purchase.
Domestic Trade and Consumer Affairs Minister Datuk Shahrir Abdul Samad had said at the Master Builders Association Malaysia 54th anniversary dinner on Aug 1 that his ministry would continue to identify and remove problems that had contributed to the cost of doing business.
“We hope to institute necessary measures and initiatives to help reduce costs and enhance efficiency and competitiveness of the construction industry,” he said, adding that the Government would strive to provide excellent service delivery to facilitate the construction business community.
At a press conference later, he said the Government would also look at improving the distribution system of goods as a way to cut costs. As an example, he said, the distribution of bread was a very effective way as there were only two levels from the bakery to the shopkeeper.
Judging from the recent case over the alleged high maintenance of government cars, it may also be timely to ensure that such costs are kept reasonably low.
By The Star (by S.C.Cheah)
The Government’s move is aimed at helping ease inflationary pressures in the economy although critics feel that the 41% jump in petrol prices and 63% hike in diesel prices in June had set in motion an unprecedented inflationary trend.
Indeed, inflation hit 7.7% in June, the highest in 26 years
In less than two months prices of almost everything from a bowl of noodles, cooking gas, public transportation, hire purchase rates and electricity tariffs to raw materials for the construction industry increased sharply.
Many people are sceptical about the 7.7% figure as they think prices of most products and services have gone up 30% or more.
While industry players generally welcomed a possible downward revision of petrol and diesel prices, it may be a case of “a bit too little and too late.” Some wonder what real good it can bring when much of the construction industry’s woes like high steel bar and cement prices and shortage of essential building materials are still unresolved.
The housing industry, too, has been hit by threats of contractors walking off their jobs. Some have surrendered their projects while others have refused to even tender for new jobs for fear of further jumps in construction costs.
The low and medium housing sectors have reported even more sluggish sales and many of these projects can be expected to take longer to complete, or even stall/abandoned.
Although high-end projects are deemed more resilient, partly because of a higher mark-up and less likely to be badly affected by profit margin erosion, there is still a possibility that some of them might also be stalled or left uncompleted if the economic slowdown worsens.
While a downward revision of petrol and diesel prices might be a short-term relief, many fear that it could create even more uncertainties especially if prices fluctuate with each month’s review.
“It’s going to cause more confusion. I don’t see how it can help, like the Government giving RM625 to owners of vehicles of less than 2,000cc and spending so much of taxpayers’ money,” said a developer, adding that the lack of transparency and reports of wastage in government projects should be also addressed.
Another main worry, especially for those servicing housing loans, is whether the mortgage rates would inevitably go up as well. Fixed deposit rates have crept up slowly, and so will lending rates eventually.
Although Bank Negara has refrained from increasing interest rates, some banks have increased their rates for hire-purchase.
Domestic Trade and Consumer Affairs Minister Datuk Shahrir Abdul Samad had said at the Master Builders Association Malaysia 54th anniversary dinner on Aug 1 that his ministry would continue to identify and remove problems that had contributed to the cost of doing business.
“We hope to institute necessary measures and initiatives to help reduce costs and enhance efficiency and competitiveness of the construction industry,” he said, adding that the Government would strive to provide excellent service delivery to facilitate the construction business community.
At a press conference later, he said the Government would also look at improving the distribution system of goods as a way to cut costs. As an example, he said, the distribution of bread was a very effective way as there were only two levels from the bakery to the shopkeeper.
Judging from the recent case over the alleged high maintenance of government cars, it may also be timely to ensure that such costs are kept reasonably low.
By The Star (by S.C.Cheah)
Penang appeals for funds to conserve buildings
PENANG: The state government is appealing to parties interested to carry out heritage conservation to come forward to help restore more than 510 buildings following Penang’s listing as a World Heritage site by Unesco.
Out of this number, 141 buildings are in the core zone of George Town’s heritage enclave, 82 within the buffer zone and another 287 buildings outside the buffer zone and core area.
The core areas encompass the historical sites of George Town, including the Lebuh Acheh historical enclave and sites such as the Lebuh Acheh Malay Mosque, Jalan Mesjid Kapitan Kling Mosque, the Goddess of Mercy Temple, Sri Mariamman Temple, Khoo Kongsi, St George’s Church, Assumption Church, St Xavier’s Institution, Convent Light Street, Little India, the museum and court building, the commercial area of Beach Street, Fort Cornwallis, Esplanade, City Hall, the Clan Jetties and the port areas.
“While we have appealed to the federal government for a RM200 million soft loan to help in our conservation efforts, we would also like to welcome those who are interested and have the necessary expertise to help restore these buildings, many of which are in a state of disrepair,” Chief Minister Lim Guan Eng said.
“We would like to call on private organisations who are interested to revive these buildings to come talk to us so we can restore them to their former glory,” he said.
“The Penang Island Municipal Council (MPPP) has sent notices to the building owners to restore their premises and those that are owned by certain agencies have been restored,” said Lim.
“However, most of the owners can ill afford to carry out restoration works as it is an expensive undertaking, while some of the owners could not be traced,” Lim said.
MPPP president Datuk Zainal Rahim Seman said the council was also looking at various incentives to encourage owners to carry out restoration works.
Lim said that if the RM200 million soft loan was not granted by the federal government and there were no takers to help restore these buildings, the state government will have to make alternative efforts to ensure their conservation.
The list of the buildings which need restoration is available at the MPPP office.
By The EDGE Malaysia (by Regina William)
Out of this number, 141 buildings are in the core zone of George Town’s heritage enclave, 82 within the buffer zone and another 287 buildings outside the buffer zone and core area.
The core areas encompass the historical sites of George Town, including the Lebuh Acheh historical enclave and sites such as the Lebuh Acheh Malay Mosque, Jalan Mesjid Kapitan Kling Mosque, the Goddess of Mercy Temple, Sri Mariamman Temple, Khoo Kongsi, St George’s Church, Assumption Church, St Xavier’s Institution, Convent Light Street, Little India, the museum and court building, the commercial area of Beach Street, Fort Cornwallis, Esplanade, City Hall, the Clan Jetties and the port areas.
“While we have appealed to the federal government for a RM200 million soft loan to help in our conservation efforts, we would also like to welcome those who are interested and have the necessary expertise to help restore these buildings, many of which are in a state of disrepair,” Chief Minister Lim Guan Eng said.
“We would like to call on private organisations who are interested to revive these buildings to come talk to us so we can restore them to their former glory,” he said.
“The Penang Island Municipal Council (MPPP) has sent notices to the building owners to restore their premises and those that are owned by certain agencies have been restored,” said Lim.
“However, most of the owners can ill afford to carry out restoration works as it is an expensive undertaking, while some of the owners could not be traced,” Lim said.
MPPP president Datuk Zainal Rahim Seman said the council was also looking at various incentives to encourage owners to carry out restoration works.
Lim said that if the RM200 million soft loan was not granted by the federal government and there were no takers to help restore these buildings, the state government will have to make alternative efforts to ensure their conservation.
The list of the buildings which need restoration is available at the MPPP office.
By The EDGE Malaysia (by Regina William)
UEM yet to hear from govt on Penang Bridge
PETALING JAYA: UEM Builders Bhd is awaiting word from the government on the developments pertaining to the Second Penang Bridge, said UEM Group chief executive Datuk Ahmad Pardas Senin.
“We are unable to make any comments now. We are still waiting for statements from the government,” he told The Edge Financial Daily.
He was asked to respond to questions on the possibility of the government forming a special purpose vehicle to take over the bridge project and UEM Builder’s contract sum being slashed by RM900 million.
Last Saturday, The Edge weekly reported that the government has formed a special purpose vehicle, Jambatan Kedua Pulau Pinang Sdn Bhd (JKPP) to undertake the project as UEM Builders and China Harbour Engineering Co (CHEC) — the two main contractors for the job — have so far failed to firm up their shareholders agreement.
It was reported that JKPP had also awarded CHEC a contract of about RM2.3 billion and UEM Builder another contract worth RM1.3 billion.
Affin Investment Research said if the news was true, it would have negative impact on UEM Builders, especially when the project comes with a materials costs fluctuation clause to protect UEM Builders’ construction margin.
“On a broader perspective, the loss of contracts to well-connected companies, if true, might cast more negative light on GLCs (government-linked companies),” it added.
Meanwhile, Regina William reports that the state government was in the dark over the latest developments for the Second Penang Bridge project.
“We are not aware of what is happening and what we know is through the report,” said Chief Minister Lim Guan Eng. “Since this is federal government project, it is up to the federal government to decide on the mechanism. But if there is a request, we will assist in coordinating and cooperating with the relevant agencies to speed up whatever needs to be implemented.”
By The EDGE Malaysia
“We are unable to make any comments now. We are still waiting for statements from the government,” he told The Edge Financial Daily.
He was asked to respond to questions on the possibility of the government forming a special purpose vehicle to take over the bridge project and UEM Builder’s contract sum being slashed by RM900 million.
Last Saturday, The Edge weekly reported that the government has formed a special purpose vehicle, Jambatan Kedua Pulau Pinang Sdn Bhd (JKPP) to undertake the project as UEM Builders and China Harbour Engineering Co (CHEC) — the two main contractors for the job — have so far failed to firm up their shareholders agreement.
It was reported that JKPP had also awarded CHEC a contract of about RM2.3 billion and UEM Builder another contract worth RM1.3 billion.
Affin Investment Research said if the news was true, it would have negative impact on UEM Builders, especially when the project comes with a materials costs fluctuation clause to protect UEM Builders’ construction margin.
“On a broader perspective, the loss of contracts to well-connected companies, if true, might cast more negative light on GLCs (government-linked companies),” it added.
Meanwhile, Regina William reports that the state government was in the dark over the latest developments for the Second Penang Bridge project.
“We are not aware of what is happening and what we know is through the report,” said Chief Minister Lim Guan Eng. “Since this is federal government project, it is up to the federal government to decide on the mechanism. But if there is a request, we will assist in coordinating and cooperating with the relevant agencies to speed up whatever needs to be implemented.”
By The EDGE Malaysia
Monday, August 4, 2008
Ivory sees potential in high-rise properties on Penang island
An artist’s impression of Ivory Property’s Island Resort project launched earlier this year
Higher construction costs can lead to shortage of high-rise properties with price ranging from RM300,000 to RM400,000 on the island over the next two years.
Ivory Property Sdn Bhd general manager Chok Keng Vui said the properties would be in high demand, as the rising cost of fuel would make it expensive to travel on a long distance to work at the island.
Having said that, Chok believed that it was still possible to construct high-rise properties on the island at affordable selling prices.
“Ivory is able to undertake such projects as we operate and manage our own construction company and design team, which helps to reduce the construction costs,” he said.
Chok said the company was reviewing one of its high-rise projects on the island – The Peak.
Originally scheduled for launching this month, he said: “We are waiting for the construction costs to stabilise before deciding on the exact launch, possibly by year-end.
“The Peak condominium units were originally priced at RM330,000,” he said.
Earlier this year, Ivory Property group launched the Island Resort project in Batu Ferringhi with a price tag between RM280,000 and RM600,000 per unit.
The project, which is 65% booked, is now selling for RM360,000 to RM700,000. The Island Resort is scheduled for completion in 2011.
Mah Sing Group Bhd managing director Datuk Seri Leong Hoy Kum said the group would still implement its South Bay project in Batu Maung as planned.
“Our target market is the medium-high to high-end segment, which is more resilient to the rising costs environment.
“We will look at properties that are in good locations, concepts and designs. Properties have proven to be the best hedge against inflation,” he added.
IJM Land Bhd managing director Datuk Soam Heng Choon said the company would constantly study the market scenario to time its launches.
“Given our penetration across all market segments, we can review the type of properties to be launched according to the demand. We can also adapt our design concept for certain specific target market.
“We believe that in a negative interest rate environment, properties will be a good hedge against inflation. Given the stock market volatility, investors can shift from the equity market to physical property assets,” he said.
IJM Land would be launching its Summer Place condominium scheme at the Jelutong Expressway early next year.
“We are able to keep the selling price at RM288,000 to RM420,000 per unit, as most of the contract works for the scheme have been awarded,” he added.
The built-up area for a Summer Place unit ranges between 960sq ft and 1,440sq ft.
Soam said the selling price for the group's new launches many be increased by 20% to 30%.
By The Star
For detail information, please visit Ivory Property Sdn Bhd Official Website
Commercial push by Glomac
Glomac to launch RM1.1 billion worth of integrated projects in 12 months
STRATEGIC DEVELOPMENT: Glomac’s project in Damansara. Right: Fong
GLOMAC Bhd, unfazed by slow consumer spending, is launching new commercial properties worth RM1.1 billion over the next 12 months while most developers are postponing their launches.
As the residential market suffers from high fuel and raw material prices, Glomac's move to invest in commercial properties is seen as strategic due to demand, group executive vice-chairman Datuk Richard Fong Loong Tuck said.
"The residential segment seems to have reached a saturation point. We are reacting to the market, which is why we are moving into integrated commercial developments," Fong told Business Times in Petaling Jaya, Selangor, recently.
"Integrated projects offer higher profit margins. We have expertise in these developments and do not see why we should not move with the flow," Fong said.
Glomac had previously built Kelana Centre Point, Kelana Business Centre, Glomac Business Park, Plaza Kelana Jaya, Dataran Prima, Glomac Square and OUG Square on similar concepts.
Fong said Glomac will not only replicate them but include more lifestyle features for new launches.
"We are launching a few commercial projects. The most expensive is Glomac Damansara," Fong said.
The RM650 million project will be sprawled over 2.76 hectares of freehold land along Jalan Damansara and adjacent to Damansara Kim.
It will feature a 15- and 30-storey office tower, a nine- and 10-storey office suite, two 25-storey serviced apartment blocks, 12 units of multi-storey shop offices and a three-level hybrid retail mall.
The project, Fong said, will be developed in four phases from this year for completion by end-2011.
Phase one, launching this month (August), will see the structures of the shop offices and the RM131 million 15-storey office tower building up first.
The mall with net lettable area of 150,000 sq ft and worth RM161 million, and the two office suites valued at RM168 million is in planning stage. This phase two project will be launched early next year.
The third and fourth phases will comprise the serviced apartments and the 30-storey office tower respectively and will be launched in late 2009.
Fong said the indicative proposed selling price for each serviced apartment unit is from RM600 per sq ft and around RM110 million per block.
The 30-storey office tower is worth RM185 million.
"We are open to selling the towers en bloc for sustainable development. The towers will attract European, Arab and local investors," he said.
Fong, who is also Malaysian chapter of the International Real Estate Federation (Fiabci) president, is optimistic on en bloc deals after selling Glomac Tower in Kuala Lumpur for RM577 million.
"We made a handsome profit from the sale. En bloc is something we will look at from now," he added.
Glomac also recently sold 20 units of four-and-a-half-storey shop offices in Sri Hartamas for RM100 million. But these were via open tenders.
The project, dubbed Galleria, will be constructed from August.
"The units were sold within a week from the tenders. We will consider this option to sell," Fong said.
By New Straits Times - Business Times - (by Sharen Kaur)
STRATEGIC DEVELOPMENT: Glomac’s project in Damansara. Right: Fong
GLOMAC Bhd, unfazed by slow consumer spending, is launching new commercial properties worth RM1.1 billion over the next 12 months while most developers are postponing their launches.
As the residential market suffers from high fuel and raw material prices, Glomac's move to invest in commercial properties is seen as strategic due to demand, group executive vice-chairman Datuk Richard Fong Loong Tuck said.
"The residential segment seems to have reached a saturation point. We are reacting to the market, which is why we are moving into integrated commercial developments," Fong told Business Times in Petaling Jaya, Selangor, recently.
"Integrated projects offer higher profit margins. We have expertise in these developments and do not see why we should not move with the flow," Fong said.
Glomac had previously built Kelana Centre Point, Kelana Business Centre, Glomac Business Park, Plaza Kelana Jaya, Dataran Prima, Glomac Square and OUG Square on similar concepts.
Fong said Glomac will not only replicate them but include more lifestyle features for new launches.
"We are launching a few commercial projects. The most expensive is Glomac Damansara," Fong said.
The RM650 million project will be sprawled over 2.76 hectares of freehold land along Jalan Damansara and adjacent to Damansara Kim.
It will feature a 15- and 30-storey office tower, a nine- and 10-storey office suite, two 25-storey serviced apartment blocks, 12 units of multi-storey shop offices and a three-level hybrid retail mall.
The project, Fong said, will be developed in four phases from this year for completion by end-2011.
Phase one, launching this month (August), will see the structures of the shop offices and the RM131 million 15-storey office tower building up first.
The mall with net lettable area of 150,000 sq ft and worth RM161 million, and the two office suites valued at RM168 million is in planning stage. This phase two project will be launched early next year.
The third and fourth phases will comprise the serviced apartments and the 30-storey office tower respectively and will be launched in late 2009.
Fong said the indicative proposed selling price for each serviced apartment unit is from RM600 per sq ft and around RM110 million per block.
The 30-storey office tower is worth RM185 million.
"We are open to selling the towers en bloc for sustainable development. The towers will attract European, Arab and local investors," he said.
Fong, who is also Malaysian chapter of the International Real Estate Federation (Fiabci) president, is optimistic on en bloc deals after selling Glomac Tower in Kuala Lumpur for RM577 million.
"We made a handsome profit from the sale. En bloc is something we will look at from now," he added.
Glomac also recently sold 20 units of four-and-a-half-storey shop offices in Sri Hartamas for RM100 million. But these were via open tenders.
The project, dubbed Galleria, will be constructed from August.
"The units were sold within a week from the tenders. We will consider this option to sell," Fong said.
By New Straits Times - Business Times - (by Sharen Kaur)
Glomac PJ complexes to be launched early 2009
PROPERTY developer Glomac Bhd is in the process of acquiring 1.28ha of freehold land in Petaling Jaya, Selangor, the site of the former Kelana Seafood Centre, to build a commercial complex.
Group executive vice-chairman Datuk Richard Fong Loong Tuck said the commercial complex will generate sales of RM250 million for Glomac, which is continuously seeking strategic land bank in Selangor and the Klang Valley for niche developments.
The commercial complex, which will overlook a lake and has yet to be named, will feature a three-level mall, a 20-storey office tower and an office suite.
"It is on the drawing board. We expect to launch it by January 2009," Fong told Business Times.
Glomac will also launch two office towers and a serviced apartment block worth RM200 million by early 2009 in the burgeoning Mutiara Damansara township in Petaling Jaya.
It recently acquired two adjoining freehold parcels totalling 115,755sq ft for RM38.69 million or RM334psf from Boustead Properties Bhd.
"We are excited over these new launches and are gearing up for more next year," Fong said.
While Glomac is optimistic on positive sales from the two projects, Fong said the developments will be affected by more expensive materials.
"We will be prudent with the developments and manage cost effectively," Fong said.
"We expect the projects to contribute significantly to Glomac's revenue and net profit from 2009," he said.
By New Straits Times - Business Times - (by Sharen Kaur)
Group executive vice-chairman Datuk Richard Fong Loong Tuck said the commercial complex will generate sales of RM250 million for Glomac, which is continuously seeking strategic land bank in Selangor and the Klang Valley for niche developments.
The commercial complex, which will overlook a lake and has yet to be named, will feature a three-level mall, a 20-storey office tower and an office suite.
"It is on the drawing board. We expect to launch it by January 2009," Fong told Business Times.
Glomac will also launch two office towers and a serviced apartment block worth RM200 million by early 2009 in the burgeoning Mutiara Damansara township in Petaling Jaya.
It recently acquired two adjoining freehold parcels totalling 115,755sq ft for RM38.69 million or RM334psf from Boustead Properties Bhd.
"We are excited over these new launches and are gearing up for more next year," Fong said.
While Glomac is optimistic on positive sales from the two projects, Fong said the developments will be affected by more expensive materials.
"We will be prudent with the developments and manage cost effectively," Fong said.
"We expect the projects to contribute significantly to Glomac's revenue and net profit from 2009," he said.
By New Straits Times - Business Times - (by Sharen Kaur)
New benchmark in luxury living
BOUTIQUE property developer Urban Hallmark Properties Sdn Bhd aims to lift the benchmark of luxurious residential living through its maiden project Zephyr Point on Basong in Damansara Heights.
Targeted for launch in the first quarter of next year, the gated and guarded development with only seven exclusive residences strives to offer the ultimate urban residential address.
From left: Julien T. Hodson-Walker, Dion Vercoe, Datuk Jeffrey Ng, Mok Chee Paan and Regroup Associates executive chairman Christopher Boyd with a model of Zephyr Point
Managing director Datuk Jeffrey Ng said Zephyr Point had been meticulously designed for those seeking a well-planned and modern living environment away from the hustle and bustle of the city but enjoy conveniences such as chic cafes and retail shops.
“Every step of the way – from the initial master planning to product layout and design, material sourcing to landscaping – we go the extra mile to set a new benchmark in quality finishes and design functionality.
“A lot of time was spent with our consultants to ensure the architecture, interior and landscape designs create a boutique effect to meet the luxurious lifestyles of our buyers,” he told StarBiz.
The panel of consultants comprises project master planner Garis Architect, interior designer Palladio Interiors and landscape architect ICN Design International.
The four units of three-storey villas and three penthouses are targeted at homeowners who desire privacy, picturesque views, security, spaciousness and exclusivity.
The residences, averaging 7,900 to 11,700 sq ft with indicative prices of RM8mil to RM12mil each, are perched nearly 60 feet above road level. Two show houses of a penthouse and a villa will be ready by the first quarter of next year in time for the sales launch.
Construction started last July and is scheduled for completion by the middle of next year.
Ng said the extensive use of premier brands in fittings and equipments and top quality finishing would ensure classy looks and durability.
Garis Architects director Mok Chee Paan said the penthouses that sprawl over an entire floor of over 10,000 sq ft each had been designed with optimal use of space and an open-plan interior that invites natural light and cross-ventilation.
Privacy is assured by way of individual entrance lobbies and private lift access. Each penthouse owners has a lock-up garage for three vehicles and a large storage room in the basement.
Palladio Interiors managing director Dion Vercoe said the double-volume atrium at the foyer of the villas would accentuate light, space and comfort of the open-plan living and dining areas.
“Another unique feature is the provision of personal space in the form of a self-contained retreat studio at the lower level that opens out to a spa pool and deck,” Vercoe said.
ICN Design director Julien T. Hodson-Walker said Zephyr Point would have trees and lush foliage strategically planted to cocoon the elevated estate to give it an intimate ambience.
Every homeowner at Zephyr Point enjoys a personal home office at the Breezeway level that also accommodates the residents' function lounge and fully equipped gymnasium.
By The Star - StarBiz - (by Angie Ng)
Mutiara Goodyear takes rising costs in its stride
As other property developers brace themselves to weather rising building material costs and general slowdown in the economy, Mutiara Goodyear Development Bhd is forging ahead with its projects.
Mutiara Goodyear chief executive officer Kee Cheng Teik is continuing with the launch of Prima Avenue, Mutiara Gombak and Melawati projects, which have a combined gross development value of RM950 million.
KEE: The Mutiara Goodyear CEO believes that even though uncertainty in the market may hold up decisions on property buying, it is temporary in nature and buyers will eventually come around.
Prima Avenue and Mutiara Gombak are commercial developments, while Melawati is a combination of commercial and residential.
The first of its projects on offer is Prima Avenue, a 1.38ha development, which will house business suites as well as retail outlets in Kelana Jaya.
"We have not factored in the increase in building materials into our pricing of the units," Kee told reporters in Petaling Jaya last week. Each business unit is priced at RM280 per sq ft while the retail lots are at RM400 per sq ft.
Kee gave two reasons for the move.
He does not expect price of building materials to remain at current levels for long and also the book cost for the 1.38ha land is almost zero, a "leftover" from its Dataran Prima development.
Steel bar prices have reached an all time high of RM4,100 per tonne, while cement prices are up a further RM1 to RM14.25 per 50kg.
"We are still happy with the profit margin we are getting," Kee said.
The project, which will house 342 business and 33 retail lots, has a GDV of RM120 million.
He said the group's status as a medium-sized developer gave it a lot of flexibility on its development.
Kee said even though he acknowledges that the uncertainty in the market might hold up decisions on property buying, it is temporary in nature and buyers will eventually come around.
"Comparatively, property and real estate are still very durable," Kee said.
On whether the current price of building materials will affect its profits for the year, Kee said it was fortunate to have completed two big projects this year and have yet to award the work for current projects.
The 35 year old company has an undeveloped land bank of 360.86ha in Klang Valley and Penang.
By New Straits Times (by Presenna Nambiar)
Mutiara Goodyear chief executive officer Kee Cheng Teik is continuing with the launch of Prima Avenue, Mutiara Gombak and Melawati projects, which have a combined gross development value of RM950 million.
KEE: The Mutiara Goodyear CEO believes that even though uncertainty in the market may hold up decisions on property buying, it is temporary in nature and buyers will eventually come around.
Prima Avenue and Mutiara Gombak are commercial developments, while Melawati is a combination of commercial and residential.
The first of its projects on offer is Prima Avenue, a 1.38ha development, which will house business suites as well as retail outlets in Kelana Jaya.
"We have not factored in the increase in building materials into our pricing of the units," Kee told reporters in Petaling Jaya last week. Each business unit is priced at RM280 per sq ft while the retail lots are at RM400 per sq ft.
Kee gave two reasons for the move.
He does not expect price of building materials to remain at current levels for long and also the book cost for the 1.38ha land is almost zero, a "leftover" from its Dataran Prima development.
Steel bar prices have reached an all time high of RM4,100 per tonne, while cement prices are up a further RM1 to RM14.25 per 50kg.
"We are still happy with the profit margin we are getting," Kee said.
The project, which will house 342 business and 33 retail lots, has a GDV of RM120 million.
He said the group's status as a medium-sized developer gave it a lot of flexibility on its development.
Kee said even though he acknowledges that the uncertainty in the market might hold up decisions on property buying, it is temporary in nature and buyers will eventually come around.
"Comparatively, property and real estate are still very durable," Kee said.
On whether the current price of building materials will affect its profits for the year, Kee said it was fortunate to have completed two big projects this year and have yet to award the work for current projects.
The 35 year old company has an undeveloped land bank of 360.86ha in Klang Valley and Penang.
By New Straits Times (by Presenna Nambiar)
Developers generous despite slowdown
Despite the slower economic growth and a softening property market, many developers are still giving freebies and financial incentives to purchasers.
While some developers are hoping that these incentives could spur sluggish sales, others genuinely want to reward their purchasers for having confidence in them.
Two recent property exhibitions held in Kuala Lumpur – iProperty.com Expo at the Kuala Lumpur Convention Centre and the 27th Malaysia International Property Showcase at the Mid Valley Megamall – saw many developers throwing big discounts and extras.
For example, Naza TTDI Sdn Bhd (TTDI) is still offering 10% discount to buyers of its award-winning Laman Seri Business Park. Bumiputra buyers get another 10% discount. These discounts were initially accorded to “early birds” during the initial stage of launch recently to reward purchasers for their confidence in TTDI.
Senior manager (marketing and sales administration) S.M. Faliq S.M. Nasimuddin said the discounts would be removed once the sales target of 70% was achieved.
“Sales have been encouraging. We have sold up to 55% since the recent launch,” he said, adding that the incentive was attractive because the project was positioned as the “best commercial centre” in Shah Alam.
Faliq said developers normally gave discounts when they were promoting a new concept or developing a new location.
“Such incentives are real, especially when promoted from the outset, and not when the sale is slow.
“In the case of our business park, we are introducing a new concept to Shah Alam that is tried and proven like our successful TTDI Plaza.
“Our discount is real and represents immediate gain once the property is nearing completion,” he said.
Purchasers of the four and five-storey strata shop offices priced from RM403,000 are also offered a two-year guaranteed rental return of 7.5% per annum and two years free maintenance fees.
Other projects that also offered discounts and incentives include:
Mutiara in Bukit Jalil: Purchasers of the 3-storey link houses priced from RM668,888 get eight air-conditioners, autogate, security alarm and a special loan package. The house will have a spacious 3,600 sq ft built-up area with 5+1 bedrooms and 6 bathrooms and two halls.
Amaya Saujana: Malton Bhd is offering two free car-parking bays and three free air-conditioners for purchasers of its Amaya freehold suites in Saujana, Selangor. The price per unit is from RM551,397.
NZX Square in Ara Damansara: Purchasers of the freehold hybrid semi-detached shop offices get incentives like zero interest until vacant possession (limited to 30 units), two years free maintenance fees, 20/80 scheme and 100% capital return.
Aman Perdana: Mah Sing Group offered 10% discount for five units during a recent weekend sale for its completed, freehold semi-detached houses priced from RM351,800 (32ft x 75ft) and from RM425,800 (35ft x 75ft).
At another launch to promote its semi-detached homes in this township, it also gave incentives worth RM70,000, including RM35,000 discount and even a “durian feast” for visitors.
Subang Alam: Subang Alam Sdn Bhd has offered lots of freebies during a recent sales launch ranging from a grand prize of a car worth RM100,000 for a lucky draw.
Other prizes include a 32-inch LCD TV set and notebook. For “early birds”, it offered free golf memberships and free legal fee for the sale and purchase agreement.
Jelutong Heights: Perhaps one of the biggest discounts was given by NBC Land Sdn Bhd who advertised in the newspaper offering “early birds” discount of RM50,000 for its 2½-storey semi-detached homes, Cypris and Dahlia, priced from RM1.17mil. The houses are 90% sold and 70% completed.
The Legend International Water Homes: This award-winning project in Port Dickson by the Kuala Lumpur Metro Group is offering 8% rental return per annum for the first three years and 12.5% per annum for the next 12 years.
For people who need a home and who think they can afford to finance their housing loan, I believe they should buy now, especially when the mortgage interest rates are still low and developers still giving away freebies.
Prices of new launches will only go up. That's a fact of life.
By The Star
While some developers are hoping that these incentives could spur sluggish sales, others genuinely want to reward their purchasers for having confidence in them.
Two recent property exhibitions held in Kuala Lumpur – iProperty.com Expo at the Kuala Lumpur Convention Centre and the 27th Malaysia International Property Showcase at the Mid Valley Megamall – saw many developers throwing big discounts and extras.
For example, Naza TTDI Sdn Bhd (TTDI) is still offering 10% discount to buyers of its award-winning Laman Seri Business Park. Bumiputra buyers get another 10% discount. These discounts were initially accorded to “early birds” during the initial stage of launch recently to reward purchasers for their confidence in TTDI.
Senior manager (marketing and sales administration) S.M. Faliq S.M. Nasimuddin said the discounts would be removed once the sales target of 70% was achieved.
“Sales have been encouraging. We have sold up to 55% since the recent launch,” he said, adding that the incentive was attractive because the project was positioned as the “best commercial centre” in Shah Alam.
Faliq said developers normally gave discounts when they were promoting a new concept or developing a new location.
“Such incentives are real, especially when promoted from the outset, and not when the sale is slow.
“In the case of our business park, we are introducing a new concept to Shah Alam that is tried and proven like our successful TTDI Plaza.
“Our discount is real and represents immediate gain once the property is nearing completion,” he said.
Purchasers of the four and five-storey strata shop offices priced from RM403,000 are also offered a two-year guaranteed rental return of 7.5% per annum and two years free maintenance fees.
Other projects that also offered discounts and incentives include:
Mutiara in Bukit Jalil: Purchasers of the 3-storey link houses priced from RM668,888 get eight air-conditioners, autogate, security alarm and a special loan package. The house will have a spacious 3,600 sq ft built-up area with 5+1 bedrooms and 6 bathrooms and two halls.
Amaya Saujana: Malton Bhd is offering two free car-parking bays and three free air-conditioners for purchasers of its Amaya freehold suites in Saujana, Selangor. The price per unit is from RM551,397.
NZX Square in Ara Damansara: Purchasers of the freehold hybrid semi-detached shop offices get incentives like zero interest until vacant possession (limited to 30 units), two years free maintenance fees, 20/80 scheme and 100% capital return.
Aman Perdana: Mah Sing Group offered 10% discount for five units during a recent weekend sale for its completed, freehold semi-detached houses priced from RM351,800 (32ft x 75ft) and from RM425,800 (35ft x 75ft).
At another launch to promote its semi-detached homes in this township, it also gave incentives worth RM70,000, including RM35,000 discount and even a “durian feast” for visitors.
Subang Alam: Subang Alam Sdn Bhd has offered lots of freebies during a recent sales launch ranging from a grand prize of a car worth RM100,000 for a lucky draw.
Other prizes include a 32-inch LCD TV set and notebook. For “early birds”, it offered free golf memberships and free legal fee for the sale and purchase agreement.
Jelutong Heights: Perhaps one of the biggest discounts was given by NBC Land Sdn Bhd who advertised in the newspaper offering “early birds” discount of RM50,000 for its 2½-storey semi-detached homes, Cypris and Dahlia, priced from RM1.17mil. The houses are 90% sold and 70% completed.
The Legend International Water Homes: This award-winning project in Port Dickson by the Kuala Lumpur Metro Group is offering 8% rental return per annum for the first three years and 12.5% per annum for the next 12 years.
For people who need a home and who think they can afford to finance their housing loan, I believe they should buy now, especially when the mortgage interest rates are still low and developers still giving away freebies.
Prices of new launches will only go up. That's a fact of life.
By The Star
YHN unit formalises deal with F&N unit
KAR Sin Bhd (KSB), a wholly-owned subsidiary of YNH Property Bhd, has formalised agreements for management, technical and consultancy services with Frasers Hospitality Pte Ltd, the hospitality arm of Frasers Centrepoint Ltd (a wholly-owned subsidiary of Fraser and Neave Ltd).
Frasers Hospitality will manage the Gold-Standard Serviced Residence, Fraser Place Kuala Lumpur, located at Lot 163, Jalan Perak, Kuala Lumpur.
Fraser Place Kuala Lumpur, slated for completion soon, will be a young vibrant hub for expatriates, located in the "golden triangle" of the Malaysian capital, where most international banks, oil and gas companies and multinationals are based. It will be within walking distance of the Petronas Twin Towers (KLCC) and Pavilion KL, the city's largest retail mall.
"This is in line with our strategy to ensure the quality of our projects to meet the taste and requirements of our discerning purchasers and also ensuring that the management of the building is left in the hands of professionals," YNH executive chairman Datuk Dr Yu Kuan Chon said in a statement.
The project comprises an office tower and a second tower with 217 studios, bedrooms and penthouse serviced residences.
By New Straits Times
Frasers Hospitality will manage the Gold-Standard Serviced Residence, Fraser Place Kuala Lumpur, located at Lot 163, Jalan Perak, Kuala Lumpur.
Fraser Place Kuala Lumpur, slated for completion soon, will be a young vibrant hub for expatriates, located in the "golden triangle" of the Malaysian capital, where most international banks, oil and gas companies and multinationals are based. It will be within walking distance of the Petronas Twin Towers (KLCC) and Pavilion KL, the city's largest retail mall.
"This is in line with our strategy to ensure the quality of our projects to meet the taste and requirements of our discerning purchasers and also ensuring that the management of the building is left in the hands of professionals," YNH executive chairman Datuk Dr Yu Kuan Chon said in a statement.
The project comprises an office tower and a second tower with 217 studios, bedrooms and penthouse serviced residences.
By New Straits Times
Rising material costs put developers in limbo
The escalating cost of building materials is raising concerns over the widening gap between the income levels and the selling price of properties as well as availability of affordable housing.
“A family with a combined monthly income of RM10,000 is eligible to obtain a mortgage loan of about RM350,000 from a commercial banking institution. But how many fall in this income bracket?,” asked registered and chartered valuer C.A. Lim & Co proprietor Lim Chien Aun.
Lim Chien Aun
“From statistics collected, the average employee monthly income is RM2,000 to RM4,000. On a joint basis, this enable the purchasers to obtain a mortgage loan for a property valued at about RM200,000.
“But with the rising cost of building materials and construction, a RM200,000 residential property will be about 30% higher if other factors affecting the market value remain as it is today.”
Steel bars have gone up to RM4,100 per tonne compared with RM3,500 in June while cement is sold at RM13.45 a bag compared with RM10.95.
Across the board, all types of commonly used construction materials have increased by 15% to 30%.
Less than 5% of the families in Malaysia have a combined income of RM10,000 and above
Lim said the Penang state government should seriously encourage the development of more affordable housing schemes on the island.
It also has to find ways to address the plight of house owners in view of the current spiralling cost of living.
“One way is to reappraise the plot ratio. Presently the plot ratio on the island allows the developer to build 3.5 times per sq ft.
“This plot ratio needs to be reappraised, taking into consideration the additional infrastructure requirements that can be added to a specifically identified area.
“Such a revision will allow a developer more space to construct a variety of homes for different income groups,” he said.
A filepic of terraced houses in Tanjung Bungah. Rehda sees fewer projects being launched in Penang this year
Presently, developers are complaining that the existing development guidelines on the island are too restrictive. For each acre, developers are allowed to develop 15 units of 1,400 sq ft properties, or 30 units of 700sq ft properties.
With the present land and construction costs, this works out to about RM600,000 to develop a high-rise unit of a 1,500sq ft.
This is why developers on the island are not able to price their properties affordably.
But with a higher plot ratio, developers can spread out their development costs and build properties with different lower price range.
Lim also urged the Penang Development Corp to work with the private sector to create more affordable and improved housing projects, taking into account the interest of the people, especially the working population.
“Otherwise, only the very rich can afford to stay in George Town, leaving the other parts of the island to become a blighted zone,” he said.
Lim is also concerned over the impact of higher interest rate on the property market. It is speculated that the banking authorities may raise interest rates by 0.5% soon.
“This may lead to a forced selling situation for those who cannot hold on to their properties due to higher mortgage repayments as well as the rising living and maintenance costs.
“Should this happen, there will be a negative impact on property prices and the livelihood of the general population which can affect the economy,” he said.
At a press conference recently, Real Estate Housing and Developers’ Association (Rehda) Penang chairman Datuk Jerry Chan appealed to the state government to allow developers to build projects with higher density and larger built-up areas in the city.
In view of soaring energy and building prices, he said there would be no development of new low-cost and low-medium-cost housing projects, which were currently priced at RM42,000 and RM75,000 respectively.
“We are appealing to the state government to revise these prices.
“Developers will resort to building only expensive homes comprising less than 150 units per scheme, which does not require them to build affordable housing,” he added.
Chan expects fewer property projects to be launched in Penang this year due to the rising cost of fuel and building materials.
“This is reflected in the new launches lined up for exhibition at the Malaysian Property Exhibition (Mapex) 2008 held recently.
“There were only three new launches this year for Mapex 2008 with a gross sales value (GSV) of RM44.5mil, compared with seven last year which had a GSV of RM300mil,” Chan added.
Henry Butcher Malaysia (Penang) director Dr Teoh Poh Huat concurred that fewer residential project launches were expected in the immediate term due to the rising development costs, including fuel and building materials.
Based on today’s land value and the existing local authority’s planning guidelines, he said it would be difficult to supply affordable homes in the near future unless the basic macro and micro challenges were promptly addressed.
The mid-end of the market will also be affected but to a lesser extent, compared with the affordable home sector.
Teoh said the high-end market would continue to attract entrepreneur’s attention, as it offered the highest margins.
He said recent foreign interests in Penang’s real estate had supported property values at levels that were unheard of in the past.
“This augurs well for the prospect of Penang’s real estate as it encouraged greater product innovation and creativity.
“Penang is now better known as a 'ought to visit' destination for property investment,” he said.
By The Star (by David Tan)
Axis REIT to become syariah-compliant?
NEWEST ASSET: Menara Axis in Petaling Jaya. It is believed that Axis REIT may soon appoint a syarlah expert to conduct due diligence on its properties
AXIS Real Estate Investment Trust (REIT), Malaysia's first property trust to be listed, is studying the possibility of converting into a syariah-compliant vehicle, to appeal to a wider group of investors.
Sources told Business Times that Axis may soon appoint a syariah expert to conduct due diligence on the properties held under the REIT.
"Axis is looking at syariah-compliant REIT to have a wider pool of investors who can invest in the trust," the source said.
Axis has some RM700 million worth of properties under the REIT in commercial, light industrial, logistics and warehouse retail facilities.
Officials from Axis REIT could not be contacted for confirmation.
According to the Securities Commission guideline for Islamic REITs, syariah-compliant assessments must be carried out by an appointed syariah committee/syariah adviser to assess any property to be acquired by an Islamic REIT.
An Islamic REIT has tenants who operate permissible activities according to the Syariah. In the event that the tenant is found to operate non-permissible activities, the fund manager for the Islamic REIT must perform additional compliance assessment.
In general, a 20 per cent non-compliance leeway is allowed. This is based on total rental from non-permissible activities which will be compared to total turnover of the Islamic REIT to obtain the percentage of rental from non-permissible activities.
As per SC's requirement, an Islamic REIT must also use takaful schemes to insure its real estate, unless takaful is unable to provide the insurance coverage needed.
It was reported that Axis REIT plans to increase its real estate size to RM1 billion in 2008.
Currently, there are two listed Islamic REITs - the Al-'Aqar KPJ REIT, the first healthcare REIT in Malaysia and Al-Hadharah Boustead REIT, Malaysia's first Islamic plantation REIT.
By New Straits Times (by Vasantha Ganesan)
UEM won't collect tolls at second Penang bridge
UEM Builders Bhd, the main builder of a second bridge to the Malaysian island of Penang, won't get the contract to collect road tolls at the site, according to Second Finance Minister Tan Sri Nor Mohamed Yakcop today.
The government decided about a month ago to set up "a special-purpose vehicle to collect the tolls," Nor told reporters in Kuala Lumpur. Under a new contract, the developers will just build the bridge.
Penang is home to manufacturers including Dell Inc and needs an additional bridge to relieve traffic congestion. China Harbour Engineering Co will work with UEM Builders to build the 23-kilometer (14-mile) link from the mainland to the island after the Export-Import Bank of China agreed to lend Malaysia US$800 million for the project, the Chinese company said last year.
UEM said in June the Malaysian government has agreed to raise the cost of the RM4.3 billion project on higher raw material prices. The bridge is due for completion in 2011, UEM said.
By Bloomberg
The government decided about a month ago to set up "a special-purpose vehicle to collect the tolls," Nor told reporters in Kuala Lumpur. Under a new contract, the developers will just build the bridge.
Penang is home to manufacturers including Dell Inc and needs an additional bridge to relieve traffic congestion. China Harbour Engineering Co will work with UEM Builders to build the 23-kilometer (14-mile) link from the mainland to the island after the Export-Import Bank of China agreed to lend Malaysia US$800 million for the project, the Chinese company said last year.
UEM said in June the Malaysian government has agreed to raise the cost of the RM4.3 billion project on higher raw material prices. The bridge is due for completion in 2011, UEM said.
By Bloomberg
Saturday, August 2, 2008
Boustead Properties branding entire development
Now that Boustead Holdings Bhd has successfully completed its privatisation of Boustead Properties Bhd, it is going to focus on branding.
That seems like flogging a dead horse actually, this branding thing. After all, it was doing that since Ikea first bought its corporate lot about 10 years ago. And with each component that came on board, Boustead drove the branding vehicle – with Ikea, Ikano, Tesco, The Curve and Cineleisure.
Boustead Properties Bhd executive director Datuk Ghazali Mohd Ali.
Boustead Properties Bhd executive director Datuk Ghazali Mohd Ali says it is necessary. “Last time, we were branding all the individual components. Now we are branding the entire development as a single large entity, with all its infrastructures that make this an award-winning township, both for commercial and residential pruposes.
“It’s different, and we need to push this strategy further if we are to remain relevant,” he says.
An analyst likens Boustead’s strategy to Coca Cola’s. “It’s a global brand, but it continues to emphasise on branding. It’s a strategy to stay at the forefront. And it will reap from it.”
Ghazali says in order for Boustead to remain attractive to shareholders, and Mutiara Damansara to buyers, it has to do things differently.
“We have proven that we can and now we are leveraging what we have started,” he says.
By that he means the overall package, and what’s on the card now that it has taken Boustead Properties private.
“We will shed some non-core assets and do a bit of rationalising, and wait out the current challenging period.”
Ghazali says the conglomerate has partners like Johnson Suisse sanitary ware, a paint company in the form of Boustead Sissions Paint and UAC Bhd which is involved in building materials as a buffer.
Boustead Holdings reported sterling first quarter 2008 results, thanks to higher contribution from the plantation business, consolidation of subsidiary Boustead Naval Shipyard’s (BNS) earnings and lower effective tax rate. The trading division reported stronger earnings as well as its pretax profit increased by 7.5 times to RM22.8mil on the back of better sales volume and some inventory gain. Bulk of the earnings was contributed by BHPetrol.
The property division’s operating profit on the other hand declined 26% due to lack of sale of corporate lots.
“We still have nine corporate lots of about an acre each in Mutiara Damansara in Petaling Jaya but we are in no hurry to sell. We can wait for prices to move up. We have a successful mall which we can inject into a real estate investment trust (Reit).
This, says an analyst, is a tactical delay to capitalise on expected forward price appreciation. All in, net profit jumped 140% year on year and 21.2% quarter on quarter to RM152.3mil. The group declared an interim dividend of 5 sen gross as a reward to shareholders.
Fresh from its corporate exercise of going private, Boustead Properties is now preparing to launch its last residential development later this year in Mutiara Damansara Surian Residency, its second condominium project there. Its first is Surian Condominium.
The freehold development will have about 300 units of between 900 and 2200 sq ft. It will have two blocks of 23 and 25 storey each and some low-rise units. In terms of overall architecture, it will be fairly similar to Surian Condominium.
“The project will be more upmarket than Surian Condominium in terms of finishing and design, our first high-rise residential development there.”
He says Surian Residency will be selling for about RM400 per sq ft.
“We want to ride on the success of Surian Condominium, which is now changing hands between 30% and 40% above its launching price in the secondary market,” he says.
Boustead Properties is at the same time negotiating with potential tenants on the lease of Surian Tower, in the same township. The office block will be part of the overall development there.
With visitors to The Curve alone numbering 2 million a month – compared to 600,000 four years ago when it first opened – the numbers, he says, speaks for itself.
“We have tenants like Living Quarters and MetroJaya who are expanding. We also have tenants who have seen better sales when they moved over here than when they were in their old place. We also have competitors who are buying corporate lots here. This says something – that Boustead Properties is on the right track, notwithstanding the current economic situation,” says Ghazali.
Glomac Bhd recently bought two pieces of land totalling 10,800 sq ft for RM38.69mil. A third lot was sold to an insurance company. Boustead Properties has four core divisions – plantations, which contributes about 35% to sales, property development (40%), hotel and property investment.
Ghazali says that although its 26-storey Surian Tower is yet to be completed, one-third of it is already leased to a multinational company.
The lease for its remaining two-thirds of the building is being negotiated currently. He hopes the place will be occupied by September 2009.
With so many visitors to The Curve, Boustead is putting in 30% more to the car parks at Surian Tower than what is required by the local authorities.
Besides this office block with a net lettable space of 335,000 sq ft, Boustead Properties will also be building a new hotel and convention centre behind Cineleisure. Like its other 150-room hotel in the popular suburb, The Royale Bintang Damansara, the new hotel will have about 300 rooms.
“The Royale Bintang Damansara is nearly always full. So this idea to have another hotel with convention facilities is a good idea. With the price of petrol today and in the years to come, I would think people will be reluctant to drive into the city. Ideas and plans just evolve, we did not have this in mind earlier.”
To integrate the various components there, Boustead Properties hope to have a physical link from the proposed LRT station in the suburb to Surian Tower office block and the new hotel and convention centre.
Ikea, among its first buyers of commercial corporate lots, bought their site for RM99 per sq ft eight years ago. Corporate lots are now in the region of RM380 to RM400 per sq ft. Things have certainly moved.
By The Star (by Thean Lee Cheng)
Budget proposals to kickstart property
Having taken tough measures to counter the rising cost scenario, property developers have stepped forward to suggest a series of measures that can help kickstart the industry and put the players on firmer ground.
In its Budget 2009 memorandum, the Real Estate and Housing Developers Association (Rehda) has highlighted that among other things, the bumiputra quota release mechanism should be standardised, structured and transparent.
Rehda president Datuk Ng Seing Liong has proposed:
·An automatic release of the quota units to be in place after six months of a project's launch or when a project has reached 50% in its construction, whichever is earlier;
·Discounts for bumiputra buyers to be capped at 5% and only applicable for houses RM250,000 and below as purchasers in a higher market segment are more financially secure and do not need such discounts;
·The low-cost housing ceiling price to be raised to RM60,000 a unit from RM42,000 currently to mitigate the effect of increased construction costs;
·A reduction or waiver of stamp duty rates for house purchase that average between 2% and 3% now. which will also help reduce the people's burden;
·Granting tax exemption for dividend income to unitholders to give a much-needed lift to the real estate investment trust (REIT) market.
Developers have been harping on some of these issues for a long time but attention from the Government is more urgent now.
The mantle of protectionism should be unshackled so as to create a more level playing field. Developers, already bracing for tougher days ahead, do not want to be further burdened by some of these practices.
Already many new project launches have been delayed to avoid unnecessary cost over-runs, now 25% to 30% higher than earlier projections.
Most developers see more challenges on the horizon with food and petrol price hikes, escalating costs of construction and expected rise in interest rates to contain inflationary pressures.
Their woes have been exacerbated by the weak take-up rate that prevents them from passing on the rising costs to buyers.
Many of these buyers are adopting a wait-and-see attitude especially in view of the uncertain interest rate scenario.
Malaysia has a relatively young population where almost a third of the 26 million people are aged 25 to 44, and the country still needs a fairly big number of houses each year.
There will still be demand for houses, especially good products at competitive prices in the right locations.
While demand for medium and lower priced properties has dropped, the high-end market is still holding out as buyers in this segment are less affected by the rising cost of living.
With sales for lower priced property expected to remain soft, more developers should consider coming up with more versatile designs and smaller projects with shorter turnaround time and better cash flows.
By The Star (by Angie Ng)
Iskandar Malaysia spurs demand for costly homes
JOHOR BARU: Iskandar Malaysia has spurred growing market demand for high-end properties that was virtually non-existent in South Johor previously, said Berinda group sales manager Lim Sung Heng.
Buyers in Johor Baru are now ready to pay for houses priced from RM500,000, he said at the launch of the Park Link Villa II super-link semi-detached houses at Taman Impian Emas recently.
Priced from RM700,000, the 36 units have land size of 50ft by 100ft, an extra wide car porch that easily fits three cars and a spacious walk-in wardrobe in the master bedroom.
“We’ll be launching more high-end houses in Taman Impian Emas and this time around, the price tag will be from RM1mil,” Lim told StarBiz.
The Park Link Villa II precinct is equipped with WiFi, RFID technology, two-tiered gated and guarded security, a 27-hole golf course and a residents' club.
Berinda, a member of the Kuok group, launched Park Link Villa I late last year and received good response for the 40 units priced from RM600,000.
Lim said the latest phase was expected to generate similar response.He said the price of houses in Johor Baru was comparatively lower than in Kuala Lumpur, for instance, a 3,500 sq ft semi-detached house selling for RM700,000 in Johor Baru would cost over RM1mil in Kuala Lumpur.
He said house buyers in Johor Baru were becoming more discerning and demanding unlike previously due to the presence of developers from Kuala Lumpur.
By The Star - StarBiz - (by Zazali Musa)
Red tape hampers import of steel bars
It is almost three months since the government liberalised the steel bars and billet market, but some contractors say they are still being slapped with 15 per cent import duty by the Customs Department.
The Cabinet had on May 12 2008 announced immediate tax-free status on steel bars and billets, be it imported or exported.
"Our first shipment of steel bars, worth RM6 million, is stuck in Singapore because the Customs Department insists that the steel bar grade of British Standard 4449 does not match their computerised Malaysia Standard 146," Johor Master Builders Association president Loh Liam Hiang said.
The Johor Customs Department continues to impose a 15 per cent import duty on the shipment, he said, adding that the association's members are already at their wits' end because steel bars in the local market are too expensive.
"How many small- and medium-sized contractors can afford to pay RM4,000 per tonne for steel bars? We decided to import but now the shipment is stuck in Singapore. How are we going to meet project deadlines? For every one day delay, we've to pay penalties," he added.
Loh was participating in a nationwide dialogue involving some 600 contractors organised by the Masters Builders Association of Malaysia (MBAM) in Kuala Lumpur yesterday.
MBAM president Ng Kee Leen, who was also present, said while importation of steel bars is within the federal government's purview, sand supply is controlled by state governments via issuance of sand mining permits.
Ng said contractors in Selangor are facing sand shortage because the state government had stopped issuing sand extraction permits. This has affected concrete castings and held back some projects for contractors.
"We appeal to the Selangor state government to quickly re-issue permits to help normalise sand supply," he said.
By New Straits Times (by Ooi Tee Ching)
The Cabinet had on May 12 2008 announced immediate tax-free status on steel bars and billets, be it imported or exported.
"Our first shipment of steel bars, worth RM6 million, is stuck in Singapore because the Customs Department insists that the steel bar grade of British Standard 4449 does not match their computerised Malaysia Standard 146," Johor Master Builders Association president Loh Liam Hiang said.
The Johor Customs Department continues to impose a 15 per cent import duty on the shipment, he said, adding that the association's members are already at their wits' end because steel bars in the local market are too expensive.
"How many small- and medium-sized contractors can afford to pay RM4,000 per tonne for steel bars? We decided to import but now the shipment is stuck in Singapore. How are we going to meet project deadlines? For every one day delay, we've to pay penalties," he added.
Loh was participating in a nationwide dialogue involving some 600 contractors organised by the Masters Builders Association of Malaysia (MBAM) in Kuala Lumpur yesterday.
MBAM president Ng Kee Leen, who was also present, said while importation of steel bars is within the federal government's purview, sand supply is controlled by state governments via issuance of sand mining permits.
Ng said contractors in Selangor are facing sand shortage because the state government had stopped issuing sand extraction permits. This has affected concrete castings and held back some projects for contractors.
"We appeal to the Selangor state government to quickly re-issue permits to help normalise sand supply," he said.
By New Straits Times (by Ooi Tee Ching)
Friday, August 1, 2008
Japan's Orix invests in Tune Hotels
JAPAN'S Orix Corp, a financial group, is investing US$17.2 million (RM56.07 million) for a 10 per cent stake in Tune Hotels.com, an operator of budget hotels.
Tune Hotels will use the money to accelerate its rollout across Southeast Asia, it said in a statement released in Kuala Lumpur yesterday.
It now operates two hotels in Malaysia and plans for 28 more across Thailand, Indonesia and the Philippines. By the end of this year, it hopes to expand its regional hotel presence to 50.
"We welcome our new partner, this investment is a major milestone in the growth of Tune and also the economy hotel investment market in Asia," said Tune Hotels director and co-founder Dennis Melka.
Orix is listed on the Tokyo stock exchange. Its main activities include corporate financial services such as leases and loans as well as automobile operations, rental operations and real estate-related finance.
Orix managing director Hideo Ichida will also become one of Tune Hotels' directors.
AirAsia Bhd group chief executive officer Datuk Seri Tony Fernandes, who is also a co-founder, said Tune Hotels has revolutionised the hospitality industry.
It offers space-efficient rooms with luxury beds and high-pressure showers at rates as low as US$3.00 (RM9.78) per night in the city centre as well as beachfront locations.
"We offer the best hotel rates to travellers by cutting out frills like ballrooms, gyms, meeting rooms and business centres," he said.
By New Straits Times
Tune Hotels will use the money to accelerate its rollout across Southeast Asia, it said in a statement released in Kuala Lumpur yesterday.
It now operates two hotels in Malaysia and plans for 28 more across Thailand, Indonesia and the Philippines. By the end of this year, it hopes to expand its regional hotel presence to 50.
"We welcome our new partner, this investment is a major milestone in the growth of Tune and also the economy hotel investment market in Asia," said Tune Hotels director and co-founder Dennis Melka.
Orix is listed on the Tokyo stock exchange. Its main activities include corporate financial services such as leases and loans as well as automobile operations, rental operations and real estate-related finance.
Orix managing director Hideo Ichida will also become one of Tune Hotels' directors.
AirAsia Bhd group chief executive officer Datuk Seri Tony Fernandes, who is also a co-founder, said Tune Hotels has revolutionised the hospitality industry.
It offers space-efficient rooms with luxury beds and high-pressure showers at rates as low as US$3.00 (RM9.78) per night in the city centre as well as beachfront locations.
"We offer the best hotel rates to travellers by cutting out frills like ballrooms, gyms, meeting rooms and business centres," he said.
By New Straits Times
Orix buys into Tune Hotel
KUALA LUMPUR: Orix Corp, a financial services and investment company headquartered in Tokyo, has agreed to a strategic investment in Tune Hotels.com Ltd.
In a statement, Tune said Orix agreed on July 27 to invest US$17.2mil for a 10% equity stake in the company.
It said Orix managing director Hideo Ichida would join Tune's board of directors effective immediately.
Tune said the proceeds from the share placement would be used to accelerate its rollout across South-East Asia.
“At present, Tune has two hotel properties opened and an additional 28 sites under development across Malaysia, Thailand, Indonesia and the Philippines.
“Tune is on track to increase its portfolio of sites (opened and under development) to over 50 by year-end and 100 by 2009,” it said.
Meanwhile, Ichida said the exponential growth of low-cost carriers in South-East Asia has created an unprecedented boom in tourism.
“Coupled with rising disposable incomes and increased regional integration in Asean, there is a shortage of quality affordable accommodation.
“Tune Hotels.com is best positioned to meet this surging market demand,” he said.
Tune chief executive officer Mark Lankester said the investment would allow the company to maintain its rapid growth across Asean and eventual leadership position in the Asian economy hotel industry.
By Bernama
Frasers Hospitality enters Malaysia
SINGAPORE: Frasers Hospitality Pte Ltd, the hospitality arm of property group Frasers Centrepoint Ltd, is entering Malaysia and will provide technical and advisory services for YNH Property Bhd’s “Gold-Standard” serviced residence project in Kuala Lumpur.
In a statement on Wednesday, Frasers Hospitality said it had signed agreements to provide the services for Fraser Place Kuala Lumpur, which is slated for completion in a year.
Fraser Place will be part of a mixed development project, which comprises an office tower and a second tower with 217 studios, one-bedroom, two-bedroom and penthouse serviced residences. Fraser Place will be open to guests in the third quarter of 2009.
YNH executive chairman Datuk Dr Yu Kuan Chon said: “We are very happy to work together with Frasers Hospitality which will enhance our property’s value, image and reputation. Frasers Hospitality has built a reputation as one of the best international branded serviced residence management companies in the world.”
Frasers Hospitality chief executive officer Choe Peng Sum said: “Fraser Place offers fully-fitted luxury apartments with five-star-hotel-type service.”
Citing the Asian Development Bank, he said in spite of the economic woes in the US and its spillover to Asia, Malaysia’s real gross domestic product was expected to grow 5.7% in 2008 versus 5.8% in 2007.
Choe said Malaysia’s foreign direct investment (FDI) this year, according to the Malaysian Industrial Development Authority, was expected to surpass the RM33.4 billion recorded in 2007.
He said these indications meant a high number of business travellers on medium-term projects. “More than 80% of our guests are from Fortune 500 companies,” he said. “They come to Fraser because we offer Gold-Standard hotel-type services and ample living space, ideal for stays of a week and longer.”
Singapore-based Frasers Centrepoint is a wholly owned subsidiary of Fraser and Neave Ltd.
By The EDGE Malaysia
In a statement on Wednesday, Frasers Hospitality said it had signed agreements to provide the services for Fraser Place Kuala Lumpur, which is slated for completion in a year.
Fraser Place will be part of a mixed development project, which comprises an office tower and a second tower with 217 studios, one-bedroom, two-bedroom and penthouse serviced residences. Fraser Place will be open to guests in the third quarter of 2009.
YNH executive chairman Datuk Dr Yu Kuan Chon said: “We are very happy to work together with Frasers Hospitality which will enhance our property’s value, image and reputation. Frasers Hospitality has built a reputation as one of the best international branded serviced residence management companies in the world.”
Frasers Hospitality chief executive officer Choe Peng Sum said: “Fraser Place offers fully-fitted luxury apartments with five-star-hotel-type service.”
Citing the Asian Development Bank, he said in spite of the economic woes in the US and its spillover to Asia, Malaysia’s real gross domestic product was expected to grow 5.7% in 2008 versus 5.8% in 2007.
Choe said Malaysia’s foreign direct investment (FDI) this year, according to the Malaysian Industrial Development Authority, was expected to surpass the RM33.4 billion recorded in 2007.
He said these indications meant a high number of business travellers on medium-term projects. “More than 80% of our guests are from Fortune 500 companies,” he said. “They come to Fraser because we offer Gold-Standard hotel-type services and ample living space, ideal for stays of a week and longer.”
Singapore-based Frasers Centrepoint is a wholly owned subsidiary of Fraser and Neave Ltd.
By The EDGE Malaysia
CapitaLand profit falls 44%, positive on outlook
SINGAPORE: CapitaLand, Southeast Asia's biggest property developer by market value, posted a 44% drop in quarterly net profit as property sales slowed and it had no big one-off gains, but it said the outlook was positive.
"Despite the cautious market sentiments, we have a positive outlook as our business units are competitively positioned and geographically diversified," CEO Liew Mun Leong said in a statement.
CapitaLand, 40%-owned by Singapore sovereign fund Temasek, earned S$515.2 million (US$376.9 million or RM1.23 billion) in April-June, down from S$912.6 million a year ago, when earnings were boosted by unrealised fair value gains in its assets. Excluding one-offs, net profit for the 2007 second quarter was S$267.2 million.
The economic gloom has triggered a steep drop in the number of home sales, with some analysts predicting house prices will fall by up to 40% over the next three years.
"In such a challenging time, when many companies in the countries we operate in are unable to raise funds, we continue to be able to access the capital markets in view of the group's strong reputation and good financial standing," Chairman Richard Hu said in the statement.
CapitaLand said it was on track in preparing its first Malaysian retail real estate investment trust (REIT) for launch this year, bringing the number of its listed REITs to six.
CapitaLand earlier this month borrowed US$1.5 billion to fund a residential project in Singapore that it plans to launch for sale in the first half of 2009, in a joint venture with Morgan Stanley Real Estate, Wachovia, and Singapore's Hotel Properties.
For 2008, CapitaLand is expected to post a 64% drop in earnings to S$1.02 billion from S$2.8 billion in 2007, according to the average of 16 analysts polled by Reuters. The 2007 results had included S$1.1 billion in revaluation gains. CapitaLand earned 61% of its income from Singapore in 2007, while Australia and New Zealand contributed 12% and China added 23%. But analysts are expecting weaker contributions from its Australia and China businesses this year.
AustraLand, 54%-owned by CapitaLand, earlier this week reported a 79% fall in earnings and announced a rights issue to raise up to A$557 million (RM1.7 billion).
CapitaLand has commited to subscribe to A$302 million in the issue, which could boost its stake in AustraLand to 70%.
Shares of CapitaLand have fallen 9% this year, slightly outperforming a 15% drop in the Straits Times Index. Rival developer KepLand lost a third of its value, while City Developments lost 19%.
By Reuters
"Despite the cautious market sentiments, we have a positive outlook as our business units are competitively positioned and geographically diversified," CEO Liew Mun Leong said in a statement.
CapitaLand, 40%-owned by Singapore sovereign fund Temasek, earned S$515.2 million (US$376.9 million or RM1.23 billion) in April-June, down from S$912.6 million a year ago, when earnings were boosted by unrealised fair value gains in its assets. Excluding one-offs, net profit for the 2007 second quarter was S$267.2 million.
The economic gloom has triggered a steep drop in the number of home sales, with some analysts predicting house prices will fall by up to 40% over the next three years.
"In such a challenging time, when many companies in the countries we operate in are unable to raise funds, we continue to be able to access the capital markets in view of the group's strong reputation and good financial standing," Chairman Richard Hu said in the statement.
CapitaLand said it was on track in preparing its first Malaysian retail real estate investment trust (REIT) for launch this year, bringing the number of its listed REITs to six.
CapitaLand earlier this month borrowed US$1.5 billion to fund a residential project in Singapore that it plans to launch for sale in the first half of 2009, in a joint venture with Morgan Stanley Real Estate, Wachovia, and Singapore's Hotel Properties.
For 2008, CapitaLand is expected to post a 64% drop in earnings to S$1.02 billion from S$2.8 billion in 2007, according to the average of 16 analysts polled by Reuters. The 2007 results had included S$1.1 billion in revaluation gains. CapitaLand earned 61% of its income from Singapore in 2007, while Australia and New Zealand contributed 12% and China added 23%. But analysts are expecting weaker contributions from its Australia and China businesses this year.
AustraLand, 54%-owned by CapitaLand, earlier this week reported a 79% fall in earnings and announced a rights issue to raise up to A$557 million (RM1.7 billion).
CapitaLand has commited to subscribe to A$302 million in the issue, which could boost its stake in AustraLand to 70%.
Shares of CapitaLand have fallen 9% this year, slightly outperforming a 15% drop in the Straits Times Index. Rival developer KepLand lost a third of its value, while City Developments lost 19%.
By Reuters
Contractors feeling the pinch
PETALING JAYA: Master Builders Association Malaysia (MBAM) affiliate members are feeling the pinch of the escalating costs of essential building materials, including cement and steel bars as well as the recent shortage of sand.
This has led to delayed and abandoned projects in various states. Construction players said the situation had entered a critical stage particularly in Johor, Kedah, Melaka and Negri Sembilan.
MBAM president Ng Kee Leen said the association had urged the government to provide soft loans to small and medium-sized contractors and requested the Construction Industry Development Board (CIDB) to waive the levy on the contract sum of 0.125%, towards aiding its members through these difficult times.
"The local industry is still having problems after the liberalisation process of steel bars," he said at an MBAM dialogue with affiliate members on Aug 1. Ng also hoped that the ban on the import of steel bars would be lifted.
Ng expected more contractors to close shop if the prices of steel bars and cement do not stabilise soon.
Malacca Building Contractor's Association chairman Liw Chong Liong said so far, three major federal government projects in that state had been halted.
Another MBAM affiliate member from Johor said the state was facing a shortage of sand due to the export of the material to Singapore.
National Ready-Mixed Concrete Association of Malaysia (NRMCA) president Chris Landry said sand was an issue, particularly in Selangor and the shortage was due to the government's reluctance to allow sand permits to be handed out.
"Now there is only one sand pit opened for trade which drastically reduces the amount of natural sand available in the market," he said.
Sand is a major component of ready-mixed concrete, and if natural sand does not become more available in the short period, Landry predicted the shortage of ready-mixed concrete would drastically affect the building industry.
Landry said effective Aug 1, sand price had increased by RM7-15 per cubic metre. He added that he had no choice but to increase the prices of concrete as well.
By The EDGE Malaysia (by Julie Chong)
This has led to delayed and abandoned projects in various states. Construction players said the situation had entered a critical stage particularly in Johor, Kedah, Melaka and Negri Sembilan.
MBAM president Ng Kee Leen said the association had urged the government to provide soft loans to small and medium-sized contractors and requested the Construction Industry Development Board (CIDB) to waive the levy on the contract sum of 0.125%, towards aiding its members through these difficult times.
"The local industry is still having problems after the liberalisation process of steel bars," he said at an MBAM dialogue with affiliate members on Aug 1. Ng also hoped that the ban on the import of steel bars would be lifted.
Ng expected more contractors to close shop if the prices of steel bars and cement do not stabilise soon.
Malacca Building Contractor's Association chairman Liw Chong Liong said so far, three major federal government projects in that state had been halted.
Another MBAM affiliate member from Johor said the state was facing a shortage of sand due to the export of the material to Singapore.
National Ready-Mixed Concrete Association of Malaysia (NRMCA) president Chris Landry said sand was an issue, particularly in Selangor and the shortage was due to the government's reluctance to allow sand permits to be handed out.
"Now there is only one sand pit opened for trade which drastically reduces the amount of natural sand available in the market," he said.
Sand is a major component of ready-mixed concrete, and if natural sand does not become more available in the short period, Landry predicted the shortage of ready-mixed concrete would drastically affect the building industry.
Landry said effective Aug 1, sand price had increased by RM7-15 per cubic metre. He added that he had no choice but to increase the prices of concrete as well.
By The EDGE Malaysia (by Julie Chong)
Thursday, July 31, 2008
Crescendo sees more profit from industrial properties
PETALING JAYA: Johor-based property developer Crescendo Corporation Bhd expects industrial properties to be its main profit generator for the current financial year ending Jan 31, 2009.
Crescendo managing director Gooi Seong Lim said the industrial property arm could contribute at least 60% of its profits in FY09 and much of the appeal of its industrial properties lay in its location in Nusajaya, which is part of the multi-billion ringgit regional development, Iskandar Malaysia.
Industrial properties contributed nearly 50% to the group’s profits in FY08.
“The Nusajaya area is located only 10 minutes from Tuas Singapore through the second link; so the take-up rate is quite good due to relocation from higher costs area in Singapore to Malaysia, which is cheaper,” Gooi said after the company’s AGM here yesterday.
Crescendo is now in the midst of building the second phase, which consists of about 40 units, of the Nusa Cemerlang Industrial Park in Nusajaya. The second phase is targeted for completion next March.
“The factories are in the early stages of building and enquiries have been encouraging. The whole (Nusa Cemerlang Industrial Park) project consists of 382 (factory) units.
“There are still a few phases to go. Package 2 is going to be officially launched in August this year and is already having some sales,” Gooi added. The first two phases have a gross development value (GDV) of about RM200 million.
He said profit projections for FY09 was looking bright for the group, as it had locked in unbilled sales, mainly from industrial properties, of some RM113 million as at June 30. “We still have 200 completed residential units on sale now with a GDV of RM40 million,” Gooi added.
For the three months to April 30 this year, Crescendo posted a net profit of RM7.3 million on a RM45.7 million revenue, which is an improvement of 82% and 105% respectively, from a year earlier.
Gooi added that the group was not looking at acquiring more land as it already had about 3,200 acres (1,295 hectares) in strategic locations in Johor, of which 1,900 acres are in Iskandar Malaysia.
By The EDGE Malaysia
Crescendo managing director Gooi Seong Lim said the industrial property arm could contribute at least 60% of its profits in FY09 and much of the appeal of its industrial properties lay in its location in Nusajaya, which is part of the multi-billion ringgit regional development, Iskandar Malaysia.
Industrial properties contributed nearly 50% to the group’s profits in FY08.
“The Nusajaya area is located only 10 minutes from Tuas Singapore through the second link; so the take-up rate is quite good due to relocation from higher costs area in Singapore to Malaysia, which is cheaper,” Gooi said after the company’s AGM here yesterday.
Crescendo is now in the midst of building the second phase, which consists of about 40 units, of the Nusa Cemerlang Industrial Park in Nusajaya. The second phase is targeted for completion next March.
“The factories are in the early stages of building and enquiries have been encouraging. The whole (Nusa Cemerlang Industrial Park) project consists of 382 (factory) units.
“There are still a few phases to go. Package 2 is going to be officially launched in August this year and is already having some sales,” Gooi added. The first two phases have a gross development value (GDV) of about RM200 million.
He said profit projections for FY09 was looking bright for the group, as it had locked in unbilled sales, mainly from industrial properties, of some RM113 million as at June 30. “We still have 200 completed residential units on sale now with a GDV of RM40 million,” Gooi added.
For the three months to April 30 this year, Crescendo posted a net profit of RM7.3 million on a RM45.7 million revenue, which is an improvement of 82% and 105% respectively, from a year earlier.
Gooi added that the group was not looking at acquiring more land as it already had about 3,200 acres (1,295 hectares) in strategic locations in Johor, of which 1,900 acres are in Iskandar Malaysia.
By The EDGE Malaysia
Bank Rakyat-Casa Impian home renovation scheme
FLEXIBLE REPAYMENT PLAN: Kamaruzaman (second from right) being briefed by Norlinda (right) and Casa Impian executive director Khairul Anwar Rahmat (second from left). With them is Bank Rakyat general manager corporate services/bank secretary Datuk Rosely Samsuri.
Bank Kerjasama Rakyat Malaysia Bhd, the country's largest cooperative bank, expects to disburse RM1 million a month for the financing of home renovation under its new product, Personal Financing i-Aslah Purchase Plus.
The bank has formed a tie-up with interior designer Casa Impian Sdn Bhd, where customers will engage the decorator's expertise in their home designs.
Customers may apply for a minimum of RM50,000 to a maximum of RM150,000 loan for the purpose, with a repayment period of up to 15 years.
"The common problem faced by first time house buyers is the difficulty to fund renovation works after spending a 'bomb' to buy the property," Casa Impian managing director Datin Norlinda Abd Taib said in Kuala Lumpur yesterday.
Despite bearish consumer sentiment, she is optimistic of an encouraging response from customers due to the bank's flexible repayment plan.
Meanwhile, Bank Rakyat managing director Datuk Kamaruzaman Che Mat said the bank expects to maintain its 2.2 per cent non-performing loans (NPLs) this year.
"To ensure a manageable NPL rate, we tie up with other banks for salary deductions from borrowers' accounts and we encourage repeat borrowers with good track records to continue banking with us," he said.
It was earlier reported that Bank Rakyat is on track to hit RM1 billion profit for this year after pre-tax earnings from January to June soared to more than RM500 million.
In the first six months, the bank gave out 23 per cent more loans than the same period in 2007, where consumer loans, mainly personal and hire purchase financing, make up 95 per cent of total loans. The balance five per cent are corporate loans.
Commenting on Bank Rakyat's plan to buy a stake in an overseas bank, Kamaruzaman said the bank has yet to initiate talks with any party but is looking at opportunities.
"We still want to grow organically, (so) any talks for such a plan may only take place next year," he said, adding that the bank will use its own funds for this purpose.
Up to June this year, its total deposits stood at RM28.1 billion, assets at RM40 billion and shareholders' fund at RM4.37 billion.
By New Straits Times (by Zurinna Raja Adam)
Wednesday, July 30, 2008
i-City to offer world class data centres
KUALA LUMPUR: I-Bhd's i-City project in Shah Alam will be the first commercial development in Malaysia to boast of three world class data centres following a strategic alliance forged with Kompakar Inc Bhd, an integrated solutions provider, yesterday.
At the agreement signing, Kompakar chief executive officer Dr Ahmad Fikri Hussein said Kompakar had decided to become one of the anchor tenants in Selangor’s first digital city.
“We are investing and will be providing world class data centre service expertise in the design, set up, management and operation of the data centre equipment and facilities.”
I-Bhd deputy chief executive officer Lim Boon Siong said I-Bhd planned to invest close to RM50mil in the data centres based on the company's business plan and projected demand.
Deputy CEO Lim Boon Siong speaking at the signing ceremony between i-Bhd and Kompakar on Tuesday. - Starpic by Ong Soon Hin
The data centres comprise a 3,500 sq ft hosting facility catering to local small and medium enterprises and two 70,000 sq ft world-class Tier 4 purpose-built ready data centre catering to global information and communications technology companies.
Al Raji Bank (Malaysia) agreed Monday to purchase 36 units of i-City Cybercentre 1 office suites for RM95mil.
The purchase accounted for 80% of the units completed in the first phase of i-City, a RM2bil township on 72 acres in Section 7, Shah Alam.
On the balance units that I-Bhd said it would hold for local information and communications technology companies, director Eu Hong Chew said long-term investment had always been part of the company's commitment to nurture the information technology industry.
In terms of investor response, Lim said besides the Middle East, i-City had received tremendous response from Australia and South Korea, although talks were still at the preliminary stage.
By The Star
I-Berhad aims to sell i-City office towers by year-end
PROPERTY developer I-Berhad is confident of selling off two office towers at its RM2 billion i-City intelligent township in Shah Alam by the end of this year, following its first en bloc sale on Wednesday.
Al Rajhi Bank (Malaysia) Bhd is buying 36 units of the i-City Cybercentre 1 office suites, one of the many components of i-City, for RM95 million.
"This is the first en bloc sale for i-City. We are in discussions with interested parties from Asia-Pacific and the Middle East and with serious buyers from South Korea and Australia.
"We are optimistic of closing one or two new deals by December," I-Berhad deputy chief officer Lim Boon Siong told Business Times after the signing of a mutual cooperation agreement with Kompakar Group in Kuala Lumpur yesterday.
The signing was witnessed by Minister of Housing and Local Government Datuk Seri Ong Ka Chuan.
Lim said Al Rajhi has indicated that it would invest in other properties within i-City, but did not elaborate.
The 30.28ha i-City, which started in mid-2007, will feature 12 office towers, a 1 million-sq ft shopping mall, office suites, three data centres, a five-star and a boutique hotel, and two blocks of 24-storey residences.
The integrated development, which is envisaged to be Selangor's knowledge hub and in the league of the Dubai Internet City in the United Arab Emirates, will offer 7.5 million sq ft of built-up when completed in 2012.
For the hotels, Lim said the company was still talking to international hotel chains with strong roots in Malaysia to operate the properties.
They include Starwood, Hilton, Marriott and Accor.
"We are at the design and discussion stage now. We hope to finalise the details by year end and launch the hotels in the first half of 2009," Lim said, adding that it was also in talks with an international hospital group that wants to operate at i-City.
Lim also said the data centres are one of the key selling points for i-City.
"Ours is the first township in this region to have world-class Tier 4 ready data centres connected to the whole 30.28ha real estate via giga-speed fibre-optics network. This is one piece of the puzzle that will enhance i-City's value," Lim said.
Earlier, Kompakar chief executive officer Dr Ahmad Fikri Hussein told reporters that the company and I-Berhad will invest RM100 million to build and equip the data centres, which consists of a 3,500 sq ft hosting facility for the local small and medium enterprises, and two 70,000-sq ft Tier 4 ready data centres.
The hosting facility and the first data centre are already operating, while the second data centre will be ready by 2011.
By New Straits Times (by Sharen Kaur)
Al Rajhi Bank (Malaysia) Bhd is buying 36 units of the i-City Cybercentre 1 office suites, one of the many components of i-City, for RM95 million.
"This is the first en bloc sale for i-City. We are in discussions with interested parties from Asia-Pacific and the Middle East and with serious buyers from South Korea and Australia.
"We are optimistic of closing one or two new deals by December," I-Berhad deputy chief officer Lim Boon Siong told Business Times after the signing of a mutual cooperation agreement with Kompakar Group in Kuala Lumpur yesterday.
The signing was witnessed by Minister of Housing and Local Government Datuk Seri Ong Ka Chuan.
Lim said Al Rajhi has indicated that it would invest in other properties within i-City, but did not elaborate.
The 30.28ha i-City, which started in mid-2007, will feature 12 office towers, a 1 million-sq ft shopping mall, office suites, three data centres, a five-star and a boutique hotel, and two blocks of 24-storey residences.
The integrated development, which is envisaged to be Selangor's knowledge hub and in the league of the Dubai Internet City in the United Arab Emirates, will offer 7.5 million sq ft of built-up when completed in 2012.
For the hotels, Lim said the company was still talking to international hotel chains with strong roots in Malaysia to operate the properties.
They include Starwood, Hilton, Marriott and Accor.
"We are at the design and discussion stage now. We hope to finalise the details by year end and launch the hotels in the first half of 2009," Lim said, adding that it was also in talks with an international hospital group that wants to operate at i-City.
Lim also said the data centres are one of the key selling points for i-City.
"Ours is the first township in this region to have world-class Tier 4 ready data centres connected to the whole 30.28ha real estate via giga-speed fibre-optics network. This is one piece of the puzzle that will enhance i-City's value," Lim said.
Earlier, Kompakar chief executive officer Dr Ahmad Fikri Hussein told reporters that the company and I-Berhad will invest RM100 million to build and equip the data centres, which consists of a 3,500 sq ft hosting facility for the local small and medium enterprises, and two 70,000-sq ft Tier 4 ready data centres.
The hosting facility and the first data centre are already operating, while the second data centre will be ready by 2011.
By New Straits Times (by Sharen Kaur)
Talam expects to complete stalled projects by year-end
Property developer Talam Corp Bhd expects three of its stalled projects, namely Ukay Perdana, Bandar Bukit Beruntung and a part of Taman Puncak Jalil - worth a combined RM400 million - to be completed by the end of the year.
The high-rise units at Taman Puncak Jalil will be completed next year.
Talam executive director Chua Kim Lan said this would mean that 7,500 units of the 13,000 stalled units would be completed.
She added that 10 per cent of its total stalled units are unsold.
Meanwhile, the company is putting its 92ha development in Gombak on hold, despite obtaining the necessary approval, due to the high prices of construction materials and dampening consumer sentiment.
"At this point of time, it is useless to start any project considering that contractors are giving quotations on a weekly basis because of the increasing price of construction materials," she said.
In March 2007, Mutual Prosperous Sdn Bhd entered into a joint venture with IJM Properties Sdn Bhd to use Cekap Tropikal Sdn Bhd as the 50:50 joint venture company to takeover the development of the area known as Sierra Selayang.
The land, which is owned by three of Talam's subsidiaries, has an estimated gross development value of RM1 billion.
Talam director Loy Boon Chen said work on the project will start once the prices have stabilised.
Loy is an IJM Corp Bhd nominee to the board of Talam.
Chua said the increasing price of steel and cement has not affected the completion of its stalled projects as most of them are past the structural phase where steel bars and cement are used the most.
She said Talam has seen an increase of less than 10 per cent in costs, when the industry average is around 20 per cent.
Chua also said the company is looking at developing industrial lots at the remaining 1,200ha undeveloped land in Bandar Bukit Beruntung and a 64ha in Puchong.
She added that Talam will no longer focus on developing medium-cost housing.
Talam expects to be back in the black this year with the implementation of its regularisation plan, which was approved by the Securities Commission in April this year.
The company will table the plan to the shareholders at an extraordinary general meeting to be held by the end of August.
By New Straits Times (by Presenna Nambiar)
The high-rise units at Taman Puncak Jalil will be completed next year.
Talam executive director Chua Kim Lan said this would mean that 7,500 units of the 13,000 stalled units would be completed.
She added that 10 per cent of its total stalled units are unsold.
Meanwhile, the company is putting its 92ha development in Gombak on hold, despite obtaining the necessary approval, due to the high prices of construction materials and dampening consumer sentiment.
"At this point of time, it is useless to start any project considering that contractors are giving quotations on a weekly basis because of the increasing price of construction materials," she said.
In March 2007, Mutual Prosperous Sdn Bhd entered into a joint venture with IJM Properties Sdn Bhd to use Cekap Tropikal Sdn Bhd as the 50:50 joint venture company to takeover the development of the area known as Sierra Selayang.
The land, which is owned by three of Talam's subsidiaries, has an estimated gross development value of RM1 billion.
Talam director Loy Boon Chen said work on the project will start once the prices have stabilised.
Loy is an IJM Corp Bhd nominee to the board of Talam.
Chua said the increasing price of steel and cement has not affected the completion of its stalled projects as most of them are past the structural phase where steel bars and cement are used the most.
She said Talam has seen an increase of less than 10 per cent in costs, when the industry average is around 20 per cent.
Chua also said the company is looking at developing industrial lots at the remaining 1,200ha undeveloped land in Bandar Bukit Beruntung and a 64ha in Puchong.
She added that Talam will no longer focus on developing medium-cost housing.
Talam expects to be back in the black this year with the implementation of its regularisation plan, which was approved by the Securities Commission in April this year.
The company will table the plan to the shareholders at an extraordinary general meeting to be held by the end of August.
By New Straits Times (by Presenna Nambiar)
Talam plans to deliver 7,000 homes
PETALING JAYA: Talam Corp Bhd intends to deliver 7,000 homes to buyers this year, says executive director Chua Kim Lan.
“So far, we have delivered 700 units and more are expected in the next few months,” she told StarBiz in a telephone interview yesterday.
Next year, it will deliver another 6,000 homes, bringing the total gross development value (GDV) of the 13,000 units to almost RM1bil.
As the main structure works of the properties are already completed, the developer is marginally affected by the rise in steel prices.
“The impact to total construction cost is less than 10%,” Chua said, adding that this, however, would eat into its margins.
The company’s Serenia Gardens project, which is a joint venture with IJM Corp Bhd, was launched earlier this year while the launch of Sierra Selayang, also with IJM, has been put on hold until next year.
The two projects have a combined GDV of RM1.5bil.
Serenia Gardens, which is on a 90-acre leasehold land in Ulu Kelang, involves the development of 225 terraced houses in the first phase and 104 units in the second.
Sierra Selayang, on the other hand, comprises semi-detached houses and bungalows.
Talam was considering to convert some of its residential land bank in Puchong and Bukit Beruntung to industrial status given that the Selangor government was keen on removing backyard factories. Chua said: “There may be launches of industrial properties early next year.”
By The Star - StarBizMah Sing Q2 net profit surges
Mah Sing Group Bhd has reported an 82 per cent increase in net profit to RM37.3 million for its second quarter ended June 30, 2008, compared with RM20.4 million in the previous corresponding period.
In a statement today, the company attributed the improvement in net profit on revenue of RM195.4 million to contribution from both residential and commercial projects.
Among the projects are the Grade A office of The Icon Jalan Tun Razak and residential projects included Hijauan Residence, Aman Perdana, Kemuning Residence and Perdana Residence as well as Sierra Perdana and Austin Perdana.
Mah Sing said having practised financial prudence and steadily charting strong growth, the group is in a good position for acquisitions with a cash pile of RM145.76 million and low gearing of 0.14 times as at June 30, 2008.
The group will be looking into Sabah and Sarawak and any potential growth locations overseas, apart from its established three hotspots in Peninsular Malaysia for more land acquisitions, it said.
Mah Sing has 14 projects in prime locations, of which nine in the Klang Valley, four in Iskandar Malaysia, Johor Baru, and one in Penang.
“We can hunt for good land for our expansion, but we are not in a hurry as we have sufficient locked-in sales to last us for another two years,” said group managing director and chief executive officer Datuk Seri Leong Hoy Kum.
“Our undeveloped land bank of 574 acres worth RM2.9 billion will be developed over the next five to seven years,” he said.
By Bernama
In a statement today, the company attributed the improvement in net profit on revenue of RM195.4 million to contribution from both residential and commercial projects.
Among the projects are the Grade A office of The Icon Jalan Tun Razak and residential projects included Hijauan Residence, Aman Perdana, Kemuning Residence and Perdana Residence as well as Sierra Perdana and Austin Perdana.
Mah Sing said having practised financial prudence and steadily charting strong growth, the group is in a good position for acquisitions with a cash pile of RM145.76 million and low gearing of 0.14 times as at June 30, 2008.
The group will be looking into Sabah and Sarawak and any potential growth locations overseas, apart from its established three hotspots in Peninsular Malaysia for more land acquisitions, it said.
Mah Sing has 14 projects in prime locations, of which nine in the Klang Valley, four in Iskandar Malaysia, Johor Baru, and one in Penang.
“We can hunt for good land for our expansion, but we are not in a hurry as we have sufficient locked-in sales to last us for another two years,” said group managing director and chief executive officer Datuk Seri Leong Hoy Kum.
“Our undeveloped land bank of 574 acres worth RM2.9 billion will be developed over the next five to seven years,” he said.
By Bernama
Luxury property portal launched
iPROPERTY.com Group launched a new property portal, iLuxuryasia.com (www.iluxuryasia.com) specifically for Asian luxury properties.
The new portal provides useful information and tips on buying and financing properties in selected countries, aside from showcasing the best new developments, resale and rental properties.
By Bernama
The new portal provides useful information and tips on buying and financing properties in selected countries, aside from showcasing the best new developments, resale and rental properties.
By Bernama
Europlus plans RM3b bond sale to fund road project
KUMPULAN Europlus Bhd plans to issue bonds worth about RM3 billion early next year to finance the West Coast Expressway (WCE) project.
Its president and chief executive Tan Sri Chan Ah Chye said the company is working with a local rating agency to raise the money quickly.
Ratings for the debt paper are expected to be finalised within a few weeks and the bonds will be put on sale six months thereafter.
The fund-raising exercise has been delayed because of changes made to the alignment of the road and costing, among other factors.
The 216km expressway will cost about RM4.6 billion. It will stretch from Banting in Selangor to Taiping in Perak.
Chan said that construction cost alone is about RM3.6 billion.
Europlus' 64.2 per cent-owned subsidiary, Konsortium LPB Sdn Bhd (KLPB), was awarded the expressway concession on May 25 last year.
Under the concession agreement, KLPB will build the expressway and can collect toll for 33 years before handing the road back to the government.
The consortium's other shareholders are Kumpulan Darul Ehsan Bhd (20 per cent) and Perak Corp Bhd (20 per cent).
Chan expects the expressway project to begin works next year and to take three years to complete.
Currently, Europlus has two major contracts in hand, including the West Coast Expressway and the Canal City, which has been delayed after the Barisan Nasional lost Selangor in the general election.
Chan said the group will soon meet the new state government to finalise new terms and conditions for the project to continue.
Europlus and construction firm IJM Corp Bhd are joint-venture partners in the project.
On its outlook for the year ending January 31 2009, Chan said he expects Europlus to make a profit now that associate company Talam Corp Bhd's proposed regularisation plan has been approved by the authorities.
In the financial year ended Jan-uary 31 2008, Europlus posted net loss of RM4.5 million on turnover of RM41.1 million.
By New Straits Times (by Rupinder Singh)
Its president and chief executive Tan Sri Chan Ah Chye said the company is working with a local rating agency to raise the money quickly.
Ratings for the debt paper are expected to be finalised within a few weeks and the bonds will be put on sale six months thereafter.
The fund-raising exercise has been delayed because of changes made to the alignment of the road and costing, among other factors.
The 216km expressway will cost about RM4.6 billion. It will stretch from Banting in Selangor to Taiping in Perak.
Chan said that construction cost alone is about RM3.6 billion.
Europlus' 64.2 per cent-owned subsidiary, Konsortium LPB Sdn Bhd (KLPB), was awarded the expressway concession on May 25 last year.
Under the concession agreement, KLPB will build the expressway and can collect toll for 33 years before handing the road back to the government.
The consortium's other shareholders are Kumpulan Darul Ehsan Bhd (20 per cent) and Perak Corp Bhd (20 per cent).
Chan expects the expressway project to begin works next year and to take three years to complete.
Currently, Europlus has two major contracts in hand, including the West Coast Expressway and the Canal City, which has been delayed after the Barisan Nasional lost Selangor in the general election.
Chan said the group will soon meet the new state government to finalise new terms and conditions for the project to continue.
Europlus and construction firm IJM Corp Bhd are joint-venture partners in the project.
On its outlook for the year ending January 31 2009, Chan said he expects Europlus to make a profit now that associate company Talam Corp Bhd's proposed regularisation plan has been approved by the authorities.
In the financial year ended Jan-uary 31 2008, Europlus posted net loss of RM4.5 million on turnover of RM41.1 million.
By New Straits Times (by Rupinder Singh)
Builders: Give 6 months lead time before raising prices
Master Builders Association Malaysia (MBAM) has voiced its unhappiness over the proposed increase in cement prices by Lafarge Malayan Cement Sdn Bhd, saying it will hurt the construction industry badly.
The price increase will take effect on August 1.
MBAM president Ng Kee Leen said that cement manufacturers should consider providing the industry with at least six months lead time to allow contractors to allocate provisions to mitigate their cost.
"This announcement has trapped contractors in a cycle of continuous price increase," he said in a statement released in Kuala Lumpur yesterday.
Ng pointed out that it will be yet another increase in just two months, after the government lifted the ceiling price of cement on June 5.
Cement prices rose 22 per cent from the RM10.90 under government price control to RM13.20 immediately after liberalisation.
Lafarge's proposed increase will add another RM1 per 50kg to RM14.25, or 30 per cent.
"As it is, contractors are facing difficulties in controlling the cost of projects and committing to timely delivery. The cement price increase will add more pressure to cash-flow problems," Ng said.
"MBAM would like to caution that many small- and medium-sized contractors from Classes D, E and F may be forced to stop work, delay work, or even abandon projects as a result of the steep price increase of essential building materials, especially steel bars and cement.
"The government should take cognisance of this and act quickly."
Ng said that although the cement liberalisation was announced last month, difficulties remained over its import because of logistics.
He added that the scenario was the same for steel bars, of which prices had risen to an all-time high of RM4,100 a tonne.
The liberalisation process of steel bars has not been well implemented, Ng said.
"It has been difficult to import steel bars into the country and there are still cases of Customs Department officers demanding approved permits and/or imposing import duty on certain steel bars."
MBAM will also ask that all items under HS Code 7214, all steel bars for construction use under Code 7214 and all steel bars for construction use under Codes MS 146 and BS 4449 be fully liberalised.
"If the situation continues to worsen, the government should step in and implement 15 per cent export tax on steel bars and billets, cement and clinkers, and ban exports of steel bars and clinkers to ensure building material manufacturers meet the needs of the local construction industry first.
"The 10 per cent import tax on cement should be waived as well because contractors and developers are already facing great pricing pressure, and any form of import tax relief will be appreciated," Ng said.
By New Straits Times
The price increase will take effect on August 1.
MBAM president Ng Kee Leen said that cement manufacturers should consider providing the industry with at least six months lead time to allow contractors to allocate provisions to mitigate their cost.
"This announcement has trapped contractors in a cycle of continuous price increase," he said in a statement released in Kuala Lumpur yesterday.
Ng pointed out that it will be yet another increase in just two months, after the government lifted the ceiling price of cement on June 5.
Cement prices rose 22 per cent from the RM10.90 under government price control to RM13.20 immediately after liberalisation.
Lafarge's proposed increase will add another RM1 per 50kg to RM14.25, or 30 per cent.
"As it is, contractors are facing difficulties in controlling the cost of projects and committing to timely delivery. The cement price increase will add more pressure to cash-flow problems," Ng said.
"MBAM would like to caution that many small- and medium-sized contractors from Classes D, E and F may be forced to stop work, delay work, or even abandon projects as a result of the steep price increase of essential building materials, especially steel bars and cement.
"The government should take cognisance of this and act quickly."
Ng said that although the cement liberalisation was announced last month, difficulties remained over its import because of logistics.
He added that the scenario was the same for steel bars, of which prices had risen to an all-time high of RM4,100 a tonne.
The liberalisation process of steel bars has not been well implemented, Ng said.
"It has been difficult to import steel bars into the country and there are still cases of Customs Department officers demanding approved permits and/or imposing import duty on certain steel bars."
MBAM will also ask that all items under HS Code 7214, all steel bars for construction use under Code 7214 and all steel bars for construction use under Codes MS 146 and BS 4449 be fully liberalised.
"If the situation continues to worsen, the government should step in and implement 15 per cent export tax on steel bars and billets, cement and clinkers, and ban exports of steel bars and clinkers to ensure building material manufacturers meet the needs of the local construction industry first.
"The 10 per cent import tax on cement should be waived as well because contractors and developers are already facing great pricing pressure, and any form of import tax relief will be appreciated," Ng said.
By New Straits Times
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