AP Land seeks more regional opportunities

Property developer Asia Pacific Land Bhd (AP Land), which lately has ventured overseas to include oil palm plantations under its belt, will continue to seek opportunities in regional markets amid the global credit crisis.

With the sale of the City Square Centre to Australia's Macquarie Global Property Advisors last year for RM680 million and the settlement of RM350 million in debts, AP Land is leveraging on its surplus cash position to pursue investment opportunities.

Last month, it launched a RM400 million commercial and housing project in China's Changshu City, marking its first foray into the country.

It has also a US$60 million (RM211.2 million) resort apartment project in Hokkaido, Japan, dubbed Shi-Ki.

"We believe there is a silver lining in every turmoil. When things turn around, it can be quick. There are people with money," joint managing director Low Su Ming said after launching AP Land's property gallery and Tower 2 of its maiden myHabitat development project in Kuala Lumpur yesterday.



Low said AP Land will continue to develop properties abroad that will include replicating the RM400 million myHabitat high-end project, which consists of twin blocks of 38-storey premier serviced apartments sprawled over 1.5 acres.

Tower 1, launched in 2005 and earmarked for completion by end-2009, is almost 90 per cent sold, with the remainder being Bumiputera lots.

It features 168 units, with prices starting from RM700 per sq ft and sizes ranging from 1,400 sq ft.

Low said sales for Tower 2, which will be completed by end-2010, may be slow due to the current turmoil, but she is optimistic about local and international demand for the property.

Tower 2 offers 215 units, which range from 600 sq ft to 1,100 sq ft and priced between RM1,200 and RM1,500 psf or from RM800,000 to RM1.4 million per unit.

"We repositioned Tower 2 after getting feedback from buyers who prefer smaller units for better yields. We have to respond readily to the market," Low said.

"We may hold a certain portion of Tower 2 for our management," she added.

By New Straits Times (by Sharen Kaur)

Visit myHabitat Official Website

IOI unit to re-schedule launch of condo project

An artist's impression of Pinnacle Collection in Sentosa Cove

PETALING JAYA: IOI Properties (S) Pte Ltd (IOIP), a wholly-owned unit of IOI Properties Bhd, is looking to launch its maiden upmarket condominium project in Singapore’s Sentosa Cove next year when market sentiment in the city-state improves.

“We have rescheduled the launch of Seascape Collection to next year to coincide with the completion of the Integrated Resort (IR) project on Sentosa island, which would kick-start commercial and tourism activities in Sentosa Cove, and to be in sync with the expected economic rebound,” IOI Properties director Datuk David Tan told StarBiz yesterday.

The relevant approvals for the project have been obtained and the project was initially planned for launch in the middle of this year but was delayed when Singapore’s residental property market softened.

Work on the show unit for Seascape Collection is in progress.

The 3.6-acre Seascape project is a 50:50 joint venture between IOI Properties and its Singapore partner, Ho Bee Investment Ltd.

It will comprise two eight-storey condominium blocks of 151 residences of various sizes. The tentative prices of the residences range from S$2,500 to S$2,800 per sq ft.

Meanwhile, the planning approval for the company’s second project in Sentosa Cove, called Pinnacle Collection, has been granted and the final building plan approval is expected shortly.

The project will be undertaken by Pinnacle (Sentosa) Pte Ltd, which is 65%-owned by IOI Properties and 35% by Ho Bee.

In January, the company successfully tendered for a 5.3-acre land parcel for S$1.1bil.

The 99-year leasehold land parcel is the final piece of condominium land to be launched by Sentosa Cove.

The site will have seven 18-storey blocks and one 20-storey block of luxurious condominiums. The maximum number of units allowed in the development is 357, while the maximum permissible gross floor area is 602,359 sq ft.

It is one of the two condominium parcels flanking the entrance of the marina leading into Sentosa Cove.

Tan said Singapore’s property market was expected to continue its uptrend when world class attractions, such as the IRs, were in place.

“We believe the prospects are good and are confident on the project sales. Besides the fact that Sentosa Cove is essentially a Singapore government-promoted project with world-class infrastructure, the impact of the two IR projects in Sentosa island and Marina Bay will be felt soon.

“A substantial portion of the target buyers are high net-worth individuals from Malaysia/Singapore, Indonesia, India, China and Middle Easterns who are keen to be a part of the most sought-after address in the world,” he said.

Due to land scarcity, the supply of residential properties in Singapore, including Sentosa Cove, is very limited.

“Our projects are the last two remaining and most strategic condominium sites at Sentosa Cove. Due to its exclusivity, prices of luxurious homes in Sentosa Cove are holding well,” Tan added.

By The Star (by Angie Ng)

Invest Expo 2008 comes at the right time

With volatility and uncertainties in the stock market, organisers of Invest Expo 2008 believe it is timely to equip retail investors with the knowledge needed to invest wisely.

The event, held at the Kuala Lumpur Convention Centre and ending today, is organised by Malaysian Investor Relations Association (MIRA) and ShareInvestor.

"We are not asking anyone to invest now, or anytime, but at least they can get exposure and learn about the different things that are out there," Malaysian Investor Relations Association chairman Datuk Justin Leong said in Kuala Lumpur yesterday.


LEONG: Participants can get exposure and learn about different things

The local stock market benchmark index, Kuala Lumpur Composite Index, has plunged by more than 37.4 per cent this year, and 17.7 per cent over the past seven weeks.

Investors were worried that the global financial crisis could not be resolved, and recession could hit most parts of the globe.

"Whichever strategy investors may adopt, they must be aware that market volatility is part and parcel of a stock market. Therefore, savvy but cautious investors need to have sufficient information and investing knowledge to be able to identify the various opportunities and threats," said Bursa Malaysia chief market operations officer Devanesan Evanson.

The Invest Expo 2008 features 25 exhibitors, consisting of banks, stock-brokerage companies, fund houses, land and property investment houses, alternative investments firm, as well as public-listed companies.

There will be about 40 seminars over the two-day period. The seminars, which start as early as 10am and end at 5.30pm, will include topics like "4th Quarter Outlook" by CIMB Investment Bank Bhd vice president (research) Nigel Foo Chek Keng; "China, We are Ready!" by OSK UOB Unit Trust Management Bhd vice president Edwin Lee Wai Kidd; and "Real Estate Investment Opportunities in Western Canada" by Edgeworth Properties (M) Sdn Bhd marketing manager Chris Tan.

The platinum sponsors of the event are Bursa Malaysia, CIMB and OSK Investment Bank Bhd.

By New Straits Times (by Goh Thean Eu)

Malaysia cement demand may grow 3pc

The Malaysian cement industry is forecasting growth in cement demand of about three per cent to 16.33 million tonnes this year compared with 15.46 million tonnes in 2007, says the Cement And Concrete Association of Malaysia.

"While there are signs of an economic slowdown and a corresponding slowdown in construction activities, we are quite optimistic that the government would be launching initiatives that would bring impetus for greater economic growth," said chairman Tan Sri Abdul Razak Ramli at the Cement and Concrete Association's Appreciation Dinner in Kuala Lumpur last night.

By Bernama

US housing starts slide further

WASHINGTON: Construction starts on new US homes slumped an additional 6.3 per cent in September to the lowest level since the recession in 1991, official data showed yesterday.

Housing starts fell to an annualised rate of 817,000.

That was down 31.1 per cent from a year ago in the latest evidence of the bursting of the housing bubble that has ravaged the US economy and led to a global financial crisis.

The figure was far weaker than the 870,000 expected by private forecasters.

Permits for new homes, a sign of future activity, fell 8.3 per cent to a pace of 786,000 and were down 38.4 per cent from a year ago.

By AFP

CapitaLand sells S$1b of Gulf apartments

CAPITALAND Ltd, Southeast Asia’s largest developer, said sales of apartments in Bahrain and Abu Dhabi have reached S$1 billion (US$675 million) since June.

“A total of 849 residential units have been booked in Abu Dhabi and Bahrain amounting to combined sales revenue of about S$1 billion since June,” Chief Executive Officer Liew Mun Leong said in a release yesterday.

By Bloomberg

UBS cuts forecasts for 3 developers

UBS AG cut its forecasts for earnings and price targets for three Malaysian property companies, including SP Setia Bhd, as real-estate sales declined and economic growth is expected to slow next year.

“We have seen three declines in Malaysian property sales over the past decade and this coincided with a sharp fall in” gross domestic product growth, Colbert Nocom, an analyst at UBS, wrote in a report today.

Stock price targets and profit forecasts were cut “to reflect our view of slower economic growth in the second half of 2008 and full-year 2009.”

UBS slashed profit forecasts at Malaysian real-estate companies it covers by 24 per cent as property sales will probably fall 5 per cent next year. Southeast Asia’s third-biggest economy may expand between 5 per cent and 5.5 per cent this year, slowing to between 4 per cent and 5 per cent next year, according to the central bank.

SP Setia, Malaysia’s biggest developer, was cut to “sell” from “neutral,” by UBS, which estimated the company’s earnings will drop 26 per cent in 2008 and 3 per cent in 2009.

Nocom also lowered his price estimate for SP Setia to RM3.00 (85 US cents) from RM3.20. He cut IGB Corp’s target to RM1.60 from RM1.75 and UEM World Bhd’s to RM2.60 from RM3.80.

SP Setia added 2 per cent to RM3.24 on the Malaysian stock exchange at 10.30 am in Kuala Lumpur, paring its decline this year to 35 per cent. IGB was unchanged at RM1.26, down 44 per cent for the year. UEM, which has tumbled 48 per cent since January 1, was unchanged at RM2.04.

By Bloomberg

Matrade to focus on Asian markets in 2009

ASIA, which accounts for 60 per cent of Malaysia's total exports, will be the major focus for trade promotion in 2009, said Malaysia External Trade Development Corporation (Matrade) chief executive officer Datuk Noharuddin Nordin.

NOHARUDDIN: About 40 per cent of Matrade's promotion programmes in 2009 will be aimed at markets within Asia

Between January and August this year, Asian markets including the Middle East contributed to more than 66 per cent of Malaysia's total exports.

He said about 40 per cent of Matrade's trade promotion programmes in 2009 will be aimed at markets within Asia, with particular focus on the Northeast Asia and Asean markets.

Export growth contracted during the slowdown of 2001, but this time around the diversified markets will be a saving factor, he added.

China and India are projected to grow at nine per cent and seven per cent respectively, which will enable these economies to absorb exports not only from Malaysia but other nations as well.

"We will not neglect the traditional markets in North America, Europe and Japan as they still account for a large percentage of the exports. As such, any movement in these markets will still have a significant impact on the total export performance.

"Our objective is to at least sustain Malaysia's share and to continue to identify niches for growth," he said at a media briefing highlighting Matrade's promotional programmes for 2009.

Noharuddin was confident that Malaysian trade numbers would still be strong in 2008, possibly with double-digit growth since exports for the first eight months of the year have already seen a 16.1 per cent growth.

He said 2009 will be more challenging, with the global outlook pointing towards recession in some of the major economies.

"Despite that outlook, there are economies that will do relatively well, and we need to comb the global environment to increase exports. We need to look for small opportunities and aggregate them, to offset any negative impact to our main markets."

The top five product sectors to be promoted are building materials, food, agricultural , automotive parts and components, medical and pharmaceutical and electrical and electronic (E&E) products.

Matrade will continue to organise its own trade fairs, the Malaysia Services Exhibition, Malaysia International Halal Showcase and International Trade Malaysia in addition to participating in international trade fairs to promote Malaysian products and services.

The services sector, which is seen as increasing in its importance to the Malaysian economy, will be one of the important focus areas for Matrade through comprehensive promotions, particularly for furniture, fashion and design products.

Oil and gas as well as health and medical care sectors will be promoted extensively while critically impacted sectors such as textiles and apparels will be stimulated through specialised marketing missions to Brazil and Mexico.

It will be holding the second Malaysian Services Exhibition in Dubai in March next year.

In terms of Malaysian exporters' capacity building, Matrade will also enhance the ability of the exporters to leverage on bilateral and regional free trade agreements.

By New Straits Times (by Rupa Damodaran)

70pc of Danga Island Villas snapped up

NEARLY 70 per cent of the luxury waterfront villas in Danga Island Villas, located within Iskandar Malaysia, have been snapped up by buyers from all over the world eventhough the project will only be launched in November.

Danga Bay Sdn Bhd chief executive officer Datuk Lim Kang Ho said the Danga Island Villas managed to secure RM230 million sales at the Cityscape international property show in Dubai last week.

Investors’ bullish perception on the project was further testament to their confidence in Iskandar Malaysia and Danga Bay, he said.

“Despite the prevailing global economic conditions, they are still willing to spend and invest in our project, reflecting their confidence in Danga Bay and Iskandar Malaysia backed by the government,” he told a media conference.

Lim said Danga Bay Sdn Bhd had not deferred any project planned for Danga Bay due to the global economic uncertainties.

Lim also said the value of completed projects in Danga Bay, for example, apartments, commercial blocks and Casa Almyra residential development, had doubled, further proving its lure to investors.

The Danga Island Villas project, worth RM900 million in Gross Development Value, is the first high-end waterfront lifestyle living concept in Iskandar Malaysia, straddling over 45 acres of a natural island off Danga Bay.

The 152 villas, which come complete with private berths for yachts, is priced between RM4 million and RM15 million each.

Of the 70 per cent Danga Island Villas units sold todate, Lim said 27 per cent of the buyers were Johoreans, 28 per cent from those living in Kuala Lumpur and Penang and six per cent from Sabah and Sarawak.

Buyers from Middle East countries, India, Pakistan, Canada and Spain accounted for 38 per cent, five per cent from Singapore and two per cent from Hong Kong.



The project is targeted primarily at wealthy retirees, jetsetting businessmen, expatriate families and the well-heeled from Malaysia and the region keen to make Iskandar their home.

Other upcoming property developments in Danga Bay are refurbishment of the Danga Bayleaf Restaurant into a RM30 million convention hall and construction of office blocks.

A budget hotel and a six-star luxury hotel are on the drawing board, he added.

By Bernama

Visit Danga Bay Website

Penang has no plans to make all reclaimed land freehold

GEORGE TOWN: The Penang state government has no plans to convert all reclaimed land from leasehold to freehold status although such land is no longer considered part of the foreshore or seabed, which is protected under the National Land Code (NLC), Chief Minister Lim Guan Eng said yesterday.

Lim said under Section 76 of the NLC, a state authority could not dispose of "any part of the foreshore or seabed for a period exceeding 99 years... to protect and reserve coastal areas for the public interest".

"However, I have been advised that after reclamation, there is no more seabed and foreshore, and therefore it is within the state's right to give private individuals freehold status for such areas," he said.

"Whilst I disagree with the previous state government's policy of converting reclaimed land to freehold, we have been advised by both the lawyers and consultants with the Penang Development Corporation (PDC) and the State Legal Adviser that this conversion is legally valid as it was gazetted as state land and no longer as foreshore land," Lim said.

The state government therefore has to comply with the consent order of the Penang High Court for a rescue deal for the Bayan Bay project that includes converting what was once seabed and foreshore to freehold land, Lim said.

All the parties involved had exercised their legal rights in court before withdrawing their final appeal to the Federal Court, he said, and any attempt to refuse to comply with the consent order would expose the state government to substantial claims for damages.

"The state government hopes that the public, including some state assemblymen and NGOs, would not equate the necessity to comply with the scheme decided by the previous state government as concurrence or even endorsement for converting reclaimed land from leasehold to freehold.

"Even though the legal view is that whilst the state authority can exercise such powers, the new government would not exercise such powers," Lim said.

By The EDGE Malaysia (by Regina William)

Guocoland 1Q profit up slightly

KUALA LUMPUR: Guocoland (Malaysia) Bhd posted a higher profit of RM3.42 million in its first quarter ended Sept 30, 2008, compared with RM3.37 million a year earlier, tempered by a 50% decline in revenue to RM18.28 million from RM36.35 million.

Earnings per share rose to 0.51 sen from 0.5 sen. No dividend was declared. Guocoland said yesterday it was taking appropriate measures to address the challenges in the current financial year.

"Given the uncertainty arising from the current financial turmoil and the slowdown in the global economy, we expect the property market in Malaysia to soften further," it said.

By The Edge Malaysia

UEM Land, UMLand in RM840m venture

PROPERTY developer UEM Land Bhd is partnering United Malayan Land Bhd (UMLand) in an RM840 million venture to build residential, commercial and retail properties on a 3.56ha site in Puteri Harbour, Johor.

Puteri Harbour is located within the 9,712ha Nusajaya development area.

The Puteri Harbour development will feature high- and low-rise residences, bungalows, corporate towers, retail shops, and five-star resorts, among others, spanning over 278.4ha which will be developed over 10 years.

In Kuala Lumpur yesterday, both UEM Land and UMLand entered into a subscription and joint-venture agreement (SJV) as equal shareholders in a JV company, known as Nusajaya Consolidated Sdn Bhd, which will develop the 3.56ha land.

Nusajaya Consolidated has the option to buy the land from UEM Land for RM67.15 million, exerciseable within six months from date of the SJV agreement.

"Through this partnership with UMLand, UEM Land will be able to expedite the overall development of Puteri Harbour. We are certain that Nusajaya will reach the tipping point by 2011," UEM Land managing director Wan Abdullah Wan Ibrahim.


WAN ABDULLAH: We are certain that Nusajaya will reach the tipping point Bank Negara assures by 2011.

In the last one year, UEM Land has signed two joint-venture agreements with companies from the Middle East for investments in Puteri Harbour.

The first is with Limitless LCC to develop a RM1.6 billion project comprising canal homes (bungalows, townhouses and high-end serviced apartments) on 44.4ha, and the second with Damac Properties LLC to develop a RM3.8 billion project.

By New Straits Times (by Sharen Kaur)

Goldmount seeks more land in Iskandar Malaysia

JOHOR BARU: Goldmount Resources Sdn Bhd plans to look for more land within Iskandar Malaysia for its future property projects in the growth corridor.

Project manager Alex Cheong said the property outlook in Iskandar Malaysia was good as the influx of local and foreign investors would create demand for houses.

He said the presence of more developers from outside Johor, especially the Klang Valley, within Iskandar Malaysia also reflected their confidence in the corridor.

“On that note, we also want to take advantage of the good prospects in the property market within Iskandar Malaysia,’’ he told StarBiz.

Cheong said unlike the Klang Valley, where getting land for property development was becoming tougher, it was not so prevalent in Iskandar Malaysia.

The company was hoping to find land within the Nusajaya area as this was slated as the key growth centre in Iskandar Malaysia, Cheong said.

He added that the value of land and properties within Iskandar Malaysia had also appreciated since the economic growth corridor was launched in November 2006.

Iskandar Malaysia spans 2,216.3 sq km within the southern-most part of Johor covering Johor Baru, Senai-Kulai, Pasir Gudang-Tanjung Langsat and Pontian-Gelang Patah.

Cheong said more high-end properties, including those with a price tag of RM1mil or more per unit which was unheard before, were also launched as buyers in south Johor were ready to pay the price.

He said more buyers were going for gated and guarded properties as security was their main concern.

The Shah Alam-based company is currently undertaking its maiden project €“ Puncak Lagenda at Taman Bukit Mewah €“ in Johor with a gross development value of RM54mil.

Phase one of the project comprises 68 double-storey terrace houses, priced from RM338,000 each, and eight semi-detached houses at RM518,000 each.

Phase two will consist of 31 double-storey shop offices with three different floor designs with a price tag of at least RM488,000 each.

By The Star - StarBiz - (by Zazali Musa)

IOI Corp to postpone Sentosa Cove launch

PETALING JAYA: IOI Corp Bhd is postponing the launch of its Sentosa Cove projects as the Singapore residential property market is undergoing a slowdown, a company official said yesterday.

He said due to the current situation, it would be better to wait for the market to recover.

The official was commenting on a Citigroup Research report yesterday which stated that the launch had been postponed.

The research house said the previous guidance was for Sentosa Seaview to be launched by this month and The Pinnacle Collection by April next year.

The land cost was S$1,364 (RM3,265) per sq ft per plot ratio for the Sentosa Cove project while the land cost was S$1,822 per sq ft per plot ratio for The Pinnacle Collection.

Citigroup Research said it was removing both projects from its immediate three-year forecasts.

Domestically, it was assuming that the Dengkil land project, with an estimated gross development value of RM2bil, would be postponed to its financial year ending June 30, 2010.

By The Star

Mapletree to build Vietnam business park

SINGAPORE: Mapletree, the real estate arm of Singapore sovereign wealth fund Temasek Holdings said yesterday it has signed an agreement to develop a US$400 million business park in Vietnam.

The 75-hectare business park, in Vietnam’s Binh Duong province, will be built in phases starting from 2009, Mapletree said in a statement.

The deal brings its total investments in the Southeast Asian country to US$700 million, it added.

Mapletree said a 68-hectare logistics park it is also building in Binh Duong, near Ho Chi Minh City, has already signed up six customers ahead of its completion in November 2008.

By Reuters

IOI to delay launch of Sentosa Cove projects: Citi

IOI Corp Bhd will postpone the launch of its Sentosa Cove projects - namely Sentosa Seaview and The Pinnacle Collection - due to the fragile residential property market in Singapore, said a Citigroup Research report.

IOI Corp, via its unit IOI Properties Bhd, is expected to launch the Sentosa Seaview project by this month and The Pinnacle Collection by April next year.

"We are removing both projects from our immediate three-year forecasts," said Citigroup Research in a report, after it visited the company's management recently.

The research house also assumed that its Dengkil Land project, with an estimated gross development value of RM2 billion, to be postponed to fiscal 2010.

"We are revising downwards earnings before interests and tax contribution from the property development business by 13 to 25 per cent over FY09-FY11E," said the report.

The projects, owned by IOI Prop and joint-venture partner Ho Bee Investment Ltd,are IOI's biggest high-end development in Singapore's Sentosa Cove.

The land at Seaview costs S$1,364 (RM3,259.96) psf while the land at The Pinnacle Collection costs S$1,822 (RM4,354.58) psf.

Pinnacle Collection will have seven 18-storey blocks and a 20-storey luxurious condominium. It will have 280 apartments and penthouses of various layout and sizes.

The Pinnacle Collection is one of two condominium parcels that flank the entrance of the marina leading to Sentosa Cove.

It is adjacent to the 1.46ha leasehold Sentosa Seaview, which was successfully tendered by another IOI Properties subsidiary with Ho Bee in March last year.

Sentosa Seaview is a luxury condominium project comprising two eight-storey apartment blocks with 151 units.

By New Straits Times

Cybercentre status to boost Mid Valley office revenue

HIGHER OFFICE REVENUE: Barragry says the response after the MSC status launch is encouraging, given that 300,000 sq ft office space has been dedicated for MSC-status companies.

Office turnover at Mid Valley City in Kuala Lumpur will grow some 80 per cent to RM90 million by next year as The Gardens North and South Office Towers are fully leased out and occupied.

While office revenue for 2008 is expected to be between RM50 million and RM55 million, the incremental growth will be fuelled by Mid Valley City receiving its MSC Malaysia Cybercentre status last month.

Mid Valley City Gardens Sdn Bhd chief executive officer Antony Barragry said the response after the MSC status launch was encouraging, given 300,000 sq ft of office space had been dedicated for MSC-status companies.

"We will use much of the balance of the Gardens North Office Tower for our commitment to the MSC (status). We are in active negotiations with quite a few parties, and are confident that we should lease out in the next six months," he said.

Current occupancy rate at the Gardens South Office Tower is 76 per cent, while 86 per cent has been leased out. Meanwhile, the Gardens North Office Tower has an occupancy rate of 15 per cent and 25 per cent leased out.

The towers also target high-end corporate businesses albeit in the financial, marketing and oil and gas segments, as there has been pent up demand for Class A office space in the area.

Rental for office space will average RM6 to RM7 per sq ft as it will provide the company a sustainable business over the long term.

Barragry said the Mid Valley City development has a strong retail mix from its two malls, combined with three hotels and large office space.

"It gives us a dynamic mix and a sustainable model. For us as a group, most of this is recurring income so it allows us not only to operate but keep abreast with the latest technology," he said.

Mid Valley City is expected to contribute some 41 per cent to its holding company IGB Corp Bhd group projected revenue of RM1.15 billion for financial year ending December 31 2008.

The total revenue of RM470 million estimated to come from Mid Valley City development encompasses the office revenue, some RM280 million from retail and RM90 million from the hotels.

The RM470 million represents between 80 to 90 per cent of its full potential turnover upon completion of the development.

As the Gardens Hotel and Office Towers become fully operational and leased out next year, overall revenue contribution by sector in Mid Valley City will be 55-60 per cent retail (including car parks), 20 per cent offices and 20 per cent hotels.

The Mid Valley City development still has some 0.81 ha of land left to develop. Originally, the land was to be used for the construction of a convention centre but now it will see high-end condominiums.

"We recognise that Mid Valley City is a business hub so we are looking at whether we can bring some commercial element into this development. We have enough space to put two towers," Barragry said.

He said the company was currently negotiating with City Hall to wrap up the deal and should be able to firm up their plans by the coming Chinese New Year.

Barragry added that the company will study the Klang Valley market for the next five to 10 years and decide if this development was suitable before proceeding.

By New Straits Times (by Jeeva Arulampalam)

RM100mil Mesra Mall opens its doors in Kertih

MESRA Mall, a RM100mil ultra-modern shopping complex, has opened its doors to shoppers in the Kerteh petroleum town.

Built on a 12ha site, it promises to be a new landmark for shoppers and tourists coming to Terengganu.

With Suria KLCC Sdn Bhd managing the operations, the complex is developed by KLCC (Holdings) Sdn Bhd through its two subsidiaries — Metro Kemasik Sdn Bhd and KLCC Projek Sdn Bhd.

Kumpulan KLCC (Holdings) Sdn Bhd chief executive officer Hashim Wahir said with the opening of the complex, people around Kemasik, Paka, Kerteh, Kijal and Chukai would no longer need to go to Kuantan or Kuala Terengganu to buy basic needs.

“Mesra Mall is among our efforts to provide the opportunity for the people here to enjoy facilities similar to that available in big towns.

“Moreover, with higher fuel prices, the people need not go far to buy their essentials and branded items as these goods are available at the mall,” he added.

Hashim said this after the complex opening by state executive councillor for rural development, entrepreneurs and cooperatives, Datuk Mohamed Awang Tera, who represented Terengganu Menteri Besar Datuk Ahmad Said.

Hashim hopes the complex would serve as a catalyst for commercial development in the Kemaman district and in Terengganu, adding that it had provided jobs for about 500 locals.

Earlier, Mohamed Awang, in his speech, said Mesra Mall would provide business opportunities for the locals to boost their income.

“The shopping centre will not harm businesses of the small and medium-scale entrepreneurs as they have been provided with separate trading areas to sell their goods,” he added.

By Bernama

AP Land ing in China

Several Chinese parties who are impressed with the Platinum Galaxy Boulevard project have approached Gee Teong

AP Land Bhd’s adviser Tan Sri Low Yow Chuan looked every part of the old fashion towkay as he sat in a chair and watched customers file in to the Platinum Galaxy Boulevard showroom in Changshu, China. Resting his hands on his walking stick, the 74-year-old patriarch of the well known developer family was obviously pleased with the company’s latest venture as it was the realising of a dream he has had for quite sometime.

“I wanted to come and develop in China for many years. In fact, I wanted to venture to my ancestral province of Xiamen but due to various problems it never took off.

“Even for this project, we have been quietly coming here for more than three years before we finally decided to invest,” Low says in an interview after the ground breaking ceremony for the Platinum Galaxy Boulevard commercial project earlier this month. Low tells of how undeveloped China was when he first visited it together with a Malaysian Government trade delegation about 20 years ago.

“There were bicycles everywhere then but look at it now, everyone is driving a car.

“When we first got to Beijing, there were not enough hotel rooms to house all of us. We had to stay in a Government-run hotel but today, there are so many,” says Low, who at the age of 23, helped his father Tan Sri Low Yat complete the now famous Federal Hotel at Jalan Bukit Bintang.

Despite his role as the company adviser, his children, who now run AP Land, and senior staff sought his opinion (and approval) on the company’s project in China. It is proof that his views still hold sway.

But when asked if he could be interviewed for his opinion on the company’s Chinese venture, Low pointed to his sons Gee Tat and Gee Teong who are now chairman and joint managing director of AP Land respectively.

Gee Teong takes up the story of how the company, which in some form or another, has been developing property in Malaysia for the past 60 years, came into the Jiangxu province’s special economic zone of Changshu.

“Things are very strict now in China. There are so many regulations to follow but if you go by the book, everything runs smoothly,” Gee Teong said. The slowly-but-surely tactic adopted by AP Land seem to have paid off because it had also snared the confidence of the local authorities.

Its ground-breaking ceremony for the Platinum Galaxy Boulevard project was attended by the top three high officials of the city €“ the mayor, his deputy and the secretary of the city’s communist party.

Their presence for the launch of a commercial project of just 6.6ha is an indication of the relationship or quanxi (in Mandarin) the company has established with the local administrators.

Asked if AP Land was not too late in coming into investing into China, Gee Teong said that was not the case as the company had been coming to China to seek out projects for quite a while.

“If this is being late then it has become an advantage as we had been able to see what others had gone through.

“This is not our first overseas venture we are in Australia, Japan and Indonesia,” he added.

He said the overseas ventures will play an important part for the company and was expected to account for between 30% and 40% of the revenue in the future.

AP Land recently acquired a piece of freehold land in Hokkaido measuring 3,082 sq m for RM18.9mil.

The project, called Shi-Ki which means four seasons, is a high-end residential development located in Niseko, said to be a major ski-resort destination in Japan. The project will generate an estimated GDV of 5.7 billion yen.

In Indonesia, AP Land now owns 36,000ha of land which will be the company’s second foray in the oil palm plantation business.

It plans to expand this to over 100,000ha in the near future.

The company has been rather low profile for the last 24 months after it cleared its debts with the sale of several properties including the City Square shopping complex, the Empire Tower office building and Crown Princess Hotel for RM680mil.

Its future in China looks bright as the launch of the Changshu development has proven to be timely.

Gee Teong let on that they had been approach by several Chinese parties who had been impressed with the Platinum Galaxy Boulevard project.

“We are looking at two offers €“ both are on a joint-venture basis. We have already started negotiations but it is still in the early stages.

“We are looking for some land bank in China both inside Jiangsu and also in other nearby provinces.

“It is our long term aspiration to grow and build a significant franchise in China. We are here to grow,” said Gee Teong.

By The Star (by Wong Sai Wan)

KSL to sell latest project overseas

JOHOR BARU: KSL Holdings Bhd is targeting the foreign market for its latest project, D’Esplanade Residence @ KSL City.

Executive director Ku Hwa Seng said for a start it would appoint an international property agent based in Singapore to attract residents and expatriates in the republic.

“We are also targeting Malaysian professionals working and residing in Singapore,” Ku told journalists yesterday during a sneak preview of the project which will be officially launched this weekend.

D’Esplanade Residence will comprise a four-storey retail podium block, two 20-storey hotel blocks with 1,000 rooms, and two 33-storey apartment towers with 346 units when fully completed in about three years.

The 33-storey Glass Tower I apartment block will comprise 242 units with built-up areas of 1,000 to 10,000 sq ft.

The price ranges from RM500,000 to RM10mil for a penthouse unit.

“Pricing for the Glass Tower I units should be attractive to Singaporeans as a similar unit there could easily cost S$1mil to S$3mil,” said Ku.

The RM500mil KSL City is located within the matured Century Gardens, opposite the Holiday Plaza shopping complex and near Jalan Datuk Suleiman.

It is about 2km from the Johor Baru central business district and the new Johor Baru Customs, Immigration and Quarantine complex.

Glass Tower II, with 104 units, would be launched in six months and the price of each unit would start from RM1mil, Ku said, adding that after Singapore, the company would promote the project to investors in Dubai and Hong Kong.

By The Star (by Zazali Musa)

NAZA TTDI targets Mideast market

DUBAI: NAZA TTDI Sdn Bhd is actively promoting its property to the Middle East market following a “high level” of interest received.

Marketing and sales director SM Faliq SM Nasimuddin said in a statement many high profile investors from the Middle East had shown keen interest in the company’s projects particularly in its “jewel in the crown” RM3.5bil Platinum Park, comprising seven iconic towers of offices, service apartments, retail units and upmarket condominiums, in the Kuala Lumpur City Centre (KLCC).


SM Faliq Nasimuddin

SM Faliq said Middle Eastern investors were very astute when it came to choosing a good property.

“In recent years they have shown keen interest in Malaysian properties particularly those in prime locations where they see potential for good capital appreciation.

“Also, luxury properties in KLCC area are comparatively much cheaper than those in downtown Singapore, Hong Kong and Dubai,” he added.

More than 400 exhibitors from around the world are participating in the event at the Dubai International Exhibition Centre.

By The Star

PHBB to buy land in Iskandar

DUBAI: Pelaburan Hartanah Bumiputera Bhd (PHBB) is in final negotiations to purchase 30 acres in the proposed financial district of Medini in Iskandar Malaysia, the state investment agency said yesterday.

“We have identified the size of the land we want - 30 acres - that we will develop in phases,” PHBB managing director Kamalul Arifin Othman told the media at Cityscape Dubai after an earlier announcement by Millenium Development International, the lead developer of the Medini financial district and one of the Middle Eastern development partners of Khazanah Nasional Bhd’s Iskandar Investment Bhd (IIB).

“We intend to be (the) first mover in the financial district,” he added.

The land acquisition will be made through a joint venture company in which PHBB will own 60% and IIB 40%.

“We have the resources to undertake the development. We had received RM2bil in seed capital from the federal government,” Kamalul said, adding that PHBB was talking to established companies to take up space in the Medini financial district.

Millenium vice chairman Oussama Kabbani said in a speech that Iskandar financial district was in the right location and right market.

The price of land there was just 10% that in Singapore even though it was just 20 minutes’ drive from the island republic, he noted.

Global Capital, the consortium that includes Millenium and IIB, would invest US$1bil to develop and sell the sites acquired within Medini, Iskandar Malaysia.

The development value in the financial district alone would exceed US$4.5bil, Oussama said, adding that Millenium was in discussion with prospective investors from the Gulf region to invest in Iskandar Malaysia.

IIB managing director Arlida Ariff said the government offered special incentives for companies to move into specific clusters in Iskandar Malaysia.

These include a 10-year tax holiday, 100% foreign ownership and flexibility in hiring foreign knowledge workers.

Companies in the Fortune 500 list and others that might want to expand from Hong Kong and Singapore were being approached by IIB as prospective tenants and investors, she added.

PHBB is a wholly-owned subsidiary of Yayasan Amanah Hartanah Bumiputra.

Formed two years ago, it has invested in 300 acres of commercial land in Kuala Lumpur and Penang, including the headquarters of Bumiputra-Commerce Holdings Bhd and the transport hub at Butterworth.

PHBB invests primarily in Grade A commercial properties and its aim is to eventually place them in a real estate investment trust.

By The Star (by C.S.Tan)

Arab investors committed to Medini

DUBAI: Khazanah Nasional Bhd’s Arab partners in the development of Medini, a 2,300-acre mixed project in Iskandar Malaysia, remain committed in spite of the global financial turbulence.

“It comes down to fundamentals. If you look at comparable rents (in Johor), they are 20% to 10% of Singapore’s,” John A. Thomas, an executive director of Mubadala, told the media on Monday.

Medini, a greenfield project in Nusajaya, Johor, was officially launched at Cityscape Dubai, an annual property exhibition, by Johor Mentri Besar Datuk Abdul Ghani Othman.

Earlier, Ghani told the media that the new state administrative centre, located next to Medini, was almost completed and civil servants would soon be moving into the new offices.

As for the global credit crunch and its impact on property investment, Thomas said: “Medini is a project that spans 10 to 15 years. Looking back later on, this will just be a blip during this period.”

Iskandar Investment Bhd (IIB), an investment arm of Khazanah, coordinates and invests in Iskandar Malaysia.

Its development partners for Medini are Mubadala, Aldar Properties, Millennium Development International and Al-Nibras 2 Ltd, a Labuan-based private fund company managed by Kuwait Finance House (M) Bhd group. Mubadala, Aldar and the Lebanese Saraya group, which owns Millennium, are all very large Middle Eastern property developers and investors.

IIB managing director Arlida Ariff said the company hoped to grow the partnerships and, at the same time, was aiming at drawing the next tier of investors to Iskandar Malaysia.

“We hope to get more participants to develop specific parcels of land in Iskandar Malaysia,” she said, adding that this was one of the aims of IIB’s participation with its booth at Cityscape Dubai.

Iskandar Malaysia was masterplanned into specific parcels of landed projects, such as education and financial centres, so that lead developers did not cannabalise each other’s market, she said.

Millennium’s country manager for Malaysia Richard Polkinghorne said the Saraya group’s objective was to transfer its expertise in the development of cities from greenfield sites to Malaysia.

“There are not many places in the world where you can build a city.

The Middle East has provided the training ground, and now Malaysia has the same vision,” he added.

In building cities, developers had to think of building offices and living space for 200,000 people and how to roll out projects over 10, 15 years, added Polkinghorne.

He remains convinced that Medini will work. “It comes down to location, location and location.

It’s close to Singapore which is running out of space. It’s a unique opportunity,” he said.

Millennium is scouting to invest in another project in Malaysia as well as elsewhere in South-East Asia.

The Aldar group also remains keen on its participation in Medini. “Aldar will bring its development and management expertise to this part of the world. We see Medini as an excellent entry point for us and it represents a salient opportunity to internationalise our operations outside of Abu Dhabi,” said chief operating officer John Bullough.

By The Star

Malaysia's largest urban project Medini launched

CATALYST DEVELOPMENT: An artist's impression of the Medini

MALAYSIA'S single largest urban development to date, Medini, was officially launched at the GCC's annual property investment event, Cityscape Dubai, yesterday.

The catalyst development, previously referred to as 'Node 1', is located in Iskandar Malaysia and is expected to bring in gross development value (GDV) in excess of US$20 billion (RM69.6 billion) over a period of 15 to 20 years.

In a statement, Iskandar Investment Bhd (IIB) managing director Arlida Ariff said Medini is Iskandar Malaysia's first sizeable world-class offering to the international property space.

"The development is undoubtedly strong in its strategic positioning, government backing, and supporting infrastructure and resources and when you add the invaluable commitment, experience and expertise of our Middle-Eastern partners - we're looking at a winning formula," she added.

IIB's Middle-Eastern business partners in the development include Rim City Sdn Bhd (RCSB), Cultural Cluster Sdn Bhd (CCSB) and Mubadala Development Company (Mubadala), with the latter leading a consortium called Global Capital comprising other well-known industry players ALDAR Properties PSJC (ALDAR) and Millennium Development International (Millennium).

CCSB is a special purpose vehicle which is majority-owned by Al-Nibras 2 Limited, a Labuan-based private fund company managed by Kuwait Finance House (Labuan) Bhd (KFHLB). The other shareholders are Khazanah, the government investment authority of Malaysia and the parent company of IIB, and Jumeirah Capital.

Medini is set to be a 920ha international mixed-use urban development, located on prime greenfield land in the heart of Nusajaya, Johor.

"We decided to capitalise on the exposure provided by the Cityscape platform to launch Medini, and in tandem, open up a limited number of exclusive opportunities within our space here for commitment from keen investors," said Richard Polkinghorne, country director of Millennium.

The company, highly experienced in large scale and mixed-use projects, will drive the 146ha International Financial District (IFD) set to be the world-class hub of Islamic Finance in Southeast Asia, with the presence of international financial institutions, banks and corporations.

Another segment in Medini known as the Lifestyle and Leisure Cluster is headed by Mubadala, whose plans include the development of 496ha of land into a City Centre, Golf Village, Medical and Wellness Village, Amusement Bay and a Residential District.

Lastly, CCSB will undertake 249.6ha in Medini to build the Creative Cluster which will include the Heritage District, Creative Park and Logistics Village.

IIB holds a 30 per cent stake across these collaborations in the Medini development.

"Malaysia's long-term economic objectives will be strongly perpetuated with every success and progress made in Iskandar Malaysia. The launch of Medini is an important milestone for us, as we are now beginning to unlock our country's true potential to be a globally competitive nation," IIB chairman Tan Sri Azman Mokhtar added.

By New Straits Times

CapitaLand may add assets in Malaysia

Sources say talks to purchase 3 shopping complexes in Malaysia have reached an advanced stage



CAPITALAND Ltd, Southeast Asia's largest real estate player, is said to be in talks to purchase three shopping complexes: Ipoh Parade in Perak, Klang Parade in Selangor and Seremban Parade in Negri Sembilan.

If the acquisitions go through, they will add to its portfolio of three retail properties in Malaysia, in line with its plans to set up a retail real estate investment trust (REIT) worth over RM2 billion.

Sources told Business Times that the negotiations between CapitaLand and TMW Asia Property Fund GmbH & Co, which owns the shopping complexes, are at an advanced stage.

Based on the property valuations undertaken in early 2004, CapitaLand could pay some RM500 million for the shopping complexes.

At press time, Business Times did not receive a response from either CapitaLand Ltd president and chief executive officer Liew Mun Leong or CapitaLand Retail Ltd chief executive officer Pua Seck Guan on the said negotiations and whether it planned to buy any or all three properties.

TMW Asia Property Fund, a German property fund, bought the three properties - under the operating companies Lion Klang Parade Sdn Bhd, Lion Seremban Parade Sdn Bhd and Lion Ipoh Parade Sdn Bhd - for RM340 million in 2005 from the Lion group.

In 2004, Klang Parade was valued at RM179 million, Ipoh Parade at RM188 million and Seremban Parade at RM90 million.

The fund is managed by Pramerica, the real estate investment management business of Prudential Financial, Inc from the US.

CapitaLand has been on a shopping spree in the past couple of years. It has in its stable the Sungei Wang Plaza in Kuala Lumpur, Gurney Plaza in Penang and Mines Shopping Fair in Seri Kembangan, Selangor.

According to previous reports, Seremban Parade has a nett lettable area of 316,847 sq ft and sits on 1.97ha; Ipoh Parade has a nett lettable area of 594,414 sq ft on 4.14ha; and Klang Parade has 696,045 sq ft space.

It was recently reported that CapitaLand Ltd might delay the launch of its retail property trust in Malaysia if market conditions worsened over the next few months.

Last month, CapitaLand said that it aimed to get approval for the REIT by the year-end.

By New Straits Times (by Vasantha Ganesan)

Dubai aims to top its own world's tallest tower

DUBAI, United Arab Emirates (AP) - With its world's tallest building nearing completion, Dubai said Sunday it is embarking on an even more ambitious skyscraper: one that will soar the length of more than 10 American football fields.

That's about two-thirds of a mile or the height of more than three of New York's Chrysler Buildings stacked end-to-end. Babel had nothing on this place.

"This is unbelievably groundbreaking design,'' Chief Executive Chris O'Donnell said during a briefing at the company's sales center, not far from the proposed site.

"This still takes my breath away.''

The tower, which will take more than a decade to complete, will be the centerpiece of a sprawling development state-owned builder Nakheel plans to create in the rapidly growing "New Dubai'' section of the city. Foundation work has already begun, O'Donnell said.

The area is located between two of the city's artificial palm-shaped islands, which Nakheel also built.

The project will include a manmade inland harbor and 40 additional towers up to 90 floors high.

About 150 elevators will carry residents and workers to the Nakheel Tower's more than 200 floors, the company said.

The building will be composed of four separate towers joined at various levels and centered on an open atrium.

"It does show a lot of confidence in this environment'' of worldwide credit problems and a souring global economy, said Marios Maratheftis, Standard Chartered Bank's Dubai-based regional head of research.

As part of government-run conglomerate Dubai World, Nakheel has played a major role in creating modern-day Dubai, a city that has blossomed from a tiny Persian Gulf fishing and pearling village into a major business and tourism hub in a matter of decades.

Besides the growing archipelago of man-made islands for which it is best known, Nakheel is responsible for a number of the city's malls, hotels and hundreds of apartment buildings.

The company said the new project is inspired by Islamic design and draws inspiration from sites such as the Alhambra in Spain and the harbor of Alexandria in Egypt.

"There is nothing like it in Dubai,'' said Sultan Ahmed bin Sulayem, Nakheel's chairman.

Perhaps not quite. But Dubai is already home to the world's tallest building, even if it remains unfinished.

That skyscraper, the Burj Dubai, or Dubai Tower in Arabic, is being built by Nakheel's chief competitor, Emaar Properties.

Emaar has kept the final height of the silvery steel-and-glass tower a closely guarded secret, saying only that it stood at a "new record height'' of 2,257 feet at the start of last month.

It's due to be finished next September.

The final height of Nakheel's proposed tower is likewise a secret, as is the price tag.

The company would only say it will be more than a kilometer (3,281 feet) tall.

O'Donnell said he was confident that Nakheel could pay for the project despite the financial troubles roiling the world's economy.

He also brushed aside concerns by some analysts that Dubai's property market is becoming overheated and due for a potentially sharp correction.

"In Dubai, demand outstrips supply,'' he said.

"There might be a slowdown, but there definitely won't be a crash."

By The Star / By AP

Home prices in Dubai seen flat till 2010

Home prices in Dubai, the second-biggest of the seven sheikhdoms that make up the United Arab Emirates, are likely to remain flat until 2010 after five years of steep gains, Colliers CRE Plc said.

About 140,000 new homes will be completed in Dubai by the end of 2010, adding to the existing stock of about 300,000 units, Colliers said in a report released in Dubai yesterday. Home prices average US$5,420 per sq m, or US$504 per sq ft, in Dubai, compared with US$6,500 a sq m in neighboring Abu Dhabi, the report said.

“We’ve not seen a drop-off in demand, but there has been a slowdown in value appreciation,” Ian Albert, Colliers regional director, told reporters in Dubai.

By Bloomberg

Germany races to save property lender Hypo

BERLIN: Germany announced yesterday that it would guaranteed all private savings accounts, joining Ireland and Greece in taking drastic independent action to head off financial crisis.

The announcement came as business leaders and lawmakers met in the capital for feverish talks to keep an embattled real-estate giant afloat.

Hypo Real Estate AG had been planning on a 35 billion (1 = RM4.81) bailout package financed by the government and private banks, but the deal fell apart on Saturday evening.

Chancellor Angela Merkel vowed that she would not let the failure of any company disrupt Europe's biggest economy.

"We will not allow the distress of one financial institution to distress the entire system," she told reporters while talks between government and business leaders continued in the capital.

"For that reason, we are working hard to secure Hypo Real Estate."

Merkel said the plan would ensure that anyone who made reckless market decisions would be made to answer for their actions.

"The federal government will make sure of that," she said. "That is our debt to the taxpayers."

The talks at the Finance Ministry came a day after a 35 billion rescue plan for the blue-chip company that was approved by the European Union on Thursday unravelled at the seams.

Finance Minister Peer Steinbrueck, who spoke at the press conference with Merkel, said the government was working on an "institute-specific solution" to Hypo's near-bankruptcy.

"We have to start again where, at the end of last week, we thought we had a solution," he said.

"I am pretty angry that the management of (Hypo) in the last few days has revealed a further liquidity hole of unknown size," Steinbrueck said.

"The federal government refuses to be forced into some sort of shared responsibility by this bank or to put the entire burden of the risks on taxpayers."

Hypo, the country's No. 2 commercial property lender, said on Saturday that the rescue plan had fallen apart after private lenders withdrew support, a key element to the proposal that had already been approved by the EU earlier last week.

Hypo is relatively small when compared with other firms in Frankfurt's blue-chip DAX index of leading companies, but its role as a lender for commercial property, infrastructure and government financing makes it a major financial player.

By Agencies

Mah Sing: New launches to proceed as planned

Developer Mah Sing Group Bhd is taking a bold step in launching new medium to high-end houses and a commercial development worth over RM1.3 billion by 2010.

It currently has 10 ongoing projects in Kuala Lumpur, Penang and Johor on its plate, which will keep it busy for the next five years.

Mah Sing Properties Sdn Bhd chief operating officer Ng Heng Phai believes the market will improve as oil and steel prices appear to be falling.


NG: The market will improve as oil and steel prices appear to be failing.

The global oil price has fallen to about US$92 (RM320) per barrel from US$120 (RM418) more than a month ago while steel is doing RM3,600 per tonne from RM4,100 per tonne some four months earlier.

From now till the end of 2010, Mah Sing will launch four projects - three residential and one commercial. They are Legenda @ Southbay featuring three and four storey resort bungalows and Southbay City, a commercial development, both in Penang; One Residence in Cheras comprising triple-storey bungalows; and Sri Pulai Perdana 2 township in Johor.

"We will go with the launch as they were pre-planned earlier. It will be profitable as we have taken mitigating measures to overcome rising cost of construction," Ng told Business Times.

He said the gross development value (GDV) from the projects will be realised over five to seven years.

"Southbay City, which will command a GDV of RM911 million and located in Batu Maung, will be an exciting project as it will feature two hotels, serviced apartments, shop offices and retails. We target to launch it at the end of 2009," Ng said.

He said Mah Sing will also continue to launch new phases within its 10 developments.

As at June 30 2008, it had a landbank of 232.5ha which will yield a GDV of RM2.9 billion, derived from the new and existing projects.

By New Straits Times (by Sharen Kaur)

Glomac to continue with overseas investments

Property developer Glomac Bhd, unperturbed by the global economic turmoil, will continue to invest overseas, especially in Australia, through takeovers of commercial buildings.

Group executive vice-chairman Datuk Richard Fong Loong Tuck said there will be more opportunities to buy with the collapse of two venerable Wall Street institutions, Lehman Brothers and Merrill Lynch.

"With the economic downturn, there will be a lot of good deals coming out in the market.

"Property owners may start to sell assets at below market rate, which is when we will buy," he told Business Times in an interview recently.

Fong said Glomac's business model is to buy old commercial buildings, refurbish them for better yields and sell at a higher price later.

Glomac made its presence in Australia in 2006 when it bought 380 Lonsdale Street in Melbourne for A$30.5 million (RM82.4 million).

The acquisition was through its unit, Glomac Australia Pty Ltd and partner Victoria Investments & Properties Pty Ltd.

The Lonsdale St property encompasses a commercial building and a seven-storey carpark complex, with 445 bays offering eight per cent rental yields.

"We are looking around in Australia for suitable office buildings to buy. We won't move (our focus) away from commercial buildings as they are easier to maintain and market," Fong said.

He said the Lonsdale St property, although worth A$40 million (RM108 million) now, will be retained until its value has appreciated by 25 per cent to 30 per cent.

"When we sell it, we will also make on the exchange rate. The gains will be reinvested for new acquisition," Fong said.

"We are being opportunistic with our investments as the outlook in Australia for commercial properties is still doing well," Fong said, adding that d Glomac is also prospecting India and Vietnam for similar acquisitions.

By Sharen Kaur

More hotels to spruce up Penang island

The Royale Bintang Penang is scheduled to be completed next year

Nine hotels will be developed in the next three to four years

SOME nine hotels in the three, four and five-star categories will be developed on the Penang island in the next three to four years.

They include Royale Bintang Penang and The Rice Miller Hotel both in Weld Quay, Hard Rock Hotel in Batu Ferringhi, Cititel Express Hotel in Jalan Magazine and Eastin e-hotel in Queensbay Mall.

The other four hotels, still yet to be named, are located at Jalan Sultan Ahmad Shah, Times Square and Queensbay Mall.

The Hard Rock Hotel, scheduled to open in early 2009, is now undergoing construction.

Located along the famous Batu Ferringhi beach front, the 252-bedroom hotel has nine studio suites and a King’s suite as well as four food and beverage outlets, which will include a Hard Rock Cafe, an all-day dining restaurant and a bar-cum-lounge.

The hotel’s main ballroom and three function rooms offer a total of 5,700 sq ft for private events as well as for meetings, corporate events and exhibitions.

Meanwhile, the four-star Royale Bintang Penang is being developed by Boustead Holdings Bhd at a cost of RM110mil.

The 12-storey hotel, equipped with 300 bedrooms, has a built-up area of about 250,000 sq ft.

Construction on the hotel has started and it is scheduled for completion at the end of 2009.

The RM150mil Eastin e-Hotel in Bayan Baru is currently being developed by the CP Land group.

CP Land group executive chairman Datuk Tan Chew Piau said the business class hotel would have 339 rooms, of which 28 were suites. It will be completed by mid-2009.

“We also plan to develop a five-star hotel and a budget hotel for the Queensbay Mall project, which are scheduled for completion in 2012 and 2014,” he said.

The IGB Group is scheduled to start developing the 28-storey Cititel Express Hotel soon. The RM100mil three-star hotel will have 550 rooms.

Cititel Hotel Management Sdn Bhd (CHM) managing director Datuk Eric H.K. Lim said the hotel was scheduled to commence operations in the last quarter of 2010.

“It will also feature a podium with a bazaar that can accommodate 80 and 100 shoplots,” Lim said.

Meanwhile, the five-star Rice Miller Hotel, scheduled for completion in 2012, is part of the RM500mil Pier commercial plaza project developed by Asian Global Business Sdn Bhd (AGB).

The Pier occupies six existing 19th century buildings that will see new structures being added on.

“We are working closely with our architects and heritage conservation and environment planner to revitalise the historical resources on the site,” said AGB chief executive officer Dr Noraini Abdullah.

Construction of The Rice Miller Hotel and the Pier project are expected to start in the next six months.

Ivory Properties group will develop a RM250mil five-star hotel for its Times Square scheme.

General manager Chok Keng Vui said construction work on the hotel was scheduled to start in mid-2010.

The hotel, which comes under phase four of the RM1bil Times Square project, will have 500 rooms.

The Low Yat Group has received the green light from the local authorities for its 23-storey hotel with 399 rooms and a double-storey basement car park at Jalan Sultan Ahmad Shah.

Construction will begin soon on the hotel, which will have about 62,000 sq ft of built-up area.

Meanwhile, the Malaysian Association of Hotels (Penang chapter) chairman Marco Battistotti said the new hotels would enable the local tourism industry to tap on tourist arrivals from niche and new market destinations.

“The new hotels will work on tapping unexplored destinations and specialised market segments, increasing the popularity of Penang as a holiday resort,” he said.

Battistotti also said in view of the heritage city status given by Unesco recently, Penang and Malacca should work together to promote heritage tourism of the Straits Settlement.

On average, the hotels in the city enjoy a yearly occupancy of 70% to 75% and beach hotels 60% to 65%.

“With the country’s economy growing 5% to 6% annually, there will still be demand from the domestic and international markets to support the new hotels.

“About 60% of the tourist arrivals is domestic with the remainder from overseas” said Battistotti.

There are now 40 hotels in Penang, of which 25 are in the city and the rest in the beach areas.

By The Star (by David Tan)

Retaining the heritage design

The four-star Royale Bintang Penang, scheduled for completion by the end of next year, will make constructive re-use of heritage buildings.

Boustead Properties Bhd executive director Datuk Ghazali Mohd Ali told StarBiz that the RM110mil project located at Weld Quay would retain the original façade thus providing hotel guests a rare opportunity to experience the original fabric of a 19th century building.

The 12-storey hotel is located in offices and godowns established in 1893, a period of great significance in the history of port settlement.

“The architecture also allows for modern, up-to-date designs and facilities within the building,” Ghazali said.

He added that glass walls were installed to separate the modern structures from the heritage part of the building.

“We are also creating an atrium, which is designed to link the new and old, providing a transition space of pleasant contrast.

“The atrium is 13 metres in height, above which is a glass skylight roofing,” he said.

The Royale Bintang Penang will have 300 rooms and 222 car-parking bays.

By The Star (by David Tan)

Impact of global economic turmoil on shopping centres

The Council of Asian and Shopping Centre (CASC) Conference 2008 to be held in Petaling Jaya from Oct 29 to 31 will focus on the current global economic turmoil and its impact on Asian shopping centres.

Malaysian Association for Shopping and Highrise Complex Management (PPK) president Joyce Yap said this year’s conference was important as it would focus on issues such as the impact of inflation, cost management, environmental issues, human resources and political instability faced by Malaysia and the region.


Joyce Yap

“Speakers will compare the impact of this coming ‘recession’ to the previous two and whether the solutions used would be applicable. It will take into consideration critical issues faced by shopping centres and retailers to plan for survival strategies during this difficult time,” Yap said.

There will be prominent speakers from Malaysia, China, India, the Philippines, Hong Kong, Thailand, Singapore and Indonesia.

CASC, established in 2004, is aimed at regional co-operation and setting future directions for shopping centre management in the region. Council members include the shopping centre associations of founding countries such as Malaysia, Singapore and Indonesia together with Hong Kong, China and the Philippines.

Yap, who is the leasing and marketing director of Pavilion KL, said Malaysia still did not have enough quality shopping centres.

“We are not as competitive and aggressive as some of our neighbouring countries. Look at Thailand, they have recovered from economic and other problems quite fast and this is due to the concerted efforts by their government and the private sector,” she said.

On the current US financial meltdown, Yap believes it would not be as bad an impact as the high inflation, political uncertainty and branding issue faced by Malaysia and the region.

“Shopping is a way of life in Asia. Shoppers are wiser today and retailers need to pamper their customers with added value and incentives. Consumers must feel that they have made a worthy purchase that has also alleviated their perceived status,” she said.

Joyce added that there were many measures that landlords and tenants could take to boost sales.

For instance, landlords could review space usage; promotions, downsizing and energy management while tenants could consolidate, re-invent their merchandise, and conduct direct sales campaigns and franchising.

Where necessary, landlords may have to review rental rates to ensure that the shopping centres do not suffer too much of a drop in occupancy during bad times.

Yap, however, lamented that the retail industry still did not have firm statistics on consumer spending trends.

“It does not matter whether you are in the central business district or suburban area, the crucial point is what it takes to make you successful.

“Do you understand your market and product? Detailed feasibility studies are important. Unfortunately Malaysia is short of retail data,” she said, adding that the Statistics Department was compiling sales data and would be making it available by year-end.

By The Star (by S.C.Cheah)

Axis to inject RM300mil assets over next two years

AXIS REIT Managers Bhd has lined up more than RM300mil worth of assets to be injected into Axis real estate investment trust (REIT) over the next two years.

According to Axis REIT Managers chief executive officer Stewart Labrooy, the group will be acquiring assets from developers or third parties, as well as tapping into its eight private equity assets.

The properties from its private equity fund comprise office, warehouse, industrial or showroom type properties. The first of the asset has been injected into Axis REIT recently at a cost of RM32mil, which was a discount of some 12.5% from the market value.

“We have proven that Axis REIT has the capability to undertake yield accretive acquisitions in the open market. Today we have committed to a portfolio of 21 properties of which 18 assets worth RM670mil have been concluded.

“We have pre-qualified three assets in Johor and the Klang Valley worth a total RM150mil and expect these acquisitions to be completed by year end,” Stewart told StarBiz, adding that Axis’ target to increase its asset base to RM1bil would be achievable next year.

He said besides resorting to bank borrowings, the group would also undertake equity raising exercises to raise capital to fund the acquisitions.

The private placement of 50 million new units at RM1.80 each in January has raised RM88mil. This has given the company the flexibility to pursue more aggressive yield accretive acquisitions without raising its gearing.

Axis REIT has been approved to issue another 51.18 million units valued at around RM82mil, which is equivalent to 20% of the approved fund size of 255.9 million units.

REITs in the country are allowed to gear up to 50% of their asset value but Axis REIT is sticking to its target of maintaining a gearing ratio of between 35% and 40%. Its current gearing ratio is about 39%.

An analyst with a local brokerage said the line up of strategic office cum industrial buildings would give a boost to Axis REIT’s income yielding potential.

“We continue to like Axis REIT for its ability to acquire yield-accretive properties and a proven track record in growing its property portfolio as well as its hands-on and experienced management.

“We maintain an outperform rating on the stock,” she said.

She added that industrial buildings, being location-centric within industrial hubs, offered better yields as they have single tenants and longer-term tenure of at least five years.

“Axis REIT can look forward to good rentals and long-term defensive earnings,’’ the analyst pointed out.

By The Star (by Angie Ng)

Design concept key in any development

Our homes and the way that we live are central to the basic core of our lives. That is why we, as property developers, spend a lot of time and effort to create greater livability and lifestyle in all our development projects. We put a lot of thought into the design and layout of all the units that we build, whether they are houses or high-rise apartments.

The environment in which we live, down to the materials used to build our homes, can affect our psyches and physical well-being. Much thought should, thus, be put into the development of homes for enhanced livability. Having large windows, for example, will give residents a feeling of being connected with the outside. As space is of utmost importance, especially in city living, the rectilinear use of space optimises the area available and cuts down wastage.

Every parcel of land is different. While some may give residents the conveniences and benefits of living in a city, others provide dwellers with the peace and beauty of natural surroundings. The idea, always, is to optimise the use of the land available so that homeowners get the best of everything that is possible.

For example, in Jia on Wilkie Road, our newly-launched development in Singapore, we have put the swimming pool on the rooftop. This achieves two aims: it saves space on the ground, giving ground floor units their own private gardens; and it gives pool users a commanding view of the skyline.

Product development involves looking at users’ needs as well as their desired way of living. For example, the provision of both wet and dry kitchens, a maid’s room, gym facilities and swimming pools have, more or less, become standard items in any high-end development.

Just as our needs and requirements have evolved over time, so too have housing developments in Malaysia evolved. Standards are now higher. No longer are the typical rows of traditional terraced houses, semi-Ds and bungalows sufficient to appease a buying public that have been exposed to the houses and lifestyles overseas.

Developers have had to respond to these changing demands by bringing in new concepts and ideas. Over the past several years we have seen property developments in Malaysia take on a more international flavour, with many innovative features now being taken for granted in the more exclusive housing projects.

Homeowners are turning their backs on the “gilded” look and expressing their preference for a more relaxed, yet sophisticated feel. To this end, the choice of building materials has moved towards those that give off a calmer, more natural feel, such as bricks and concrete that have not been covered and painted over.

Gated and guarded developments have also become fairly widespread as homebuyers start to demand security, greenery, private open spaces, recreational facilities and a communal lifestyle all at the same time. Gita Bayu in Sri Kembangan, a combination of strata homes and bungalows with a clubhouse, is a good example of this type of development. It sits on what used to be a rubber plantation and some portions of this have been retained for the back-to-nature feel.

With our 20trees development in Melawati, we took some time to get the project off the ground because we wanted to make sure that all the houses and apartments to have a view of the Melawati Quartz Range. 20trees has been designed in such a way that residents get to feel a connection to nature in their daily lives.

Developers also have to think of other factors that may affect the livability of the development - for inner city dwellers, for example, the problem of noise can be a constant one and developers need to think about how to provide for this. Thick walls and insulated windows will help keep the noise level down.

Some developers of high-rise properties have also started to cater to the attachment that Malaysians and Singaporeans have to their cars. 51 Gurney in Kuala Lumpur and Hamilton Scotts on Singapore’s Scotts Road will both provide car parking facilities within the apartment units €“ a veritable car park in the sky for owners to showcase their cars in their own units. Special lifts will be used to bring the cars up to the correct apartment units.

In order to come up with concepts that fit the way people want to live, developers constantly look out for effective design and architecture that really work. The biggest challenge right now is for developers to ensure that they are able to continue this evolution and deliver creative and innovative ideas that will sell while keeping current escalating costs in check. This is a big test and developers ought to focus on how they can control, rather than cut, costs.

House buyers, for their part, tend to end up living the way the developer has visualised it. The initial concept of a product is critical to the way that the product finally turns out and the way that people are able to live.

·The writer is the managing director of SDB Properties Sdn Bhd, a lifestyle property company. Bouquets and brickbats are welcome, send in your email to md@sdb.com.my.

By The Star (by Teh Lip Kim)

Two largest REITs may be postponed

CapitalLand paid RM770mil to buy Gurney Plaza in Penang.

PETALING JAYA: The proposed listing of the two largest real estate investment trusts (REITs) on Bursa Malaysia in terms of asset value will likely be postponed to next year if the weak market conditions continue.

Analysts said the current lacklustre mood on the local bourse could drag to the middle of next year as the full impact of the US financial crisis took its toll on equity markets around the world.

“REIT sponsors will not want to proceed with listing plans and will wait until the market improves before going ahead with the launch of their REIT,” an analyst with a local brokerage told StarBiz.

Singapore’s CapitaLand Ltd, which earlier planned to list its pure play retail REIT on Bursa by year-end, may delay the exercise if the current weak market conditions persist.

According to a company spokesman, the timing for the proposed listing of its REIT was subject to market conditions.

“We note the extremely negative market conditions currently and are watching the market situation carefully. We will provide any material update on the listing plans when appropriate,” he said in response to a query on the company’s listing plans.

CapitaLand’s plans to list a REIT with RM2bil of assets will see the country’s first foreign-sponsored REIT on Bursa.

The company will group its shopping mall assets in Malaysia for the trust.

One of Asia’s largest real estate firms, CapitaLand 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.

HwangDBS Vickers Research said Sunway City Bhd (SunCity) also looked likely to delay the launch of its REIT to next year in view of the current market sentiment.

With RM3bil worth of assets, the SunCity REIT will be the country’s first listed integrated resort REIT.

By The Star (by Angie Ng)

SIHB to buy Welcome Properties

Supportive International Holdings Bhd (SIHB) has proposed to acquire Welcome Properties Sdn Bhd for RM10 million.

The acquisition will be financed by internally-generated funds and from bank borrowings, if necessary, SIHB said in a filing to Bursa Malaysia.

The proposed acquisition represents SIHB's commitment to meet increased expectations for long-term growth and sustainability through diversification into property development.

It said the board envisages the acquisition will contribute positively to SIHB’s future earnings, arising from the Aman Bayu project, with an expected profit of some RM60 million.

Welcome Properties owns more than 19.2 hectares of freehold sea-facing land at Teluk Air Tawar, Butterworth, with a net book value of about RM35.1 million as at December 31, 2007.

The company is now undertaking a two-phase mixed development, called

“Projek Aman Bayu”, comprising residential and commercial components on the said land.

The total gross development value for the project is about RM360 million while the gross development cost is about RM253 million.

Expected profit is about RM60 million.

The project development cost is funded by a RM22 million term loan undertaken by Welcome Properties.

The first phase has already commenced and is expected to be completed by the end of next year. Development of the second phase is slated to start in mid-2009 and due for completion in 2010.

By Bernama

Brisk sales for Hunza project

The 3-storey linked houses in Alila Homes.

GEORGE TOWN: Hunza Properties Bhd has sold over 95% of its RM105mil Alila Homes project, comprising 122 three-storey linked houses and 40 three-storey townhouses, in Tanjung Bungah Hill.

Executive chairman Datuk Khor Teng Tong said the group spent RM5mil on landscaping the terraced garden according to feng shui principles.

Besides the terraced garden, purchasers were attracted to the project’s elevated location at least 50m above sea level and its security system, he told StarBiz.

“It is a gated and guarded community.

“There are also closed-circuit televisions strategically located in the development,” he said.

Although construction and land costs had increased by 30% and 200% respectively, Hunza had maintained the original selling price of RM786,000 for the three-storey linked houses, he added.

The linked houses have built-up areas ranging from 2,218 to 2,378 sq ft. The project also has a clubhouse with various facilities.

By The Star

More projects from E&O

KUALA LUMPUR: Eastern & Oriental Bhd (E&O) is planning to launch properties worth over RM2bil in gross development value (GDV) during its current financial year ending March 31.

Scheduled for launch were the St Mary’s serviced apartments in Kuala Lumpur and the first phase of the Seri Tanjung Pinang condominiums in Penang, said executive director Eric Chan.

“Each project has a GDV of over RM1bil,” he said after the company AGM and EGM yesterday.

“We will be evaluating the property market and will decide when the time is right to launch. But it will be within this financial year.”

The St Mary’s development is located in Kuala Lumpur’s central business district, at the corner of Jalan Tengah and Jalan P. Ramlee.

It will comprise three blocks of 28-storey luxury apartments on 4.13 acres of freehold land while the Seri Tanjung Pinang condominium development is located on 21 acres of freehold land.

E&O’s core businesses are in property development, property investment as well as hospitality and lifestyle projects.

The property development division currently contributed about 90% to group revenue, according to Chan.

“Within the next five years, we want to increase the contribution from our property investment, and hospitality and lifestyle divisions to about 20% each, with our property development contributing about 60%,” he said.

According to its annual report, E&O has a total landbank of 1,687 acres, located in the Klang Valley and Penang.

Chan said the group was looking to acquire more land for future projects.

“We are always looking for new locations, especially within the Klang Valley and Penang because that is where our brand is,” he said, adding that the group was also looking to expand its presence overseas.

“We hope to take our brand regional,” Chan said. “When the right opportunity arises we will do so but at the moment we are not present in any other country.”

By The Star