AXIS Real Estate Investment Trust (Axis REIT) (5106) expects to continue paying out attractive dividends to its unitholders despite the slowing global economy and the recent dismal performance of the local stock market.
Axis REIT, which now has a portfolio of 19 properties, does not see a cause for concern as only 20 per cent of its tenancy agreements are up for renewal next year.
Chief executive officer Stewart LaBrooy in fact feels that when businesses feel the pinch of the slowing economy, they tend to cut costs by relocating their offices from Grade A buildings into those offering more attractive rates.
"Based on the previous recession, when things get bad, companies trim their budgets and move to industrial parks .... (and) these are the types of properties that Axis REIT owns," he said.
"Our rentals have always been below the market price. We are so, (because we are) not located in town centres and want to be competitive. Our strategy is to keep the tenants for the long term," LaBrooy said, adding that buildings owned by Axis REIT are categorised as Grade A minus.
"In the location we are based at, we offer better yield even with our lower rents," he told Business Times in an interview recently.
Axis REIT, according to him, has managed to generate a gross yield of 11.6 per cent and has always distributed 99.9 per cent of its net income.
On whether Axis REIT will continue to acquire properties in the current economic scenario, Labrooy said: "We will still grow (our assets) despite the market.
"One should not buy when the market is greedy, but when the market runs scared," he said. In fact, he said, in the current market, there is more properties for sale than previously.
"There are many building owners who want to sell and lease back as they want to monetise their assets for working capital," he said.
"We will take the opportunity when we see it," he said.
Axis REIT will continue to look for commercial properties like offices, warehouses and industrial buildings in the Klang Valley and Johor to expand its asset base.
Currently, Axis REIT has completed the purchase of four and is completing a fifth property that will bring the value of its portfolio to an estimated RM696 million by December 31 2008.
Meanwhile, Axis REIT, which recently applied to be registered as a syariah-compliant counter, may look at debt financing though the issuance of sukuk paper as part of its future strategy.
"We are not looking at it ... maybe at the end of 2009 or in 2010," he said.
By Business Times (by Vasantha Ganesan)
Monday, November 10, 2008
Thursday, November 6, 2008
YTL Land offers homes with private pool
The newly completed Parkville Homes with its meandering artificial stream in Lake Edge, Puchong.
PETALING JAYA: YTL Land & Development Bhd is offering semi-detached houses with their own private pool in its Lake Edge upmarket residential development in Puchong.
Called the Waterville, the 50 units of homes are priced from RM1.59mil each. The design includes a lawn on the top floor and a long timber deck at the pool.
YTL Land general manager Edward T. G. Lee said many people had registered their interest in the Waterville homes (currently in an advanced stage of construction) that would feature 3,800 sq ft built-up area with four bedrooms and a maid’s room. The standard lot size is 40ft x 85ft.
Each bedroom comes with an en suite bathroom and the choice to shower in the outdoors. The master bedroom is located on the top floor while three bedrooms are on the first floor. The dry kitchen is in front while the living room is set at the rear of the house for privacy.
“There are many Puchong residents who are looking to upgrade. They like staying in Puchong because of the many amenities and it is very difficult for them to uproot,” Lee said on a media tour of the gated and guarded community yesterday.
He was confident the Waterville would be well received despite the current property market slowdown as there were few quality semi-detached houses in Puchong and that Lake Edge offered so much in terms of lifestyle living.
Lake Edge features a collection of courtyard, terrace, semi-detached homes and bungalows.
By The Star
AmFirst REIT posts bigger H1 revenue
COMMERCIAL ASSETS: Menara Merais, Kelana Brem Towers and Menara AmBank are among properties in AmFirst REIT's portfolio
AMFIRST Real Estate Investment Trust (AmFIRST REIT), the country's oldest property trust, saw a 63 per cent increase in revenue to RM45.4 million for the first half ended September 30 2008.
Net profit surged by 50 per cent to RM29.8 million from RM19.82 million a year ago.
The growth was attributed mainly by profit from its newly-acquired units at The Summit Subang USJ, which started to contribute from April 1.
There was also organic growth from positive rental reversion from tenancy renewals and tenant replacement, its manager Am ARA REIT Managers Sdn Bhd said in a statement yesterday.
As at September 30 2008, the average occupancy rate of AmFIRST's total properties stood at 88.26 per cent.
Am ARA chief executive officer Lim Yoon Peng said global uncertainties over real estate valuations, which developed during the period under review, have had an impact on investors' view on REIT stocks, reflected in depressed unit prices, and Malaysian REITS were not spared.
"Nevertheless, we believe fundamentals of the Malaysian property market remain firm," he said.
"REIT with good occupancy rates and strategies for development will be able to maintain steady dividend streams arising from the middle- to long-term nature of their tenancies, to the benefit of their unitholders," he added.
Lim said Am ARA will continue to extract the best value out of the existing assets in the trust's portfolio as there is still room to further improve the earnings capacity and potential.
AmFirst, listed in December 2006, is one of the larger commercial space REITs in Malaysia with six properties worth RM840 million in its portfolio. They are Bangunan AmBank Group, Menara AmBank, AmBank Group Leadership Centre, Menara Merais, Kelana Brem Towers and The Summit.
AmFIRST aims to diversify its portfolio via investments in profit-producing real estate, primarily used for commercial, retail and office purposes.
A distribution of 4.268 sen per unit, representing 100 per cent of AmFirst income after tax, has been declared. Based on AmFirst's market price of RM0.88 per unit (as at September 30), the distribution per unit represents an annualised yield of 9.7 per cent.
The book closure and payments date of the distribution is November 21 and 28 respectively.
By Business Times (by Sharen Kaur)
ING to pay RM328m for Menara Standard Chartered
The purchase by its Malaysian arm, ING Insurance Bhd, from Reco City Sdn Bhd is expected to be completed by year-end. Reco City is an affiliate of Singapore's GIC Real Estate Pte Ltd (GIC RE).
Business Times had earlier reported that ING was a frontrunner to buy the 45-storey building, with total tenantable area of about 345,000 sq ft.
ING Insurance president and chief executive officer Datuk Dr Nirmala Menon said that an agreement to buy the property was entered into in September.
"It is a calculated acquisition, which was made after we were satisfied with our professional consultants' due diligence reports, with relevant risk consideration and risk management done," she said.
She added that apart from capital appreciation, the building is one of the most prominent office towers in the prime commercial area of Kuala Lumpur's Golden Triangle. It would also act as a hedge against inflation.
"The company obtained approval from the Foreign Investment Committee (FIC) to acquire Menara Standard Chartered in September 2008. The purchase is scheduled to be completed before year-end," she added.
Talks surfaced recently that ING Insurance may not go ahead with the deal as parent ING Groep NV had warned that it will likely post euro500 million (RM2.27 billion) in losses, when it announces its third quarter results next week.
Last month, the Dutch government extended euro10 billion (RM45.3 billion) to ING to help reduce the financial services provider's debt equity ratio from 15 per cent to 10.
Nirmala, however, said that ING Insurance will continue to seek prime properties in Malaysia for investment.
"Our purchase of Menara Standard Chartered is our testament that ING Insurance is committed to long-term investments in the Malaysian market and we continuously seek prime investment opportunities including real estate opportunities. The total assets under (our) management currently stands at RM10 billion," she said, adding that investment is part of ING Insurance's portfolio diversification strategy for a secured and strong income stream.
Menara Standard Chartered is over 90 per cent occupied. Its main tenant is Standard Chartered Bank Malaysia.
GIC RE bought Menara Shahzan Insas in November 2001 for RM135 million. Following an extensive renovation, the building was renamed Menara Standard Chartered.
By Business Times (by Vasantha Ganesan)
Business Times had earlier reported that ING was a frontrunner to buy the 45-storey building, with total tenantable area of about 345,000 sq ft.
ING Insurance president and chief executive officer Datuk Dr Nirmala Menon said that an agreement to buy the property was entered into in September.
"It is a calculated acquisition, which was made after we were satisfied with our professional consultants' due diligence reports, with relevant risk consideration and risk management done," she said.
She added that apart from capital appreciation, the building is one of the most prominent office towers in the prime commercial area of Kuala Lumpur's Golden Triangle. It would also act as a hedge against inflation.
"The company obtained approval from the Foreign Investment Committee (FIC) to acquire Menara Standard Chartered in September 2008. The purchase is scheduled to be completed before year-end," she added.
Talks surfaced recently that ING Insurance may not go ahead with the deal as parent ING Groep NV had warned that it will likely post euro500 million (RM2.27 billion) in losses, when it announces its third quarter results next week.
Last month, the Dutch government extended euro10 billion (RM45.3 billion) to ING to help reduce the financial services provider's debt equity ratio from 15 per cent to 10.
Nirmala, however, said that ING Insurance will continue to seek prime properties in Malaysia for investment.
"Our purchase of Menara Standard Chartered is our testament that ING Insurance is committed to long-term investments in the Malaysian market and we continuously seek prime investment opportunities including real estate opportunities. The total assets under (our) management currently stands at RM10 billion," she said, adding that investment is part of ING Insurance's portfolio diversification strategy for a secured and strong income stream.
Menara Standard Chartered is over 90 per cent occupied. Its main tenant is Standard Chartered Bank Malaysia.
GIC RE bought Menara Shahzan Insas in November 2001 for RM135 million. Following an extensive renovation, the building was renamed Menara Standard Chartered.
By Business Times (by Vasantha Ganesan)
Wednesday, November 5, 2008
Malaysia unveils RM7b stimulus plan
The government has unveiled a RM7 billion stimulus package to reinforce and stimulate the economy, and at the same time, bring relief to the public at an economically challenging time.
Announcing the stimulus package in Parliament, Deputy Prime Minister Datuk Seri Najib Razak, who is also finance minister, said the measures were proof of the governments concern for the people's well-being and to stimulate private sector confidence.
Najib said the RM7 billion was from the savings derived from cuts in the fuel subsidy.
The government will adopt an expansionary policy as is the current practice in other countries.
He said the government had the flexibility to implement value added high impact projects.
Najib said the gross domestic product would be revised downwards to 3.5 per cent for 2009, but the fiscal deficit would remain at 4.8 per cent.
The reason for the deficit is that the government chooses to continue with Budget 2009, as announced, to maintain the growth momentum.
Najib told the Dewan Rakyat that to ensure more people could own houses, RM1.2 billion has been allocated to build 25,000 units of low- and medium-cost houses.
He said RM500 million has been set aside to upgrade, repair and maintain police stations, living quarters, army camps and quarters.
Najib also said RM600 million would be channelled to minor projects, including village roads, community halls and small bridges.
The deputy prime minister said the jobs would go to small-time contractors.
Public amenities such as roads, schools and hospitals will be allocated RM500 million, while a similar amount will be used to build and upgrade roads in rural areas, villages and agriculture roads, including in Sabah and Sarawak.
Najib said RM200 million had been set aside to improve school facilities, with the funds given evenly to religious, mission, Chinese and Tamil schools.
He said RM300 million would be allocated for a fund to implement a skills programme catering to the needs of employers and industry, particularly in the development corridors.
He said RM1.5 billion would be used to set up a special fund to attract private sector investment and would be disbursed as grants, cheap loans or as equity.
Another RM100 million has been allocated to set up new business premises to increase the number of small- and medium-scale entrepreneurs.
Youth programmes will receive RM100 million.
Najib said the packages were aimed at alleviating hardship and encourage spending.
Civil servants also received some good news with the extension of all housing loans from 25 years to 30 years, while the quantum of loan to buy cars has been increased.
Najib said Bank Negara would encourage local banks to introduce a similar measure for its housing loan customers.
To encourage the development of retail business and domestic tourism industry, hyper markets can open till 11pm on weekdays and 1am on weekends. Those in shopping complexes could seek to operate round the clock.
To stimulate activity in the private sector, import duties for cement, long iron and steel products for the construction and manufacturing sectors have been abolished.
The government will also allow individuals or foreign entities to buy commercial real estate worth RM500,000 and above without any Foreign Investment Committee approval, for their own use.
By Business Times
Announcing the stimulus package in Parliament, Deputy Prime Minister Datuk Seri Najib Razak, who is also finance minister, said the measures were proof of the governments concern for the people's well-being and to stimulate private sector confidence.
Najib said the RM7 billion was from the savings derived from cuts in the fuel subsidy.
The government will adopt an expansionary policy as is the current practice in other countries.
He said the government had the flexibility to implement value added high impact projects.
Najib said the gross domestic product would be revised downwards to 3.5 per cent for 2009, but the fiscal deficit would remain at 4.8 per cent.
The reason for the deficit is that the government chooses to continue with Budget 2009, as announced, to maintain the growth momentum.
Najib told the Dewan Rakyat that to ensure more people could own houses, RM1.2 billion has been allocated to build 25,000 units of low- and medium-cost houses.
He said RM500 million has been set aside to upgrade, repair and maintain police stations, living quarters, army camps and quarters.
Najib also said RM600 million would be channelled to minor projects, including village roads, community halls and small bridges.
The deputy prime minister said the jobs would go to small-time contractors.
Public amenities such as roads, schools and hospitals will be allocated RM500 million, while a similar amount will be used to build and upgrade roads in rural areas, villages and agriculture roads, including in Sabah and Sarawak.
Najib said RM200 million had been set aside to improve school facilities, with the funds given evenly to religious, mission, Chinese and Tamil schools.
He said RM300 million would be allocated for a fund to implement a skills programme catering to the needs of employers and industry, particularly in the development corridors.
He said RM1.5 billion would be used to set up a special fund to attract private sector investment and would be disbursed as grants, cheap loans or as equity.
Another RM100 million has been allocated to set up new business premises to increase the number of small- and medium-scale entrepreneurs.
Youth programmes will receive RM100 million.
Najib said the packages were aimed at alleviating hardship and encourage spending.
Civil servants also received some good news with the extension of all housing loans from 25 years to 30 years, while the quantum of loan to buy cars has been increased.
Najib said Bank Negara would encourage local banks to introduce a similar measure for its housing loan customers.
To encourage the development of retail business and domestic tourism industry, hyper markets can open till 11pm on weekdays and 1am on weekends. Those in shopping complexes could seek to operate round the clock.
To stimulate activity in the private sector, import duties for cement, long iron and steel products for the construction and manufacturing sectors have been abolished.
The government will also allow individuals or foreign entities to buy commercial real estate worth RM500,000 and above without any Foreign Investment Committee approval, for their own use.
By Business Times
140 construction-related industries to benefit
Contractors lauded the governments move to allocate a big chunk of the RM7 billion stimulus package to the construction and housing sector, but stressed the need for timely and coordinated execution.
By removing import duties and approval permits on more building materials, the government is further liberalising the local steel and cement markets.
"We're appreciative of the government lifting import duties on more steel products and cement," said Master Builders Association of Malaysia (MBAM) president Ng Kee Leen.
"This should facilitate more steel products and cement from regional producers at competitive pricing if there is not enough supply in the domestic market.
"Such pump-priming moves should ensure continued growth in the construction sector, thus benefiting more than 140 related industries.
"We hope to see timely and coordinated rollout of these jobs," he said.
Deputy Prime Minister and Finance Minister Datuk Seri Najib Razak yesterday announced a stimulus package to boost the economy, most of which would go towards building and upgrading of low-cost housing units, schools, roads and public amenities.
The Real Estate and Housing Developer s Association Malaysia (Rehda) is pleased that the government would be building more low-cost and low-medium cost homes.
"Such a move will relieve private sector developers from social obligations and allow us to focus on meeting the demand for market-driven products, especially during these trying times," said Rehda president Datuk Ng Seing Liong.
He said the removal of the need for Foreign Investment Committee approval for purchases of commercial properties worth RM500,000 and above would encourage more foreign investment in Malaysia's property sector.
"Property investment is still one of the most viable options, considering the high yields in the longer term."
Rehda also hopes to see more competitively priced local building materials with the lifting of duties and approval permits on imported steel bars and cement.
Crest Builder Holdings Bhd, which specialises in constructing police and army quarters, is happy with the governments move to channel funds to projects that will directly benefit small and medium-sized contractors. Currently, 40 per cent of its RM1.3 billion order book are government projects.
Executive director Eric Yong said: "This is good news because these are high-multiplier projects, benefiting large groups of engineers, architects, surveyors, contractors, sub-contractors,
building material suppliers, freight forwarders and property
developers."
Mah Sing Group Bhd group managing director Datuk Seri Leong Hoy Kum, expressed optimism the stimulus package would have far-reaching and positive implications.
"Another key point is the creation of jobs, as historical statistics have shown that job security and sentiments are the most important factors in property investment decisions.
"The move will certainly attract more investments and generate more employment in the country.
"Mah Sing Group, in particular, is very upbeat about the far-reaching, positive effects that the incentives will bring about."
By Business Times
By removing import duties and approval permits on more building materials, the government is further liberalising the local steel and cement markets.
"We're appreciative of the government lifting import duties on more steel products and cement," said Master Builders Association of Malaysia (MBAM) president Ng Kee Leen.
"This should facilitate more steel products and cement from regional producers at competitive pricing if there is not enough supply in the domestic market.
"Such pump-priming moves should ensure continued growth in the construction sector, thus benefiting more than 140 related industries.
"We hope to see timely and coordinated rollout of these jobs," he said.
Deputy Prime Minister and Finance Minister Datuk Seri Najib Razak yesterday announced a stimulus package to boost the economy, most of which would go towards building and upgrading of low-cost housing units, schools, roads and public amenities.
The Real Estate and Housing Developer s Association Malaysia (Rehda) is pleased that the government would be building more low-cost and low-medium cost homes.
"Such a move will relieve private sector developers from social obligations and allow us to focus on meeting the demand for market-driven products, especially during these trying times," said Rehda president Datuk Ng Seing Liong.
He said the removal of the need for Foreign Investment Committee approval for purchases of commercial properties worth RM500,000 and above would encourage more foreign investment in Malaysia's property sector.
"Property investment is still one of the most viable options, considering the high yields in the longer term."
Rehda also hopes to see more competitively priced local building materials with the lifting of duties and approval permits on imported steel bars and cement.
Crest Builder Holdings Bhd, which specialises in constructing police and army quarters, is happy with the governments move to channel funds to projects that will directly benefit small and medium-sized contractors. Currently, 40 per cent of its RM1.3 billion order book are government projects.
Executive director Eric Yong said: "This is good news because these are high-multiplier projects, benefiting large groups of engineers, architects, surveyors, contractors, sub-contractors,
building material suppliers, freight forwarders and property
developers."
Mah Sing Group Bhd group managing director Datuk Seri Leong Hoy Kum, expressed optimism the stimulus package would have far-reaching and positive implications.
"Another key point is the creation of jobs, as historical statistics have shown that job security and sentiments are the most important factors in property investment decisions.
"The move will certainly attract more investments and generate more employment in the country.
"Mah Sing Group, in particular, is very upbeat about the far-reaching, positive effects that the incentives will bring about."
By Business Times
Builders hail open tender
PETALING JAYA: Property developers hail the plan to invite open tenders for the development of government land in strategic locations as an excellent initiative to ensure better planned developments that will optimise the potential value of the land.
Announcing the economic stabilisation plan yesterday, Deputy Prime Minister Datuk Seri Najib Razak said to maximise the returns of the Government’s undeveloped landbank, it would adopt an open tender system to invite the private sector and government-linked companies to develop the land.
The Government will determine the criteria and scope of the plans that will be spelt out clearly in the terms of offer.
Real Estate and Housing Developers Association (Rehda) president Datuk Ng Seing Liong said the system would ensure greater participation from industry players with the expertise to add value to the land.
“If the open tender system is transparent and above board, it will benefit all Malaysians and the country through more well-planned developments and greater earnings to the Government for development purposes,” Ng said.
IJM Land Bhd managing director Datuk Soam Heng Choon said some of the government land, including the more than 400ha of Rubber Research Institute land in Sungei Buloh and former government quarters in Jalan Cochrane and Jalan Ampang Hilir, were prime assets.
“With their strategic locations, these landbank have very high development value potential and will attract much interest from industry players to submit their proposals for development and the best will be selected,” he said.
SP Setia Bhd group managing director Tan Sri Liew Kee Sin expressed delight that the system would help optimise the land value for the benefit of the Government and the people.
“In Hong Kong and Singapore, all the government land are up for open tenders and the practice has ensured developments were undertaken in a well-planned and orderly manner.
“Any government initiative that is done in a fair and transparent manner will help to instil stronger confidence and participation among industry players,” Liew said.
Meanwhile, developers can also look forward to more foreign participation in the commercial property sector as foreigners buying commercial property priced above RM500,000 are now exempted from Foreign Investment Committee approval.
International Real Estate Federation Malaysia president Datuk Richard Fong said the latest measure would further liberalise the country’s property sector and raise its attractiveness as a property investment hub.
“In the past, developers did not even want to attempt to market commercial property to foreigners as these efforts had been futile due to the strict restrictions imposed. There are many interested investors from the Middle East, Japan, South Korea and Singapore looking for quality commercial property,” Fong said.
Rehda’s Ng urged state governments to comply with the directive to relax rulings on foreign purchases to ensure the success of the measure as the states were in charge of issuance of property titles.
By The Star (by Angie Ng)
Announcing the economic stabilisation plan yesterday, Deputy Prime Minister Datuk Seri Najib Razak said to maximise the returns of the Government’s undeveloped landbank, it would adopt an open tender system to invite the private sector and government-linked companies to develop the land.
The Government will determine the criteria and scope of the plans that will be spelt out clearly in the terms of offer.
Real Estate and Housing Developers Association (Rehda) president Datuk Ng Seing Liong said the system would ensure greater participation from industry players with the expertise to add value to the land.
“If the open tender system is transparent and above board, it will benefit all Malaysians and the country through more well-planned developments and greater earnings to the Government for development purposes,” Ng said.
IJM Land Bhd managing director Datuk Soam Heng Choon said some of the government land, including the more than 400ha of Rubber Research Institute land in Sungei Buloh and former government quarters in Jalan Cochrane and Jalan Ampang Hilir, were prime assets.
“With their strategic locations, these landbank have very high development value potential and will attract much interest from industry players to submit their proposals for development and the best will be selected,” he said.
SP Setia Bhd group managing director Tan Sri Liew Kee Sin expressed delight that the system would help optimise the land value for the benefit of the Government and the people.
“In Hong Kong and Singapore, all the government land are up for open tenders and the practice has ensured developments were undertaken in a well-planned and orderly manner.
“Any government initiative that is done in a fair and transparent manner will help to instil stronger confidence and participation among industry players,” Liew said.
Meanwhile, developers can also look forward to more foreign participation in the commercial property sector as foreigners buying commercial property priced above RM500,000 are now exempted from Foreign Investment Committee approval.
International Real Estate Federation Malaysia president Datuk Richard Fong said the latest measure would further liberalise the country’s property sector and raise its attractiveness as a property investment hub.
“In the past, developers did not even want to attempt to market commercial property to foreigners as these efforts had been futile due to the strict restrictions imposed. There are many interested investors from the Middle East, Japan, South Korea and Singapore looking for quality commercial property,” Fong said.
Rehda’s Ng urged state governments to comply with the directive to relax rulings on foreign purchases to ensure the success of the measure as the states were in charge of issuance of property titles.
By The Star (by Angie Ng)
Construction gets much-needed lift
PETALING JAYA: The removal of import duty for cement and long iron and steel products, and abolishment of approved permit (AP) for long iron and steel products will give the construction industry a much-needed boost.
Master Builders Association Malaysia president Ng Kee Leen welcomed the Government’s latest move as a way to promote competitive material pricing and lower construction costs.
“The Government’s reiteration on the waiver of import duty and AP for steel helped clarify the import process, which was not fully understood by all parties earlier.
“The lifting of cement import duty, meanwhile, will lower the domestic cement price which is now 15% to 20% more expensive than imported cement.
“However, it may take months to feel the impact,” he told StarBiz yesterday.
Previously, a 10% import duty was imposed on cement from non-Asean countries.
Cement and Concrete Association of Malaysia executive director Grace Okuda was surprised by the announcement, as the association was not consulted on the waiver of cement import duty.
Lafarge Malayan Cement Bhd president and chief executive officer Bi Yong Chungunco said the company needed to verify the reported statement before giving any comments.
OSK Research analyst Ng Sem Guan said the latest move covered long steel products compared with only billets and certain grade of long bars announced by the Government on May 12.
“While the step may address the contractors’ complaint of the shortage of certain steel products and create a competitive pricing environment, the impact to local steel millers remains nominal, given that local millers benefit from their logistic advantage that allow prompt and small quantity delivery with competitive pricing.
“We also think that the Government may introduce local standard or testing requirement on imported steel products to safeguard public interest and safety hence non-tariff barrier to import,” he said.
By The Star
Master Builders Association Malaysia president Ng Kee Leen welcomed the Government’s latest move as a way to promote competitive material pricing and lower construction costs.
“The Government’s reiteration on the waiver of import duty and AP for steel helped clarify the import process, which was not fully understood by all parties earlier.
“The lifting of cement import duty, meanwhile, will lower the domestic cement price which is now 15% to 20% more expensive than imported cement.
“However, it may take months to feel the impact,” he told StarBiz yesterday.
Previously, a 10% import duty was imposed on cement from non-Asean countries.
Cement and Concrete Association of Malaysia executive director Grace Okuda was surprised by the announcement, as the association was not consulted on the waiver of cement import duty.
Lafarge Malayan Cement Bhd president and chief executive officer Bi Yong Chungunco said the company needed to verify the reported statement before giving any comments.
OSK Research analyst Ng Sem Guan said the latest move covered long steel products compared with only billets and certain grade of long bars announced by the Government on May 12.
“While the step may address the contractors’ complaint of the shortage of certain steel products and create a competitive pricing environment, the impact to local steel millers remains nominal, given that local millers benefit from their logistic advantage that allow prompt and small quantity delivery with competitive pricing.
“We also think that the Government may introduce local standard or testing requirement on imported steel products to safeguard public interest and safety hence non-tariff barrier to import,” he said.
By The Star
Extended hours likely to push up retail sales
PETALING JAYA: The Government’s move to extend the business hours of hypermarkets and supermarkets should help boost retail sales, industry players said.
The move, which is part of the economic stimulus package, allows hypermarkets to extend their operating hours to 11pm on weekdays and 1am on weekends.
Supermarkets located in shopping malls can open up to 24 hours, subject to approval from the local government.
“It allows consumers more convenience in planning their buying activities and this may translate into better sales,” said Poh Ying Loo, senior general manager at Aeon Co (M) Bhd.
“Operators who can respond and adjust to the shift will benefit.”
Poh said Aeon would need to look into its business operational capacity and resources before deciding on any change in its operating hours.
Aeon currently has 19 Jusco stores and employs about 10,000 staff.
Its operating hours are from 10am to 10.30pm from Mondays to Thursdays and 10am to 11pm on Fridays to Sundays.
Carrefour Malaysia marketing and communications director Sivakumar Haridas said the move liberalised the retail industry to a certain extent as it offered working adults flexible time to shop and a place to spend quality time with their family after working hours.
“The longer opening hours will also create more opportunities for employment.
“In line with this, we are pleased to announce our price cut campaign within a week, to further provide consumers value for money for essential everyday items,” he said.
Carrefour hypermarkets currently open from 9am to 10pm on weekdays and 8am to 11pm on weekends.
There are currently 15 Carrefour hypermarkets nationwide.
By The Star
The move, which is part of the economic stimulus package, allows hypermarkets to extend their operating hours to 11pm on weekdays and 1am on weekends.
Supermarkets located in shopping malls can open up to 24 hours, subject to approval from the local government.
“It allows consumers more convenience in planning their buying activities and this may translate into better sales,” said Poh Ying Loo, senior general manager at Aeon Co (M) Bhd.
“Operators who can respond and adjust to the shift will benefit.”
Poh said Aeon would need to look into its business operational capacity and resources before deciding on any change in its operating hours.
Aeon currently has 19 Jusco stores and employs about 10,000 staff.
Its operating hours are from 10am to 10.30pm from Mondays to Thursdays and 10am to 11pm on Fridays to Sundays.
Carrefour Malaysia marketing and communications director Sivakumar Haridas said the move liberalised the retail industry to a certain extent as it offered working adults flexible time to shop and a place to spend quality time with their family after working hours.
“The longer opening hours will also create more opportunities for employment.
“In line with this, we are pleased to announce our price cut campaign within a week, to further provide consumers value for money for essential everyday items,” he said.
Carrefour hypermarkets currently open from 9am to 10pm on weekdays and 8am to 11pm on weekends.
There are currently 15 Carrefour hypermarkets nationwide.
By The Star
Tuesday, November 4, 2008
Pramerica’s fund to invest RM1b in 4 malls
From left: Owners' representative Michael Leong, AsiaMalls Management Pte Ltd GM Stephanie Ho, DTZ Nawawi Tie Leung Property Consultants senior director Adzman Shah and Pramerica director of portfolio management Bernard Loh at the press conference announcing the investment yesterday.
PETALING JAYA: Pramerica Real Estate Investors (Asia) Pte Ltd, a real estate investment business of US-based Prudential Financial Inc, expects to invest some RM1.1 billion in four retail projects comprising four shopping malls in Malaysia through its Asian Retail Mall Fund (ARMF), its portfolio manager said.
“We expect to put in a total development cost of RM1.1 billion for these four malls. We are still waiting for the evaluation of the malls’ gross development value (GDV) from evaluators,” Pramerica director of portfolio management Bernard Loh told a press conference here yesterday.
ARMF is a real estate fund managed on behalf of institutional investors by Pramerica. It is also the owner of Kinta City in Ipoh, but it does not involve itself in the mall’s management.
Three of the projects are under construction — SSTwo in Petaling Jaya, Ampang Mall in Jalan Ampang and 1st Avenue in Georgetown. The RM40 million refurbishment of Penang’s Island Plaza shopping mall, which was acquired in August last year for RM120 million will begin in the first quarter next year for a time period of 15 months.
These four malls provide a total net lettable retail area of about 1.8 million square feet — 462,800 sq ft at SSTwo, 580,000 sq ft at Ampang Mall, 400,000 sq ft at 1st Avenue and 326,800 sq ft from Island Plaza.
SSTwo was targeted for opening by next year-end, while the construction of 1st Avenue and the Phase 1 of Ampang Mall would be completed by the fourth quarter next year and the first quarter of 2011, respectively.
In Singapore, ARMF has invested in seven shopping malls — Tiong Bahru Plaza, Century Square, Hougang Mall, White Sands, Liang Court, Jurong Point 2 and Tampines 1 as well as an office tower called Central Plaza.
Its eighth mall, Serangoon Mall, would be completed in first quarter of 2011. AsiaMalls Management Pte Ltd is the leasing agent and retail mall manager for ARMF’s properties in Singapore.
Loh said ARMF might acquire more malls in Malaysia, but the location would focus on developed areas in the Klang Valley and Penang.
“The decision to invest in Malaysia was driven by the positive growth figures and consumer sentiment despite difficult global market conditions. The latest Malaysia Retail Industry Report placed the total retail expenditure of 2007 as nearly RM67.1 billion, 12.8% higher than the year before.
“We also believe that other critical factors like increasing tourist arrivals and sustained domestic spending will provide higher revenues,” he added.
When asked if the company planned to inject the properties into a real estate investment trust (REIT), Loh said there was such a possibility, but that would be subject to market conditions.
In Malaysia, DTZ Nawawi Tie Leung Property Consultants Sdn Bhd will be Pramerica’s leasing agent and retail mall manager for the four malls.
DTZ senior director Adzman Shah said demand for suburban malls was increasing despite the global financial crisis, as there were not many major malls opening in 2007.
“For well-located malls, the average occupancy is between 80% and 90%. We talked to some retailers and they are quite excited about the projects. They know the market will be going very fast once it moves on,” Adzman added.
By The EDGE Malaysia (by Racheal Lee Mei Nyee)
Realty fund to invest RM1b in Malaysian malls
PRAMERICA Real Estate Investors (Asia) Pte Ltd will invest some RM1.1 billion in four malls in Malaysia through a real estate fund known as the Asian Retail Mall Fund (ARMF)
Pramerica is the real estate investment arm of US company Prudential Financial Inc.
"We are keen to be part of an economy that remains competitive despite the current financial climate and Malaysia fits the profile," ARMF portfolio manager Bernard Loh told reporters at the launch of the properties yesterday.
Two of the malls, Ampang and SStwo, will be located in the Klang Valley. A third, 1st Avenue, will be developed in George Town, Penang.
The fourth, Island Plaza, is an existing mall in Penang that will be refurbished in the first quarter of next year.
Pramerica has appointed property consultant DTZ Nawawi Tie Leung Property Consultants Sdn Bhd to be the leasing agent and retail mall manager.
DTZ will be in charge of looking for tenants to fill up about 1.8 million sq ft in the four malls.
DTZ senior director Adzman Shah said there still appears to be healthy demand for retail space in Malaysia despite the global economic slowdown.
Retailers are gravitating towards well-run malls in good locations, especially in suburban areas, he added.
"We have received a lot of inquiries and that is a good indication of where the market is going. Most of them know the market will move very fast once it picks up .... people are preparing for the next push," Adzman said.
The Ampang mall, located along the upper end of Jalan Ampang, is to be completed by the first quarter of 2011. Its first phase will comprise a six-level retail podium.
SStwo, built within the SS2 Petaling Jaya residential and commercial area, and 1st Avenue, situated along Penang's Magazine Road, are both expected to open by late 2009.
SStwo is to be a five-level mall, while 1st Avenue - a joint venture between ARMF, Penang's Belleview Group and the Lion group - will have seven levels of retail space, including a dedicated youth level.
"We are offering local, regional and international retailers a different and wider range of retail estate to establish their businesses," Loh said.
ARMF has no plans to acquire more properties in Malaysia for now as its focus will be on the four malls, he said.
On whether the malls would be injected into a real estate investment trust, Loh said it was a possibility that the fund would consider later.
In Singapore, ARMF manages shopping malls such as Tiong Bahru Plaza, Century Square, Hougang Mall, White Sands, Liang Court and Tampines 1.
By Business Times (by Adeline Paul Raj)
Pramerica is the real estate investment arm of US company Prudential Financial Inc.
"We are keen to be part of an economy that remains competitive despite the current financial climate and Malaysia fits the profile," ARMF portfolio manager Bernard Loh told reporters at the launch of the properties yesterday.
Two of the malls, Ampang and SStwo, will be located in the Klang Valley. A third, 1st Avenue, will be developed in George Town, Penang.
The fourth, Island Plaza, is an existing mall in Penang that will be refurbished in the first quarter of next year.
Pramerica has appointed property consultant DTZ Nawawi Tie Leung Property Consultants Sdn Bhd to be the leasing agent and retail mall manager.
DTZ will be in charge of looking for tenants to fill up about 1.8 million sq ft in the four malls.
DTZ senior director Adzman Shah said there still appears to be healthy demand for retail space in Malaysia despite the global economic slowdown.
Retailers are gravitating towards well-run malls in good locations, especially in suburban areas, he added.
"We have received a lot of inquiries and that is a good indication of where the market is going. Most of them know the market will move very fast once it picks up .... people are preparing for the next push," Adzman said.
The Ampang mall, located along the upper end of Jalan Ampang, is to be completed by the first quarter of 2011. Its first phase will comprise a six-level retail podium.
SStwo, built within the SS2 Petaling Jaya residential and commercial area, and 1st Avenue, situated along Penang's Magazine Road, are both expected to open by late 2009.
SStwo is to be a five-level mall, while 1st Avenue - a joint venture between ARMF, Penang's Belleview Group and the Lion group - will have seven levels of retail space, including a dedicated youth level.
"We are offering local, regional and international retailers a different and wider range of retail estate to establish their businesses," Loh said.
ARMF has no plans to acquire more properties in Malaysia for now as its focus will be on the four malls, he said.
On whether the malls would be injected into a real estate investment trust, Loh said it was a possibility that the fund would consider later.
In Singapore, ARMF manages shopping malls such as Tiong Bahru Plaza, Century Square, Hougang Mall, White Sands, Liang Court and Tampines 1.
By Business Times (by Adeline Paul Raj)
Monday, November 3, 2008
Berjaya Jeju Resort slated to be launched in first quarter 2009
BERJAYA Jeju Resort, which will be developed into a world-class integrated tourism and recreational destination on the honeymoon island of Jeju, will mark Berjaya Land Bhd’s (BLand) entry into South Korea’s property market when the project is launched in the first quarter of next year.
The development would be undertaken by Berjaya Jeju Resort Ltd, a 81:19 joint venture between BLand and Jeju Free International City Development Centre (JDC).
The joint venture company has invested US$30mil as initial paid-up capital in the development.
BLand chief executive officer Datuk Francis Ng said the development was a strategic investment because the geographical location of Jeju made it a well-connected city with a potential market of over 750 million people.
“Jeju’s free international city status coupled with various tax incentives, such as the five-year corporate tax exemption from the first year of profits, and the property tax exemption of 15 years for both Korean and foreign investors, are the primary factors why Jeju is seen as a good investment destination,” he told Malaysian journalists on a recent site tour of the project.
Other favourable factors include a friendly corporate investment environment, an effective legal system, and the availability of professionals drawn from the ranks of the more than 6,000 local graduates churned out there yearly.
“We are confident that our long term investment in South Korea will stand us in good stead for stronger growth and to partake in other related business activities in the coming years,” Ng added.
Located on 183 acres in Yerae-dong in Seogwipo City in southwest Jeju, Berjaya Jeju Resort with a potential gross development value (GDV) of US$3.5bil is targeted for completion in 2015.
Among the various components of the development will be 1,282 residences, including villas and apartments, worth a GDV of US$1.5bil; a casino, two hotels, shopping mall, an indoor arena and a valley resort and wellness resort.
Ng said the indicative prices of the residential properties in Berjaya Jeju Resort would be between US$500 and US$600 per sq ft.
The first phase of the development, comprising the North Gate mid-rise apartments, is planned for launch in the first quarter next year. The other precincts including the casino, casino hotel and shopping mall would kick off in two to three years.
BLand senior general manager for properties marketing Mah Siew Wan said as there was no restriction on foreign buyers to purchase property in Jeju, “we will be targeting buyers from China, Japan and Taiwan.”
“Our immediate target market will be Korean buyers, especially from Seoul. It is said that it is every Korean’s dream to own a home on Jeju island,” Mah said.
South Korea has a population of more than 70 million, of which 560,000 are residents in Jeju.
According to JDC chairman and chief executive officer Kim Kyung Taeg, Berjaya Jeju Resort would redefine Jeju’s waterfront and bring a whole new dimension to Jeju’s tourism industry.
“It is expected to foster an eco-friendly, high value-added leisure environment and is part of our vision to establish Jeju as an international city with world-class tourist destination developments,” Kim said.
The integrated resort development would be able to position Jeju as an important investment opportunity and also put the island on the world map.
By The Star
The development would be undertaken by Berjaya Jeju Resort Ltd, a 81:19 joint venture between BLand and Jeju Free International City Development Centre (JDC).
The joint venture company has invested US$30mil as initial paid-up capital in the development.
BLand chief executive officer Datuk Francis Ng said the development was a strategic investment because the geographical location of Jeju made it a well-connected city with a potential market of over 750 million people.
“Jeju’s free international city status coupled with various tax incentives, such as the five-year corporate tax exemption from the first year of profits, and the property tax exemption of 15 years for both Korean and foreign investors, are the primary factors why Jeju is seen as a good investment destination,” he told Malaysian journalists on a recent site tour of the project.
Other favourable factors include a friendly corporate investment environment, an effective legal system, and the availability of professionals drawn from the ranks of the more than 6,000 local graduates churned out there yearly.
“We are confident that our long term investment in South Korea will stand us in good stead for stronger growth and to partake in other related business activities in the coming years,” Ng added.
Located on 183 acres in Yerae-dong in Seogwipo City in southwest Jeju, Berjaya Jeju Resort with a potential gross development value (GDV) of US$3.5bil is targeted for completion in 2015.
Among the various components of the development will be 1,282 residences, including villas and apartments, worth a GDV of US$1.5bil; a casino, two hotels, shopping mall, an indoor arena and a valley resort and wellness resort.
Ng said the indicative prices of the residential properties in Berjaya Jeju Resort would be between US$500 and US$600 per sq ft.
The first phase of the development, comprising the North Gate mid-rise apartments, is planned for launch in the first quarter next year. The other precincts including the casino, casino hotel and shopping mall would kick off in two to three years.
BLand senior general manager for properties marketing Mah Siew Wan said as there was no restriction on foreign buyers to purchase property in Jeju, “we will be targeting buyers from China, Japan and Taiwan.”
“Our immediate target market will be Korean buyers, especially from Seoul. It is said that it is every Korean’s dream to own a home on Jeju island,” Mah said.
South Korea has a population of more than 70 million, of which 560,000 are residents in Jeju.
According to JDC chairman and chief executive officer Kim Kyung Taeg, Berjaya Jeju Resort would redefine Jeju’s waterfront and bring a whole new dimension to Jeju’s tourism industry.
“It is expected to foster an eco-friendly, high value-added leisure environment and is part of our vision to establish Jeju as an international city with world-class tourist destination developments,” Kim said.
The integrated resort development would be able to position Jeju as an important investment opportunity and also put the island on the world map.
By The Star
High growth in BLand overseas ventures
BERJAYA Land Bhd (BLand), which ventured into the international property development market in a big way two years ago, has in the pipeline a number of interesting residential, commercial and resort projects abroad.
While cautious of the impact of the global financial meltdown on the property market, chief executive officer Datuk Framcis Ng said: “We are invested in these countries for the long term and we have confidence that these countries are resilient enough to weather the downturn and recover when the global economy picks up in time.”
He does not discount the need to slow down or defer some of the company’s projects if the demand is not there.
To finance its ventures overseas, Ng said BLand would be disposing of more assets including shopping malls and overseas hotels, for working capital.
In the past 12 to 18 months, the BLand group had raised approximately RM1.8bil from the sale of assets and Treasury BLand irredeemable convertible unsecured loan stocks. KL Plaza was sold for RM470.6mil in February while the sale of two hotels in Seychelles and Mauritius raked in RM145mil.
Ng pointed out that BLand’s bottomline these two to three years would be well cushioned by income generated from local property development and investment projects, as well as its gaming and hotel activities.
BLand expects overseas ventures to contribute about 30% to the group’s revenue in the next four years.
According to Ng, BLand’s property projects in Vietnam, South Korea, China and Libya will start making more significant contribution by then.
Its maiden project on Jeju island in South Korea, Berjaya Jeju Resort, would make up half of the contribution to the property division.
About 30% of the revenue contribution will come from gaming and the balance from local property development and investment, hotel and recreation businesses.
Ng said together with BLand’s property projects in Malaysia, BLand’s property division could chalk up 50% of BLand’s group revenue by 2012.
BLand’s landbank include 1,000 acres in Malaysia, 660 acres in Thailand, 2,300 acres in Vietnam with investment licences granted, 76 acres in China that are currently under development and 183 acres in Jeju.
The first phase of Berjaya Jeju Resort comprising the North Gate mid-rise apartments is scheduled for launch in the first quarter of 2009.
Over the next eight years, the Jeju project is expected to contribute net earnings of US$100mil a year to BLand.
“In Vietnam, we target to launch the first phase of Thach Ban in Hanoi by early next year. We have started work on the Dong Nai residential development project, and are planning to launch it in the second quarter of 2009.
“We have also received investment licences for the Vietnam Financial Centre and the Vietnam International University Township projects, and are now awaiting construction permits. The four projects in Vietnam are worth a total gross development value (GDV) of US$2.5bil,” Ng told StarBiz.
In China, BLand is developing the Great Mall of China, a retail mall in Beijing which is targeted for completion in three to four years. The project, with a GDV of RM1.8bil is already 10% completed.
The company has also recently ventured into Libya to undertake the development of an integrated golf resort cum residential and commercial project in Tripoli.
The project, with GDV of RM2.5bil would take off in the second quarter of next year.
For the financial year ended April 30, 2008 (FY08), local property projects contributed 20% of the group’s revenue of RM1.5bil while the share from gaming was 56%. BLand recorded net earnings of RM1.1bil in FY08.
Analysts said with the consolidation of BToto as a 50% subsidiary of BLand in February, contribution from the gaming sector was expected to jump to more than 80% these two to three years.
Meanwhile, the annual dividend of RM150mil to RM200mil received from BToto is also a boost to BLand’s cash flow, they said.
By The Star (by Angie Ng)
While cautious of the impact of the global financial meltdown on the property market, chief executive officer Datuk Framcis Ng said: “We are invested in these countries for the long term and we have confidence that these countries are resilient enough to weather the downturn and recover when the global economy picks up in time.”
He does not discount the need to slow down or defer some of the company’s projects if the demand is not there.
To finance its ventures overseas, Ng said BLand would be disposing of more assets including shopping malls and overseas hotels, for working capital.
In the past 12 to 18 months, the BLand group had raised approximately RM1.8bil from the sale of assets and Treasury BLand irredeemable convertible unsecured loan stocks. KL Plaza was sold for RM470.6mil in February while the sale of two hotels in Seychelles and Mauritius raked in RM145mil.
Ng pointed out that BLand’s bottomline these two to three years would be well cushioned by income generated from local property development and investment projects, as well as its gaming and hotel activities.
BLand expects overseas ventures to contribute about 30% to the group’s revenue in the next four years.
According to Ng, BLand’s property projects in Vietnam, South Korea, China and Libya will start making more significant contribution by then.
Its maiden project on Jeju island in South Korea, Berjaya Jeju Resort, would make up half of the contribution to the property division.
About 30% of the revenue contribution will come from gaming and the balance from local property development and investment, hotel and recreation businesses.
Ng said together with BLand’s property projects in Malaysia, BLand’s property division could chalk up 50% of BLand’s group revenue by 2012.
BLand’s landbank include 1,000 acres in Malaysia, 660 acres in Thailand, 2,300 acres in Vietnam with investment licences granted, 76 acres in China that are currently under development and 183 acres in Jeju.
The first phase of Berjaya Jeju Resort comprising the North Gate mid-rise apartments is scheduled for launch in the first quarter of 2009.
Over the next eight years, the Jeju project is expected to contribute net earnings of US$100mil a year to BLand.
“In Vietnam, we target to launch the first phase of Thach Ban in Hanoi by early next year. We have started work on the Dong Nai residential development project, and are planning to launch it in the second quarter of 2009.
“We have also received investment licences for the Vietnam Financial Centre and the Vietnam International University Township projects, and are now awaiting construction permits. The four projects in Vietnam are worth a total gross development value (GDV) of US$2.5bil,” Ng told StarBiz.
In China, BLand is developing the Great Mall of China, a retail mall in Beijing which is targeted for completion in three to four years. The project, with a GDV of RM1.8bil is already 10% completed.
The company has also recently ventured into Libya to undertake the development of an integrated golf resort cum residential and commercial project in Tripoli.
The project, with GDV of RM2.5bil would take off in the second quarter of next year.
For the financial year ended April 30, 2008 (FY08), local property projects contributed 20% of the group’s revenue of RM1.5bil while the share from gaming was 56%. BLand recorded net earnings of RM1.1bil in FY08.
Analysts said with the consolidation of BToto as a 50% subsidiary of BLand in February, contribution from the gaming sector was expected to jump to more than 80% these two to three years.
Meanwhile, the annual dividend of RM150mil to RM200mil received from BToto is also a boost to BLand’s cash flow, they said.
By The Star (by Angie Ng)
Local real estate cheap for foreigners
Despite the current global financial meltdown, the Malaysian property market still remains attractive to foreign investors, according to International Real Estate Federation (FIABCI) Malaysia honorary treasurer Yeow Thit Sang.
“The local property market is still attractive in terms of prices. Properties in Malaysia are among the cheapest in the region,” he told StarBiz.
“Our laws are also comparatively more lenient for foreigners to buy and sell property in Malaysia,” he added.
Yeow said foreigners wanting to purchase property in countries such as Indonesia, the Philippines, Thailand and Vietnam were generally put off by the countries’ respective laws.
Another plus point for foreigners who bought property in Malaysia is that they are not subjected to death taxes, Yeow said.
“Japan has a death tax of 70%. Even in England death duties are stringent. That is why all the Lords are becoming paupers!”
Yeow said FIABCI-Malaysia would be sending a representative to Japan in December to create more awareness about the local property market and to encourage more foreign direct investment (FDI) into Malaysia.
He also said the local political development was not creating uncertainty and was not deterring foreign investors from Malaysia.
“The political scene in Malaysia is a normal democratic process. It is a sign of political maturity rather than uncertainty. It is not causing chaos like some countries,” Yeow said.
On another issue, when asked if the local property market was in a slump, Yeow said: “Our property market has not hit a slump. It is more of a slowdown.”
He attributed the slowdown to rising raw material prices that was sparked by the fuel price hike in June.
“Problems occur when construction cost goes up midway through a project and it is uncertain if it is the developer, contractor or consumer that will bear the cost,” Yeow said.
He said many contractors were increasingly reluctant to take on projects without a variation clause spelt out in the contract.
“Both contractors and developers should insist on a variation clause in their contracts to safeguard their interests.
“Should construction costs go up midway through the project, they can immediately determine who bears the cost and not have projects hanging,” Yeow said.
Going forward, he said he did not foresee see a slump in the local property market.
“There can never be a slump so long as there is demand. There is a lot of migration from rural to urban areas.
“The population is growing steadily and there will always be a need to house people,” he said.
“From an investment point of view, buying property is also a good safeguard against inflation,” Yeow added.
Yeow believes a high level of unemployment in the country could cause the local property sector to tumble.
“If unemployment were to rise, people will not be able to pay their loans and that will cause a slump. When that happens, banks will also take back the property,” he said, adding that the unemployment rate in Malaysia was low now.
“We still need to bring in foreign workers,” Yeow said.
On another note, Yeow said the standard of property development in Malaysia had improved tremendously over the years and it was being benchmarked against international standards.
“Our developments are definitely on par with those of other countries. Many of our projects have won international awards such as FIABCI International Prix d’Excellence,” he said.
The International Prix d’Excellence is an annual competition that honours the world’s best property projects.
On the local front, developers are recognised for their development projects and are honoured at the annual Malaysia Property Award.
Winners of the Malaysia Property Award in their relevant categories will go on to represent Malaysia the following year at the International Prix d’Excellence.
FIABCI Malaysia will be organising its 16th Malaysia Property Award on Nov 12 at the One World Hotel in Petaling Jaya, with Malayan Banking Bhd as the official sponsor.
The categories that will be contested are: Property Man of the Year, Master Plan, Residential Development (low rise and high rise), Retail Development, Industrial Development, Specialised Project (two categories), Office Development, Hotel Development and Resort Development.
The Yang di-Pertuan Agong and Raja Permaisuri Agong will be the guests of honour at the prestigious event.
By The Star (by Eugene Mahalingam)
“The local property market is still attractive in terms of prices. Properties in Malaysia are among the cheapest in the region,” he told StarBiz.
“Our laws are also comparatively more lenient for foreigners to buy and sell property in Malaysia,” he added.
Yeow said foreigners wanting to purchase property in countries such as Indonesia, the Philippines, Thailand and Vietnam were generally put off by the countries’ respective laws.
Another plus point for foreigners who bought property in Malaysia is that they are not subjected to death taxes, Yeow said.
“Japan has a death tax of 70%. Even in England death duties are stringent. That is why all the Lords are becoming paupers!”
Yeow said FIABCI-Malaysia would be sending a representative to Japan in December to create more awareness about the local property market and to encourage more foreign direct investment (FDI) into Malaysia.
He also said the local political development was not creating uncertainty and was not deterring foreign investors from Malaysia.
“The political scene in Malaysia is a normal democratic process. It is a sign of political maturity rather than uncertainty. It is not causing chaos like some countries,” Yeow said.
On another issue, when asked if the local property market was in a slump, Yeow said: “Our property market has not hit a slump. It is more of a slowdown.”
He attributed the slowdown to rising raw material prices that was sparked by the fuel price hike in June.
“Problems occur when construction cost goes up midway through a project and it is uncertain if it is the developer, contractor or consumer that will bear the cost,” Yeow said.
He said many contractors were increasingly reluctant to take on projects without a variation clause spelt out in the contract.
“Both contractors and developers should insist on a variation clause in their contracts to safeguard their interests.
“Should construction costs go up midway through the project, they can immediately determine who bears the cost and not have projects hanging,” Yeow said.
Going forward, he said he did not foresee see a slump in the local property market.
“There can never be a slump so long as there is demand. There is a lot of migration from rural to urban areas.
“The population is growing steadily and there will always be a need to house people,” he said.
“From an investment point of view, buying property is also a good safeguard against inflation,” Yeow added.
Yeow believes a high level of unemployment in the country could cause the local property sector to tumble.
“If unemployment were to rise, people will not be able to pay their loans and that will cause a slump. When that happens, banks will also take back the property,” he said, adding that the unemployment rate in Malaysia was low now.
“We still need to bring in foreign workers,” Yeow said.
On another note, Yeow said the standard of property development in Malaysia had improved tremendously over the years and it was being benchmarked against international standards.
“Our developments are definitely on par with those of other countries. Many of our projects have won international awards such as FIABCI International Prix d’Excellence,” he said.
The International Prix d’Excellence is an annual competition that honours the world’s best property projects.
On the local front, developers are recognised for their development projects and are honoured at the annual Malaysia Property Award.
Winners of the Malaysia Property Award in their relevant categories will go on to represent Malaysia the following year at the International Prix d’Excellence.
FIABCI Malaysia will be organising its 16th Malaysia Property Award on Nov 12 at the One World Hotel in Petaling Jaya, with Malayan Banking Bhd as the official sponsor.
The categories that will be contested are: Property Man of the Year, Master Plan, Residential Development (low rise and high rise), Retail Development, Industrial Development, Specialised Project (two categories), Office Development, Hotel Development and Resort Development.
The Yang di-Pertuan Agong and Raja Permaisuri Agong will be the guests of honour at the prestigious event.
By The Star (by Eugene Mahalingam)
Emkay to build RM4.3b Cyberjaya projects from 2010
EMKAY Group, controlled by developer Tan Sri Mustapha Kamal Abu Bakar, plans to build RM4.3 billion worth of properties in Cyberjaya, Selangor, from 2010.
The future developments will add another 10 million sq ft of office space in Cyberjaya in several years, Mustapha Kamal said.
"The group is now looking at buying some 70 acres of prime land for that purpose," he said after a ceremony to mark the construction of an 11-storey office building at its NeoCyber project in Cyberjaya on Saturday.
The Emkay group is helping to develop Cyberjaya through major projects such as NeoCyber and MKN EmbassyTechzone.
The latter's development is a 60:40 joint venture with India's Embassy Group.
Until then, Emkay will first build eight office towers at MKN Embassy Techzone next year.
The office buildings will boast a gross development value of RM800 million, covering an office space of two million sq ft. It had bought 20 acres for the project.
State-owned Amanah Raya Bhd recently bought three completed office buildings at MKN Embassy Techzone development for a combined RM266 million.
Emkay has so far completed projects totalling RM291 million and an office space of 700,000 sq ft in Cyberjaya.
By 2011, it will have provided a total 3.5 million sq ft of office space.
On whether the looming economic recession would hamper the group's development plans, he said: "We have successfully gone through two recessions before. With this experience, God willing, we are confident that our future projects will go on as planned."
Meanwhile, Emkay has built 272 residential units and 205 shop offices at NeoCyber.
Being built in four phases since 2007, the development is into its third phase, which started last month and slated for completion by June 2010.
By Business Times (by Zuraimi Abdullah)
The future developments will add another 10 million sq ft of office space in Cyberjaya in several years, Mustapha Kamal said.
"The group is now looking at buying some 70 acres of prime land for that purpose," he said after a ceremony to mark the construction of an 11-storey office building at its NeoCyber project in Cyberjaya on Saturday.
The Emkay group is helping to develop Cyberjaya through major projects such as NeoCyber and MKN EmbassyTechzone.
The latter's development is a 60:40 joint venture with India's Embassy Group.
Until then, Emkay will first build eight office towers at MKN Embassy Techzone next year.
The office buildings will boast a gross development value of RM800 million, covering an office space of two million sq ft. It had bought 20 acres for the project.
State-owned Amanah Raya Bhd recently bought three completed office buildings at MKN Embassy Techzone development for a combined RM266 million.
Emkay has so far completed projects totalling RM291 million and an office space of 700,000 sq ft in Cyberjaya.
By 2011, it will have provided a total 3.5 million sq ft of office space.
On whether the looming economic recession would hamper the group's development plans, he said: "We have successfully gone through two recessions before. With this experience, God willing, we are confident that our future projects will go on as planned."
Meanwhile, Emkay has built 272 residential units and 205 shop offices at NeoCyber.
Being built in four phases since 2007, the development is into its third phase, which started last month and slated for completion by June 2010.
By Business Times (by Zuraimi Abdullah)
Global crisis won't derail Malton's regional ambitions
Chief operating officer Yeoh Teng Tatt said the crisis will not derail plans to expand its property developments regionally nor will it derail any current projects.
"We are exploring potentials abroad and will carry out feasibility studies when something materialises. In the meantime, we will proceed to develop current projects as per plan even if we are suffering from thinner (profit) margins," Yeoh said.
The main board-listed firm's current outstanding order book totals some RM2 billion, which will keep it busy until 2011.
Yeoh said Malton is expected to do better this year, encouraged by sales from its recently launched projects including Amaya Saujana, V Square, Pearl Villas and Bayu Villas.
"For new launches, we did quite well for the higher-end products, which are more resilient to the market (slowdown)," Yeoh said.
For fiscal year ended June 30 2008, it posted a net loss of RM3.1 million from a net profit of RM4.7 million in 2007.
While there may be no further launches for the rest of this year, Malton is gearing up to launch its maiden signature condominium project in Penang, dubbed The Mansion@Cantonment, also the first for the firm outside the Klang Valley, by early next year.
It is a 36-storey block with duplexes fronting the sea and city worth RM47 million.
Also in the plan is to launch a mixed-commercial project in Taman Maluri, Cheras, worth some RM200 million, by March 2009.
"We are fortunate to have an in-house construction arm to plan our resources. This holds water for our next launches," Yeoh said.
To augment its landbank and continue with its property developments especially in Johor, Malton recently bought Austin Heights Sdn Bhd (AHSB) for RM103 million.
AHSB is involved in a 78.8ha project called Austin Heights in Tebrau, Johor, comprising houses, condominiums, retail units and schools.
By Business Times (by Sharen Kaur)
Nomad unveils serviced offices at Pavilion KL
The Nomad Group Bhd's unit has unveiled its latest serviced offices, The Nomad Offices Pavilion KL, situated in Bukit Bintang to cater to business professionals.
They are located on the eighth floor of the shopping centre and will be the sixth Nomad offices available in the central business district of Kuala Lumpur.
The serviced offices offer fully furnished and unfurnished office suites, virtual office, meeting rooms, business lounge and video conferencing facilities, in addition to office support services.
They will cater to retail-based companies, not only to be used as their corporate headquarters, but also as satellite offices.
"The smaller fully furnished office suites of three to four workstations can be expanded to increase floor space and accommodate more workstations," Nomad Group chief executive officer Hew Thin Chay said in a statement.
By Business Times
They are located on the eighth floor of the shopping centre and will be the sixth Nomad offices available in the central business district of Kuala Lumpur.
The serviced offices offer fully furnished and unfurnished office suites, virtual office, meeting rooms, business lounge and video conferencing facilities, in addition to office support services.
They will cater to retail-based companies, not only to be used as their corporate headquarters, but also as satellite offices.
"The smaller fully furnished office suites of three to four workstations can be expanded to increase floor space and accommodate more workstations," Nomad Group chief executive officer Hew Thin Chay said in a statement.
By Business Times
Friday, October 31, 2008
Sunway unit to operate Allson Capital in KL
Sunway International Hotels & Resorts, a company under Sunway Group, has signed a management agreement to operate the three-star Allson Capital Hotel Medan Tuanku in Kuala Lumpur in 2011.
The 198-room hotel, to be built at an estimated cost of RM82 million by Capital Properties Sdn Bhd, will be ready in the third quarter of 2011.
Sunway International's chief executive officer Hanley Chew said the hotel expects to achieve a 60 per cent occupancy and a RM175 average room rate (ARR) in the first year of operations.
The bulk of its guests is expected to be the business crowd. Apart from the domestic market, the hotel is also targeting travellers from the Asean region, Hong Kong, India, Middle East, Australia and Europe.
"Allson Capital Hotel Medan Tuanku will be fitted with business-class facilities, and will be designed to serve travellers who seek dependable, consistent and practical accommodation options. The hotel will offer 'selected services' accommodation for today's travellers without compromising comfort and design," Hanley said.
The hotel is expected to offer room rates below the traditional full-service hotel, despite its location in the heart of the city.
Some 55 per cent of its business crowd is expected to be corporate, contributed by multinational companies and the commercial sector from the Kuala Lumpur/Klang Valley areas. Another 15 per cent is expected to come from meeting and conference groups, both foreign and local.
The developer of the hotel, Capital Properties Bhd, was formed in the 1960s to engage in the development of the Medan Tuanku area of Kuala Lumpur. A subsidiary of Glenmarie Estates Sdn Bhd, this is Capital Properties' first hotel project.
Sunway International, meanwhile, manages and franchises hotels under the Sunway Hotels & Resorts and Allson Hotels & Resorts brand names.
By New Straits Time
The 198-room hotel, to be built at an estimated cost of RM82 million by Capital Properties Sdn Bhd, will be ready in the third quarter of 2011.
Sunway International's chief executive officer Hanley Chew said the hotel expects to achieve a 60 per cent occupancy and a RM175 average room rate (ARR) in the first year of operations.
The bulk of its guests is expected to be the business crowd. Apart from the domestic market, the hotel is also targeting travellers from the Asean region, Hong Kong, India, Middle East, Australia and Europe.
"Allson Capital Hotel Medan Tuanku will be fitted with business-class facilities, and will be designed to serve travellers who seek dependable, consistent and practical accommodation options. The hotel will offer 'selected services' accommodation for today's travellers without compromising comfort and design," Hanley said.
The hotel is expected to offer room rates below the traditional full-service hotel, despite its location in the heart of the city.
Some 55 per cent of its business crowd is expected to be corporate, contributed by multinational companies and the commercial sector from the Kuala Lumpur/Klang Valley areas. Another 15 per cent is expected to come from meeting and conference groups, both foreign and local.
The developer of the hotel, Capital Properties Bhd, was formed in the 1960s to engage in the development of the Medan Tuanku area of Kuala Lumpur. A subsidiary of Glenmarie Estates Sdn Bhd, this is Capital Properties' first hotel project.
Sunway International, meanwhile, manages and franchises hotels under the Sunway Hotels & Resorts and Allson Hotels & Resorts brand names.
By New Straits Time
Malaysia urged to promote property tourism
PETALING JAYA: Malaysia should promote “property” tourism to bring in foreign direct investment that would benefit not only the economy but also the retail industry.
Prime properties like this one in Setia Eco Park might be attractive to foreign investors.
International Real Estate Federation (FIABCI) Malaysia president Datuk Richard Fong said some real estate agencies in Penang had started to bring in groups of foreign tourists under a “property” tourism package that included visits to property launches and show houses.
The idea, he said, was to encourage these tourists to buy local property. As these visitors also shopped and stayed at hotels, their visits had benefited the hotel and retail industry, he added.
Fong, who is Glomac Bhd executive vice chairman, said the newly set up Malaysian Investment Inc by FIABCI Malaysia and the Economic Planning Unit, would strive to promote Malaysian properties abroad.
“With 1,000 foreigners each buying RM1mil worth of property in Malaysia, that will amount to RM1bil,” he said during a panel discussion on the “Synergies of shopping on tourism” at the Council of Asian Shopping Centres Conference 2008 on Wednesday.
He said it had been found that each foreign expatriate who bought a home in Malaysia spent an average of RM10,000 a month.
This would amount to RM10mil a month for 1,000 expatriates.
“They will also bring their friends to visit Malaysia. This is good not only for local properties but also for all of you (shopping centres),” he said, adding that the Malaysia My Second Home (MM2H) had been “under-played”.
Malaysian Association for Shopping and Highrise Complex Management advisor Datuk Eddy Chen, while advocating wholesome “family” tourism, also noted that “sin” tourism like casinos and karaoke lounges had brought in the big spenders for certain countries.
While it was a good to promote Malaysia as a tourism hub, Chen said it was also important to look into offering more quality products and services and increase Internet marketing.
“We’re neither here nor there whereas Singapore offers a cocktail of incentives,” said the Metro Kajang Group managing director.
Tune Hotels Sdn Bhd chief executive officer Mark Lankester in calling for a revival of “sports” tourism said Tune Hotels and its sister company AirAsia Bhd, were making it affordable for tourists to travel and stay in Malaysia.
By paying less on air travel and accommodation, tourists could spend more on shopping, he said, adding that it was part of Tune Hotels’ strategy to set up hotels near shopping areas and at shopping centres.
Malaysia Association of Convention and Exhibition Organisers and Suppliers president Jonathan Kan called for more “cross border” selling to promote travel among Asean nations and bring in more international conferences to Malaysia.
By The Star (by S.C.Cheah)
Prime properties like this one in Setia Eco Park might be attractive to foreign investors.
International Real Estate Federation (FIABCI) Malaysia president Datuk Richard Fong said some real estate agencies in Penang had started to bring in groups of foreign tourists under a “property” tourism package that included visits to property launches and show houses.
The idea, he said, was to encourage these tourists to buy local property. As these visitors also shopped and stayed at hotels, their visits had benefited the hotel and retail industry, he added.
Fong, who is Glomac Bhd executive vice chairman, said the newly set up Malaysian Investment Inc by FIABCI Malaysia and the Economic Planning Unit, would strive to promote Malaysian properties abroad.
“With 1,000 foreigners each buying RM1mil worth of property in Malaysia, that will amount to RM1bil,” he said during a panel discussion on the “Synergies of shopping on tourism” at the Council of Asian Shopping Centres Conference 2008 on Wednesday.
He said it had been found that each foreign expatriate who bought a home in Malaysia spent an average of RM10,000 a month.
This would amount to RM10mil a month for 1,000 expatriates.
“They will also bring their friends to visit Malaysia. This is good not only for local properties but also for all of you (shopping centres),” he said, adding that the Malaysia My Second Home (MM2H) had been “under-played”.
Malaysian Association for Shopping and Highrise Complex Management advisor Datuk Eddy Chen, while advocating wholesome “family” tourism, also noted that “sin” tourism like casinos and karaoke lounges had brought in the big spenders for certain countries.
While it was a good to promote Malaysia as a tourism hub, Chen said it was also important to look into offering more quality products and services and increase Internet marketing.
“We’re neither here nor there whereas Singapore offers a cocktail of incentives,” said the Metro Kajang Group managing director.
Tune Hotels Sdn Bhd chief executive officer Mark Lankester in calling for a revival of “sports” tourism said Tune Hotels and its sister company AirAsia Bhd, were making it affordable for tourists to travel and stay in Malaysia.
By paying less on air travel and accommodation, tourists could spend more on shopping, he said, adding that it was part of Tune Hotels’ strategy to set up hotels near shopping areas and at shopping centres.
Malaysia Association of Convention and Exhibition Organisers and Suppliers president Jonathan Kan called for more “cross border” selling to promote travel among Asean nations and bring in more international conferences to Malaysia.
By The Star (by S.C.Cheah)
Ivory seeks investor for proposed 5-star hotel
IVORY Properties Group is looking for an investor for the 450-room five-star hotel planned at its Penang Times Square development in Penang.
Ivory Properties Sdn Bhd executive director Datuk Seri Nazir Ariff Mushir Ariff said the proposed hotel and podium block carry an estimated gross development value of RM250 million.
"The 10-storey podium block will comprise six floors of retail outlets and six parking levels," he told Business Times in an interview.
Nazir said the hotel will form the fourth phase of development for the RM400 million Penang Times Square project on the fringe of George Town's heritage enclave, which has been included in Unesco's World Heritage List.
"We are seeking an investor who is also keen to operate the hotel whose rooms are expected to take up 200,000 sq ft over 20 floors.
"Alternatively, we are willing to build the hotel if a renowned hotel chain is keen to operate it on a long-term basis," he said, adding that the proposed hotel is expected to break ground in 2010 and be completed by 2013.
Ivory Properties managing director Datuk Low Eng Hock said the company has held initial talks with potential investors from the Middle East, but nothing has materialised as yet.
According to Nazir, the first two phases of Penang Times Square, which include residential and commercial units, are scheduled to be completed early next year.
"The third phase, which will include a convention and exhibition centre and a cineplex, is expected to break ground by the end of 2009," he said.
The value of the residential units has already appreciated by 30 per cent, while that of neighbouring properties in the Datuk Keramat area has doubled.
Penang Times Square sits on 5.2ha where one of the country's oldest tin smelting operations, Escoy Smelting Sdn Bhd, once stood.
About 0.8ha has been earmarked by Ivory Properties for an urban open space and a heritage museum.
Ivory Properties' other projects include the luxurious hilltop villas at its "Moonlight Bay" development along the Batu Ferringi tourism belt and "The View Twin Towers" which overlook the Penang Bridge.
By New Straits Times (by Marina Emmanuel)
Ivory Properties Sdn Bhd executive director Datuk Seri Nazir Ariff Mushir Ariff said the proposed hotel and podium block carry an estimated gross development value of RM250 million.
"The 10-storey podium block will comprise six floors of retail outlets and six parking levels," he told Business Times in an interview.
Nazir said the hotel will form the fourth phase of development for the RM400 million Penang Times Square project on the fringe of George Town's heritage enclave, which has been included in Unesco's World Heritage List.
"We are seeking an investor who is also keen to operate the hotel whose rooms are expected to take up 200,000 sq ft over 20 floors.
"Alternatively, we are willing to build the hotel if a renowned hotel chain is keen to operate it on a long-term basis," he said, adding that the proposed hotel is expected to break ground in 2010 and be completed by 2013.
Ivory Properties managing director Datuk Low Eng Hock said the company has held initial talks with potential investors from the Middle East, but nothing has materialised as yet.
According to Nazir, the first two phases of Penang Times Square, which include residential and commercial units, are scheduled to be completed early next year.
"The third phase, which will include a convention and exhibition centre and a cineplex, is expected to break ground by the end of 2009," he said.
The value of the residential units has already appreciated by 30 per cent, while that of neighbouring properties in the Datuk Keramat area has doubled.
Penang Times Square sits on 5.2ha where one of the country's oldest tin smelting operations, Escoy Smelting Sdn Bhd, once stood.
About 0.8ha has been earmarked by Ivory Properties for an urban open space and a heritage museum.
Ivory Properties' other projects include the luxurious hilltop villas at its "Moonlight Bay" development along the Batu Ferringi tourism belt and "The View Twin Towers" which overlook the Penang Bridge.
By New Straits Times (by Marina Emmanuel)
Las Vegas Sands, Resorts say S'pore casinos on track
SINGAPORE: Las Vegas Sands plans to open its Singapore casino by end-2009 as scheduled despite a report that the project will be delayed, a Singapore-based company executive said yesterday.
"We continue to target the end of 2009 for the opening of Marina Bay Sands," George Tanasijevich, general manager of Marina Bay Sands, said in a statement.
His comments follow a report in the Straits Times newspaper yesterday, which said the casino project was several months behind schedule due to construction issues and a shortage of labour.
An old sea wall built by British colonial rulers set back the laying down of foundation works on the construction site which sits on reclaimed land, the report said.
According to the paper, event organisers said the casino had indicated that it would only accept bookings from April 2010.
The Marina Bay Sands is being built on reclaimed land near Singapore's central business district and is scheduled to open in late 2009. The second, Genting International's Resorts World at Sentosa, is slated for completion in 2010.
Resorts World may also see a delay in the opening of some of its facilities although a casino spokeswoman said it was "on track" for a "soft opening" in 2010, the paper said.
The Straits Times said Resorts World at Sentosa was in talks with the government to defer the opening of some facilities in the US$4.1 billion (US$1 = RM3.55) project.
However, four hotels, the Universal Studios theme park and the casino would open as scheduled in the first quarter of 2010, the paper added.
The delay in the opening of some of the facilities is due to the need to find storage space for the equipment for the attractions in the Universal Studios theme park, it said.
Resorts World at Sentosa spokeswoman Krist Boo denied there were any delays.
"The development is progressing well and on schedule," she said in a statement.
The plan all along was for a "soft launch" in the first quarter of 2010 with Universal Studios, Festive Walk, the casino and most of the hotels, she said.
The other attractions, including the marine life park, a spa and two hotels were scheduled to open in subsequent quarters, she added.
By Reuters, AFP
"We continue to target the end of 2009 for the opening of Marina Bay Sands," George Tanasijevich, general manager of Marina Bay Sands, said in a statement.
His comments follow a report in the Straits Times newspaper yesterday, which said the casino project was several months behind schedule due to construction issues and a shortage of labour.
An old sea wall built by British colonial rulers set back the laying down of foundation works on the construction site which sits on reclaimed land, the report said.
According to the paper, event organisers said the casino had indicated that it would only accept bookings from April 2010.
The Marina Bay Sands is being built on reclaimed land near Singapore's central business district and is scheduled to open in late 2009. The second, Genting International's Resorts World at Sentosa, is slated for completion in 2010.
Resorts World may also see a delay in the opening of some of its facilities although a casino spokeswoman said it was "on track" for a "soft opening" in 2010, the paper said.
The Straits Times said Resorts World at Sentosa was in talks with the government to defer the opening of some facilities in the US$4.1 billion (US$1 = RM3.55) project.
However, four hotels, the Universal Studios theme park and the casino would open as scheduled in the first quarter of 2010, the paper added.
The delay in the opening of some of the facilities is due to the need to find storage space for the equipment for the attractions in the Universal Studios theme park, it said.
Resorts World at Sentosa spokeswoman Krist Boo denied there were any delays.
"The development is progressing well and on schedule," she said in a statement.
The plan all along was for a "soft launch" in the first quarter of 2010 with Universal Studios, Festive Walk, the casino and most of the hotels, she said.
The other attractions, including the marine life park, a spa and two hotels were scheduled to open in subsequent quarters, she added.
By Reuters, AFP
Thursday, October 30, 2008
Mutiara set to launch RM1b worth of projects
KUALA LUMPUR: Mutiara Goodyear Development Bhd plans to launch about RM1bil worth of projects next year despite the poor economic outlook, said chief executive officer Kee Cheng Teik.
“Although the economic uncertainty has hit investors’ confidence level, there was demand for good projects with good locations especially in the Klang Valley and Penang,” he said after the company AGM yesterday.
From left: Mutiara Goodyear Development Bhd executive director Lim Beng Guan, Mutiara Goodyear Development Bhd CEO Kee Cheng Teik and Mutiara Goodyear Development Bhd executive chairman Hamidon Abdullah at the company's AGM on Wednesday. - Starpic by T.K. Lim
Kee said the company would be prudent to maintain a strong balance sheet.
“We will be more careful as to which projects we would launch first, depending on market conditions while focusing on containing costs involved.”
Mutiara had a net cash flow of about RM50mil as at July 31.
Projects in Mutiara’s pipeline include a commercial block in Sunway in Petaling Jaya, a 69-acre housing scheme in Kajang and a 456-acre mixed development project in Penang.
The company is also involved in the exclusive 80-acre freehold Nadayu property project near Taman Melawati in Kuala Lumpur, that will be launched by the first quarter of 2009.
Kee, referring to talk that banks were limiting borrowings for property developers, assured that all of Mutiara’s projects had sufficient financing.
“Our bankers have been very supportive of our projects,” he said.
Mutiara was looking to increase its landbank, which currently stood at about 890 acres in the Klang Valley and Penang, Kee said.
He added that the company was also exploring opportunities to develop properties overseas, especially in countries like Vietnam and China.
By The Star
“Although the economic uncertainty has hit investors’ confidence level, there was demand for good projects with good locations especially in the Klang Valley and Penang,” he said after the company AGM yesterday.
From left: Mutiara Goodyear Development Bhd executive director Lim Beng Guan, Mutiara Goodyear Development Bhd CEO Kee Cheng Teik and Mutiara Goodyear Development Bhd executive chairman Hamidon Abdullah at the company's AGM on Wednesday. - Starpic by T.K. Lim
Kee said the company would be prudent to maintain a strong balance sheet.
“We will be more careful as to which projects we would launch first, depending on market conditions while focusing on containing costs involved.”
Mutiara had a net cash flow of about RM50mil as at July 31.
Projects in Mutiara’s pipeline include a commercial block in Sunway in Petaling Jaya, a 69-acre housing scheme in Kajang and a 456-acre mixed development project in Penang.
The company is also involved in the exclusive 80-acre freehold Nadayu property project near Taman Melawati in Kuala Lumpur, that will be launched by the first quarter of 2009.
Kee, referring to talk that banks were limiting borrowings for property developers, assured that all of Mutiara’s projects had sufficient financing.
“Our bankers have been very supportive of our projects,” he said.
Mutiara was looking to increase its landbank, which currently stood at about 890 acres in the Klang Valley and Penang, Kee said.
He added that the company was also exploring opportunities to develop properties overseas, especially in countries like Vietnam and China.
By The Star
Berjaya Hotels targets Mideast tourists
ABU DHABI: Berjaya Hotels and Resorts is going all out to woo more Middle East travellers to its properties in Malaysia, including those located on Tioman and Redang islands as well as Langkawi.
Its regional sales and marketing director, Peggy Tan, said Middle Eastern tourists are seasoned travellers, eyeing destinations where they could enjoy a total holiday experience.
“We’re not only talking about, say, good hotels and accommodation and good airfares here. It has to be a total holiday experience for them.
“And with properties on resort islands, the highlands of Berjaya Hills as well as in Kuala Lumpur, I think we should be able to meet their expectations,” she said on the sidelines of a workshop here yesterday, aimed at strengthening business ties with Middle East travel agencies and airline companies.
The event was part of a joint promotional roadshow with Tourism Malaysia, with Kuwait being the next stop.
Tan said the company believes that the Middle East is the key to helping it further boost its presence in the international travel and leisure industry.
She said Berjaya Hotels and Resorts had invested nearly RM66 million in product development and upgrading hotel facilities and would launch new rooms in Redang soon.
In addition, she said, the company has appointed Dubai-based Leen Marketing Services as its general sales agent for the United Arab Emirates and the Gulf.
“This office will be our eyes and ears that can hopefully spur more business from this region.
“It’ll enable us to elevate Berjaya Hotels and Resorts’ branding and positioning in the Middle East market,” she said.
A member of the Berjaya Corporation Group of Companies, Berjaya Hotels and Resorts is a public listed Malaysian conglomerate managing 15 properties in Malaysia, Singapore, Seychelles, Sri Lanka and the United Kingdom.
On the Middle East market, Tan said: “We’re realigning our marketing strategies, focusing our efforts on this market. The current downturn will have an impact to a certain extent. But as far as this market is concerned, I think this is a bright spot for us to tap.”
Disclosing that Middle East customers chalked up close to 10,000 room nights at Berjaya hotels last year, she said Berjaya would offer more packages developed in collaboration with its travel trade partners.
Being a Muslim country with wonderful culture and a wide array of culinary delights, Tan reckoned that Middle East travellers found Malaysia appealing.
She also commended Tourism Malaysia for having undertaken numerous promotional campaigns in this region to attract more tourists to Malaysia.
Tan said: “We’re committed to showcasing Malaysia as a premier holiday destination among Middle East travellers and are going into full gear with Tourism Malaysia in placing Malaysia prominently on the world map.
“The Middle East plays an essential part in helping elevate Berjaya’s brand name in the travel industry. And we’re certain that our travel trade partners in this region will find our new plans refreshing and exciting.”
Lucky workshop participants went home with attractive prizes, courtesy of Berjaya Hotels and Resorts and Tourism Malaysia.
By Bernama
Its regional sales and marketing director, Peggy Tan, said Middle Eastern tourists are seasoned travellers, eyeing destinations where they could enjoy a total holiday experience.
“We’re not only talking about, say, good hotels and accommodation and good airfares here. It has to be a total holiday experience for them.
“And with properties on resort islands, the highlands of Berjaya Hills as well as in Kuala Lumpur, I think we should be able to meet their expectations,” she said on the sidelines of a workshop here yesterday, aimed at strengthening business ties with Middle East travel agencies and airline companies.
The event was part of a joint promotional roadshow with Tourism Malaysia, with Kuwait being the next stop.
Tan said the company believes that the Middle East is the key to helping it further boost its presence in the international travel and leisure industry.
She said Berjaya Hotels and Resorts had invested nearly RM66 million in product development and upgrading hotel facilities and would launch new rooms in Redang soon.
In addition, she said, the company has appointed Dubai-based Leen Marketing Services as its general sales agent for the United Arab Emirates and the Gulf.
“This office will be our eyes and ears that can hopefully spur more business from this region.
“It’ll enable us to elevate Berjaya Hotels and Resorts’ branding and positioning in the Middle East market,” she said.
A member of the Berjaya Corporation Group of Companies, Berjaya Hotels and Resorts is a public listed Malaysian conglomerate managing 15 properties in Malaysia, Singapore, Seychelles, Sri Lanka and the United Kingdom.
On the Middle East market, Tan said: “We’re realigning our marketing strategies, focusing our efforts on this market. The current downturn will have an impact to a certain extent. But as far as this market is concerned, I think this is a bright spot for us to tap.”
Disclosing that Middle East customers chalked up close to 10,000 room nights at Berjaya hotels last year, she said Berjaya would offer more packages developed in collaboration with its travel trade partners.
Being a Muslim country with wonderful culture and a wide array of culinary delights, Tan reckoned that Middle East travellers found Malaysia appealing.
She also commended Tourism Malaysia for having undertaken numerous promotional campaigns in this region to attract more tourists to Malaysia.
Tan said: “We’re committed to showcasing Malaysia as a premier holiday destination among Middle East travellers and are going into full gear with Tourism Malaysia in placing Malaysia prominently on the world map.
“The Middle East plays an essential part in helping elevate Berjaya’s brand name in the travel industry. And we’re certain that our travel trade partners in this region will find our new plans refreshing and exciting.”
Lucky workshop participants went home with attractive prizes, courtesy of Berjaya Hotels and Resorts and Tourism Malaysia.
By Bernama
'Malaysian mall operators, tenants still doing okay'
The number of shopping malls in Malaysia and their total gross area is expected to grow by some 20 per cent by the end of 2010, based on the current projects under development.
This is similar to the 20 per cent growth experienced in the first half of 2008 compared with the same period in 2006, where total number of shopping complexes reached 260 and total gross area was 144.6 million sq ft.
Net lettable area now stands at 82 million sq ft.
Mall development is expected to not only happen in city centres, but also suburban or small towns.
This was revealed by the Malaysian Association for Shopping and Highrise Complex Management (PPK), whose president Joyce Yap said in comparison to other countries in the region, the retail space per capita in Malaysia is still low. This provides an opportunity for further addition.
She was speaking at a press conference following the launch of the Council of Asian Shopping Centres Conference 2008 in Petaling Jaya yesterday.
Meanwhile, Yap said local mall operators and retail tenants are still doing well amid the current global financial crisis.
"Tenants are still (doing) okay. There has been no impact on their sales turnover and visitation," she said.
However, she added that if the situation warrants it, rentals may increase by a smaller percentage compared with previous years when tenancies are up for review.
PPK adviser Datuk Teo Chiang Kok said in the last three years, rentals in shopping malls have increased by up to 15 per cent, depending on the trade and location.
By New Straits Times (by Vasantha Ganesan)
This is similar to the 20 per cent growth experienced in the first half of 2008 compared with the same period in 2006, where total number of shopping complexes reached 260 and total gross area was 144.6 million sq ft.
Net lettable area now stands at 82 million sq ft.
Mall development is expected to not only happen in city centres, but also suburban or small towns.
This was revealed by the Malaysian Association for Shopping and Highrise Complex Management (PPK), whose president Joyce Yap said in comparison to other countries in the region, the retail space per capita in Malaysia is still low. This provides an opportunity for further addition.
She was speaking at a press conference following the launch of the Council of Asian Shopping Centres Conference 2008 in Petaling Jaya yesterday.
Meanwhile, Yap said local mall operators and retail tenants are still doing well amid the current global financial crisis.
"Tenants are still (doing) okay. There has been no impact on their sales turnover and visitation," she said.
However, she added that if the situation warrants it, rentals may increase by a smaller percentage compared with previous years when tenancies are up for review.
PPK adviser Datuk Teo Chiang Kok said in the last three years, rentals in shopping malls have increased by up to 15 per cent, depending on the trade and location.
By New Straits Times (by Vasantha Ganesan)
Wednesday, October 29, 2008
Sunrise to proceed with launch of 3 projects
Property developer Sunrise Bhd said it will go ahead with the launch of two projects in Malaysia and one in Canada next year, worth a combined RM2.5 billion, despite concerns over cooling property prices.
The projects were supposed to be launched from December this year, but were deferred by a few months due to weak market sentiment.
They comprise a RM970 million maiden project in Richmond, Canada, featuring five residential blocks with some commercial elements; 28 Mont' Kiara, a six-star condominium development worth around RM900 million; and Solaris Towers, featuring two office blocks worth about RM600 million.
"There is a financial crisis but we will get ready and launch (the projects) when the market is better. We will hold the launches for a while partly because we want costs to come down," executive deputy chairman Datuk Allan Lim Kim Huat said after the company's shareholders meeting in Kuala Lumpur yesterday.
Lim did not rule out selling Solaris Towers en bloc.
As for the Richmont project, which is a modification of Mont' Kiara but with smaller built-ups of 600 to 700 sq ft, Lim said Sunrise will grow from there as margins are similar to its projects in Malaysia.
As for lower margins due to higher cost of raw materials, Lim said the easing of commodity prices will stabilise earnings.
He hopes Sunrise's net profit and revenue will do better this year, given that it has RM1.36 billion of unbilled sales with 32 per cent gross margins that will be realised over the next 30 months.
For its fiscal year ended June 30 2008, it achieved a 119 per cent growth in net profit to RM147.8 million from 2007's RM67.5 million. Revenue was higher by 22.9 per cent to RM685.8 million.
Sunrise's unbilled sales are one of the highest among local listed property firms and will soon touch RM1.49 billion as it gears up to sell 19 completed bungalows worth RM130 million.
"We hope to improve our performance this year. The next two to three years will not be an issue for us as by 2010, we expect to launch the (mix development) project at Wisma Angkasa Raya (opposite Petronas Twin Towers) in Kuala Lumpur, which is in the planning stage now," Lim said.
While the global economic slowdown will put some downward pressure on property prices, Sunrise hopes to maintain the pricing of its products which are targeted at the medium to high-income groups.
Sunrise's remaining 32ha in Mont'Kiara, with an estimated gross development value of more than RM3 billion, will continue to be the cash cow for the company over the next six to eight years.
It also has 160ha in Mersing, Johor, 80ha in Seremban, Negri Sembilan and 22ha in Serdang, Selangor for future launches.
By New Straits Times (by Sharen Kaur)
The projects were supposed to be launched from December this year, but were deferred by a few months due to weak market sentiment.
They comprise a RM970 million maiden project in Richmond, Canada, featuring five residential blocks with some commercial elements; 28 Mont' Kiara, a six-star condominium development worth around RM900 million; and Solaris Towers, featuring two office blocks worth about RM600 million.
"There is a financial crisis but we will get ready and launch (the projects) when the market is better. We will hold the launches for a while partly because we want costs to come down," executive deputy chairman Datuk Allan Lim Kim Huat said after the company's shareholders meeting in Kuala Lumpur yesterday.
Lim did not rule out selling Solaris Towers en bloc.
As for the Richmont project, which is a modification of Mont' Kiara but with smaller built-ups of 600 to 700 sq ft, Lim said Sunrise will grow from there as margins are similar to its projects in Malaysia.
As for lower margins due to higher cost of raw materials, Lim said the easing of commodity prices will stabilise earnings.
He hopes Sunrise's net profit and revenue will do better this year, given that it has RM1.36 billion of unbilled sales with 32 per cent gross margins that will be realised over the next 30 months.
For its fiscal year ended June 30 2008, it achieved a 119 per cent growth in net profit to RM147.8 million from 2007's RM67.5 million. Revenue was higher by 22.9 per cent to RM685.8 million.
Sunrise's unbilled sales are one of the highest among local listed property firms and will soon touch RM1.49 billion as it gears up to sell 19 completed bungalows worth RM130 million.
"We hope to improve our performance this year. The next two to three years will not be an issue for us as by 2010, we expect to launch the (mix development) project at Wisma Angkasa Raya (opposite Petronas Twin Towers) in Kuala Lumpur, which is in the planning stage now," Lim said.
While the global economic slowdown will put some downward pressure on property prices, Sunrise hopes to maintain the pricing of its products which are targeted at the medium to high-income groups.
Sunrise's remaining 32ha in Mont'Kiara, with an estimated gross development value of more than RM3 billion, will continue to be the cash cow for the company over the next six to eight years.
It also has 160ha in Mersing, Johor, 80ha in Seremban, Negri Sembilan and 22ha in Serdang, Selangor for future launches.
By New Straits Times (by Sharen Kaur)
Sunrise is confident RM1.3bil in unbilled sales can sustain performance over three years
KUALA LUMPUR: Despite softer conditions in the property market, Sunrise Bhd expects to perform well in the next two to three years due to its high unbilled sales of RM1.36bil.
Executive deputy chairman Datuk Allan Lim Kim Huat said the sales were equivalent to about 2.6 times its average annual income over the past three years.
He said these sales came from four ongoing projects, namely 10 Mont’ Kiara (MK10), 11 Mont’ Kiara (MK11), Solaris Dutamas and The Residence.
“With these projects as well as three new projects in the pipeline, I think we will do fine in the next two to three years,” he told reporters after the company’s AGM yesterday.
Unbilled sales are similar to order books of construction companies; both refer to sales secured from customers but not yet booked as revenue in the profit and loss account.
As at July,Sunrise had sold 93% of MK10 units, 45% of MK 11, 92% of Solaris Dutamas, 9% of The Residence Phase 2B, 90% of Mont’ Kiara Meridin, 95% of Mont’ Kiara Banyan, and 100% of Kiara Designer Suites-Kiara Walk.
“We are quite busy constructing and delivering to buyers units in the ongoing projects.
“Although things are a little uncertain due to the economic slowdown, the next three years will be a busy period for us,” he said.
Lim added that Sunrise foresaw the pressure on margins easing given the recent plunge in commodity prices.
However, the company plans to defer the launch of its three new projects in view of weaker demand.
The three projects are a six-star condominium development called 28 Mont’ Kiara, two office blocks at Solaris Tower in Kuala Lumpur, and the first phase of a residential development in Vancouver, Canada.
“We are not under pressure to launch any project, as we want to launch them at the right time and at the right price,” he said.
Although there is a slowdown in demand, Lim does not see any major financial problems for the buyers.
“It is just that they are more careful making investments and have a wait-and-see attitude,” he said.
Originally, Sunrise had planned to launch the two office blocks and 28 Mont’ Kiara by year-end while the Canadian project was expected to be launched by February or March 2009.
Lim said all new launches would depend on market conditions.
He added that it might launch the Vancouver project, next year. The project has an estimated gross development value of C$350mil .
By The Star
Executive deputy chairman Datuk Allan Lim Kim Huat said the sales were equivalent to about 2.6 times its average annual income over the past three years.
He said these sales came from four ongoing projects, namely 10 Mont’ Kiara (MK10), 11 Mont’ Kiara (MK11), Solaris Dutamas and The Residence.
“With these projects as well as three new projects in the pipeline, I think we will do fine in the next two to three years,” he told reporters after the company’s AGM yesterday.
Unbilled sales are similar to order books of construction companies; both refer to sales secured from customers but not yet booked as revenue in the profit and loss account.
As at July,Sunrise had sold 93% of MK10 units, 45% of MK 11, 92% of Solaris Dutamas, 9% of The Residence Phase 2B, 90% of Mont’ Kiara Meridin, 95% of Mont’ Kiara Banyan, and 100% of Kiara Designer Suites-Kiara Walk.
“We are quite busy constructing and delivering to buyers units in the ongoing projects.
“Although things are a little uncertain due to the economic slowdown, the next three years will be a busy period for us,” he said.
Lim added that Sunrise foresaw the pressure on margins easing given the recent plunge in commodity prices.
However, the company plans to defer the launch of its three new projects in view of weaker demand.
The three projects are a six-star condominium development called 28 Mont’ Kiara, two office blocks at Solaris Tower in Kuala Lumpur, and the first phase of a residential development in Vancouver, Canada.
“We are not under pressure to launch any project, as we want to launch them at the right time and at the right price,” he said.
Although there is a slowdown in demand, Lim does not see any major financial problems for the buyers.
“It is just that they are more careful making investments and have a wait-and-see attitude,” he said.
Originally, Sunrise had planned to launch the two office blocks and 28 Mont’ Kiara by year-end while the Canadian project was expected to be launched by February or March 2009.
Lim said all new launches would depend on market conditions.
He added that it might launch the Vancouver project, next year. The project has an estimated gross development value of C$350mil .
By The Star
YTL buys Singapore REIT
Portfolio worth S$2.2b includes prime properties on Orchard Road, and in Japan and China
INFRASTRUCTURE conglomerate YTL Corp Bhd yesterday thrust itself into the heart of Singapore's Orchard Road prime property belt when it took control of the Macquarie Prime REIT (MP REIT) and its management company Prime REIT Management Holdings Pte Ltd (PRMH) for S$285 million (RM678 million).
MP REIT also has other prime properties in Japan and China. Altogether, it has a property portfolio worth some S$2.2 billion (RM5.24 billion).
MP REIT holds 74.2 per cent of total strata lots in Wisma Atria on Orchard Road and about 27.2 per cent of the total strata lots in Ngee Ann City.
Together, the holding offers the longest stretch of street level frontage along the bustling upmarket Orchard Road.
YTL Corp's latest investment is an addition to its other projects in Singapore, including the Sandy Island and Lakefront developments on Sentosa Island, and the Westwood Apartments on Orchard Boulevard.
YTL Corp managing director Tan Sri Francis Yeoh was in Singapore yesterday to finalise the agreement with the REIT vendors.
The sale to YTL Corp involved 247.1 million units of MP REIT at S$0.82 (RM1.95) a unit.
Speaking to Business Times, Yeoh said the 49 per cent discount to the REIT's net asset value per unit was possible amid the current global market turbulence.
The price is, however, a 17 per cent premium over its 30-day volume weighted average price and a premium of 52 per cent over the units' last traded price.
The acquisition of 50 per cent of PRMH, together with the units, allows YTL Corp to control the REIT.
The units also provide an attractive 2009 yield of about 9.4 per cent based on a Bloomberg forecast.
MP REIT had a market capitalisation of about S$516 million (RM1.23 billion) as of October 24 2008.
Merrill Lynch (Singapore) Pte Ltd acted as exclusive financial adviser to YTL Corp on the proposed acquisitions.
There are firm plans to rename the REIT as Starhill Global REIT and the property manager as YTL Pacific Star REIT Management Ltd and YTL Pacific Star Property. Yeoh will then be appointed the REIT manager executive chairman.
"The proposed acquisitions provide the YTL group with an opportunity to globalise our Starhill brand," Yeoh said.
YTL Corp's Starhill brand now encompasses several prime properties in Kuala Lumpur's Bukit Bintang area.
MP REIT was listed on the main board of the Singapore Exchange Securities Trading Ltd on September 20 2005 at an initial public offering (IPO) price of S$0.98 (RM2.33) with the year's projected dividend yield of 5.12 per cent.
The IPO was oversubscribed by 35 times.
By New Straits Times (by Mustapha Kamil)
INFRASTRUCTURE conglomerate YTL Corp Bhd yesterday thrust itself into the heart of Singapore's Orchard Road prime property belt when it took control of the Macquarie Prime REIT (MP REIT) and its management company Prime REIT Management Holdings Pte Ltd (PRMH) for S$285 million (RM678 million).
MP REIT also has other prime properties in Japan and China. Altogether, it has a property portfolio worth some S$2.2 billion (RM5.24 billion).
MP REIT holds 74.2 per cent of total strata lots in Wisma Atria on Orchard Road and about 27.2 per cent of the total strata lots in Ngee Ann City.
Together, the holding offers the longest stretch of street level frontage along the bustling upmarket Orchard Road.
YTL Corp's latest investment is an addition to its other projects in Singapore, including the Sandy Island and Lakefront developments on Sentosa Island, and the Westwood Apartments on Orchard Boulevard.
YTL Corp managing director Tan Sri Francis Yeoh was in Singapore yesterday to finalise the agreement with the REIT vendors.
The sale to YTL Corp involved 247.1 million units of MP REIT at S$0.82 (RM1.95) a unit.
Speaking to Business Times, Yeoh said the 49 per cent discount to the REIT's net asset value per unit was possible amid the current global market turbulence.
The price is, however, a 17 per cent premium over its 30-day volume weighted average price and a premium of 52 per cent over the units' last traded price.
The acquisition of 50 per cent of PRMH, together with the units, allows YTL Corp to control the REIT.
The units also provide an attractive 2009 yield of about 9.4 per cent based on a Bloomberg forecast.
MP REIT had a market capitalisation of about S$516 million (RM1.23 billion) as of October 24 2008.
Merrill Lynch (Singapore) Pte Ltd acted as exclusive financial adviser to YTL Corp on the proposed acquisitions.
There are firm plans to rename the REIT as Starhill Global REIT and the property manager as YTL Pacific Star REIT Management Ltd and YTL Pacific Star Property. Yeoh will then be appointed the REIT manager executive chairman.
"The proposed acquisitions provide the YTL group with an opportunity to globalise our Starhill brand," Yeoh said.
YTL Corp's Starhill brand now encompasses several prime properties in Kuala Lumpur's Bukit Bintang area.
MP REIT was listed on the main board of the Singapore Exchange Securities Trading Ltd on September 20 2005 at an initial public offering (IPO) price of S$0.98 (RM2.33) with the year's projected dividend yield of 5.12 per cent.
The IPO was oversubscribed by 35 times.
By New Straits Times (by Mustapha Kamil)
YTL ventures into S’pore REIT
PETALING JAYA: YTL Corp Bhd is making inroads in Singapore’s real estate sector with its proposed acquisition of about 26% in Macquarie Prime REIT (MP REIT) and 50% of Prime REIT Management Holdings Pte Ltd from Macquarie Bank Ltd for S$285mil.
Prime REIT is the holding company of Macquarie Pacific Star Prime REIT Management Ltd, the REIT manager of MP REIT, and Macquarie Pacific Star Property Management Pte Ltd, the property manager of MP REIT’s Singapore properties.
Merrill Lynch (S) Pte Ltd is financial advisor to YTL Corp on the proposed acquisitions.
YTL Corp said in a statement yesterday the group would acquire 247,101,000 units in MP REIT at S$0.82 each, which was a 49% discount to MP REIT’s net asset value per unit, a 17% premium over its 30-day volume-weighted average price and a premium of 52% over its last traded price.
The proposed acquisitions will be financed by internally generated funds.
The acquisitions, which would provide a yield of about 9.4%, would allow YTL Corp to control the REIT. MP REIT had a market capitalisation of S$516mil as of Oct 24 and owns over S$2.2bil worth of prime retail and office properties in Singapore, Japan and China.
Its asset portfolio include 74.23% of total strata lots in Wisma Atria and 27.23% of total strata lots in Ngee Ann City.
YTL Corp said upon completion of the transaction, it intended to rename MP REIT, the manager and the property manager companies to Starhill Global REIT, YTL Pacific Star REIT Management Ltd and YTL Pacific Star Property Management Pte Ltd, respectively.
As Starhill Global REIT will be a key vehicle of YTL Corp, the group planned to appoint managing director Tan Sri Francis Yeoh as the REIT manager’s executive chairman.
“Our vision and investment track record will enable us to add value to MP REIT through our sponsorship as we focus on re-branding and growing the REIT through yield accretive acquisitions of prime regional assets,” Yeoh said.
Since its listing on the Singapore Exchange in September 2005, MP REIT has added eight retail properties to its portfolio through the acquisitions of prime assets in Japan and China.
An analyst with a local brokerage said YTL Corp, with its war chest of more than RM10bil, was in a good position to pick up some quality assets at depressed prices following the global financial meltdown.
“With the price at a 49% discount to the net asset value, the proposed acquisition of MP REIT will provide stable earnings and good upside potential. By having a REIT in Singapore, YTL will be well placed to tap the city-state’s expanding real estate sector and promote its Starhill brand in the international market,” she added.
By The Star (by Angie Ng)
Prime REIT is the holding company of Macquarie Pacific Star Prime REIT Management Ltd, the REIT manager of MP REIT, and Macquarie Pacific Star Property Management Pte Ltd, the property manager of MP REIT’s Singapore properties.
Merrill Lynch (S) Pte Ltd is financial advisor to YTL Corp on the proposed acquisitions.
YTL Corp said in a statement yesterday the group would acquire 247,101,000 units in MP REIT at S$0.82 each, which was a 49% discount to MP REIT’s net asset value per unit, a 17% premium over its 30-day volume-weighted average price and a premium of 52% over its last traded price.
The proposed acquisitions will be financed by internally generated funds.
The acquisitions, which would provide a yield of about 9.4%, would allow YTL Corp to control the REIT. MP REIT had a market capitalisation of S$516mil as of Oct 24 and owns over S$2.2bil worth of prime retail and office properties in Singapore, Japan and China.
Its asset portfolio include 74.23% of total strata lots in Wisma Atria and 27.23% of total strata lots in Ngee Ann City.
YTL Corp said upon completion of the transaction, it intended to rename MP REIT, the manager and the property manager companies to Starhill Global REIT, YTL Pacific Star REIT Management Ltd and YTL Pacific Star Property Management Pte Ltd, respectively.
As Starhill Global REIT will be a key vehicle of YTL Corp, the group planned to appoint managing director Tan Sri Francis Yeoh as the REIT manager’s executive chairman.
“Our vision and investment track record will enable us to add value to MP REIT through our sponsorship as we focus on re-branding and growing the REIT through yield accretive acquisitions of prime regional assets,” Yeoh said.
Since its listing on the Singapore Exchange in September 2005, MP REIT has added eight retail properties to its portfolio through the acquisitions of prime assets in Japan and China.
An analyst with a local brokerage said YTL Corp, with its war chest of more than RM10bil, was in a good position to pick up some quality assets at depressed prices following the global financial meltdown.
“With the price at a 49% discount to the net asset value, the proposed acquisition of MP REIT will provide stable earnings and good upside potential. By having a REIT in Singapore, YTL will be well placed to tap the city-state’s expanding real estate sector and promote its Starhill brand in the international market,” she added.
By The Star (by Angie Ng)
China, S.Korea must do more to avoid property crash
HONG KONG/SEOUL: China and South Korea have moved to prop up their frazzled housing markets but probably need to do much more to avoid major price slides that could ruin developers, damage banks and threaten the region’s economies.
A share price collapse this week for Chinese property developers such as Guangzhou R&F and China Overseas Land suggests that many investors believe a housing market bust is on the cards, despite a policy U-turn by Beijing.
“Investors might just be throwing in the towel,” UBS analyst Eric Wong said of the sharp drop, which saw some stocks lose as much as 35 per cent of their value over Monday and yesterday.
The Chinese government, fearing a price bubble, was in market cooling mode only a year ago, squeezing developers with a clampdown on loans and hatching moves to stamp out speculation.
New home prices then slumped by up to 40 per cent in the southern cities of Guanzhou and Shenzhen as sales dried up, and property firms began slashing prices across the country to keep cash flowing in.
The outlook grew even dimmer as the global credit crisis began to buffet Asia and batter its financial markets, stalling the region’s once-roaring economies.
So last week Beijing unveiled cuts in taxes, mortgages and down payments on homes in an effort to breathe life into a property industry that accounts for about 10 per cent of gross domestic product (GDP) in the world’s fourth-largest economy.
But the country’s biggest developer, China Vanke Co, reported yesterday a 13 per cent decline in net profit and a nearly 30 per cent drop in sales volume, in another reminder of how deep-seated the problems are.
If the housing market fails to perk up, analysts say policy makers will probably resort to macro-economic measures to spur demand, such as cutting taxes and interest rates.
“The usual monetary cocktail is a blunt instrument but it’s longer lasting,” said UBS’s Wong, adding that Beijing might also raise export subsidies and hike pay at state companies.
On the property side, the government could reel back on its measures to dissuade people from buying apartments as investments and tell banks to start lending to developers again, Wong said.
TOO WEAK, TOO LATE?
In South Korea, where around half the country’s personal wealth is tied up in property, the government pledged 5 trillion won (US$3.4 billion) last week to buy unsold homes and land from developers to prevent mass bankruptcies in the industry.
An interest rate cut of 75 basis points followed on Monday as policy makers tried to keep the global financial storm at bay.
The steps are a reaction to slowing economic growth and a steep climb in the number of unsold new homes on the market, which rose 43 per cent to a record 160,595 units in July from the end of 2007, according to government data.
Just as in China, the government had a hand in slowing the market in early 2007, tightening restrictions on mortgages and buying second homes.
Analysts believe freeing up finance for homebuyers is the answer, not just taking homes off the market. Apartment prices in the most expensive districts in Seoul and in satellite towns have fallen up to 20 per cent from their peaks in 2006.
“The measures came too late and are too weak,” Daiwa Institute of Research analyst Hyo Yim said of the government’s action to shore up the property market.
The government should loosen rules on mortgage lending and cut back taxes on owners of two or more homes, Yim said.
Mortgage debt in South Korea is still only a quarter of GDP, compared to 61 per cent in Australia, and 105 per cent in the United States, according to CLSA. In China, home loans equal only 12 per cent of GDP.
“The government cracked down on so-called speculative buyers, but people won’t buy homes if they don’t expect prices to rise,” said Yim, adding that the housing market would probably not recover before 2010.
Many of South Korea’s 12,000 builders face a cash crunch as credit dries up and home sales slow, with 88 firms defaulting in the first nine months of 2008, up 17 per cent from a year earlier.
Even top developers are not immune to such worries, with shares in GS Construction, Hyundai Development and Samsung Engineering tumbling between 37 and 50 per cent in the last month.
But some analysts are suggesting that South Korean construction stocks may have bottomed thanks to the government’s actions, with valuations at historical lows and at a 30 per cent discount in price/earnings terms to the overall stock market.
BNP Paribas analyst Jae Rhee has a 12-month target stock price for Hyundai Development that is double its current price. And the potential upside for GS Construction and Samsung Engineering is about 70 per cent, he wrote in a report last week.
Chinese developers are now trading at near 70 per cent discounts to net asset value, and at 7.4 times forecast 2008 earnings, according to Citigroup analyst Oscar Choi, who believes the stocks have been sold off “indiscriminately”.
And Beijing will do all it can to stop a property market crash, said CLSA analyst Nicole Wong, who has a buy rating on New World China Land and Agile Property.
“Policy is very supportive; basically they’re underwriting a put option on market,” she said. “For sure the government will take further steps if the downward spiral doesn’t stop.”
By Reuters
A share price collapse this week for Chinese property developers such as Guangzhou R&F and China Overseas Land suggests that many investors believe a housing market bust is on the cards, despite a policy U-turn by Beijing.
“Investors might just be throwing in the towel,” UBS analyst Eric Wong said of the sharp drop, which saw some stocks lose as much as 35 per cent of their value over Monday and yesterday.
The Chinese government, fearing a price bubble, was in market cooling mode only a year ago, squeezing developers with a clampdown on loans and hatching moves to stamp out speculation.
New home prices then slumped by up to 40 per cent in the southern cities of Guanzhou and Shenzhen as sales dried up, and property firms began slashing prices across the country to keep cash flowing in.
The outlook grew even dimmer as the global credit crisis began to buffet Asia and batter its financial markets, stalling the region’s once-roaring economies.
So last week Beijing unveiled cuts in taxes, mortgages and down payments on homes in an effort to breathe life into a property industry that accounts for about 10 per cent of gross domestic product (GDP) in the world’s fourth-largest economy.
But the country’s biggest developer, China Vanke Co, reported yesterday a 13 per cent decline in net profit and a nearly 30 per cent drop in sales volume, in another reminder of how deep-seated the problems are.
If the housing market fails to perk up, analysts say policy makers will probably resort to macro-economic measures to spur demand, such as cutting taxes and interest rates.
“The usual monetary cocktail is a blunt instrument but it’s longer lasting,” said UBS’s Wong, adding that Beijing might also raise export subsidies and hike pay at state companies.
On the property side, the government could reel back on its measures to dissuade people from buying apartments as investments and tell banks to start lending to developers again, Wong said.
TOO WEAK, TOO LATE?
In South Korea, where around half the country’s personal wealth is tied up in property, the government pledged 5 trillion won (US$3.4 billion) last week to buy unsold homes and land from developers to prevent mass bankruptcies in the industry.
An interest rate cut of 75 basis points followed on Monday as policy makers tried to keep the global financial storm at bay.
The steps are a reaction to slowing economic growth and a steep climb in the number of unsold new homes on the market, which rose 43 per cent to a record 160,595 units in July from the end of 2007, according to government data.
Just as in China, the government had a hand in slowing the market in early 2007, tightening restrictions on mortgages and buying second homes.
Analysts believe freeing up finance for homebuyers is the answer, not just taking homes off the market. Apartment prices in the most expensive districts in Seoul and in satellite towns have fallen up to 20 per cent from their peaks in 2006.
“The measures came too late and are too weak,” Daiwa Institute of Research analyst Hyo Yim said of the government’s action to shore up the property market.
The government should loosen rules on mortgage lending and cut back taxes on owners of two or more homes, Yim said.
Mortgage debt in South Korea is still only a quarter of GDP, compared to 61 per cent in Australia, and 105 per cent in the United States, according to CLSA. In China, home loans equal only 12 per cent of GDP.
“The government cracked down on so-called speculative buyers, but people won’t buy homes if they don’t expect prices to rise,” said Yim, adding that the housing market would probably not recover before 2010.
Many of South Korea’s 12,000 builders face a cash crunch as credit dries up and home sales slow, with 88 firms defaulting in the first nine months of 2008, up 17 per cent from a year earlier.
Even top developers are not immune to such worries, with shares in GS Construction, Hyundai Development and Samsung Engineering tumbling between 37 and 50 per cent in the last month.
But some analysts are suggesting that South Korean construction stocks may have bottomed thanks to the government’s actions, with valuations at historical lows and at a 30 per cent discount in price/earnings terms to the overall stock market.
BNP Paribas analyst Jae Rhee has a 12-month target stock price for Hyundai Development that is double its current price. And the potential upside for GS Construction and Samsung Engineering is about 70 per cent, he wrote in a report last week.
Chinese developers are now trading at near 70 per cent discounts to net asset value, and at 7.4 times forecast 2008 earnings, according to Citigroup analyst Oscar Choi, who believes the stocks have been sold off “indiscriminately”.
And Beijing will do all it can to stop a property market crash, said CLSA analyst Nicole Wong, who has a buy rating on New World China Land and Agile Property.
“Policy is very supportive; basically they’re underwriting a put option on market,” she said. “For sure the government will take further steps if the downward spiral doesn’t stop.”
By Reuters
Asian wealth funds eye home turf
SINGAPORE: Asian sovereign wealth funds may become more visible shoring up markets closer to home as emerging economies look to their deep pockets to steer around the damaging effects of global market turmoil.
The shift will come after funds’ risky bets on Western banks such as Citigroup and UBS, where they pumped in billions of dollars during the early phase of the credit crisis, show little signs of paying off.
Wealth funds from Singapore, China and South Korea may instead look to invest growing cash piles in more defensive sectors such as Asian utilities and infrastructure firms, while keeping an eye on distressed property and financial assets in Western markets.
State funds, following their counterparts in Russia and the Middle East, could also pump cash into local banks to support domestic financial systems, and take part in private equity or debt deals to help firms refinance billions of dollars of debt.
“There has been another round of de-risking from assets like stocks in emerging markets over the last few days, but the SWFs are in for the longer haul,” said Jan Randolph, who covers sovereign funds at London-based consultancy Global Insight.
“I think they’ll still be looking for opportunities now that everything is a lot cheaper.”
Asian sovereign wealth funds, which Deutsche Bank estimated manage around US$1 trillion, or 29 per cent of the assets held by global funds, have become more influential in financial markets, but began building cash piles after the credit crisis worsened.
The fallout from the collapse of the US subprime mortgage market is now hurting the ability of the corporate sector to raise capital, forcing firms to look for state help.
According to Morgan Stanley, Asian sectors facing refinancing risks are banks, especially those dependent on markets for funding in South Korea, Australia, India and Hong Kong, as well as select property stocks in China, India and Australia, and some Australian utilities and infrastructure stocks.
In the corporate bond sector alone, US$17.2 billion worth of bonds mature next year, led by companies in South Korea, Thailand and Taiwan, according to Thomson Reuters data.
The Government of Singapore Investment Corp (GIC) gave evidence of such deals when it agreed to buy US$250 million in convertible debt of Australian property trust GPT, raising its presence in a country that accounts for just 2 per cent of its portfolio.
“The convertible bond space is offering unprecedented opportunities right now,” said Kirby Daley, senior strategist at Newedge Group in Hong Kong.
“If you have capital you can take full advantage of that — the opportunities are far better than getting in on the equity side of a lot of these companies.”
Several investment grade sovereign and corporate bonds now give a yield of around 15 per cent and present opportunities for long-term investors, said Liew Tzu Mi, head of GIC’s global emerging markets team for fixed income, currencies and commodities.
But Liew told a seminar last week it was hard for investors to buy now as the cash market for many bonds has dried up.
GIC, which has over two-thirds of its investments in the United States and Britain, said recently it has been increasing its emerging market exposure in North Asia and the Americas.
DEFENSIVE
The sea of liquidity among wealth funds was illustrated by Singapore’s GIC when it disclosed 7 per cent of its portfolio was in cash — over US$20 billion out of an estimated US$300 billion.
Korea Investment Corp (KIC), which has received US$30 billion from the South Korean government, said it expects to be defensive in a falling market by diversifying.
“In addition to such traditional assets as equities and bonds, a gradual increase in the proportion of alternative assets can diversify investment risks,” it said in a recent report.
But the crisis has not totally derailed SWFs’ appetite for big deals in the West, as shown by an Abu Dhabi state-owned venture capital firm’s move to invest US$2.1 billion in a manufacturing joint venture with Advanced Micro Devices.
And despite China Investment Corp’s (CIC) initial losses on its investments and recent concerns among regulators about overseas investments, the Chinese state fund went ahead to raise its stake in private equity firm Blackstone.
CIC still holds 90 per cent of its around US$200 billion of assets in cash. With the outlook uncertain for financials, these state-backed funds may also look to battered real estate markets and funds.
Property consultant CB Richard Ellis Group said allocations by sovereign funds to the commercial property sector could rise to 7 per cent of their portfolio over the next seven years, with the focus on markets such as Britain and Japan.
Steffen Kern wrote in a Deutsche Bank report that sovereign funds’ investment in the troubled financial sector may have peaked after they injected US$92 billion in the last 18 months.
“With a view to portfolio diversification, they may now be looking to other sectors for future investment opportunities,” Kern said.
By Reuters
The shift will come after funds’ risky bets on Western banks such as Citigroup and UBS, where they pumped in billions of dollars during the early phase of the credit crisis, show little signs of paying off.
Wealth funds from Singapore, China and South Korea may instead look to invest growing cash piles in more defensive sectors such as Asian utilities and infrastructure firms, while keeping an eye on distressed property and financial assets in Western markets.
State funds, following their counterparts in Russia and the Middle East, could also pump cash into local banks to support domestic financial systems, and take part in private equity or debt deals to help firms refinance billions of dollars of debt.
“There has been another round of de-risking from assets like stocks in emerging markets over the last few days, but the SWFs are in for the longer haul,” said Jan Randolph, who covers sovereign funds at London-based consultancy Global Insight.
“I think they’ll still be looking for opportunities now that everything is a lot cheaper.”
Asian sovereign wealth funds, which Deutsche Bank estimated manage around US$1 trillion, or 29 per cent of the assets held by global funds, have become more influential in financial markets, but began building cash piles after the credit crisis worsened.
The fallout from the collapse of the US subprime mortgage market is now hurting the ability of the corporate sector to raise capital, forcing firms to look for state help.
According to Morgan Stanley, Asian sectors facing refinancing risks are banks, especially those dependent on markets for funding in South Korea, Australia, India and Hong Kong, as well as select property stocks in China, India and Australia, and some Australian utilities and infrastructure stocks.
In the corporate bond sector alone, US$17.2 billion worth of bonds mature next year, led by companies in South Korea, Thailand and Taiwan, according to Thomson Reuters data.
The Government of Singapore Investment Corp (GIC) gave evidence of such deals when it agreed to buy US$250 million in convertible debt of Australian property trust GPT, raising its presence in a country that accounts for just 2 per cent of its portfolio.
“The convertible bond space is offering unprecedented opportunities right now,” said Kirby Daley, senior strategist at Newedge Group in Hong Kong.
“If you have capital you can take full advantage of that — the opportunities are far better than getting in on the equity side of a lot of these companies.”
Several investment grade sovereign and corporate bonds now give a yield of around 15 per cent and present opportunities for long-term investors, said Liew Tzu Mi, head of GIC’s global emerging markets team for fixed income, currencies and commodities.
But Liew told a seminar last week it was hard for investors to buy now as the cash market for many bonds has dried up.
GIC, which has over two-thirds of its investments in the United States and Britain, said recently it has been increasing its emerging market exposure in North Asia and the Americas.
DEFENSIVE
The sea of liquidity among wealth funds was illustrated by Singapore’s GIC when it disclosed 7 per cent of its portfolio was in cash — over US$20 billion out of an estimated US$300 billion.
Korea Investment Corp (KIC), which has received US$30 billion from the South Korean government, said it expects to be defensive in a falling market by diversifying.
“In addition to such traditional assets as equities and bonds, a gradual increase in the proportion of alternative assets can diversify investment risks,” it said in a recent report.
But the crisis has not totally derailed SWFs’ appetite for big deals in the West, as shown by an Abu Dhabi state-owned venture capital firm’s move to invest US$2.1 billion in a manufacturing joint venture with Advanced Micro Devices.
And despite China Investment Corp’s (CIC) initial losses on its investments and recent concerns among regulators about overseas investments, the Chinese state fund went ahead to raise its stake in private equity firm Blackstone.
CIC still holds 90 per cent of its around US$200 billion of assets in cash. With the outlook uncertain for financials, these state-backed funds may also look to battered real estate markets and funds.
Property consultant CB Richard Ellis Group said allocations by sovereign funds to the commercial property sector could rise to 7 per cent of their portfolio over the next seven years, with the focus on markets such as Britain and Japan.
Steffen Kern wrote in a Deutsche Bank report that sovereign funds’ investment in the troubled financial sector may have peaked after they injected US$92 billion in the last 18 months.
“With a view to portfolio diversification, they may now be looking to other sectors for future investment opportunities,” Kern said.
By Reuters
Steel imports solution in sight
PETALING JAYA: The construction industry is in the final stage of discussion with the Government to iron out hitches in steel import procedures.
Effective May 12, the Government liberalised the prices of steel bars and allowed the import of steel bars free of tax. However, there has been some confusion at the Customs level.
Master Builders Association Malaysia (MBAM) president Ng Kee Leen said the discussion with the Government on the final details was expected to be completed soon.
“After four months of discussion, we have received a letter from the Customs Department agreeing that Malaysian standard MS146 is equivalent to British Standard BS4449. The confusion was one of the reasons for the steel bar import hitches,” he told StarBiz yesterday.
MBAM and the Real Estate and Housing Developers Association are leading the industry players in the discussion.
Since the Government lifted the ceiling price on steel bars and allowed the import of all steel bars that met the MS146 standard five months ago, there has been confusion on the ground as to the types of steel that can be imported tax-free.
“The Malaysian Customs did not realise that BS4449 steel bars were actually equivalent to the MS146. Thus, many international steel bars that met the BS4449 standard were not allowed to be imported just because of the different steel bar code,” Ng said.
“In addition, some Customs officers asked for import duty and import licence even though the Government had fully liberalised the steel market.
“The message of liberalisation was not understood by the Customs officers who worked on the ground. Hopefully, after this discussion is completed, the procedures and process of importing steel would be clear to all parties.”
Ng said the “full liberalisation” would be a positive move for the construction industry, as it would lower domestic steel prices to match those of neighbouring countries, which are about 10% to 15% lower. Currently, Malaysian steel bars cost about RM3,200 per tonne.
A source said that domestic monthly steel consumption had plunged to below 100,000 tonnes from about 200,000 tonnes in July in anticipation of the “full liberalisation” of steel imports.
Meanwhile, in a statement yesterday, Ng urged manufacturers, trading houses, distributors and Tenaga Nasional Bhd to adjust their prices accordingly, given that fuel prices had fallen recently. This would ensure that the benefits would be passed down to contractors.
“When the fuel prices increased in June, nearly all building materials’ prices jumped by 15% to 30%. The increase in diesel prices also caused transportation and machinery operation costs to rise tremendously by between 30% and 40%. All this happened in June.
“However, when world crude oil prices fell below US$65 per barrel and local fuel prices were adjusted downwards twice, transportation rates remained the same. Input prices have fallen but nearly all of the construction materials have yet to be reduced in price,” he said.
By The Star (by Law Kai Chow)
Effective May 12, the Government liberalised the prices of steel bars and allowed the import of steel bars free of tax. However, there has been some confusion at the Customs level.
Master Builders Association Malaysia (MBAM) president Ng Kee Leen said the discussion with the Government on the final details was expected to be completed soon.
“After four months of discussion, we have received a letter from the Customs Department agreeing that Malaysian standard MS146 is equivalent to British Standard BS4449. The confusion was one of the reasons for the steel bar import hitches,” he told StarBiz yesterday.
MBAM and the Real Estate and Housing Developers Association are leading the industry players in the discussion.
Since the Government lifted the ceiling price on steel bars and allowed the import of all steel bars that met the MS146 standard five months ago, there has been confusion on the ground as to the types of steel that can be imported tax-free.
“The Malaysian Customs did not realise that BS4449 steel bars were actually equivalent to the MS146. Thus, many international steel bars that met the BS4449 standard were not allowed to be imported just because of the different steel bar code,” Ng said.
“In addition, some Customs officers asked for import duty and import licence even though the Government had fully liberalised the steel market.
“The message of liberalisation was not understood by the Customs officers who worked on the ground. Hopefully, after this discussion is completed, the procedures and process of importing steel would be clear to all parties.”
Ng said the “full liberalisation” would be a positive move for the construction industry, as it would lower domestic steel prices to match those of neighbouring countries, which are about 10% to 15% lower. Currently, Malaysian steel bars cost about RM3,200 per tonne.
A source said that domestic monthly steel consumption had plunged to below 100,000 tonnes from about 200,000 tonnes in July in anticipation of the “full liberalisation” of steel imports.
Meanwhile, in a statement yesterday, Ng urged manufacturers, trading houses, distributors and Tenaga Nasional Bhd to adjust their prices accordingly, given that fuel prices had fallen recently. This would ensure that the benefits would be passed down to contractors.
“When the fuel prices increased in June, nearly all building materials’ prices jumped by 15% to 30%. The increase in diesel prices also caused transportation and machinery operation costs to rise tremendously by between 30% and 40%. All this happened in June.
“However, when world crude oil prices fell below US$65 per barrel and local fuel prices were adjusted downwards twice, transportation rates remained the same. Input prices have fallen but nearly all of the construction materials have yet to be reduced in price,” he said.
By The Star (by Law Kai Chow)
Tuesday, October 28, 2008
YNH Property’s sale of 50% stake in YNH Tower still on
KUALA LUMPUR: YNH Property Bhd's proposed sale of a 50% stake in YNH Tower to Kuwait Finance House (KFH) is still on and expected it to be formalised by year-end.
The company said in a statement to Bursa Malaysia on Tuesday that it was not delaying the sale of the 50% stake.
YNH also said the KFH acquisition offer had already been announced in January and it was “currently formalising the agreement by end of the year”.
On the second block, YNH stated it “is not in a hurry to sell or to seek a joint venture partner to complete the project”.
It added since the first block had been sold and the funding for the construction of whole development was essentially covered by the sale of the first block.
“Further, the location of the commercial development is very prime, within the Golden Triangle of Kuala Lumpur city centre,” it said.
By The Star
The company said in a statement to Bursa Malaysia on Tuesday that it was not delaying the sale of the 50% stake.
YNH also said the KFH acquisition offer had already been announced in January and it was “currently formalising the agreement by end of the year”.
On the second block, YNH stated it “is not in a hurry to sell or to seek a joint venture partner to complete the project”.
It added since the first block had been sold and the funding for the construction of whole development was essentially covered by the sale of the first block.
“Further, the location of the commercial development is very prime, within the Golden Triangle of Kuala Lumpur city centre,” it said.
By The Star
Emkay to develop more projects via Setia Haruman
The Emkay Group expects to boost its revenue in Cyberjaya, Selangor, by opening up new land for development via its stake in Setia Haruman Sdn Bhd, the master developer of Cyberjaya.
Setia Haruman, 75 per cent held by Emkay and 25 per cent by the UEM Group, has the rights to sell land parcels and plan, design and develop the infrastructure in Cyberjaya from 1997 until the project is developed by 2019.
It has 2,832.8ha of land under its belt, of which 30 per cent has been developed.
Mustapha Kamal: Cyberjaya project is going to be a vibrant development
Emkay, controlled by property tycoon Tan Sri Mustapha Kamal Abu Bakar, had previously bought 18.6ha of land in Cyberjaya from Setia Haruman for RM143 million to develop NeoCyber, an integrated development; MKN Embassy TechZone, an information technology park; and Bangunan Mustapha Kamal.
It may buy more land to build data centres, more purpose-built commercial buildings and a university for local and international investors, Mustapha Kamal told Business Times in an interview recently.
The group also wants to sell land parcels via Setia Haruman to local developers to build high technology buildings for overseas and local clients.
"The investment that Emkay did (in Cyberjaya) has shown results. Many big names have come in. It proves that the Cyberjaya project is going to be a vibrant development," he said.
Rental rates at Cyberjaya have increased from RM3.50 per sq ft a year ago to RM4.50 per sq ft now.
Emkay is developing MKN Techzone, featuring four commercial blocks worth RM350 million, developed under Phase One, and eight buildings worth over RM600 million in Phase Two, in a 60:40 venture with India's Embassy Group.
State-owned Amanah Raya Bhd (ARB) recently bought two blocks in Phase One, and also Bangunan Mustapha Kamal for RM266 million.
The buildings, which offer more than eight per cent yields, have been tenanted to government agencies for 10 to 15 years.
ARB chairman Datuk Dusuki Ahmad has indicated that the group may buy two blocks in Phase Two.
Emkay is looking for buyers for the other two blocks in Phase One, where one has been leased to Pejabat Pengarah Tanah dan Galian. It is finalising a deal to lease the last block to a government agency.
"The strategy that we took was to construct the buildings, lease them, and then scout for buyers. Embassy is expected to attract new investments from India," Mustapha Kamal said.
Due to good response from tenants and buyers, Emkay plans to launch Phase Two next year, offering two million sq ft of office space.
"Techzone will be developed as a campus project where everything will be integrated. We will not stop our activities because of the current global uncertainties," he said.
In the pipeline is a plan to build an 18-hole golf course and residential units.
By New Straits Times (by Sharen Kaur)
Setia Haruman, 75 per cent held by Emkay and 25 per cent by the UEM Group, has the rights to sell land parcels and plan, design and develop the infrastructure in Cyberjaya from 1997 until the project is developed by 2019.
It has 2,832.8ha of land under its belt, of which 30 per cent has been developed.
Mustapha Kamal: Cyberjaya project is going to be a vibrant development
Emkay, controlled by property tycoon Tan Sri Mustapha Kamal Abu Bakar, had previously bought 18.6ha of land in Cyberjaya from Setia Haruman for RM143 million to develop NeoCyber, an integrated development; MKN Embassy TechZone, an information technology park; and Bangunan Mustapha Kamal.
It may buy more land to build data centres, more purpose-built commercial buildings and a university for local and international investors, Mustapha Kamal told Business Times in an interview recently.
The group also wants to sell land parcels via Setia Haruman to local developers to build high technology buildings for overseas and local clients.
"The investment that Emkay did (in Cyberjaya) has shown results. Many big names have come in. It proves that the Cyberjaya project is going to be a vibrant development," he said.
Rental rates at Cyberjaya have increased from RM3.50 per sq ft a year ago to RM4.50 per sq ft now.
Emkay is developing MKN Techzone, featuring four commercial blocks worth RM350 million, developed under Phase One, and eight buildings worth over RM600 million in Phase Two, in a 60:40 venture with India's Embassy Group.
State-owned Amanah Raya Bhd (ARB) recently bought two blocks in Phase One, and also Bangunan Mustapha Kamal for RM266 million.
The buildings, which offer more than eight per cent yields, have been tenanted to government agencies for 10 to 15 years.
ARB chairman Datuk Dusuki Ahmad has indicated that the group may buy two blocks in Phase Two.
Emkay is looking for buyers for the other two blocks in Phase One, where one has been leased to Pejabat Pengarah Tanah dan Galian. It is finalising a deal to lease the last block to a government agency.
"The strategy that we took was to construct the buildings, lease them, and then scout for buyers. Embassy is expected to attract new investments from India," Mustapha Kamal said.
Due to good response from tenants and buyers, Emkay plans to launch Phase Two next year, offering two million sq ft of office space.
"Techzone will be developed as a campus project where everything will be integrated. We will not stop our activities because of the current global uncertainties," he said.
In the pipeline is a plan to build an 18-hole golf course and residential units.
By New Straits Times (by Sharen Kaur)
US new home sales up in Sept
WASHINGTON: Sales of new US homes recorded an unexpected increase in September as median home prices dropped to the lowest level in four years, the Commerce Department reported yesterday.
Sales of new single-family homes rose by 2.7 per cent last month to a seasonally adjusted annual rate of 464,000 homes, Commerce said. Economists had expected sales would drop from the August level.
The surprising increase in September sales still left them 33.1 per cent below the level of a year ago as the US is battered by the worst slump in housing in decades. Analysts are not convinced that the sales increases are signalling a bottom for the housing market.
By AP
Sales of new single-family homes rose by 2.7 per cent last month to a seasonally adjusted annual rate of 464,000 homes, Commerce said. Economists had expected sales would drop from the August level.
The surprising increase in September sales still left them 33.1 per cent below the level of a year ago as the US is battered by the worst slump in housing in decades. Analysts are not convinced that the sales increases are signalling a bottom for the housing market.
By AP
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