YTL Hotels: Dubai project will pave way for more overseas ventures

YTL Hotels expects Pangkor Laut Luxury Resort, Residence & Spa Village, a resort development on The World in Dubai, to pave the way for similar developments outside the region.

It currently manages a collection of award-winning resorts and hotels in Southeast Asia.

"It's a fantastic opportunity for YTL Hotels to lend its brand for a world-renowned development. The exposure will be good for us as we look to expand," the resort manager for Pangkor Laut Resort, Jeffrey Mong, told Business Times in an interview.

The World, an idea conceived by Sheikh Mohammed bin Rashid Al Maktoum, the ruler of Dubai, is a man-made archipelago of 300 artificial islands constructed in the rough shape of a map, located 4km off the coast of Dubai.
The islands composed mainly of sand dredged from Dubai's coastal waters. Individual islands have been sold by the developer, Nakheel Group, for US$15 million to US$50 million (RM50.1 million to RM167 million).

Investors from Kazakhstan and Russia bought five islands to develop Pangkor Laut Luxury Resort, Residence & Spa Village.

A partnership agreement was signed between the investors and YTL Corp Bhd in 2008. YTL Hotels, the hospitality arm of YTL, was invited to bring its luxury hospitality to Dubai by licensing the brand Pangkor Laut and Spa Village for the project.

It was also appointed the sole operator for the resort, and to set up and manage the five-star spa.

Mong said the partnership will help the company's employees to learn and experience the management of a world-class asset.

Construction on the project, modelled after Pangkor Laut Resort, is half way and it will be ready by 2012.

This will be the first time YTL Hotels will manage a property without an equity investment.

Pangkor Laut Luxury Resort, Residence & Spa Village will offer a lifestyle package combining luxurious villas, townhouses and apartments, boutique restaurants and retail outlets.

The Pangkor Laut Luxury Resort will offer 120 deluxe guest rooms, 20 fully equipped luxury beachfront villas, shopping gallery, aqua park and an underwater nightclub - a first for Dubai.

The residential component, Pangkor Laut Luxury Residence & Spa Village, will offer 92 fully furnished apartments, 27 attached three-bedroom villas with a private pool, 34 independent luxury villas with private marinas, a community centre and spa.

By Business Times

YTL Corp unit to acquire Japanese resort for RM222mil

PETALING JAYA: YTL Corp Bhd’s wholly-owned subsidiary YTL Hotels & Properties Sdn Bhd has entered into an agreement to purchase a Japanese village resort for 6 billion yen (about RM222mil).

In a filing with Bursa Malaysia yesterday, YTL said the proposed acquisition would enable the group to participate in one of Japan’s finest ski resort destinations on Hokkaido island with potential to develop into a world class four season resort through luxury residential development and mountain retail development.

“The proposed acquisition is not expected to have an immediate material effect on the earnings, net assets and gearing of the group for the current financial year. However, it is expected to improve the earnings of YTL Corp in the longer term,” it added.

By The Star

YTL to enter into ski resort business

YTL Corp Bhd is entering into an agreement with several parties which will ultimately see the company participating in one of Japan’s finest ski resort destination.

The conglomerate, through its wholly-owned subsidiary, YTL Hotels & Properties Sdn Bhd, will acquire 496,184 shares, representing 100 per cent of the equity interest in Niseko Village from PC One YK (PC One), a Japanese limited liability company.

By Bernama

UOA REIT may buy 2 buildings

UOA Real Estate Investment Trust (REIT) is considering buying two office blocks in Kuala Lumpur for RM500 million.

It received an offer from UOA Holdings, a substantial unitholder in UOA REIT, for the sale of Parcel B Menara UOA Bangsar and Wisma UOA Damansara II, priced at RM289 million and RM211 million respectively.

"The board of directors of the manager (UOA Asset Management Sdn Bhd) and OSK Trustees Bhd (trustee) will deliberate on the terms and conditions contained in the offer letters and a further announcement will be made upon completion of the deliberation," UOA REIT said in a statement to Bursa Malaysia Bhd.

Parcel B Menara UOA Bangsar, located in Jalan Bangsar Utama 1, comprises a tower block with 15 levels of office space, three levels of retail podium, six levels of elevated car park and four levels of basement parking.
The newly completed commercial and retail property, which has a 99-year leasehold tenure, is 88.5 per cent occupied.

Wisma UOA Damansara II, located at Changkat Semantan, comprises a 16-storey office building and five levels of basement parking.

The two-year-old freehold property, used for commercial and retail purposes, is 87 per cent occupied.

The purchase of Parcel B, Menara UOA Bangsar, will involve a refundable deposit of 0.01 per cent, or RM28,900; a cash payment of RM156.03 million; and the issuance of 102.26 million new REIT units.

The purchase of Wisma UOA Damansara II will also involve a refundable deposit of 0.01 per cent, or RM21,100; a cash payment of RM113.92 million; and the issuance of 74.66 million new REIT units.

By Business Times

Kulim to sell Menara Ansar for RM105m

Diversified palm oil group Kulim (Malaysia) Bhd plans to dispose its investment property, Menara Ansar, in Johor Baru for RM105 million.

The divestment will be satisfied part cash with the company set to receive RM63 million, said managing director Ahamad Mohamad in statement today.

The remainder will be via the issuance of 42.9 million new units of Al-Aqar KPJ Real Estate Investment Trust (REIT) at an issuance price of RM0.98 per unit.

Ahamad said Kulim had opted to dispose its investment in Menara Ansar as it would allow the group to unlock the value of its non-core assets as well as realise its investment in the property.
"The divestment will allow us to utilise the proceeds for repayment of borrowing, which currently stands at RM1.7 billion, and lower our gearing from 0.33 times to 0.32 times," he said.

On the Al-Aqar REIT, which is the world's first listed Islamic REIT and Asia's first healthcare REIT, Ahamad said it would be a good investment for the group as it has been providing stable and respectable dividends for the last two years.

As at Dec 31, 2009, Al-Aqar has an existing fund size of 518.37 million units with current assets totalling RM49.81 million and a real estate portfolio of RM961.5 million.

Kulim has accepted the offer to dispose Menara Ansar from AmanahRaya Trustees Bhd, which is the trustee of Al-Aqar REIT. The transaction is scheduled to be completed by the third quarter this year.

Menara Ansar, built on 9,739 square metres of freehold land, is a 21-storey office space with a three-level basement car park. To date, it has an occupancy rate of 92 per cent.

By Bernama

China sees long-term growth in housing prices

Soaring Chinese housing prices will rise further in 2010 and beyond as the nation develops and as local officials push property sales as a revenue source, the country's housing minister said Monday.

The bullish assessment by Minister Jiang Weixin appeared to cast doubt on government pledges to curb runaway prices that have fuelled fears of a real estate bubble and concerns that they were rising out of reach of many Chinese.

"I think this year the housing market will progress at a steady pace," Jiang told reporters at a briefing on the sidelines of the country's annual session of parliament.

"My prediction is that the upward pressure on housing prices will remain great for the next 20 years because demand will be huge due to rapid urbanisation and industrialisation and because our land is limited," he added. "Therefore we face huge price pressure."

Premier Wen Jiabao on Friday singled out the issue as a top government priority in an address to open parliament, saying Beijing would crack down on illegal practices aimed at driving up prices to ensure the "steady and sound development of the real estate market".

"We will resolutely curb the precipitous rise of housing prices in some cities and satisfy people's basic need for housing," Wen said.

Massive bank lending in 2009 has triggered fears that the cash flood has fed a spending spree by property speculators. Prices in 70 major cities rose 9.5 percent in January from the same month a year ago, the fastest pace since April 2008, the latest official data shows.

Jiang indicated the problem was being exacerbated by local governments for whom the property transfer fees are a significant source of revenue. "I think local governments are very happy to see housing prices rise because this means more fiscal revenue for them," he said. "So local governments have the obligation to fix this problem. This is a top priority in their work as instructed by the central government."

China's far-flung provincial, city and county level governments have a patchy record on following through with initiatives handed down by Beijing due to pressure to maintain economic growth in their areas. Beijing has been trying to cool the property sector by restricting lending, requiring buyers of second homes to put up a down payment of at least 40 percent and hiking interest rates on mortgage loans.

By AFP

HSL plans ambitious La Promenade project

An artist’s impression of a semi-detached house at The Leaf.

KUCHING: Riding on the robust sales of its newly-launched guarded and gated residential estate The Leaf, Hock Seng Lee Construction Sdn Bhd has set its next ambitious target to build 1,000 high-end homes in a major mixed-development project in Sungai Kuap, along the Kuching-Samarahan Expressway.

Named La Promenade, this single-biggest project ever undertaken by the property arm of Hock Seng Lee Bhd (HSL) will have a commercial centre of 200 shophouses, a shopping mall, two office blocks, a clubhouse and a man-made lake and recreational facilities.

These are in addition to the 1,000 high-end homes in the guarded and gated residential estate.

HSL plans to relocate its head office at Jalan Pending to La Promende in one of Sarawak’s fastest growing centres.


Yii Chee Sing (right) discussing the Leaf’s development with the company’s property development manager Benny Goh.

Executive director Yii Chee Sing said with a gross development value (GDV) of RM900mil, La Promenade would be launched in the second half of this year.

“Reclamation works for the project is already under way. The entire development spanning 80ha will be carried out in 10 phases over 10 years,” he told StarBiz.

Yii said the company’s confidence of a strong demand in high-end residential homes was boosted by the nearly sold-out The Leaf, which would provide lifestyle living, comprehensive security system and attractive landscaping.

He said more than 90% of the 54 luxurious contemporary duplex villas, semi-detached houses and double-storey linked houses at The Leaf, near Kuching International Airport, had been snapped up since its launch three months ago. The showhouses drew some 6,000 visitors on the opening day last November.

“All the 34 semi-detached units priced between RM700,000 and RM1mil have been sold,” he said, acknowledging the current glut in the sales of conventional semi-detached houses priced in the RM400,000-RM500,000 range in the state capital.

The Leaf boasts Sarawak’s first electrified perimeter fencing to deter and detect any intrusion. Its other security measures are vehicle access card entry, intercoms and panic alarms from each home to the guardhouse as well as round-the-clock patrols by trained guards.

“Housebuyers today are more sophisticated in choosing what they are going to invest in. Besides the house designs, they are particularly concerned about safety for a peaceful living,” said Yii.

He said The Leaf’s entire development would provide an attractive environment with covered drains, leafy landscaping and, most notably, concealed utility services. There will be lush lawns, trees and shrubs in keeping with the estate name – The Leaf.

Other shared facilities for the house owners are a recreational park with a playground and a discovery fruit orchard for children.

Yii said the La Promenade community would be modelled after The Leaf as there was a rising demand for lifestyle concept living that emphasised on security, landscape and recreational facilities.

He said HSL Construction had built some 1,000 houses in the state capital in the past five years, including in the top-selling Samariang Aman project in Bandar Baru Samariang (GDV of RM110mil). All the 642 units priced between RM160,000 and RM220,000 in this ongoing residential development have been taken up.

Yii said an innovative design introduced for the single-storey terrace houses in Semariang Aman was an internal countyard to bring extra light and ventilation to the centre of the home. This private garden space not only enhances the ambience of the house but also the quality of life of its occupants.

On the drawing board is the proposed Samariang Aman II project – a mixed commercial and residential development with over 220 shops, a hypermarket and a seven-storey office block.

The company has just launched Vista Aman in Samarahan which involves the development of 60 houses. Its other residential developments are Highfields in Batu Kawa (175 units), Lavender Hills along Kuching-Serian Road (64 units) and Vista Parade in Sibu (38 units).

HSL Construction has a landbank of some 285ha with good development potentials in both Kuching and Bintulu, with a total GDV of RM1.9bil.

The size of the landbank is expected to increase as more construction contracts are secured by parent company HSL whereby payment is by way of cash and land. Most of the land it owns now was secured over the years as part-payment for state-funded infrastructure projects.

“The property arm now contributes about 15% to the HSL group revenue, and between RM8mil and RM9mil a year to group profits,” said Yii.

By The Star (by Jack Wong)

Developers, analysts unperturbed by interest rate hike

PETALING JAYA: Developers and property analysts are not overly concerned about Bank Negara’s overnight policy rate (OPR) hike to 2.25% from a record low of 2%.

Although Thursday’s rise in the benchmark interest rate was the first in almost four years, industry players do not expect property sales to be affected.

According to ECM Libra property analyst Bernard Ching, despite the interest rate hike, bank financing will continue to be cheap with effective interest rates at 3.8% to 4% from the previous highs of 6.5% to 6.75% about two-and-a half to three years ago.

“Going forward, we expect the OPR to rise gradually and the best thing to do is to lock in the current negative spread before the rates rise further,” Ching told StarBiz.

He said the housing packages being offered by developers were providing a low entry cost for housebuyers and fuelling demand for houses.

He expects these packages to continue for the next couple of months at least, as it would be premature to end them at this juncture.

Ching said upper-middle range buyers, who have the capability to service their loans, were mostly buying for investment purposes.


»We see it as a normalisation of rates, given the improved economic outlook this year« TAN SRI LIEW KEE SIN

SP Setia Bhd president and chief executive officer Tan Sri Liew Kee Sin said the rise in the OPR was very minimal and that “we see it as a normalisation of rates, given the improved economic outlook this year.”

“Generally, interest rates are still low and remain attractive to house buyers. We do not see this affecting our property sales and are confident with our ongoing launches. We will continue with what we have planned for this year,” he added.

Mah Sing Group Bhd group managing director-cum-chief executive Tan Sri Leong Hoy Kum said with the rates still far below historical highs, the affordability level of property buyers was still high.

“We doubt that the rate hike will have any impact on property sales. This increase should be seen as a positive move as it indicates a normalisation which can curb inflationary pressures,” he said.

Leong said the expected economic expansion, improvement in employment market, high savings and healthy affordability levels would contribute to higher demand for properties in the coming months.

Mah Sing will be capitalising on its branding, product quality, location, concept and track record to capture its market share and achieve its 2010 sales target of RM1bil.

The company plans to have property launches in 10 new projects and four existing developments.

By The Star (by Angie Ng)

Sime unit looks to Vision Valley for growth

Sime Darby Property Bhd's chief is looking to the RM30 billion Sime Darby Vision Valley (SDVV) to be its future growth driver.

The 32,000ha development is expected to enhance the value of its landbank and the company is optimistic of an earnings margin of no less than 15 per cent.

It expects to secure approval for the project soon and for work to start in September, managing director Datuk Tunku Putra Badlishah told Business Times in an interview.

The SDVV, scheduled to be completed by 2025, targets housing more than 4.5 million people.

It will encompass anchor projects Selangor Vision City (SVC) - covering the Guthrie Corridor, Subang Jaya, Carey Island, Ampar Tenang and Sepang Estate - and Negeri Sembilan Vision City (NSVC).
The NSVC will include Labu and Tanah Merah Estates and a new model of affordable housing community that will be developed as the first project in the country to cater for the housing needs of workers in the SDVV, Tunku Badlishah said.

Some 14,800ha will emerge as the main driving clusters for the overall master plan with its sports, healthcare and wellness; education; aviation and maintenance, repair and overhaul; leisure, tourism and entertainment; and Green Experimental Cluster components.

Tunku Badlishah said that key to the SDVV, a regional development, will be to attract foreign

direct investment (FDI) from the Asia-Pacific, the US, Europe and the Middle East.

“Geographically, we are right smack in Asia-Pacific. So, location-wise, we have the edge. Malaysia Airports Holdings Bhd is committed to building the new low-cost carrier terminal (LCCT) in Sepang. When the new LCCT is completed, Malaysia will become a stronger transportation hub for the region.”

Sime Darby Property is talking to local and foreign
conglomerates to invest in the development.

The SDVV will complement the Iskandar Malaysia development in Johor.

Sime Darby Property will work with Iskandar Investment Bhd and the Iskandar Regional Development Authority for the development of both Iskandar Malaysia and the SDVV, Tunku Badlishah said.

By Business Times

SP Setia plans high-end condos in Gurney Drive

Property developer SP Setia Bhd is set to make its mark on Penang's popular seafront promenade Gurney Drive, if a plan to buy land in the upmarket neighbourhood goes through.

General Manager S. Rajoo said SP Setia has identified a parcel of land measuring 0.92 hectares in the area, and plans to build 70 units of high-end condominiums.

"We intend to incorporate lots of greenery into the proposed development for the super-condominiums which are set to boast a floor area of 3,000 sq feet," he told Business Times.

Rajoo was speaking during a Chinese New Year celebration hosted by SP Setia in Penang which was attended by the company's president and chief executive officer Tan Sri Liew Kee Sin and chief operating officer Datuk Voon Tin Yow.

The proposed project in Gurney Drive is part of SP Setia's move to expand its landbank by 12ha this year.
Gurney Drive, located in the affluent Pulau Tikus area in George Town, is currently lined with high-end condominiums and is near a sea-fronting shopping mall and a host of eateries.

"We have also identified another 5.6ha land to acquire in the southwest district of Penang island. We intend to develop a gated community comprising detached and semi-detached homes," Rajoo said.

SP Setia is also looking to buy more land in the southwest district for a resort homes development.

"This would be a sizeable piece of land where more bungalows and semi-detached units will be built," he added.

It now has an undeveloped landbank of around 24.4ha on Penang island.

SP Setia still thinks that demand for landed properties is strong despite similar projects being launched by other developers.

"The supply for landed properties is still lacking and we intend to market our homes to foreign investors and locals," he said.

SP Setia's entry into Penang was via its maiden development "Setia Pearl Island" in Sungai Ara near the Penang International Airport.

The project, which is sited on a 45.2ha of land, serves as the company's flagship project in Penang.

From November 2009 until now, the company has sold properties worth RM115 million at Setia Pearl Island.

"Our target is to chalk sales of RM200 million by the end of October," he added.

By Business Times (by Marina Emmanuel)

Pickup in industrial parks

The industrial property sector is expected to rebound this year as the supply has been stagnant in the last four to five years.

“Since 2004, the prices of industrial land have appreciated as property developers venture into developing industrial parks as a new income avenue to overcome the softer property market,” says MIDF Research in a recent report.

It adds that, currently, industrial players are on the lookout for more than the conventional designs.

“Features such as gated and guarded concepts, super-sized terraces, underground cabling and covered drainage are value-added features in demand. We expect the trend of industrial parks being located in the vicinity of commercial areas, and close to highways, to continue in the future,” the report says.

Nevertheless, it says niche concepts such as “halal parks” and Technology Centres may remain in the offering to serve niche players.

KGV-Lambert Smith Hampton (M) Sdn Bhd executive director Anthony Chua says the number of industrial properties transacted have shown a gradual increase of 13.6% from 2005 to 2008 and the value of these transactions rose significantly by 58% in that period.

“The industrial land prices in some popular schemes demonstrated up trend of over the past 6 years. Popular schemes include area in Kota Kemuning, Glenmarie, Bukit Jelutong and Balakong in Selangor and with few factors boosting the price going up,” he tells StarBizWeek in an email reply.

He says one of the factors involved is limited new supply of industrial properties like for example, in Wilayah Persekutuan where there is no new factories between 2005 to 2008.

“The growing small and medium enterprise sector forms a source of demand for industrial premises and the role of the government in expanding this sector with various initiatives and financing augurs well for the industrial property sector,” he says.

Industrial premises such as terrace and semi-detached factories are suitable for services operation such as those in auto servicing, distributive trade, transportation, light manufacturing or processing.

“Some astute developers who spotted this trend has ventured into industrial schemes to capitalise on this “neglected” sector compared to the residential and industrial sectors,” says Chua.

On the current and new trends in the industrial sector, he says the current trend of developing semi-detached factories is continuing although there are significant changes to the building features.

“Semi-detached factories are transforming from light industrial workshop design to a more corporate look. This has attracted some companies to use these newer factories as their corporate offices,” he says.

Chua elaborates that the recent trend include “super-link” factories, somewhat similar to super-link houses. These are terrace factories with large built-up areas, some are almost similar in size to semi-detached factories (6,000 sq ft and above).

He adds that a fairly recent introduction in the industrial property scene is the set-up of Halal Parks in establishing Malaysia as a global Halal Hub.

“This is a government initiative and to-date 17 Halal Parks have been planned with five in operations. The innovation in creating Halal Parks is in bringing the concepts and practices for the entire chain of activities encompassing industrial and food development, food manufacturing, Halal traceability, logistics and certification under one location,” says Chua.

Mah Sing Group Bhd’s group managing director cum group chief executive Tan Sri Datuk Seri Leong Hoy Kum says the company focuses on appropriate product offering, optimum pricing and promotion strategy.

“Mah Sing’s experience in industrial developments includes the successful 300-acre Mah Sing Integrated Industrial Park in Sungai Buluh. This project with a gross development value of RM400mil was launched in 1995 and is fully sold. Furthermore, we have a unique user’s viewpoint for industrial developments, as we have a profitable plastics business with factories in both Malaysia and Jakarta.

“We recently launched iParc@Bukit Jelutong in January whereby we saw overwhelming response, with 40 units out of a total of 42 units being sold,” he says.

Due to the strong response, he says, Mah Sing has decided to develop a similar concept for iParc 2@Shah Alam to cater to the spill over demand.

“We are careful to select lands that fits the requirements of industrial property buyers like for example; excellent road, rail, air and sea connectivity, readily available infrastructure facilities like water, electricity and telecommunications and also close proximity to mature residential developments which provides a catchment of skilled and unskilled labour force,” he says.

He adds that Mah Sing also creates fresh demand by offering flexible designs to suit the needs of the end user, hence the layout design can be configured to specific needs.

Effectively, he says, these can be customised factories at a fraction of the cost of commissioning a purpose built factory.

Another developer involved in the industrial sector, LBS Bina Group Bhd says that the property sector has seen a strong comeback since the third quarter 2009 with renewed buying interest for property.

“Given the improving economy sentiment, we expect strong recovery in demand for properties, both residential and commercial for year 2010. We remain optimistic over the demand for our industrial units in Puchong in view of the strong demand in this vicinity,” says Lee Eileen from sales and marketing department through an e-mail reply to StarBizWeek.

Generally, LBS is positive about the business outlook for 2010 as the Malaysian economy is set to recover, albeit slowly.

“This was proven after our successful launching of our 58 units of semi-detached factory at Taman Perindustrian Tasik Perdana@Puchong on January last year.

“The sales were picking up from May 2009 and we managed to achieve 71% of the sales of the said project on September 2009. The balance units are available for sale and reserved for bumiputra only,” she says.

The project in Taman Perindustrian Tasik Perdana covers 39 acres of development which consists of 58 units of 1 1/2 storey semi-detached factory and 11 industrial lots.

“The semi-detached factory was sold at the range of RM1.4mil to RM2.5mil with a built up area of 4,043 sq ft. We are selling the industrial lot at RM80 per sq ft and the land size of the lot is ranging from 0.5 acres to 1.88 acres. Currently, there are four industrial lots available for sale and is reserved for Bumiputra only,” she says.

The group will launch five units of 3-storey bunglow factory with built up area of 8524 sq ft at the land size of 0.316 acres onwards in April. The proposed selling price of each units is RM3.5mil onwards.

By The Star

Promoting safer neighbourhoods

ABRIDGED versions of gated and guarded enclaves in older housing estates are sprouting up in many parts of the Klang Valley.

Increasing urban crime rates have compelled many residents to put up with the inconveniences of having their housing estates barricaded and turned into “fortresses”.

As one colleague whose USJ11 house was broken into last year says: “Even the police admit that break-ins and robberies have become almost daily occurrences and there has been a sharp spike in such crimes in the Klang Valley.”

The residents’ associations need the support from at least 85% of the residents to get approval from the authorities to implement the security schemes.

Those who have supported the scheme swear that it has drastically reduced crime in their neighbourhoods.

The opponents, however, say that the fences, guard posts and barriers are an inconvenience to the residents and the public, especially visitors, because some public roads have been sealed off and are not accessible.

While peace of mind and security used to be a given fact just a few years ago, today it comes with a price. Each household that has signed up for the security scheme has to fork out monthly fees of around RM50 to RM55 for guards to be stationed at the main entrance of their housing area and for a 24-hour patrol.

There is also the inconvenience of having to forego the easy access offered by open roads around the neighbourhood. Because of the barricades and fences, residents have to take longer route as well as be screened by the guards before entering the cordoned housing area.

Business operators in these housing estates, especially food operators, lamented that their businesses have suffered tremendously since the barricades went up.

The promoters of the security scheme should realise that any closure of roads must not create a hassle to residents or hamper the movement of emergency services.

The scheme should only be an interim measure and not be turned into a permanent feature in our housing estates. This is because under the Street, Drainage and Building Act 1974, it is illegal to put up barriers that obstruct access to public roads.

Provisions of the Town and Country Planning Act 1976 may also be violated where guard houses are built on public land or road shoulders. To address some legal issues which have cropped up, the Housing and Local Government Ministry intends to come out with guidelines for such guarded schemes.

Minister Datuk Seri Kong Cho Ha is concerned over the absence of proper guidelines for these guarded community housing estates that have resulted in state governments and local councils introducing their own guidelines and by-laws which differ from one locality to another.

Ultimately, it is important to address the root causes of crime and to seek more sustainable measures to curb it. Local communities and law enforcers can play more effective roles in fighting crime in housing estates.

Hopefully, the RM1bil allocation pledged by the Government to beef up the police force will be deployed wisely and efficiently to rein in this rising social menace. More regular patrols by plainclothes policemen should be effective.

Volunteer patrol schemes and neighbourhood watchgroups should also be deployed to combat crime in residential areas. If properly implemented, such patrols will promote stronger understanding and ties among residents. Reinstating good neighbourliness will certainly go a long way to promote safe neighbourhoods.

Those who are averse to barricading the roads should resort to mobile security patrolling instead. Developers can also play a big role by designing their new housing estates in a more safe and secure way. These housing areas should not “share” entry and exit points with other neighbouring projects.

Preferably, each neighbourhood should have more cul-de-sacs and less through roads to minimise access, noise, air pollution and promote pedestrian safety for the residents.

Deputy news editor Angie Ng believes all Malaysians deserve to enjoy the bliss of secure homes and public places.

By The Star

Keeping The Lid On House Prices

Great demand: A file picture of house buyers checking out the properties on offer at a property fair in Shanghai.

The question of when is the right time to buy a house is always on the minds of the Chinese people. But the timing varies like a roller coaster.

The world’s third-biggest economy has seen itself moving back and forth in its fiscal approach to control soaring house prices over the past few years. And this can only complicate the decision to buy a property, not to mention that prices remain ridiculously high.

Senior executive Chen Zilin, who bought his first home in Beijing six years ago and a second in 2007, went through tough times on each occasion. Now he is more like an observer of the ever dynamic real estate market.

“Before I got married, my then fiance told me to buy an apartment before we could wed. We got the apartment for 380,000 yuan (RM187,000) which was quite a good price at that time,” said the 32- year-old from Zhuhai in Guangdong province.

Chen and his wife lived in the first apartment, a two-bedroom unit measuring 90 sq m, and rented out the second, a service apartment about 13km from the city centre.

The first apartment was bought under the city’s affordable housing scheme that his Beijing native wife is entitled to. It can now fetch 1.4 million yuan (RM690,000). The second is now valued at over a million yuan, up from 700,000 yuan (RM343,000).

“Who would have expected the price of my first apartment to increase four-fold? It’s good that I bought the apartments early as I can now save money for other things,” he said.

“But if I were to buy a bigger house, I will have to pay more. So, there are two sides to the coin.” Last month, the Chinese government moved to cool a possible bubble, when house prices in 70 major cities rose 9.5% year-on-year, by limiting interest rate discounts for loans and requiring buyers to pay as much as 40% in down payment.

Several banks, following government guidelines, have also stopped lending to property developers without adequate capital or licence, and recalled loans to those hoarding land and homes.

Just 10 months ago, when housing sales slumped to record lows, banks were allowed to give a maximum 30% discount on the interest, and down payment of as low as 20%.

House buyers in cities like Shanghai even had stamp duties waived and deed tax cut to 1%.

And the grapevine has it that developers in Beijing will be required to announce the exact sales numbers of their housing projects as soon as they market the projects.

“The government has been rather passive and not taking enough initiatives to dictate the pace. At the end of the day, most people still look at the price, which is still too high, when house hunting,” Chen said.

Xu Fang, who works as a teacher in Shanghai, believes that despite the high prices in many major cities, there are still potential growth areas where prices are relatively affordable. She and her husband bought three apartments in three years, all in the suburbs.

“We bought our first home in Anting for only 400,000 yuan (RM196,000) using our parents’ savings. Then we walked out of a sales centre with another apartment costing about the same price, followed by the third a few months later,” the 27-year-old said.

“I’m not worried whether the price of my properties will increase significantly. So far, the price of the first and second houses, each measuring 70 sq m, have gone up to about 550,000 yuan (RM269,000), which is not too bad.

“When buying houses, we mostly consider the location, whether there’s a core industry which can bring about sustainable development in the area.”

She said Anting had great promise – the town had been earmarked as a car city together under the city’s 11th Five-Year Plan (2006-2010). The third apartment, a three-bedroom unit costing about a million yuan, is now Xu’s most prized acquisition. The couple plans to move into the apartment with their baby one day.

In Guangzhou, where average house prices are about 8,000 yuan (RM3,920) a sq m, buyers have seen prices increase more than 25%, the highest nationwide last year.

“It’s better not to buy a house now, as the prices do not reflect the actual cost of the property,” said a Guangzhou-native designer, who only wanted to be known as Yang.

Yang bought a 90 sq m secondhand apartment near downtown for 550,000 yuan (RM269,500) at the age of 33. Currently it can fetch 715,000 yuan (RM350,000), a 30% gain on paper.

“The price was still all right when we bought it one-and-a-half years ago. Last year, house prices in the city rose significantly,” he said. Yang is paying back his parents 5,000 yuan (RM2,450) a month for the money he borrowed from them to buy the house. He and his wife have a yearly disposable income of 210,000 yuan (RM102,900).

However, for those with lower income, owning and changing to a bigger home remains a dream. Chinese Premier Wen Jiabao told netizens in an online chat last Saturday that he was bent on keeping house prices at reasonable levels.

“I really understand the complaints as my family had lived in a 9 sq m house before I left home. Of course, that was a different era, and now we should provide housing for the public based on the current situation,” he said.

“We will need a little longer to strike a balance between supply and demand, and giving the public more housing choices and fiscal management in managing the market.”

Wen said the government would build five million affordable homes this year, adding to the two million completed last year. Another two million shanty houses will be upgraded this year.

He also vowed effective fiscal policies and legal means to curb land hoarding by developers as well as property speculation.

Mu Qiru, a representative of the Chinese People’s Political ConsultativeConference,thenation’s top advisory body, said it was not right to blame the entire real estate industry for the soaring prices.

“We must have confidence in the developers as well. Developers are a driving force in our economy and pay up to 65% taxes to the government,” said Mu, who is also the chairman of Beijing Zhaotai Land Holdings Co Ltd.

She said the recent record-breaking land sale prices was unavoidable as developers faced fierce competition in land auctions, but the government could continue to fine-tune auction procedures to keep prices at reasonable levels.

By The Star

'Rate hike won't hurt property demand'

Malaysia’s decision to raise interest rates is unlikely to hurt property demand which will be driven by the economic rebound, a strengthening ringgit and affordability levels, according to JPMorgan Chase & Co.

“We remain positive on the property sector as this represents a normalization in rates,” Simone Yeoh, an analyst at JPMorgan, said in a report dated March 4.

By Bloomberg

NSTP sells land to Megah Selesa

The New Straits Times Press (Malaysia) Bhd (NSTP) has sold a plot of land in Shah Alam to Megah Selesa Development Sdn Bhd for RM15.9 million.

The sale and purchase agreement for the 217,807sq ft plot in Bukit Jelutong was signed on March 3, NSTP said in a filing to Bursa Malaysia yesterday.

Proceeds from the sale will be used for working capital, the company added. NSTP bought the land in November 1995.

By Business Times

Iskandar Investment invites tenders for Legoland Malaysia

KUALA LUMPUR: Iskandar Investment Group has invited tenders for the construction of Legoland Malaysia Theme Park at Iskandar Malaysia.

Package two comprises of primary infrastructure and package three is for the service and administration building, open car park and substation 33kV.

The notice of invitation was issued by IDR Assets Sdn Bhd, a member of the group, according to an advertisement on Friday, March 5.

"The invitation is restricted to companies registered and have offices actively operating in Johor," according to the notice.

Another criteria is that the companies must have completed building and infrastructure projects, with a value of no less than RM20 million accumulated over the last five years.

By The EDGE Malaysia

Pantai to open RM500m hospital in Johor

Healthcare group Pantai Holdings Bhd is scheduled to open a RM500 million hospital in the Iskandar region in Johor.

The 400-bed hospital will also have a centre of excellence and a nursing college, the hospital's chairman Tan Sri Khatib Abdul Hamid said.

"It will be ready within five years, but it can be earlier," Khatib said.

However, it is unclear if Pantai will wholly own or merely have a stake in the hospital. It could also lease and operate the premises.
Pantai has also confirmed the opening of a hospital in Sri Manjung, Perak. To be ready in 2012, Pantai will lease this building and manage it.

Pantai now operates nine hospitals nationwide.

Khatib was speaking to reporters at a signing ceremony with Preventive Healthcare Sdn Bhd.

Preventive Healthcare basically markets health screening packages locally and abroad. Its customers can then seek treatment at any one of the Pantai hospitals.

Its chief executive officer Dax Lee said it now has some 600 members and is looking to grow this to 20,000 within the next five years.

This three-year-old company is also looking to rake in RM290 million in revenue in the next five years as it makes an estimated 150,000 transactions from its services.

Lee added that the business, which he owns with his partner, the chief operating officer Cheong Dik Hau, has been profitable since the first year.

Preventive Healthcare has set up an office in Jakarta and will this year branch out to Medan, Indonesia and Hanoi, Vietnam. It is also looking at moving into Surabaya (Indonesia) and Guangzhou (China) in 2011 to lure foreign patients into Malaysia.

The company also provides electronic storage of all medical records for up to 15 years.

By Business Times

SP Setia upbeat on RM2b sales

PROPERTY developer SP Setia Bhd is projecting RM2 billion sales this year, driven by the improved economy and ongoing product launches in addition to its financial package campaign offerings.

The group has 10 ongoing projects and some 1,578 hectares. of landbank with a total gross development value of RM26 billion, sustainable over the next 12 years.

Despite the challenging economy, it posted a RM171 million net profit and a record breaking sales of RM1.65 billion last year.



"Sales have continued to hold up at higher than the pre-crisis level due to the group's strong branding and innovative marketing strategies," said president and chief executive officer Tan Sri Liew Kee Sin after the company's annual general meeting yesterday.
He said continuous strong sales is projected in its key locations namely Klang Valley, Penang and Johor.

The 5/95 financial incentives undertaken by SP Setia has helped to push sales tremendously.

During the first quarter of 2010, it recorded RM608 million in sales, a sixfold increase from the RM101 million during the same period in 2009.

Last year, the property group made its foray into the luxury high-rise development with the launch of Setia Sky Residences located in the vicinity of Kuala Lumpur City Centre, Setia Walk in Puchong and EcoLakes in Vietnam.

SP Setia ventured into Vietnam in mid-2007 with a US$12 million (RM40.4 million) acquisition of a 243ha land located 42km north of Ho Chi Minh City.

Last year, it also entered into a joint-venture agreement with Hangzhou Ju Shen Construction Engineering Ltd to carry out mixed development projects in XiaoShan, Hangzhou.

"However, sales this year will mostly be from the Malaysian market as we are stronger economically. Sales from Vietnam is only projected to be about RM100 million of the RM2 billion total sales target," Liew said.

By Business Times

SP Setia revises upward sales target

SHAH ALAM: Property developer SP Setia Bhd has increased its sales target for the financial year ending Oct 31, 2010 (FY10) to RM2bil from RM1.65bil announced earlier, backed by a jump in sales of RM608mil recorded for the first quarter.

The group achieved its highest ever sales of RM1.65bil in FY09 despite challenging market conditions last year.

President and chief executive officer Tan Sri Liew Kee Sin said he was upbeat about the sales target after the group recorded a six-fold increase in sales for the first quarter compared with RM101mil achieved in the same quarter of FY09.

“The group’s sales have continued to hold up higher than pre-crisis levels due to strong branding and adoption of innovative marketing strategies,” he said after SP Setia’s AGM yesterday.

He added that the sustained sales performance, despite a price increase of at least 10% for the group’s entire product range, would underpin its targeted return to growth this year.

“Of the RM2bil sales target, almost all will come from the local market and 10% from our project in Vietnam.

“The market in Vietnam is not so stable at the moment and we are taking it slow and steady there,” he said.

Liew said the group’s main focus would be its projects in the Klang Valley, Penang and Johor Baru.

“We have about 10 ongoing projects in Malaysia with a total gross development value of RM26bil that would last for 10 to 12 years on our 3,900 acres of land,” he said.

By The Star

JAKS to help Star develop its PJ land

AKS Resources Bhd will help Star Publications (Malaysia) Bhd turn its land in Petaling Jaya, Selangor, into a residential and commercial development.

The companies sealed a deal yesterday to build two office blocks, a commercial cum educational block and a residential block on 24,568 sq m plot in Section 13. T

The project will boast a gross development value of RM370 million, JAKS said in a filing to Bursa Malaysia yesterday.

By Business Times

Mydin to build its biggest hypermart in Kota Baru

MYDIN Mohamed Holdings Bhd, the operator of the locally-owned Mydin wholesale stores and hypermarkets, plans to build its biggest hypermarket in the country at the Tunjong new township in Kota Baru soon.

The RM200 million hypermarket, expected to be completed by 2012 will be built on a 7.2 hectare site about five kilometres from the town centre.

Mydin managing director Datuk Ameer Ali Mydin said the Kelantan government was in the final phase of acquiring the land for the project from its owners and the ground works were expected to start in May.

"It will be our biggest hypermarket in Malaysia to date and will have 2,000 parking bays. We have decided to build a big hypermarket in Kelantan because we have a large piece of land for the project and also because we believe there is a demand for it," he told reporters in Kota Baru on Tuesday night.
Ameer Ali was speaking after a special prayer led by Kelantan Menteri Besar Datuk Nik Aziz Nik Mat for its latest hypermarket in Kubang Kerian.

Mydin also targets to set up hypermarkets in Johor Baru, Ipoh, Kuantan and Kuala Terengganu by as early as next year, he said.

On its business, Ameer Ali said the economic recession has proven to be a blessing in disguise for the company, as revenue swelled to RM1.3 billion last year from RM1.1 billion in 2008.

"The recession has led to more consumers frequenting our outlets as we offer competitive prices for our goods," he said.

By Business Times

SP Setia revises 2010 sales target to RM2b

Property developer, SP Setia Bhd has revised its sales target for financial year 2010 to RM2 billion from an intial RM1.65 billion.

President and Chief Executive Officer Tan Sri Liew Kee Sin said the optimistic forecast was due to the RM608 million in sales recorded in the first quarter of the 2010 financial year.

Speaking to reporters after the company's annual general meeting today, he also said the confidence was based on the country's economic recovery following the 4.5 per cent fourth quarter gross domestic product (GDP) growth recorded last year.

For the financial year ended Oct 31, 2009 the company recorded its highest ever sales of RM1.65 billion, amidst challenging market conditions.
At present, the group has a landbank of 1,560 hectares in the Klang Valley, Johor and Penang with 10 ongoing projects.

According to Liew, the gross development value (GDV) of the landbank is estimated at RM26 billion and would enable the company to sustain itself for another 12 years.

He said for this year, the company would focus on its projects in Johor, the Klang Valley and Penang.

He disclosed that SP Setia expects its Vietnam operations to contribute RM100 million only.

SP Setia currently has two development projects, the Eco Lakes at MyPhuoc Industrial Park and EcoXanh in Ho Chi Minh City, Vietnam.

The company has chosen to go "slow and steady" in Vietnam, following the discouraging economic situation in that country, with a high interest rate of 16 per cent and the devaluation of its currency, the Dong.

However, Liew said the devaluation of the Dong did not affect SP Setia's projects there much, as the land already belonged to the company.

For the financial year ended Oct 31, 2009, SP Setia recorded RM1.4 billion in revenue with a profit before tax of RM231 million.This is against the RM1.47 billion in revenue and profit before tax of RM297.9 million previously.

By Bernama

Property sales to rise 5-10pc: RAM

The outlook for Malaysian property market is promising with sales volume expected to increase by 5 to 10 per cent this year, according to RAM Holdings Bhd.

In stating this, its chief economist Dr Yeah Kim Leng said the improving economic outlook and friendly lending policy will help to increase the confidence level of consumers and boost the property market.

"Affordable housing and domestic-led growth strategy implies supportive policies will continue, though Bank Negara Malaysia remains wary of asset bubbles," Yeah said at a talk organised by the International Real Estate Federation or FIABCI here today.

He said the favourable demographics, stricter-but-still easy access to home financing, rural-urban migration, foreign demand and income growth are all expected to improve housing sales.
Yeah said expectation that the central bank will start "normalisation" of its monetary measures beginning this month will not dampen home purchases, especially when economic growth strengthened further.

RAM expects an increase of 0.75 to 1.00 percentage point in the overnight policy rate by year-end.

Loan growth is projected to expand between 8.0 and 10 per cent this year with non-performing loans likely to hover around 2.0 to 3.0 per cent.

Loans growth remained positive at 6.5 per cent last year during the first 11 months of 2009 despite the economic recession as loans to the broad property sector outpaced overall loan growth.

Yeah said consumer credit will continue to remain the core focus of banks'' lending but competition from non-financial institutions is likely to intensify.

Property loans accounted for 36.2 per cent of total banking system loans.

"The banks still view residential property lending as relatively safe, accounting for 26 to 27 per cent of their loans portfolios," he said, adding that credit conditions are not expected to tighten as demand is not overly excessive and output gap remains for the rest of the year.

On the Malaysian economy, Yeah said the country is expected to resume modest growth this year with an upside bias should public sector reform and transformation policies and strategies strengthen further consumer and investor confidence, thus triggering a surge in domestic and foreign direct investment.

"After a massive running down of inventories last year, re-stocking will contribute to higher production this year but ''autonomous'' or ''self-sustaining'' growth has to come from private consumption and investment," he said.

RAM projects the country''s economy to grow by 4.9 per cent in 2010 and 5.4 per cent in 2011, supported by domestic-driven private sector spending and government spending.

Yeah said Malaysia could reduce its budget deficit to below 3.0 per cent of the gross domestic product (GDP) from 2013 onwards compared to the forecast of 5.6 per cent this year.

According to him, there is a chance for the deficit to be reduced from next year if economic growth can improve further.

"With the goods and services tax (GST) introduction next year, the country can raise more revenue and will be able to cut back on spending," he said.

Currently, taxes and royalties from oil and gas accounted for 40 per cent of the government revenue while its debt level made up 40 per cent of the GDP.

By Bernama

Asia acts over fears of property bubble

Asian countries fearing a disastrous US-style property bubble are striving to cool down their real-estate markets as the region powers out of the global financial crisis.

Policymakers are worried that excessive exuberance could push property prices far above their real value, only to crash and bring down with them banks that lent money too freely and individuals who borrowed beyond their means.

"It is better to pre-empt a bubble than wait for it to get serious and have to take more drastic measures," Singapore Prime Minister Lee Hsien Loong said last month after the city-state took fresh measures against speculation.Singapore was one of the countries hit by the 1997-1998 Asian financial meltdown.

That crisis followed a property crash, leaving a blighted landscape of unfinished projects across the region and banks gasping for lifelines.

Problems in the US housing market had set off the devastating financial firestorm that swept across the world in late 2008 and lasted well into 2009.

While Asia is now leading the global economic recovery, officials are determined to avert another crisis. Low interest rates, strong demand and speculation have pushed property prices in many Asian cities higher, in some cases surpassing peaks reached in 2007.

"The risk of an asset bubble is quite high in certain (economies) such as China, Hong Kong and Singapore," said Chua Yang Liang, head of Southeast Asia research at property consultancy Jones Lang LaSalle.

A bursting of that bubble could "potentially derail economic growth, especially if banks and other investment houses are overly exposed to those sectors", Chua told AFP, singling out real estate as a cause of concern.

In China, property prices in 70 major cities hit a 21-month high in January.Beijing has tightened lending, requiring buyers of second homes to put up a downpayment of at least 40 percent, and they also face higher interest rates on their mortgage loans.

In Singapore, where housing prices have been heating up since last year, the government slapped additional duties on sellers who flip a residential property within a year of buying it.

Home buyers are also now limited to borrowing up to 80 percent of the property's value, instead of 90 percent.In densely packed Hong Kong, home to one of the world's most frenetic property markets, authorities are fretting about a surge of speculative money since late 2008.

Starting April, the territory will increase the stamp duty for sales of flats worth 20 million Hong Kong dollars (2.6 million US) or more from 3.75 percent to 4.25 percent. Prices of some Hong Kong luxury flats have returned to 1997 boom levels.

In October last year, Henderson Land Development said it had sold a luxury duplex apartment for a world record of 88,000 Hong Kong dollars (11,300 US) per square foot, or a price tag of 57 million US dollars.

Australia's central bank on Tuesday lifted interest rates afresh. One factor it cited was a "solid" increase in mortgages, "and dwelling prices have risen significantly over the past year".

Median house prices in Sydney rose 12.1 percent in 2009 and 18.5 percent in Melbourne, and observers said the rise was likely to continue.But Simon Vinson, head of Asian property at AMP Capital Investors, said he did not see the overall Asian market overheating.

"It's really only been the residential market that has experienced strong price growth. Commercial markets remain less buoyant," he said. The rise in residential property prices is just a "retracing" of some of the losses suffered by the sector during the global downturn, he said. "Is this a bubble? At the overall market level, we believe it is more a reversion," he said.

Analysts also said that unlike their counterparts in the West, Asian banks are not over-exposed to the property market. "Banks in Singapore, China and Hong Kong have been managing their risks quite well as the respective monetary authorities provide strict instructions on banking operations," said Chua Chor Hoon, head of Southeast Asia Research at property consultancy DTZ.Chua of Jones Lang LaSalle said that in Asia, "the share of mortgages as a proportion of total bank lending is still within healthy levels".

By AFP

JAKS to make debut in property development

KUALA LUMPUR : Water-infrastructure builder JAKS Resources Bhd is making a debut in property development under a collaboration with Star Publications (M) Bhd.

In a statement to Bursa Malaysia today, JAKs said its unit JAKS Island Circle Sdn Bhd had signed a joint development agreement with Star to undertake an estimated RM370 million mixed-project on a 2.5ha (24,568 square meters) leasehold site along Jalan University in Section 13, Petaling Jaya.

The site is adjacent to the Jaya One commercial centre.

"JAKS group has the expertise in the construction business and the proposed development will forge the JAKS group forward into the related industry of property development.

"The entire proposed development is expected to be completed within sixty months from the development commencement date," JAKS said in a statement.

Both Star and JAKS will jointly apply for banking facilities not exceeding RM 50 million which will be charged against the land to partly finance the proposed development.

By The EDGE Malaysia (by Chong Jin Hun)

Sime Darby Prop awaits approvals for Selangor Vision City

SHAH ALAM: Sime Darby Property Bhd is awaiting the approval from the state and federal governments on its plans for its proposed 10,861-acre (4,395ha) Selangor Vision City (SVC) development, said its managing director Tunku Datuk Putra Badlishah Tunku Annuar.

Speaking to reporters after a presentation of the SVC development to Selangor Menteri Besar Tan Sri Abdul Khalid Ibrahim here today, Tunku Badlishah said the proposal had taken a while as it was a massive project.

According to Sime Darby Property, 3,450 acres of SVC's 10,861 acres have already been developed.

The SVC is located along the Guthrie Corridor Expressway (GCE) from Lagong to Bukit Jelutong where 11,000 acres of the proposed 45,175 acre stretch belong to Sime Darby. It would also incorporate existing townships such as Subang Jaya and Bukit Jelutong.

At a separate event in i-City later, Khalid said he hoped to announce the status of the application by Sime Darby Property next month through the regular approval process.

The idea for the SVC was first mooted in 2007, while a masterplan, the Sime Darby Vision Valley (SDVV), was unveiled in 2009. The SDVV, comprising the SVC and the Negri Sembilan Vision City, is expected to generate a gross development value (GDV) of up to RM30 billion and span over two decades.

It has been reported that the entire SVC project will have an estimated GDV of RM10 billion and is envisioned to be the backbone of the northern Shah Alam and southern Selayang areas.

"Instead of doing this project piecemeal, we are trying to get the entire approval under a special area plan, which also involves getting approval at the federal level," said Tunku Badlishah. "There will be a meeting with the (federal planning) authorities on March 17, and once they are okay with this, we can move ahead with details."

He said Sime Darby Property was "always open" to joint-ventures with other developers, although it was not talking to any party now.

"The project is still in the concept stage and there has been no approval given yet, so we cannot move ahead until we get this," he said.

He said the two main priority areas of the SVC are the Bukit Jelutong City Centre and an environmentally-friendly township named Elmina East, which has an estimated GDV of RM6 billion.

By The EDGE Malaysia (by Melody Song & Max Koh)

Takaful Ikhlas to build up property role

Takaful Ikhlas Sdn Bhd, a wholly-owned subsidiary of MNRB Holdings Bhd, wants property to account for at least a fifth of its investment portfolio for the year ending March 31 2011.

The takaful operator recently made its maiden property investment when it paid RM87 million for its new corporate office, IKHLAS Point, in the fast-developing commercial area of Bangsar South, Kuala Lumpur.

Its president and chief executive officer, Datuk Syed Moheeb Syed Kamarulzaman, hopes the investment will be the beginning of its plans to broaden income through properties.

The investment portfolios of takaful operators are similar to their conventional counterparts' and include equity, cash and bonds.

"We are keen to buy rentable office premises that offer long-term sustainable revenue. However, we are cautious in our investment policy, which trends towards capital preservation," Syed Moheeb told reporters after a media tour of IKHLAS Point.

The company bought the building, which include two office blocks, using funds from contributions paid by policyholders, which number about 1.3 million currently.

"We are, in fact, renting the building from our policyholders. But, more importantly, the investment will ensure rental income for our policyholders," Syed Moheeb said.

"This is a really good investment for us because the yield is higher. We bought this building at a very low price during the recession," he said, adding that the property had already appreciated by more than 26 per cent in just one year.

The purchase was done through the company's Family Fund, which was given the approval by the operator's investment committee in July 2008.

Takaful Ikhlas' total assets currently stand at more than RM1.2 billion, out of which 60 per cent comes under its Family Fund and the balance under its Shareholder Fund and General Risk Fund.

Depending on the size of the investment, future property investments could be a mix of the funds available.

The company is also looking to house its existing 10 branches in its own buildings in future.

All the branches occupy rented premises at present.

Deputy Finance Minister Datuk Dr Awang Adek Hussin officially launched IKHLAS Point yesterday.

Takaful Ikhlas also spent another RM10 million to renovate the property, which has a build-up of 99,286 sq ft.

The company occupies all 10 floors in Tower 11A as well as another three floors in Tower 11, which also has 10 floors. The other seven floors are rented out.

By Business Times (by Rupinder Singh)

YTL on the prowl for hotels in Asia, Europe

YTL Corp Bhd, a diversified group with interests in property and power generation, is on the lookout for hotels and resorts in Asia-Pacific and Europe to grow its hospitality business.

The company, which is sitting on a huge cash reserve of more than RM10 billion, wants to buy completed properties, or build new ones, and manage more assets, the resort manager for Pangkor Laut Resort, Jeffrey Mong, said.

YTL, through leisure arm YTL Hotels, owns and manages hotels and resorts in Malaysia, Thailand, Indonesia and the UK.

By July, YTL will open a boutique hotel in France, called Muse, a new brand on an existing hotel in St Tropez which YTL bought in 2007.
"We are converting the hotel from 35 rooms to 15 suites, with plunge pools and a spa, introducing our Spa Village brand," Mong said in an interview with Business Times in Kuala Lumpur.

YTL's wholly-owned properties include the Cameron Highlands Resort; JW Marriot Hotel Kuala Lumpur; Spa Village Resort Tembok Bali in Bali, Indonesia; Villa Tassana and Villa 13 in Phuket, Thailand; and Bray House, Berkshire, in the UK.

It has stakes in the Majestic Hotel in Malacca and Kuala Lumpur, The Chedi in Phuket, Tanjong Jara Resort in Terengganu, and Vistana Hotel in Kuala Lumpur, Penang and Kuantan.

All the properties are managed by YTL Hotels, including Pangkor Laut Resort and The Ritz-Carlton, Kuala Lumpur, which are majority owned by the Yeoh family.

Its latest management contract is for the Swatch Art Peace Hotel, a seven-suite retail-cum-hotel project in Shanghai, China, which will open in August.

YTL will also manage the Pangkor Laut Luxury Resort, Residence & Spa Village, a multi-module development on The World in Dubai, the United Arab Emirates, from 2012.

On the home front, YTL will set up two resorts in Sabah at a cost of some RM200 million by the middle of next year.

YTL executive director Datuk Mark Yeoh Seok Kah had earlier told Business Times that it would open a resort on Pulau Gaya, the largest island in the Tunku Abdul Rahman Marine Park and the closest to downtown Kota Kinabalu, and on Pulau Tiga, off the western coast.

The two yet-to-be-named luxury resorts would have 132 and 75 luxury villas respectively.

"We will target travellers from Asia-Pacific and Europe. The islands have good diving spots. So we are confident of long-haul travellers," Mong said.

By Business Times

Australian property prices spiral upwards

SYDNEY: Australian real estate prices are rising strongly and show no signs of abating, analysts said yesterday, after weekly sales in one state hit a record A$1.025 billion (A$1 = RM3.04).

The Real Estate Institute of Victoria said last week saw "the largest dollar volume of transactions ever recorded" amid growing confidence in the economy as people took advantage of low interest rates.

"We've seen more physical sales in a week period, but never have they passed the billion dollar mark," research manager Robert Larocca told AFP.

"So that's partly a sign of how strong the market is and it's also a sign that people are spending more than they have in the past."
Larocca said the surge in sales was the result of historically low interest rates following the global financial crisis and the growing population in Melbourne, Australia's second largest city, outstripping available housing.

"People are confident, they are confident because the economy is going much better than they expected it to," he added.

David Airey, president of the Real Estate Institute of Australia, said Melbourne was one of the country's strongest markets but noted that Australian property prices were strong and rising.

By AFP

New highway to further drive Selangor growth

The RM1 billion Kuala Lumpur-Kuala Selangor Expressway project, set to open in June next year, will benefit several housing and industrial projects in Selangor.

Projects and towns that may benefit from KLS include Kundang Jaya Industrial Park, Bandar Baru Kundang, Ijok, Bandar Tasik Puteri, Rawang and Sg Buloh.

KLS is a 33km two-lane dual carriageway with five interchanges, three toll plazas as well as a rest and service area, connecting Assam Jawa near Kua-la Selangor to Templer's Park near Rawang.

KL-Kuala Selangor Expressway Bhd (KLSEB) chairman Datuk Mohamad Razali Othman said the toll road will be ready by April next year and open to public in June.

It is expected to spur ongoing projects along the stretch and open up new developments, he said.
KLSEB, an equal joint venture between Bina Puri Holdings Bhd, a construction group and privately-held Arena Irama Sdn Bhd, holds a 40-year concession to maintain and operate KLS, previously known as Assam Jawa-Templer Park Highway or LATAR.

The highway will cut travelling time from Kuala Lumpur to Kuala Selangor and vice versa, to just 30 minutes from two hours currently.

"We are confident in this development and hope to recoup our investments for the project within the next 15 to 20 years," he told Business Times.

KLS provides alternatives to Federal Route 54 and to other existing roads along the stretch.

It was supposed to start in 1997 and completed by the year 2000 after Bina Puri signed a 40-year concession agreement with the government.

But the project was put on the back burner as the company could not secure financing due to the Asian financial crisis.

The government also decided to put on hold several mega infrastructure projects.

KLS was revived in 2008 after Bina Puri partnered Arena Irama and awarded the design-and-build contract for package 1 (Assam Jawa to Kundang) and package 2 (Kundang to Taman Rimba Templer), worth a total RM958 million to Mudajaya Corp Bhd.

KLSEB has secured a RM740 million loan from Bank Pembangunan Malaysia Bhd and a RM300 million loan from Islamic Development Bank for the project.

KLS was incorporated in 1996 with paid-up capital of RM5 million by 1997. The shareholding then was 60 per cent held by Bina Puri and 40 per cent by Arena Irama.

By Business Times

Seberang Prai becomes popular

Artist impression of the Pearl Garden project, launched last September, sold about 70% in a matter of weeks.

The Seberang Prai residential property market is facing robust demand in both the landed and high-rise segments.

Two key developers in Seberang Prai have lined up for launching, in the first quarter of this year, some 486 units of landed residential properties with an estimated gross sales value of RM156mil to meet the rising needs of those with the disposable income to upgrade their lifestyle.

Over the past two years, the investments brought in by multinational corporations such as Ibiden, Honeywell International, National Instruments, St Jude Medical, and First Solar have created an executive class of home seekers.

The projects are the second and third phases of Pearl Garden, with a gross sales value of RM71mil, developed by Tambun Indah Development Sdn Bhd and Phase 2 of RM85mil Bukit Mertajam Utama by DNP Land Sdn Bhd.

The Pearl Garden, a joint venture project with Mutiara Goodyear Development Bhd, comprises 446 units of double-storey terraced, semi-detached, and bungalow houses on a 67.9-acre land in Simpang Ampat, about 20km from the Penang Bridge.

The first phase, launched last September, was about 70% sold (175 units) in a matter of weeks.

“Most of our buyers are those who want to own landed property but could not do so on the island. The second and third phases, comprising 271 double-storey terraced and semi-detached houses, was launched mid-February,” says Tambun Indah general manager Teh Theng Theng.

The Pearl Garden is a gated and guarded project, with 24-hour security, and comes with a double-storey clubhouse and recreational facilities such as a swimming pool, a gymnasium, jogging track, and a community hall. The selling price for the properties ranged between RM238,000 and RM512,000.

“We are also arranging for a special financing package that provides 90% financing and allows purchasers to pay the 10% instalments over a 12-month period. Depending on the size and type of unit, the monthly instalment starts from RM400 per month,” Teh adds.

The RM85mil Bukit Mertajam Utama, comprising 215 units of double-storey terraced and semi-detached houses, is located on a 56-acre site in Bukit Mertajam, about 3km from the Penang Bridge.

The terraced and semi-detached houses have respective built-up areas of 1,900sq ft and 2,700sq ft priced at RM328,000 and RM468,000.

DNP Land (North) general manager K.C. Tan says about 60% of Bukit Mertajam Utama, scheduled for official launch in March, were sold during the soft launch last month.

“Landed properties in Seberang Prai, which are priced about 40% lower than landed homes on the island, will always find a strong market in the young executives with a combined household income of over RM6,000,” he says.

As for the high-rise condominium market, that too seems to be getting increasingly popular in Seberang Prai, a territory known for its affordable landed residential homes.


Fook Tone Huat ... Most mainland buyers look for properties priced 40% below the landed properties on the island.

More than 10 years ago, high-rise residential properties were not that sought after, Henry Butcher Malaysia (Seberang Prai) senior manager Fook Tone Huat tells StarBizWeek.

“Most of the buyers on the mainland looked for landed homes which were priced about 40% below the landed properties on the island.

“About three years ago, high-rise properties in Jalan Raja Uda and Jalan Telaga Air, in Butterworth, started to do well. The original selling price, which started off from about RM160,000 for a unit with over 1,000sq ft in built-up area, has risen over 30% over the past three years to around RM210,000 and RM230,000 today,” he says.

The Cassia Resort Condominiums by Island LandCap Properties and the Vista Bay Condominiums by Cendana Realty Sdn Bhd are two such projects launched three years ago in the heart of Butterworth town that has seen such appreciation.

For this reason, there are already three high-rise residential projects that will be launched by the middle of this year; Island LandCap’s Pinang Laguna Water Park Condo and Airmas Development’s apartment Telaga Emas by the first quarter of this year and Dahlia Park in mid-2010.

The largest of these scheme is the RM160mil Pinang Laguna Water Park Condo, located in Seberang Jaya, comprising about 1,000 units, with over 1,000sq ft in built-up areas, priced from RM180,000 onwards.

The Dahlia Park, located near Jalan Bagan Luar, at the heart of Butterworth town, comprises 140 condominium units with built-up areas ranging between 1,307sq ft and 1,726 sq ft. These will be priced from RM190,000 onwards. Dahlia Park is equipped with comprehensive clubhouse facilities.

The Apartment Telaga Emas, located at Jalan Telaga Air, Butterworth, comprises 144 units with built-up areas of 1,327 sq ft priced from RM197,000 onwards. The scheme is equipped with amenities such as a swimming pool, sauna and round-the-clock security.

“High-rise properties have become popular because of their affordable pricing, and because of the facilities that come with them. In comparison, landed properties, which have been appreciating at about 10% per annum, are now priced over RM300,000 for a double-storey terraced unit with built-up area of 1,600sq ft and a 1,400sq ft land area.

“This means that only households, with a combined income of over RM5,000, and who are willing to borrow to the maximum, can take up loans for such housing projects. Landed property prices are expected to go up by another 10% this year,” he says.


Oon Weng Boon ... High-rise properties could sell well if they are strategically located.

Island LandCap Properties executive chairman Oon Weng Boon says the high-rise properties in Butterworth could sell well if they are strategically located and offer a full range of recreational facilities.

“Our Cassia Resort Condominium sold well because it was centrally located in Butterworth town, on Jalan Raja Uda, and had various clubhouse facilities. Furthermore, the pricing of Cassia Resort Condominium which was around RM160,000 then, was affordable for many households with a combined income between RM3,500 and RM4,000,” he says.

Oon says the Pinang Laguna Water Park Condo project was the group’s first attempt to infuse theme-park concept with condominium lifestyle living in Seberang Prai.

“This adds value to the project, making it more attractive to house buyers, especially those with families. During the soft launch preview last month, we have already received bookings for about 50% of the first phase, comprising 350 condominiums. The second phase is scheduled for launching in the second half of this year,” he says.

By The Star (by David Tan)

The Chinese love for properties

China, Hong Kong and Singapore's buoyant property markets.

AS US gaming giant Las Vegas Sands goes hither and thither in preparation for what it describes as the “most expensive stand-alone integrated resort-property ever built” scheduled in late April this year, all eyes are on the effect on the city state property sector.

The opening of the US$5.5bil (RM18.7bil) Marina Bay Sands casino resort complex will come two months after the start of gaming operations at Resorts World Sentosa, a development owned by Malaysia’s Genting Group.

Las Vegas Sands says the 963-room hotel, part of the shopping mall and convention centre will also open together with the casino.

The second phase of the opening slated for June 23 will include a massive sky garden on top of the development’s three hotels as well as more retailers, it said.

Its chairman and chief executive Sheldon Adelson says their dedication to complete the project never wavered despite the challenging economic climate.

Construction of the complex – the US gaming firm’s first development in Southeast Asia – had been delayed by materials shortages and financial difficulties faced by subcontractors due to the recent global economic slump.

As Asia climbs out of the economic quagmire which has engulfed the world, the property radar in this part of the world have been far more rosy than that of the West.

Singapore’s property sector, as with Hong Kong’s and China’s, have piqued quite a bit of interest among Asians themselves and watched with envy in the West.

Known as the exotic Far East by the West, property prices in this part of the world have remained excitingly buoyant by contrast, so much so that the Singapore government has recently imposed a levy on people selling residential properties within a year from the date of purchase.

The city-state also lowered the loan-to-value limit to 80% from 90% for all housing loans provided by financial institutions.

The measures are “aimed at pre-empting the formation of a property bubble,” Adrian Chua, an analyst at DBS Group Holdings Ltd writes in a note.

“The earlier-than-expected introduction of measures signals that more could come should prices and volumes not revert back to sustainable levels.”

Singapore’s steps come after the island’s private home sales last year were just shy of the 2007 record, helped by the nation’s economic recovery. A total of 14,688 homes were sold last year, compared with the record 14,811 transacted in 2007, according to government data.

Private residential prices rose 7.3% in the fourth quarter from the previous three months, extending the biggest rally in 28 years, based on data from the Urban Redevelopment Authority. The government’s property price index surged 15.8% in the third quarter.

China’s property market is no less exciting. Having grown by leaps and bounds, it will probably go through a “more meaningful correction” this year because the price gains in 2009 aren’t sustainable, Christopher Lee, corporate ratings director at Standard & Poor’s, says.

The outlook for the Chinese market is “neutral” for this year, Bei Fu, an associate director of corporate ratings at S&P, says on a conference call with Lee this week.

“The middle of 2010 could be a potential turning point for many developers,” Fu says. “A combination of slower demand, higher supply and various government initiatives will dampen market sentiment.”

China’s property prices has surged 9.5% in January, the most in 21 months, as total new loans have surged to 1.39 trillion yuan (US$204bil), more than in the previous three months combined.

The China Banking Regulatory Commission told banks last month to “strictly” follow property lending policies.

Investors tend to “sit on the sideline” in anticipation of more tightening measures to curb property price gains this year, Lee says.

Gradual and cautious

Beijing will scrap some home-purchase incentives after the jump in prices, reducing the scope of a housing sales-tax exemption and enforcing a 40% down-payment requirement for second homes, the capital’s Municipal Commission of Housing and Urban-Rural Development says in a statement this week.

The People’s Bank of China raised the reserve requirement by 50 basis points for the second time this year just before Chinese New Year to slow bank lending. The change came into effect this week.

The central bank says it wants to gradually normalise monetary conditions from a “crisis mode” after gross domestic product grew 10.7% in the fourth quarter, the fastest pace in two years.

“Policy introduction this year will be in a gradual and cautious manner,” Fu says. “Stability will be the focus.”

The Chinese government will increase supply of subsidised public housing this year to provide affordable accommodation for people with lower incomes, and there will be a “surprise” in the number of available luxury homes by the middle of this year, when projects started one year ago are completed, leading to stronger competition among developers, she says.

Industry consolidation

“Bigger and stronger property players will do even better as they have the scale and financial resources to grow, and smaller companies will find the market condition more challenging,” Hong Kong-based Fu says. “We expect to see more merger and acquisition activities in the sector.”

Over in Hong Kong, developers are optimistic the city’s government will maintain its “benign” stance toward the industry, and that borrowing costs will remain low, sustaining real estate demand.

“The government has kept a rather benign stance towards the Hong Kong property sector,” Macquarie Group Ltd analysts led by Chris Cheng says in a research report.

“Nothing significantly new was introduced in relation to property” in financial secretary John Tsang’s budget speech earlier in the week.

The city has announced that it will raise the stamp duty on homes selling for more than HK$20mil (US$2.57mil) to 4.25 % from 3.75%.

This is in response to US Federal Reserve chairman Ben S. Bernanke’s remark that a slack labour market and low inflation will allow the Federal Open Market Committee to keep the benchmark lending rate low “for an extended period.”

The Hong Kong Monetary Authority typically tracks the Fed’s interest rate movements because the city’s currency is pegged to the dollar. The lowest mortgage rates in at least two decades and an influx of overseas capital equivalent to more than a third of Hong Kong’s annual gross domestic product helped fuel a 29% gain in property prices last year.

The raised transaction tax on luxury homes, the first increase since 1999, will only affect about 2% of the property market. Of 110,000 Hong Kong residential sales in 2009, about 2,000 sold for more than HK$20mil, according to realty company Midland Holdings Ltd.

By the way, all three countries are predominantly Chinese. – Agencies

By The Star

Lessons from recent tragedies

Governing authorities should work towards a construction benchmark

The need for a high quality culture to be adopted for all construction projects, whether they are public or private structures or facilities, cannot be over emphasised as the people’s safety should be of paramount importance.

The fact that there have been a spate of “problem” projects with structural problems or certified unfit for occupancy shows that a conscious quality culture is still grossly missing among some industry players.

From faulty infrastructure projects to poorly constructed public buildings and amenities, the list includes the collapse of the Kuala Terengganu stadium roof and the roof of the Kuala Berang express bus and taxi terminal, the RM18mil Batu Burok Aquatic Complex and the RM123mil Sultan Mahmud Airport terminal.

Shoddy workmanship and the use of sub-standard building materials have been found to be the major contributor of most of these failed projects.

There is also the issue of proper maintenance and whether these public structures are periodically maintained to ensure that they are in tip top condition.

Besides the loss of lives like the three schoolchildren attending the 1Malaysia camp in Kuala Dipang who drowned after the suspension bridge they were on collapsed last October, such mishaps will also tarnish the image of the country and the whole industry.

It is important to ensure that personals of the governing authorities, including the Public Works Department, are well equipped and properly trained to ensure they keep abreast of latest industry standards and needs to conduct their supervisory role responsibly.

Industry practitioners should take it upon themselves to promote a conscious quality culture in all their projects.

There are many benefits that can be reaped from having quality construction standards that include significantly reducing the incidents of structural and architectural defects.

The adoption of high international standards in our building and construction projects is a good platform for local players to take their developments international.

For a start, industry players and the governing authorities should work towards a minimum set of quality standards that need to be adhered to by the building fraternity, including contractors.

Although there is a local quality system, the Quality Assessment System in Construction introduced by the Construction Industry Development Board since 2006 to evaluate the quality and workmanship of construction projects in the country, it is not compulsory for the building fraternity to adopt them.

The adoption of such standards should not be just to win government contracts but to ensure a strong quality culture prevail among industry practitioners.

In Singapore, it is compulsory for all public amenities and government buildings to adhere to the strict guidelines of the Construction Quality Assessment System (Conquas).

Its Building and Construction Authority conducts intensive training camps for developers, contractors, and building engineers, to adopt these stringent quality standards in their projects.

The fact that there are 47 Malaysian developers and contractors who are adopting Conquas shows that there are local players that have embraced the quality culture seriously.

It is important to build on this foundation and cast the net wider to include all the industry players, whether big or small.

A poor maintenance culture is also one of the major flaws in our society today that has contributed to the poor state of affairs in many of our buildings and public facilities.

To ensure greater durability and sustainability of these facilities, there is a need to promote a world-class maintenance culture among the people and the relevant authorities.

There is no point having great buildings or projects if they are not properly maintained.

For those who own strata-titled buildings, it is mandatory for them to make monthly contribution to a common maintenance fund to ensure the proper upkeep and maintenance of the common facilities.

The maintenance is the responsibility of the joint management body (JMB), of which owners are members.

It is the responsibility of owners to pay the maintenance fees.

Likewise, the respective local councils and authorities should also ensure that all public facilities are properly maintained to ensure they are safe to the users at all times.

·Deputy news editor Angie Ng believes selflessness is the way to go to promote a caring society.

By The Star

See Hoy Chan nursing medical ambition

See Hoy Chan is now talking to three foreign hospital operators to jointly develop a medical centre in Bandar Utama township

See Hoy Chan Holdings Group (SHC), controlled by the Teo family, is said to be in talks with several foreign hospital operators to jointly develop a medical centre in its highly successful Bandar Utama township in Petaling Jaya, Selangor.

"Several international operators have expressed interest in forming a joint venture with SHC to open a medical centre in Bandar Utama. SHC is now talking to three of them," a source told Business Times.

The source added that SHC and the foreign companies were looking at possible models for the partnership.

It is undecided if the foreign player will take on sole management of the medical centre to be built by SHC or both will jointly manage it, with the foreign partner having a stake in the business.
"The medical centre in Bandar Utama could be up and operational within three years of obtaining all the approvals," the source said, adding that regulatory approvals had yet to be sought.

Foreign hospital operators with a presence in the country include Singapore's Parkway Holdings and Health Management International (HMI), the US-based Columbia Asia and Austria's Vamed.

It is understood that at least one of the players SHC is talking to has no representation here as yet.

Industry players said that this operator is world renowned for its medical facilities and expertise, and is particularly successful in the region for medical tourism.

When contacted by Business Times, SHC director Datuk Teo Chiang Kok said that talks were "still preliminary". He did not elaborate.

In an interview in 2006, Teo had said that the Bandar Utama master plan would include setting up a medical centre and a retirement village.

Some 4.86ha near 1Utama's Phase 2 shopping complex has been allocated for this purpose.

At that time, Teo had said that the medical centre would offer maternity and paediatric care, while the retirement home would cater for residents in the area.

The group's plans for a medical centre were said to have been inspired by Teo's father, Tan Sri Teo Soo Cheng, given his involvement in the Tung Shin Hospital in Jalan Pudu, Kuala Lumpur.

In April last year, Prime Minister Datuk Seri Najib Razak announced that the government was lifting the 30 per cent Bumiputera equity rule for 27 service sub-sectors, including health services. However, it is unclear if that includes hospitals and medical centres.

By Business Times