Sunway REIT IPO launched

Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop (left) and Sunway Group founder and chairman Tan Sri Dr Jeffrey Cheah at the launch of Sunway REIT’s prospectus yesterday.

PETALING JAYA: Sunway City Bhd (SunCity) and Sunway REIT Management Sdn Bhd have launched the initial public offering (IPO) of 1.65 billion units in Sunway Real Estate Investment Trust (Sunway REIT).

Sunway REIT, which has an approved fund size of 2.78 billion units, will become Malaysia’s largest listed REIT when it lists on the Main Market of Bursa Malaysia in July. Sunway REIT Management is the manager for Sunway REIT.

Eight properties, with an appraised value of RM3.7bil, would be injected into the REIT. They are Sunway Pyramid Shopping Mall, Sunway Carnival Shopping Mall, SunCity Ipoh Hypermarket, Sunway Resort Hotel and Spa, Pyramid Tower Hotel, Sunway Hotel Seberang Jaya and office properties.

Sunway REIT Management chief executive officer Datuk Jeffrey Ng said the company was committed to actively providing value-added services to the properties.

“Four of the assets are in Bandar Sunway, which has over the years proven its growth potential as a landmark tourist destination,” he said.

He said there was a planned enhancement of several existing assets, and leasing of recently completed space, adding that the assets being injected into the REIT were assets in locations that had proven track records for growth.

Sunway REIT’s IPO comprises an institutional and selected investors portion of 1.52 billion units and a retail portion of 134 million units.

The final retail price per offer unit would be the lower of 97 sen, or 97% of the institutional offer price, to be determined by way of bookbuilding.

Four cornerstone investors – the Employees Provident Fund, Permodalan Nasional Bhd, Government of Singapore Investment Corp and Great Eastern Life Assurance (M) Bhd – have secured 376 million units, or about 22.7% of the offer units.

An analyst with a local brokerage said the listing of Sunway REIT next month would be a milestone for Malaysian REITs (M-REITs) not only because of its large fund size, but also because it had attracted several cornerstone investors.

“Sunway REIT will be on the radar of the ‘big boys’ and this can only be good for the smaller REITs as well,” he said.

The analyst also said Sunway REIT could bolster the equity market and make it more attractive to foreign institutional players.

According to the analyst, Sunway REIT’s dividend yield was about 6.7% (based on forecast dividend per unit or DPU of 6.7 sen), which was below the average 8.5% for other REITs. He said the REIT’s IPO was at a premium to other M-REITs.

“But taking account of the size of the trust and its potential, we believe Sunway REIT has its merits,” he said.

A REIT adviser said that while Sunway REIT had its “attractiveness”, there could be some investors who preferred to invest in pure-play REITs that were focused on specific asset classes such as retail, office space and warehouse.

“Sunway REIT is a fairly unique trust because it’s a mixed REIT that has retail and hospitality elements,” he said.

The REIT adviser said if the different asset classes were integrated in a synergistic manner and managed well, Sunway REIT might actually offer a favourable return to investors over the longer term. “This is left to be seen,” he said.

By The Star

Sunway REIT sets RM7.4b target

With about 1.6 billion units up for subscription by retail and institutional investors, the REIT is also set to be the most liquid of REITs available in the market.

Malaysia's biggest property trust, the Sunway real estate investment trust (REIT), has set a target to double its size to RM7.4 billion in the next five to seven years.

It will focus its investments on shopping malls, hotels and offices.

"Sunway REIT is very much a township REIT, with the best assets of Bandar Sunway. So, if you believe that in 10 to 15 years we will continue to grow, then you would invest in us," Sunway REIT Management Sdn Bhd chief executive officer Datuk Jeffery Ng said.

The Sunway REIT is made up of eight of Sunway City Bhd's (SunCity) properties in the retail and hospitality space, located in Penang, Perak, Selangor and Kuala Lumpur, valued at RM3.7 billion.
This includes the popular Sunway Pyramid Shopping Mall and its newest purchase, Sunway Tower, an office building in central Kuala Lumpur.

It has an approved fund size of 2.78 billion units.

With about 1.6 billion units up for subscription by retail and institutional investors, the REIT is also set to be the most liquid of REITs currently available in the market.

About 8 per cent of the initial public offer units will be offered to retail investors, while the rest will be offered to Malaysian and foreign institutional investors.

About 35-38 per cent of total approved fund size will be held by SunCity.

"Investors are not looking for the lowest tax scheme, rather they are looking for growth and liquidity. Generally, Malaysian REITS have been illiquid, so the Sunway REIT will interest a lot of investors," RHB Investment Bank Bhd managing director Chay Wei Liong told reporters after the launch of the REIT's prospectus in Petaling Jaya, Selangor, yesterday.

Malaysia imposes a withholding tax of 10 per cent on individual investors for income made from REITs. Singapore, a popular destination for REIT listings, does not have such a tax.

On whether the recent announcement by CapitaMalls Asia to list its REIT on Bursa Malaysia would dampen interest in Sunway REIT, Chay said there was enough money to go around.

Ng did not discount the possibility of secondary listing in Singapore, saying the board will have to decide on that.

On possible plans to inject SunCity's overseas properties into the REIT, Ng said it will focus on Malaysia for the short and medium term.

"In the long term, should and when the opportunity arise we will consider it, and work hand in hand with our sponsor. It would be something that our board of directors would decide on," Ng said.

By Business Times

IJM Prop, Angkasa scrap building plan

IJM Land Bhd said its unit IJM Properties Sdn Bhd and Angkasa Gagah Sdn Bhd, a unit of IGB Corp Bhd, have scrapped a plan to build residential property in Setapak, Selangor.

Both parties signed a deal for the project in October 2006.

IJM did not say why they aborted it but said that it needed regulatory approval for the project.

By Business Times

RM3b boost for Naza TTDI's Platinum Park

The Platinum Park is a high-end integrated residential and commercial lifestyle properties in the Kuala Lumpur City Centre area, worth RM4 billion.

Naza TTDI Sdn Bhd's Platinum Park project in Kuala Lumpur will see a new wave of development as the property developer launches lifestyle properties worth about RM3 billion next year and in 2013.



The 3.68-hectare Platinum Park is a high-end integrated residential and commercial development in the Kuala Lumpur City Centre (KLCC) area, worth RM4 billion.

Group managing director SM Faliq SM Nasimuddin said Naza TTDI will introduce its first residential property - a luxury serviced apartment, by early next year.

It will next launch a high-end condominium towards the end of 2011 or by early 2012.
Faliq said the towers may be named Platinum Park Suites and Platinum Park Residences, respectively.

He said there will be more than 200 units of serviced apartments, with sizes ranging from 500 sq ft to 1,100 sq ft offered to retail investors.

The condominium tower will have more than 100 units, ranging from 2,000 sq ft to 3,500 sq ft.

"We will sell individual units but if we get a good offer for an en bloc, we will consider," he told Business Times in an interview in Shah Alam, Selangor, recently.

Faliq said Naza TTDI will build niche lifestyle retail outlets with some 200,000 sq ft of space.

The final component of Platinum Park will include a luxury five-star 50-storey hotel, where construction will start after 2012.

Faliq said Naza TTDI is in negotiations with several international operators in Asia Pacific and Europe to run and manage the hotel.

Naza TTDI is also in talks with local and foreign investors who are keen to form joint ventures with the company to build the hotel or buy it over.

"We have several options. The end deal will depend on what we have on the table," Faliq said.

Naza TTDI will look at a few financing options to fund the lifestyle components.

"I am very excited with the Platinum Park development. My aim is to make it the most iconic project here. We are targeting to complete this project by 2016 or 2017," Faliq said.

Work in progress include three office towers, which will be built between March and December in 2013.

They include the 50-storey Naza Towers, which will be the Naza Group of Companies' new headquarters, and a 50- and 38-storey tower for plantation group Felda and a government-linked company, respectively.

The towers are designed to be "green buildings" through the efficient use of energy, water and materials.

Naza TTDI will apply for certification under the Green Building Index of Malaysia.

By Business Times

Naza TTDI has big overseas plans

NAZA TTDI Sdn Bhd is mulling the idea of taking the TTDI brand overseas by building townships and mixed developments.

Group managing director SM Faliq SM Nasimuddin said the property company will focus on Asia Pacific and expects to start its maiden construction by 2013.

The plan will include building hotels to expand its leisure division.

"We are talking to investors and hope to form several partnerships with other property developers in Asia Pacific. We have to step outside of Malaysia to expand the growth of the company. We will look at every given opportunity," Faliq said in an interview with Business Times recently.
Faliq said he would like to replicate the multi-billion ringgit Taman Tun Dr Ismail (TTDI) township development in the region.

"We want to move forward with the TTDI brand. People always associate Naza with automotive (business). But we are more than that. We have diversified the group's strategies into other businesses. The core is still auto, followed by property development," he said.

Faliq, 25, is the fourth child of the late Tan Sri Nasimuddin, and probably Malaysia's youngest group MD.

He took control of Naza TTDI at the peak of the company's crisis, when he was 23.

"I saw the worst and was able to push things through. The company is strong and healthy now. We have a few projects in hand worth a combined RM8.5 billion, including Platinum Park, which I am very proud of," Faliq said.

Naza TTDI has unbilled sales of RM1.3 billion and is planning to launch new projects this year.

On how he manages the Naza Group's property and construction division as well as personal life, Faliq said being hands on is a key contributor.

"I spend most of my time in the office and I know exactly what is going on around. I read a lot of materials about the market place.

"This is still a family business. I am very close to all my siblings and we always sit together for dinner and talk about the day's happenings and how to achieve a new beginning. It is very exciting," Faliq said.

Faliq is a huge fan of the Ferrari Maserati and drives the marque himself to work.

He is active in sports and plays football, badminton and golf, occasionally, with his childhood friends.

Faliq is a firm believer of maintaining a healthy body and tries to visit the gymnasium once a week.

"I cannot live like any 25-year-old because of my responsibilities. When I have time, I make it possible for everything else that is not work-related," he said.

By Business Times

I&P to focus on new projects

PROPERTY developer I&P Group Sdn Bhd expects to fully develop its massive land bank of about 5,400 acres with a potential gross development value of up to RM10bil over a span of 10-20 years, says group managing director Datuk Jamaludin Osman.

“Each of our township will take about 12 years to be fully developed. Our focus will be on the launch of new projects or phases to cater to market demand,” he tells StarBizWeek.

The group’s prominent townships include Bandar Kinrara, Alam Impian in Shah Alam, Alam Sari in Bangi and Taman Pelangi in Johor Baru.


Datuk Jamaludin Osman ... ‘Each of our township will take about 12 years to be fully developed.’

Jamaludin expects the outlook of the property market to be bright for the year and as such, is confident its launches will be well received by the market.

“The target revenue of RM1bil (for the current financial year) may be higher if market demand stays robust this year, hence more new launches are expected at our existing townships,” he says.

The new launches include terrace houses, semi-ds and also bungalows. The company is also planning to build service apartments on its existing townships in Klang Valley in future but this will be timed according to market demand.

During the group’s launch of Temasya Glenmarie, buyers flocked the launch venue to buy up the property while in Bandar Kinrara, I&P had to resort to a balloting system as the response was overwhelming.

“We believe our track record of delivering quality products to buyers and our strategic township locations are the pull factors,” Jamaludin says.

The price range of I&P properties are generally not cheap but are still sought after given their strategic locations and expectation of better returns on investment.

For example, the recent launch of Sapphire terraced homes in Bandar Kinrara, which had four designs with built-ups of 2,354 to 2,900 sq ft are priced from RM520,888 onwards.

Yet, the 104 units had to be sold via a balloting exercise because 448 registrations were received.

“Our products do give better returns on investment to buyers. For example, a terrace house in Bandar Kinrara is now worth about RM700,000 while in Alam Impian, a terrace house can fetch about RM500,000,” Jamaludin says.

He says the group has three target markets – first time buyers, up-graders and investors.

Asked whether the group has any plans to venture abroad like many of its peers, Jamaludin says not for the time being.

“We need to do a very comprehensive risk management analysis before making any plans to go overseas. We need to know the risk and also the market situation of the target countries if we go abroad,” he says.

I&P Group is a subsidiary of Permodalan Nasional Bhd. It was formed in May 2009 after the successful merger exercise between three companies: Island & Peninsular Sdn Bhd, Petaling Garden Sdn Bhd and Pelangi Sdn Bhd.

The exercise also saw several subsidiaries becoming part of the I&P Group, namely Perumahan Kinrara Bhd, Syarikat Perumahan Pegawai Kerajaan Sdn Bhd and I&P Alam Impian Sdn Bhd.

By The Star

SDB eyes Singapore’s premium property market

View of the living room at Gilstead Two.

SELANGOR Dredging Bhd’s (SDB) property arm, SDB Properties Sdn Bhd is riding high in Singapore, eyeing the premium property market there.

After the launch of its first residential project in 2007 called Jia, a 22-unit seven-storey apartment block, SDB is moving forward with its second property development, Gilstead Two at Gilstead Road near Newton MRT station.

The project, with a gross development value (GDV) of S$200mil (RM470.95mil), comprises 110 units in a 34-storey tower.

Unlike Jia, which offers larger unit sizes (two and three-bedroom units of between 1,200 sq ft to 1,600 sq ft), Gilstead Two offers much smaller units (Type A is 904 sq ft while Type B is 775 sq ft).

It is believed that Gilstead Two has received positive response; 33 of the 40 units released for private viewing recently were snapped up at prices ranging from S$1,900 per sq ft to S$2,300 per sq ft. The project is expected to be completed by 2014.

SDB managing director Teh Lip Kim tells StarBizWeek that the property market in Singapore is buoyant, like other financial hubs throughout the globe.

“Property prices there went down in 2008 by as much as 30% in certain areas but has picked up again to pre-crisis levels since the start of the second quarter of 2010,” she says.

SDB also has a parcel of land in Singapore, located in Ballestier Road that it plans to develop and launch by the end of the financial year (March 31, 2011).

“We are currently coming up with the concept for this development,” she says. SDB has picked Singapore as a sweet spot for its developments due to several reasons.

“It is close by, so it’s easy to keep track on the progress of the developments. Singapore is the financial hub of this region and the market is open and competitive. It is relatively easy to do business there, approvals are easily obtained once all the conditions are met,” says Teh. In fact, she says submissions for approvals are made on-line and approvals are also obtained on-line, making it a very efficient process.

On the contribution of the group’s projects in Singapore to its earnings, Teh says it is not significant at the moment but should pick-up due to the Gilstead Two development.

The group also has several projects in the pipeline in Malaysia to be launched soon. This includes 20Trees West, a low density bungalow development in Melawati which comprises 48 units of three-storey bungalows with swimming pools. The size of the homes range from 6,200 sq ft upward.

Teh says SDB also has a new condominium project located in a quiet enclave along Jalan Ampang, close to the British High Commission.

The development is called Dedaun and it comprises 38 units of spacious homes in a 10-storey building. “These homes measure about 3,200 sq ft, and have been designed with the sublime feel of homes in the 1970s,” says Teh.

On the outlook of Malaysia’s property market this year, Teh says it has definitely improved.

“Our launch of the second phase of Five Stones (a high-end condominium in Petaling Jaya) was very well received. The GDV for Five Stones is RM420mil and we have achieved 97% of the GDV. So things are definitely moving in the right direction,” she says.

On the company’s market focus, Teh says all its developments have been high-end projects.

“This ties in with our development concepts which focus on smaller scale, more private developments. For the moment, we will continue to focus on this type of products,” she says.

“We would like to focus on developing here (Malaysia) and in Singapore for now. However, we will look into other countries if the opportunity arises and when the time is right,” says Teh.

SDB began way back in 1962 when it was incorporated as Selangor Dredging Ltd. In 1964, the company changed its name to Selangor Dredging Bhd upon listing on the main board of the Kuala Lumpur Stock Exchange.

For over two decades, the company’s sole business was tin mining, operating two dredges in Dengkil.

In the early 1980s, SDB began to put in motion a plan for diversification. This led to the company’s involvement in various activities including hardware manufacturing and retail manufacturing of tyre rims for national car Proton and Perodua.

In 1985, Wisma Selangor Dredging, the company’s first property was completed and in 1997, SDB’s hotel property was completed. After a period of consolidation, which was completed in 2004, SDB is now fully a property company, principally involved in hotel, property management and leasing and property development.

By The Star

Listing boost from CapitaMalls

Singapore's CapitaMalls Asia Ltd may raise up to RM995 million from the listing of its Malaysian assets in a real estate investment trust on the Main Market of Bursa Malaysia.



The listing will help the company accelerate growth of its shopping mall business in Malaysia, as the property trust will provide direct access to both the domestic and international capital markets.

CapitaMalls Asia told the Singapore Exchange (SGX) yesterday that it had received the approval from Malaysia's Securities Commission (SC) to list CapitaMalls Malaysia Trust (CMMT), which will hold the company's three Malaysian shopping malls.

They are Penang's Gurney Plaza, Sungei Wang Plaza in Kuala Lumpur and The Mines in Seri Kembangan, Selangor - with a total property value of RM2.13 billion and total net lettable area of 1.88 million sq ft.

However, the decision on when to list the REIT will also depend on several factors, including prevailing market conditions.
The listing is for 1.35 billion CMMT units, of which 786.52 million units, or 58.26 per cent, will be offered to Malaysian and foreign institutional and other investors as well as Malaysian retail investors.

CapitaMalls Asia will retain an interest of 33.00 per cent to 41.74 per cent in CMMT after the offer, dependent on whether an over-allotment option is exercised.

Two cornerstone investors, the Employees Provident Fund and Great Eastern Life Assurance (Malaysia) Bhd, have committed to subscribe 90 million units, or 11.4 per cent, of the total units offered.

They will pay RM1.10 per unit or the institutional price, whichever is lower. The estimated distribution yields for 2010 and 2011 are 6.5 per cent and 6.8 per cent respectively.

While no definitive price has been fixed, the company could raise some RM995 million based on a price of RM1.10 per unit if CapitaMalls Asia chooses to retain an interest of only 33 per cent.

The trustee for CMMT is AmTrustee Bhd.

Malaysia is a key growth market for CapitaMalls Asia and the third largest contributor to the company's earnings before interest and tax for the financial year ended December 31 2009, contributing S$52.4 million.

The company said that CMMT will be Malaysia's largest listed "pure-play" shopping mall REIT by market capitalisation and property value.

The REIT will be CapitaMalls Asia's designated listed vehicle to hold its stabilised Malaysian retail assets as the company seeks to capitalise on acquisition opportunities in Malaysia.

Business Times reported recently that CapitaMalls Asia plans to invest some RM3.5 billion in Malaysia over the next two to three years to buy existing malls and build new ones.

"The planned listing of CMMT is part of the company's strategy to list in the home markets of our assets, and to recycle capital for reinvestment. It will enable us to accelerate our growth in Malaysia, and develop fee-based income for the company," said CapitaMalls Asia chief executive officer Lim Beng Chee in the statement yesterday.

This is the second REIT that CapitaLand Group is sponsoring in Malaysia, the first being Quill Capita Trust which was listed in 2007.

By Business Times

CapitaLand plans major business boost in Vietnam

HANOI: Southeast Asia's largest property developer, Singapore-based CapitaLand, says it plans to increase its assets in Vietnam tenfold and is building thousands of new homes.

"Vietnam has been earmarked as the group's most important overseas market in Asia, after China," the company said in a statement.

The firm will invest S$299 million (S$1 = RM2.38), and is looking to hold ten percent of its assets in the country within the next three to five years, said Chen Lian Pang, chief executive officer of CapitaLand Vietnam Holdings.

"The real estate market is supported by the country's strong economic growth, rapid urbanisation, and a young and growing population," said CapitaLand, which is building more than 4,000 residential units in Vietnam.
It says it is the largest owner-operator of international serviced residences in the country, with five under the Somerset brand and three others being developed under contracts.

Vietnam has a population of almost 90 million people.

The economy grew by 5.32 per cent last year despite the global economic and financial crisis.

Prime Minister Nguyen Tan Dung told global business leaders on Sunday that the economy is expected to expand 6.5 to 7 per cent this year, against a government target of 6.5 per cent.

Singaporean firms are among the major investors in Vietnam.

By AFP

Bolton expects strong profit growth this year

PETALING JAYA: The property market looks pretty strong this year partly because access to financing is still “relatively good”, said Bolton Bhd executive chairman Datuk Azman Yahya.


Datuk Azman Yahya (right) posing with Bolton Bhd executive director Chan Wing Kwong at the newly launched Bolton Studio.

He said the company planned to launch three big projects this year.

The company aims for RM500mil sales in the financial year ended March 31, 2011. Bolton recorded revenue of RM257.5mil for FY10.

“We have seen unprecedented demand for our properties; even the projects we haven’t launched,” Azman told StarBiz after the launch of Bolton Studio yesterday.

Bolton has said it planned to launch a mix residential, retail and commercial projects worth about RM1bil this year.

“Profit growth will be reasonably strong compared with last year as things are looking pretty rosy for the time being,” Azman said.

For FY10, Bolton charted a 51% hike in net profit to RM27.7mil compared with RM18.3mil in FY09

On its newly-launched sales gallery Bolton Studio, Azman said the company hoped to provide its customers additional convenience by having a property showcase under one roof.

“We plan to replicate this sales gallery concept at our township development of Taman Tasik Prima Puchong. Even as we speak, the finishing touches are being put to Bolton Studio Taman Tasik Prima which is expected to be opened by the end of the month,” he said.

He said due to the gallery’s easy accessibility from Kuala Lumpur, Subang Jaya and Shah Alam via well-connected highways, it had since its April opening attracted many curious passer-bys which had resulted in positive sales enquiries.

With a built-up area of about 8,000 sq ft, the gallery features scale models of Bolton’s latest high-end developments of sixceylon, 51 Gurney and Arata.

Each scale model is equipped with a touch screen terminal whereby users can browse and experience a 3-dimension walk-through and find out more information about the respective developments.

Bolton Studio also showcases a live show unit of sixceylon, a 33-storey condominium in Bukit Ceylon featuring 215 units.

The 696 sq ft fully-furnished show unit provides customers with a functional idea on ways to optimise small-sized units to their full potential.

By The Star

Rahsia Estates plans high-end developments

PROPERTY developer Rahsia Estates Sdn Bhd, a subsidiary of Riverbank Suites Sdn Bhd, has chosen Langkawi for its newest project called Rahsia Estates Residences & Spa Langkawi.

Group Chief Executive Officer Hanizah Tun Abdul Hamid said the gross development value would be approximately RM250 million while the total cost RM180 million.

"It will be parceled into four different precints with various types of resort properties comprising a niche boutique-style hotel offering 18 luxury villas, a five-star hotel complex with 110 club suites, and 31 cabana villas positioned as prime residential choices," she said.

She told this to reporters after the Memorandum of Agreement (MOA) signing ceremony between Rahsia Estates and Asian Finance Bank Bhd (AFB) here Friday.

The MOA between AFB and Rahsia Estates is a strategic partnership whereby the bank will be introducing the property to local and international investors interested in high-profile properties in prime locations.

AFB, a full-fledged Islamic bank, is backed by Qatar Islamic Bank, RUSD Investment Bank Inc of Saudi Arabia and Global Investment House of Kuwait.

Present at the event were Deputy Tourism Minister Datuk Dr James Dawos Mamit and AFB Chief Executive Officer Datuk Mohamed Azahari Kamil.

The resort, sprawled across 6.9 hectares of undulating land facing the Andaman Sea and Pulau Dayang Bunting, was set to be Langkawi's first niche mixed residential and commercial development, Hanizah said.

"The development will abide and follow the guidelines as laid out by the Green Building Index once operational by the year 2014.

"It stands to become one of Langkawi's award-winning landmarks, offering luxurious accomodation, and top-rated customer services within a gated community and security service.

"As the economic climate is on a recovery trend, Rahsia Estates notes the demand for such a mixed-property development project. This will appeal to discerning tourists who enjoy a certain lifestyle, as well as second home-buyers wishing to set up home base and live in the island, particularly, those who are participating in the Malaysia-My-Second-Home programme," she said.

Meanwhile, Azahari said he had confidence in Rahsia Estates' resort project in Langkawi eventhough the property market was currently "soft".

"The company has secured one of the best locations on the island that stands to ensure the development's successful completion and visitors' satisfaction.

"The bank believes that property transactions will start to move upwards in the near future since there are positive signs of recovery," he said.

He said Rahsia Estates Residences & Spa Langkawi would become the most attractive and rare property jewel to be acknowledged as one of the nation's luxurious property resorts and one of the iconic resorts of Langkawi.

"The bank's strategy is to market the property to its Middle Eastern network to take advantage of the potential of this exquisite property development in the region," he said.

The bank had already identified potential buyers from the Middle East, he added.

By Bernama

'City of Malaysia' to rise from Sg Besi airport site

The Sungai Besi airport in Kuala Lumpur will be developed into a green mixed-use development, which will feature a commercial hub.



Defence Minister Datuk Seri Ahmad Zahid Hamidi said the new development area will be known as "City of Malaysia" and will be jointly developed by Middle Eastern investors including the Qatar Investment Authority and 1Malaysia Development Bhd.

"We have decided to move the Royal Malaysian Air Force (RMAF) airbase now occupying the land to another area, which will be announced by the Prime Minister at a later date. We are not sure when the move will take place yet. But they will be moving lock, stock and barrel to a new location," he told a press conference after presenting the 50 keys to new homeowners by the Lembaga Tabung Angkatan Tentera (LTAT) in Bukit Jalil, Kuala Lumpur yesterday.

He added that LTAT will not have any stake in the new commercial development that is to take place at the Sungai Besi airport.
"We are also not sure when they (LTAT) are going to move out. All these things are being ironed out. But moving is not a problem because LTAT has enough landbank for relocation," Ahmad Zahid said.

He said the 460ha land is owned by the federal government through an entity know as "Perusahaan Tanah Persekutuan".

Meanwhile, Ahmad Zahid said delivery of the Airbus A400M has been delayed to 2015.

Malaysia had placed its order in 2005 for the four planes originally due to be delivered in 2013.

"Because they will be delivered at a later date, we are allowed to defer our payment. If not, the progressed payment was supposed to start this year," he added.

By Business Times

UEM Land to step outside Nusajaya

PROPERTY developer UEM Land Holdings Bhd wants to expand its landbank beyond Nusajaya in Johor to include places like the Klang Valley and Penang to provide a steady income stream.

The company has RM250 million to spend after it exercised its rights issue in April, which saw RM970 million being raised. Part of the proceeds from the exercise were used to repay debt and for working capital.

UEM Land plans to launch its maiden project outside Nusajaya in Cyberjaya, Selangor, by the end of this month. Dubbed "Symphony Hill", the 39.7ha development, with a gross development value of RM1.1 billion, will be developed in at least six phases over the next 10 years.

"We will develop according to market demand. If there is more demand, we might not need to wait until six phases," said managing director Datuk Wan Abdullah Wan Ibrahim after the company's annual general meeting in Kuala Lumpur yesterday.
UEM Land is in talks with certain parties to develop land in the Klang Valley, but has yet to finalise anything.

"We want to make UEM Land a national player in the property market and for this to happen, the company must have activities and exposure outside of Nusajaya," he said.

UEM Land is the developer of Nusajaya's main features such as the state administration complexes of Kota Iskandar, Puteri Harbour, Southern Industrial and Logistics Clusters and Alfiat Healthpark and residences.

The company has 3,400ha of undeveloped land in Nusajaya, which is targeted to be developed by 2025.

For its financial year ended December 31 2009, it posted a 54 per cent jump in net profit to RM115.6 million on revenue of RM403.1 million.

By Business Times

52 high-impact projects

MALAYSIA has identified 52 high-impact projects worth RM63 billion to be carried out by public-private partnerships under the 10th Malaysia Plan (10MP).

The projects, which include the building of highways and power plants, are expected to drive the economic transformation agenda.

"This new wave of public-private partnership (PPP) will ensure equitable sharing of risks and returns," Prime Minister Datuk Seri Najib Razak said in his speech during the tabling of the 10MP in Parliament yesterday.

The projects include seven highways at an estimated cost of RM19 billion. Among them are the West Coast Expressway, Guthrie-Damansara Expressway, Sungai Juru Expressway and Paroi-Senawang-KLIA Expressway.
Companies seen benefiting from these highway projects include Gamuda Bhd, IJM Corp Bhd, WCT Bhd and Mudajaya Bhd.

Other projects include two coal-powered electricity plants that cost an estimated RM7 billion and development of the Malaysian Rubber Board's land in Sungai Buloh, Selangor, at a cost of about RM10 billion. The land is about 1,337ha.

Najib said the private sector will also get the chance to take part in major projects led by government-linked companies, such as the redevelopment by 1Malaysia Development Bhd of the Sungai Besi Airport area and a new international financial district in Kuala Lumpur.

Other projects include construction of a liquefied natural gas regasification plant by Petroliam Nasional Bhd in Malacca (about RM3 billion) and two aluminium smelters in the Sarawak Corridor of Renewable Energy (about RM18 billion).

Analysts said they had expected more big projects to be announced under the PPP, but felt that it was nevertheless a good start. The value of the projects is three times more than the RM20 billion Private Finance Initiative scheme under the 9MP, they noted.

(The full list of projects under the 10MP is expected to come out in August.)

The analysts said that the main concern now was funding and execution and, in some cases, tariff.

Many felt that it was important for the government to ensure that the projects roll out within the stipulated five-year time-frame and did not encounter delays once the deadlines were set.

"Many of the foreign investors I spoke to today were sceptical as to whether some of these projects would actually happen, seeing as some under the 9MP were not carried out.

" If they do happen, however, it would be great for the construction sector, and the government would benefit as well," said a construction analyst from a foreign research firm, who declined to be named.

By Business Times

i-City aims to produce global technopreneurs

Malaysia can be the next launch pad for a pool of world talented technopreneurs and have its own Silicon Valley success stories with i-City's new status as a technopreneur campus.



I-Berhad, developer of the RM2 billion i-City project in Shah Alam, Selangor, obtained approval from the government in May to turn the project into a technopreneur campus. It thus has potential to attract talents not only from Malaysia, but also from across the region.

i-City, which is now 20 per cent completed, is a 29ha project that boasts broadband speed of 20Mbps, with a fibre-optic network and a back-up power supply.

I-Berhad deputy chairman and controlling shareholder Tan Sri Lim Kim Hong said under the technopreneur campus concept, i-City will be a "gated but open" international zone.

"This zoning is in recognition of i-City as both a knowledge hub as well as a night tourism destination that will be a catalyst in the transformation of Shah Alam into a vibrant city," he said.
Apart from having a technologically-advanced state-of-the-art infrastructure, Lim said i-City also focuses on other elements of the Silicon Valley-like ecosystem.

This includes developing the entrepreneurial talent pool, organising programmes to connect entrepreneurs and technopreneurs with venture capital partners and getting universities to play a higher level of support for industries.

"They (technopreneurs) have the business model and technology but may not be relevant in this market. We try to match them with venture capitalists," he told Business Times in Shah Alam, Selangor, recently.

Lim, an old hand in Malaysia's corporate sector, said the technopreneur campus concept has its roots in the campuses of many of the world's leading knowledge companies such as Google campus and Microsoft campus.

He said these campuses are enclaves where the offices and supporting facilities of these companies are located.

Lim said for i-City, the technopreneur campus status is seen as a formal recognition of what is already in place.

"The approval also included a number of programmes and activities that will enhance the value of the development such as cultural and night tourism activities, a boutique hotel, an Islamic financial hub and plug-and-play technopreneur development centre," he said.

I-Berhad expects to complete other developments such as the Cybercentre office suites during the second phase, which is expected to kick off by year-end.

It also plans to build office towers and a one million-sq ft shopping mall in future phases.

By Business Times

SP Setia taking new tack with KL project

Malaysia's largest property developer by sales aims to launch its RM6 billion KL Eco City project in Kuala Lumpur by December.

SP Setia Bhd, the country's largest property developer by sales, is targeting to launch its much-talked-about KL Eco City, a RM6 billion project in Kuala Lumpur, by December.



"We postponed the launch of KL Eco City previously because of what was happening globally. We hope this time the project will come on stream as planned," SP Setia president and chief executive officer Tan Sri Liew Kee Sin told reporters after visiting Balai Berita in Kuala Lumpur yesterday.

KL Eco City, described as a green mixed development, is located opposite Mid Valley Megamall. It will be developed in three phases over some 10 years.

SP Setia will build office towers, condominiums and signature offices, including an area for retail.
The project is a joint venture with Kuala Lumpur City Hall (DBKL), which owns the 9.7ha leasehold land in Kampung Haji Abdullah Hukum.

DBKL is partnering SP Setia on a profit-sharing basis, taking 20 per cent of the project's net profit.

Liew said he was upbeat about the project, among SP Setia's biggest.

"We will have a different marketing approach for KL Eco City. It will be something never done before - not by us nor any other developers in Malaysia."

Liew also expressed optimism that SP Setia would meet its RM2 billion sales target for the fiscal year ending October 31 2010.

Up to May 31 this year, it had achieved revenue of RM1.6 billion, attributed to property sales from its 10 ongoing projects in Malaysia and Vietnam.

Since last year, SP Setia has launched several marketing programmes to promote sales, including its popular "5/95 home loan package", which has been emulated by other property developers, and the "Best for the Best" scheme. The latest was the "Invest in Setia Homes".

SP Setia achieved its highest sales of RM1.65 billion last year in spite of the global economic turmoil.

By Business Times

UEM Land eyes landbank expansion

UEM Land Holdings Bhd is looking at expanding its land bank in areas like the Klang Valley, says its managing director/chief executive officer, Datuk Wan Abdullah Wan Ibrahim.

"We have a serious strategy in identifying new revenue streams. We are now active in looking for land outside Nusajaya, Johor, to supplement our income," he told reporters after the company's annual general meeting here today.

Wan Abdullah said the vision going forward was to make the company less Nusajaya-centric. "In order to be a national player, we must have projects not just in Nusajaya and need to have exposure elsewhere.

"There are discussions currently and we have also received proposals from Penang," he said. The company currently has 3,200 hectares in Nusajaya which are yet to be developed while in Cyberjaya, it has about 39.2ha.
Meanwhile, its chairman, Tan Sri Dr Ahmad Tajuddin Ali, said UEM Land expected this year to be better. Ahmad Tajuddin said the company planned to launch a new project -- Symphony Hills -- in Cyberjaya next month.

"The high-end project will consist of six phases and it has an estimated gross development value (GDV) of RM1.01 billion," he said.

He said the company also planned to launch 480 units of houses in Nusa Bayu project in Johor in September.

"Nusa Bayu is a residential project and will consist of 4,942 houses with a GDV of RM800 million. "The project is targeted at medium- to low-income groups," he said.

UEM Land's pre-tax profit for financial year ended Dec 31, 2009, rose to RM129.582 million from RM75.700 million in the same period of 2008.

Its revenue, however, fell to RM403.085 million from RM511.647 million previously.

By Bernama

Sime unit is Green Builder of the Year

SIME Darby Property Bhd has been selected the inaugural recipient of Frost & Sullivan’s 2010 Malaysia Green Builder of the Year Award for its best practices in the industry.

The award looked into several categories, including commendable diligence, commitment and innovative business strategies required to advance in the global marketplace, Sime Darby said in a statement.

Managing director Datuk Tunku Putra Badlishah said the award recognised the group’s continuous efforts in pursuing the sustainability agenda.

By Bernama

Green buildings: Need for bigger public sector role

The public sector and government agencies should lead the development of green buildings, rather than making it mandatory for the private sector to do such projects.



Energy, Green Technology and Water Minister Datuk Seri Peter Chin said he was talking to a few other ministers on the prospect.

"I am hoping that the public sector will spearhead the development of green buildings. Maybe we can start with new government hospitals or schools developed by the Public Works Department."

Chin spoke to reporters after visiting the Energy Commission's (EC) new "green" headquarters in Putrajaya yesterday.

Called Diamond Building, the headquarters is the country's third green building after Chin's ministry's Low Energy Office and Malaysian Green Technology Corp's Green Energy Office in Bangi, Selangor.

The Diamond Building is the country's first office building to be certified with the highest Green Mark Platinum environmental rating (provisionally) by Building and Construction Authority of Singapore.

The EC is investing RM94 million on the eight-storey headquarters, which is said to be 46 per cent more energy-efficient than a typical office tower.

Construction started in September 2007. The EC is ready to relocate and fully occupy the building from June 28 this year, the commission officials said.

The Diamond Building is targeted at reducing energy usage by 65 per cent with an energy index of 85 kWh/m2 per year at 2,800 hours of use.

A normal office building in Malaysia has an energy index of 250 kWh/m2 per year.

By Business Times

Sun Hung Kai's HK$10.9b land buy beats estimates

HONG KONG: Sun Hung Kai Properties Ltd, the world's biggest developer by market value, paid HK$10.9 billion (HK$100 = RM42.61) for a residential site at a public auction in Hong Kong, beating estimates and underscoring that luxury home demand is withstanding government efforts to cool the market.

The Ho Man Tin district site was estimated at HK$8.41 billion, according to the median of seven analysts surveyed by Bloomberg News.

At HK$12,540 a square foot, it is the highest price in urban Hong Kong since its property market peaked in 1997, according to Centaline Property Agency Ltd.

Home prices have risen 41 percent since the end of 2008, prompting the government to tighten down-payment requirements for luxury homes in October to curtail speculation after record- low interest rates fueled the surge.
The Hang Seng Property Index, tracking six of Hong Kong's biggest develo pers, closed 1.8 per cent higher, reversing a 0.1 per cent drop.

"The above-expectations bidding price shows that the developers hold a positive outlook on urban sites for luxury homes, as currently it is obvious the supply for luxury homes is not sufficient," Wong Leung-sing, an associate director of research at Centaline, one of the city's biggest real estate agencies, said by phone yesterday.

The Centa-City Index, a measure of Hong Kong's home prices, last week fell 1.44 per cent, its biggest weekly drop in over 18 months, after the government's May 12 pledge to keep boosting land supply to cool the market. Hong Kong may add as many as 60,000 homes in three to four years, Financial Secretary John Tsang said on Wednesday.

The price "was not cheap but still reasonable," Fiona Wan, a spokeswoman at Sun Hung Kai, said by phone yesterday.

The firm expects to invest HK$18 billion to develop the site "into a luxurious residential area." The estimates ranged from HK$7.15 billion to HK$9.8 billion.

Home prices in Hong Kong rose the most among the world's major markets in the fourth quarter, property adviser Knight Frank LLP said in April.

Average prices climbed almost 28 per cent from a year earlier in Hong Kong, while in China they advanced 25 per cent, a global index compiled by the London-based broker showed. They rose 3.4 per cent in the UK and fell 3.1 per cent in the US, according to the April 21 survey.

Luxury home prices may rise 20 per cent this year as the economy expands and supply remains limited, real estate broker CB Richard Ellis Group Inc said in January.

By Bloomberg

Mitrajaya expects to maintain record earnings

PROPERTY and construction firm Mitrajaya Holdings Bhd, which posted record revenue and profit last year, expects to maintain or perform better in the current financial year ending December 31 2010.

This would be driven equally by the group's ongoing property and construction projects, managing director Foo Chek Lee said.

"To date, the group's combined order book value for construction and property development projects is nearly RM300 million," he told Business Times after a shareholders' meeting in Subang Jaya, Selangor, yesterday.

"We will continuously bid for projects, both in the private and public sector, and we aim to secure between RM200 million and RM300 million worth of projects," Foo said.
In the year ended December 31 2009, Mitrajaya posted RM45.5 million in net profit on revenue of RM326.3 million, up from RM2.1 million and RM195.3 million, respectively, in 2008.

Foo attributed last year's strong performance to stable prices of construction material and fuel and its ongoing property development projects.

Meanwhile, the group's overseas project called the Blue Valley Golf and Country Estate in South Africa, which has a gross development value (GDV) of RM400 million, will be completed in five years.

On the local front, Mitrajaya's three property projects in Puchong and Mont Kiara - Desa Idaman, Lavender Terraces and Kiara 9, which have a combined GDV of over RM500 million, are expected to be completed by early next year.

They will start contributing to the group's bottomline in the current financial year.

Mitrajaya has also clinched construction deals in Johor's Iskandar Malaysia, comprising of a RM64 million contract for the Newcastle University Medicine Malaysia Campus and a RM40.3 million deal for the car parks at the theme park.

Foo also said he is upbeat about the current year, especially with the rollout of construction projects under the 10th Malaysia Plan as well as the strong demand for properties priced under RM1 million.

And while the proposedrise in the foreign workers levy may bring additional cost to the group, it will not constitute a major portion of the group's cost, he added.

By Business Times

SunCity unit unveils Sunway Rymba Hills

SUNWAY Damansara Sdn Bhd, a unit of Sunway City Bhd, has launched Sunway Rymba Hills, a RM270 million gated and guarded residential project on 7.9ha in Sunway Damansara, Selangor.

The joint venture project with Perbadanan Kemajuan Negeri Selangor comprises 80-units of 3-storey forest villas, SunCity said in a statement.

There are four different designs with built up areas ranging from 4,259 sq ft to 4,650 sq ft.

It claims to be the only residential development in Petaling Jaya with an exclusive 2.63ha private forest park.

By Business Times

Axis REIT to buy land for RM134m

AXIS Real Estate Investment Trust (REIT) is buying two parcels of land for RM134 million.

The leasehold land are in Telok Panglima Garang and Petaling Jaya in Selangor.

The REIT also plans to place out up to 69 million new shares or about 22.4 per cent of its existing units.

It also wants to increase its existing approved fund size from about 307.08 million units up to a maximum of 375.9 million units.

By Business Times

Magna Prima’s land acquisition deal

MAGNA Prima Bhd and vendor Muafakat Baru Sdn Bhd have agreed to extend the deadline to seal a firm agreement on a land acquisition.

The companies had agreed on a three-month extension till September 19 this year for the purchase of a 4.1ha of land in Kuala Lumpur, Magna Prima told Bursa Malaysia yesterday.

Magna Prima is buying the land for RM57.93 million.

By Business Times

6-star Malacca resort opens next week

MALACCA'S first six-star resort and spa will open its doors next week, following a RM140 million investment by timber group Sanbumi Holdings Bhd.

The Philea Resort & Spa, claimed to be Asia's largest log resort, is located on a 5.7ha site in Ayer Keroh, Malacca. It was designed by Symbios Design Associates Sdn Bhd.

Philea's general manager Ung Beng Huat said Philea is Sanbumi's maiden venture in the hospitality management industry. Sanbumi is also involved in the tourism industry

Speaking at the preview of the resort on Monday evening, he said a thorough study had been done for two years involving concept and other details before Philea's construction started in August 2008 and was completed in May this year.
The company plans to bring in tourists from Hong Kong, Taiwan and China via chartered flights four times a week.

Philea consists of 180 Pavillion Villas, 19 units of Philea Suites and two units of Royal Villas. Each villa is uniquely designed, complemented with pine-log walls and a host of amenities.

The resort will also have five in-house food and beverage outlets as well as a host of other facilities and services such as outdoor-landscaped swimming pool and a spa village which will be opening soon.

By Business Times

Halal parks draw RM4.8b investments

EIGHT halal parks in the country has attracted a total of RM4.8 billion in investment so far, said Halal Industry Development Corp (HDC).

Chief executive chairman Datuk Seri Jamil Bidin said these halal parks are already in operation at various locations throughout the country. Those in Selangor, Negri Sembilan and Malacca are doing very well.

"The parks in these areas are almost fully capitalised. We hope the state government will give more land to expand the halal parks," he said in Kuala Lumpur.

The development of these halal parks is in line with the aim to make Malaysia a centre for halal supply chain in the region. HDC helps by promoting investments of halal products and services and other incentives in collaboration with the state government.
Yesterday, HDC awarded the 209.6ha techpark@enstek developed by TH Properties Sdn Bhd, the Halmas certified status, a special status for halal parks having complied with the requirements under the HDC guidelines.

techpark@enstek is the first halal park to receive the certification in conjunction with Halmas certification launched yesterday. The park has so far attracted a total of RM2.5 billion of investments and is in talks for another RM500 million worth of investment from two pharmaceutical companies this year.

Its investors include Coca Cola Bottlers (Malaysia) Sdn Bhd , a subsidiary of the world-renowned Coca Cola Company which is building a RM1 billion bottling plant on its 12ha site.

The government has also purchased a 24.8ha site at techpark@enstek to develop 9BIO, a National Institute of Natural Products, Vaccines and Biologicals for vaccine production. This development will spearhead the production of halal vaccines for Malaysia's own consumption as well as for export.

Another government project in the pipeline is the Malaysian Islamic Development Department (Jakim) proposed halal complex which will undertake the infrastructure in developing a global halal accreditation and reference hub.

Bandar Enstek is a joint venture between TH Properties and Negri Sembilan State Development Corp. The township offers an extensive network of industrial, commercial, residential and institutional properties.

HDC also launched its new corporate logo at the event to mark its fourth year in the industry. On the corporatisation of HDC, Jamil said Ministry of International Trade and Industry will prepare a proposal to the cabinet on the ways forward for the industry.

By Business Times

Desa ParkCity – a milestone development

Adiva in Desa ParkCity. “People who live there see the intangibles, they feel safe and secure.”

HAVING a vision is so crucial. Whatever one sets out to do, without a dream, there will be no vision. And without a vision, there will be no goals, or milestones leading to that goal.

Desa ParkCity celebrated its 10th year milestone when one of its 10th precincts bagged FIABCI’s Prix d’Excellence Award (residential – low rise category) at the 61st World Congress of the International Real Estate Federation (FIABCI) held in Bali last week.

The 11-acre Adiva precinct comprising 160 triple, double-storey and walk-up apartments set against linear parks within the masterplanned development of Desa ParkCity became the world’s best in a property showcase which saw 54 entrants from 11 countries competing for 14 categories. FIABCI is the French acronym for the Paris-based federation.


Lee Liam Chye ... ‘There has to be commitment.’

It was a milestone for both Perdana ParkCity Sdn Bhd, a subsidiary of Sarawak-based Samling group, and its group chief executive officer Lee Liam Chye, who has been steering that project from its conception. The two are synnonymous.

The victory also cements the successful rebranding of that location.

The success of Desa ParkCity goes back to 1999, a year after the 1997/98 Asian financial crisis. That year, Lee, together with several others, visited a quarry mine adjacent to Bandar Menjalara in Kuala Lumpur. Lee describes that 473 acres a piece of wasteland – “a hot potato that no one wanted” – with ravines, ridges, a hillock and parts of it secondary forest.

A little known figure in the property world, Lee, from Penang, was educated in Britain. He has a Bachelor of Science (honours) in estate management from the University of Southbank, Britain. He spent several years with Penang City Hall’s valuation department before joining the private sector. His previous projects include One Ampang Avenue, an apartment sitting atop some shops, and another project in Cebu, the Philippines. ParkCity is his big break.

“I’ve always asked myself why certain places in Britain and France, especially Paris, evoke strong emotions within me. These places promote concepts and percepts which are fundamental. Some of these cities may have been built a long time ago, but the fundamental concepts upon which they were built remain relevant until today. Only technology, the way things are done and building materials have changed, but ideals and the idea behind them remain relevant,” says Lee.

He had a vision to build a master planned development with landed strata units set amidst gardens and parks, with the living area overlooking a garden instead of the car porch and commercial amenities within walking distance. At that time, the only strata-titled projects were condominiums.


Adiva in Desa ParkCity, homes in a park. Adiva won the residential (low rise) category in the FIABCI Prix d’Excellence Awards 2010 at the 61st World Congress of the International Real Estate Federation in Bali.

Said Lee during a 2003 interview, his first with StarBizWeek: “When I saw that piece of land, I saw the challenges, but I also saw the potential.” During that interview, he talked about creating a sense of place and space, with trees and parks all within a community.

Seven years later, a day after picking up the Prix d’Excellent award in Bali, Lee says: “There has to be commitment. You have to be genuine in what you want to build and from that point onwards, opportunities for innovation and creativity will come.

“ParkCity has the X factor. People who live there see the intangibles, they feel safe and secure.”

Prices of its landed properties have gone up quite a bit. When Safa, a non-strata development, was launched in 2002, it was priced at about RM400,000. Today, they are changing hands at about RM1.3mil. A three-storey Zenia, priced between RM800,000 and RM900,000 in 2005 is now ranging between RM1.6mil and RM1.85mil. With each new subsequent launch, prices of older precincts have increased. City Hall has approved 13,000 housing units. Lee says they will only build half of that.

Today, Lee will be holding a priority launch for about 2,000 registrants for its latest condominium The Westside One. He calls the 40-storey block of 338 condominium units “branded residences”. Sizes range from 969 sq ft to 2,066 sq ft with prices averaging RM580 per sq ft. This will be the third condominium project there. There will be several more condominium projects there with invariable density.

On June 26, he will be holding a priority launch for Casaman, a gated and guarded strata-titled 147 units of two- and triple-storey terraced homes with superior finishes.

“Casaman will be our most ambitious and will be different. It will have built-ups ranging from 3,100 sq ft for double-storeys and up to 5,300 sq ft for triple-storeys,” he says. Prices range from RM1.7mil to RM2.9mil.

“I have been asked: why are my terrace houses masquerading as semi-detached units? Because there is a constant demand for bigger homes.”

Are houses there overpriced, as claimed by some? Views differ.

Says a source from property consultancy CH Williams, Talhar and Wong: “You can’t say they are overpriced when there is demand.”

Some agents say there is a bit of a bubble in that location. But the demand continues to climb.

“Prices have been holding up well simply because there is a demand for landed strata-titled units. Those who buy into that community want the security,” says an agent familiar with that location.

Other projects in that area include Sunway SPK Homes, adjacent to Desa ParkCity, and Villa Manja, both by the Sunway group. Each of them have piggy-backed on the success of ParkCity but they lack the space and amenities available at ParkCity.

Recently, Sunway launched 180 townhouses with built-up of about 2,500 sq ft priced between RM1.03mil and RM1.1mil. About 80% are sold.

One of ParkCity’s biggest price boosters is its commercial area The Waterfront, which comprises a supermarket, eateries and a clubhouse. When Tesco opens its new supermarket in Bandar Menjalara, this may dilute some of the traffic at The Waterfront.

Says Lee: “An important point of this development is walkability. The community benefits from being able to take a pleasant walk to the shops. Today, the buzzword is sustainability and the green environment. We have been talking about that and the new urbanistic element 10 years ago. And the houses we built melt with the open spaces.”

As the community evolves, other components are being added – a private hospital to be operational in 2012 by the Sime Darby group, and an international school by next year.

By The Star (by Thean Lee Cheng)

Johor Land acquires Wisma Time for RM78m

PROPERTY developer Johor Land Bhd has bought Wisma Time on Jalan Tun Razak in Kuala Lumpur for an estimated RM78 million, sources say.

The building is owned by STLR Sdn Bhd, a wholly-owned unit of Khazanah Nasional Bhd.

The 12-storey freehold building with a mezzanine floor and two basement car parks has a nett lettable area of 171,611 sq ft.

It is understood that Johor Land, a Johor Corp company, has bought the property for investment.
"The price is inclusive of a renovation amount ... the building is being renovated now," a source told Business Times.

In April, it was reported that the building, which is located on the same row as Menara AA and Wisma Technip, has an indicative price of RM80 million.

At that time, the occupancy at the building was quoted as 68 per cent. "It is now almost 90 per cent occupied," the source said.

Officials from Knight Frank, the advertising and handling agent when contacted to confirm the sale, declined to comment.

However it is believed that the deal, which was signed last month, was jointly closed by Knight Frank and CH William Talhar & Wong.

The building, originally belonged to Time Engineering Bhd. It was sold to STLR for RM62.05 million in 2002. Johor Land was delisted in July 2009.

Based on the last financial statement submitted to Bursa Malaysia, in the year ended December 31 2008, Johor Land made a net profit of RM5.66 million on revenue of RM51.03 million.

By Business Times

Paramount to expand landbank

Property developer Paramount Corp Bhd said part of the proceeds from its 20 per cent stake sale in Jerneh Insurance Bhd will be used to buy land in the Klang Valley.



"Landbank is an important part of our strategic plan. We just bought 20ha in Cyberjaya, Selangor because of the location. We buy where there is success," managing director and chief executive officer Ong Keng Siew said.

Ong said it is selling its stake in Jerneh to focus on property development and education, which will continue to contribute 70:30 to its bottom line.

"It is very glamorous to diversify but to play the diversification game is not very attractive in the eyes of investors. We have a few options for the proceeds from the stake sale and it may include giving special dividends to shareholders," Ong said.
Paramount, with three ongoing projects, has RM207 million cash in hand and 390ha.

The company is planning to launch some RM2 billion worth of properties this year and next, Ong said after the company's shareholders meeting in Subang Jaya, Selangor yesterday.

Paramount plans to launch a 200ha mixed development project, dubbed "Banyan Hills" in Sg Petani, Kedah by the fourth quarter of this year.

Next year, it plans to start building the new KDU College campus and a mixed development on 8.7ha in Glenmarie, Shah Alam.

"We are relocating our branch campus in Section 13, Petaling Jaya to Glenmarie. We will redevelop the 2.1ha site into a high-end residential and commercial project in the near future," Ong said.

As for the land in Cyberjaya, Paramount plans to build mid-to high-end residential properties worth RM530 million, in two phases, starting next year.

Ong also said the company will hive off its loss-making English language centre in China.

It is talking to a buyer and expects to conclude the deal by the end of this year. Ong did not say how much it is selling the centre for.

"There is a lot to do in Malaysia in education. While the sector is tough as there are many players, we position ourselves as a quality education provider.

"We plan to build more campuses and international schools and are looking at the Iskandar Development Region in Johor. We want to increase our existing 8,000 student population," he said.

By Business Times

MRCB to buy more land in Klang Valley

KUALA LUMPUR: Malaysian Resources Corp Bhd’s (MRCB) chief executive officer Mohamed Razeek Hussain said the group will use part of the cash raised from recent share sale exercise to buy small pieces of prime land around Klang Valley, while keeping an eye for opportunities to participate in upcoming government projects.

These includes a massive Government development plan in Sungai Buloh on a joint- venture with the main shareholder the Employees Provident Fund (EPF).


From left: MRCB executive director Datuk Ahmad Zaki Zahid, Mohamed Razeek Hussain and MRCB chief financial officer, Chong Chin Ann after the AGM

“We will be looking to participate (in the Sungai Buloh project), but there’s still no award from EPF to MRCB,” Razeek told reporters after the group’s AGM yesterday.

MRCB’s chairman Tan Sri Azlan Zainol, who is also EPF’s chief, however, did not attend the post-AGM press conference.

The pension fund had been buying shares in MRCB from the open market after its takeover offer at RM1.50 a piece was rejected by minority shareholders in late March.

Latest filing with Bursa Malaysia showed EPF as the single largest shareholder in MRCB with a 40.9% stake.

Shares in MRCB had risen to as high as RM1.69 on April 2 on high hopes it would benefit from the Government’s intention to unlock the values of its landbank around Klang Valley. The stock was up 2 sen to close at RM1.50 yesterday.

At the press conference yesterday, Razeek said the group’s might look beyond local shores in building up its business.

“We are always on the lookout for new opportunities, locally or abroad, but we will only go into our areas of core competency,” he said.

The group is building an apartment block in Melbourne with gross development value of A$57mil.

Razeek said MRCB was currently bidding for projects estimated to total RM600mil at home to replenish its engineering and construction order book of RM3bil.

“We have to go with some degree of optimism,” he said, adding that the amount tendered excludes in-house projects at KL Sentral.

This excludes upcoming projects such as the Light Rail Transit (LRT) expansion, where MRCB is one of the contractors already pre-qualified for the project.

On his outlook for the current year ending Dec 31, 2010 (FY10), Razeek said the group expected revenue to top RM1bil for the first time this year, with “reasonable growth” in profits from last year.

In FY09, MRCB return to the black with a net profit of RM34.6mil on sales of RM922mil.

By The Star

MRCB upbeat on winning contracts worth RM250m

MALAYSIAN Resources Corp Bhd (MRCB) hopes to win some RM250 million worth of contracts this year from RM600 million worth of projects it tendered for in Malaysia.

Its chief executive officer Mohamed Razeek Hussain said the bids, for its construction division, are for jobs in the Iskandar region in Johor, Sabah, Kuantan and in Gombak, Kuala Lumpur.

Razeek, who was speaking to reporters following the company's annual general meeting in Kuala Lumpur yesterday, expects a decision on the award within the next three months.

"We have been shortlisted and we stand a good chance (to win) for a hospital project in Sabah," he said, declining to reveal the amount.

On participation in the 1,214ha land project in Sungai Buloh which is being developed by MRCB's controlling shareholder the Employees Provident Fund (EPF) and the government, Razeek said that no tender have been called yet.

Similarly, he said that no tender had been called for the RM7 billion extension of the light rail transit line in the Klang Valley. MRCB Engineering has been prequalified as main contractors for facilities work and subcontractor for fabrication and delivery of segmental box girder.

In the current financial year ending December 31 2010, MRCB expects to cross the RM1 billion revenue mark and make a significant improvement in its profitability this year, as all business segments grow.

In 2009, it made RM921.61 million in revenue and a net profit of RM37.48 million.

Its current construction order book stands at RM3 billion while its prized KL Sentral development project is expected to last until 2016.

"Most of our projects are ending in 2011 and 2012," he said.

One such project where it will enjoy recurring income is the 8.1km RM1 billion Eastern Dispersal Link (EDL) that will link the Sultan Iskandar Customs, Immigration and Quarantine (CIQ) to the PLUS highway. The link will be ready in September 2011 and toll collection will start in 2012.

The Duta-Ulu Kelang Expressway (DUKE) will start to contribute positively in the next three to four years.

By Business Times

MRCB: Prime land deals in pipeline

MALAYSIAN Resources Corp Bhd (MRCB) plans to buy its first piece of land in the Kuala Lumpur City Centre and it could pay as much as RM170 million for the asset.

If the deal happens, MRCB would start its maiden project in the city centre.

Chief executive officer Mohamed Razeek Hussain said it has identified a piece of land measuring 0.45ha to 0.9ha, located a stone's throw away from the Petronas twin towers.

"We have identified the land near KLCC ... we can get a good price below what's in the market," he said. The going market rate for land in the area is around RM2,000 to RM2,500 per sq ft.
"It is work in progress, we are talking to the landowners and we hope to conclude it as soon as possible," Mohamed said.

While he did not say where the land is, sources say it is located on Jalan Kia Peng and is slated for development of high-end residences.

MRCB also plans to buy an 8ha plot in the Klang Valley, outside the KLCC.

By Business Times

Sunway REIT to be Bursa’s largest

PETALING JAYA: Sunway Real Estate Investment Trust (REIT), which is slated for listing on July 8 on the main board of Bursa Malaysia, is set to become the largest REIT on the local stock exchange with a fund size of 2.78 billion units.

However, according to a report by OSK Research, Sunway REIT’s initial public offering (IPO) would be at a premium to other Malaysia REITs.

“Based on the Sunway REIT’s net asset value per unit (NAV/unit) of 97 sen upon listing, its price over NAV (P/NAV) was estimated to be at about 1x (based on the assumed IPO price of RM1/unit for the institutional offering).

“This is about what the other REITs are currently trading at on average,” said the report.

The REITs’ dividend yield was only expected at about 6.7% (based on forecast dividend per unit (DPU) of 6.7 sen), which was below the average 8.5% for other REITs, it added.


It said this could imply that Sunway City (SunCity) would be selling the properties to the REIT at a high valuation benchmark.

“Having said that, the low yield offered by Sunway REIT and the premium to be paid for those properties could be justifiable given that the trust will be the largest in Malaysia, with the largest free float of about RM1.6bil vis-à-vis any given REITs, and the unique prospects of those properties, which offer a relatively more defensive investment and yet potentially attractive long-term growth,” the report noted.

It added that Sunway REIT might potentially attract certain classes of investors with a defensive investment strategy, such as pension and insurance funds. “This has been proven by the fact that Sunway REIT very recently secured four large cornerstone investors (at 98 sen/unit) which collectively hold about 14% stake in the trust,” it said.

The investors are a Singapore sovereign wealth fund, the Employees Provident Fund, Permodalan Nasional Bhd and Great Eastern.

The report said a trading buy opportunity in SunCity with an adjusted price target of RM4.52 would be the biggest beneficiary of the deal if the properties were to be disposed off at such valuations.

“Based on conservative estimates, this will add a further 69.8 sen/share (or a maximum 99 sen, depending on the response to the book-building process for the institutional offering) to SunCity’s net asset, bringing it to about RM5.32/share,” it said.

It further added that pegging this against 0.85x to 0.90x (P/NTA), which is the average that its peers were currently trading at, the reseach house estimated that SunCity might likely trade in the range of RM4.52 to RM4.79 as the listing of Sunway REIT got closer to realisation.

HwangDBS Vickers Research said in a report that Sunway REIT’s yield looked “rich” at 6.9% versus the sector’s 8.5%, while rising interest rate environment could force yields higher.

However, the report said, the REIT should help SunCity unlock its investment properties’ value and lead to more efficient allocation of resources to boost return on average asset.

The report maintained a “buy” call on SunCity and target price of RM4.70, assuming no discount for property investment and 30% discount for property development.

By The Star

Axis-REIT to inject more assets

KUALA LUMPUR: Axis Real Estate Investment Trust (Axis-REIT) will acquire a parcel of leasehold land, and industrial buildings, in Kuala Langat, Selangor, from Corporate Landmarks Sdn Bhd for RM85mil.

It will also purchase leasehold land with buildings in Petaling Jaya from Dazzling Township Sdn Bhd for RM49mil.

Axis-REIT also plans to undertake a proposed placement of up to 68.820 million new units, representing about 22.4% of the existing units in circulation, at a price to be determined later.

It also proposes to increase its approved fund size to a maximum of 375.901 million units from 307.081 million, currently.

By Bernama

Developers: Foreign labour cut could lead to delays and higher property prices

KUALA LUMPUR: Developers are concerned that the Government’s move to reduce the number of foreign workers in the country will result in project delays, leading to possible price increases in property.

Almost 100% of construction workers in the country are foreigners, according to International Real Estate Federation (FIABCI) Malaysia president Datuk Richard Fong.


Datuk Richard Fong ... ‘We will have the same problem again.’

“We have already seen the effect of tightening labour market five years ago when workers were sent home on an amnesty programme. We will have the same problem again,” he said at a press conference here after a talk by FIABCI World president (2010/2011) Enrico Campagnoli entitled Fiabci in front of Financial Crisis.

He said this resulted in delays in completion of projects which allowed buyers to claim penalties from developers for late delivery.

“When the workers finally returned, we had to retrain them because they were unskilled. So, it is a cycle which keeps repeating itself. The workers return but the issue that cropped up was quality, which in turn led to high rates of defects in the properties,” Fong, who is also Glomac Bhd group executive vice-chairman, said.

FIABCI World President Datuk Alan Tong said “with reference to reducing foreign workers, before the authorities come up with new rules, it would be prudent for more dialogue between the Government and the private sector to facilitate a better understanding of the sector, which today, depends almost 100% on foreign labour.”

“If the authorities want to reduce the number of foreign workers in the country, they must first think of the alternatives. Notwithstanding that, we laud the Government’s proposed plan to wean the country off subsidies,” added Tong, who is also Bukit Kiara Properties (BKP) group chairman.

Tong’s views are shared by See Hoy Chan Holdings group director Datuk Teo Chiang Kok, the developer for Bandar Utama township. Teo, who is also the first vice-chairman of the FIABCI Asia-Pacific Secretariat, said there must be safety nets for the lower income groups with the removal of subsidies.

“Do not look at subsidies as purely a setback suffered by consumers because flour and sugar prices are going to go up. The removal of subsidies also involves water, electricity and petrol which will impact the housing sector in no small way. We have to look at the bigger picture,” Teo said. Earlier, Campagnoli said the debt situation in the euro zone would affect the property sector in different ways because the countries have different economic strengths.

By The Star

Sunway REIT set for July 8 listing

Malaysia's largest real estate investment trust, Sunway REIT, will finally be listed on July 8 2010, some five-and-a-half years after the plan was first announced.

With properties valued at RM2.6 billion to be injected into it, Sunway REIT has secured four cornerstone investors who will together buy 14 per cent of the 2.78 billion units to be listed.

They include Singapore's investment firm GIC, the Employees Provident Fund (EPF), Permodalan Nasional Bhd (PNB) and Great Eastern Life Assurance (Malaysia) Bhd.

Cornerstone investors usually participate in large initial public offerings (IPOs) and unlike institutional investors, they have a confirmed allocation.

Cornerstone investors are said to be more common in Hong Kong and Singapore. It is understood that cornerstone investors emerged during the Maxis Bhd IPO.
"Cornerstone investors have become a trend. I don't think Sunway REIT needs the cornerstone investors but it adds good gloss over the whole transaction," a banker said.

"Sunway REIT have these cornerstone investors to kick off the momentum that the big blue-chip investors are keen in this REIT and this also adds credibility to the REIT," he said.

The four cornerstone investors will buy a total of 376 million units. They will pay the lower of the institutional price and 98 sen.

In total, there will be some 1.65 billion units for public subscription, of which 134 million are for retail investors and 1.52 billion for institutional investors.

Based on the indicative retail price of 97 sen, the total market capitalisation of Sunway REIT upon listing is estimated at RM2.6 billion.

Properties that will form part of the REIT include the Sunway Pyramid Shopping Mall, SunCity Ipoh Hypermarket, Sunway Resort Hotel & Spa, Pyramid Tower Hotel and Sunway Hotel Seberang Jaya.

Its office properties will include Menara Sunway and Sunway Tower.

By Business Times

EPF, PNB among Sunway REIT cornerstone investors

KUALA LUMPUR: Malaysian property developer Sunway City Bhd has secured four cornerstone investors who will buy 14% of the roughly US$500mil (RM1.65bil) initial public offering of its real estate investment trust (REIT).

The cornerstone investors are the Employees Provident Fund, state investment company Permodalan Nasional Bhd, the Government of Singapore Investment Corp Pte Ltd and insurer Great Eastern Life Assurance (M) Bhd, the company said in its draft prospectus.

The cornerstone investors will take up 376 million units at a price which is the lower of the institutional price and 98 sen each. The Sunway REIT, with a fund size of 2.78 billion units, is set to become Malaysia’s largest REIT when it is listed in the third quarter of this year.

It will feature some 1.65 billion units for public subscription, of which 1.5 billion are for institutional and selected investors, the company said in May.

The issue price of the Sunway REIT will be determined after a book-building process which is expected to close on June 24, according to the prospectus.

RHB Investment Bank and Credit Suisse are the joint global coordinators. The banks, along with Maybank Investment Bank, HSBC, JP Morgan and CIMB, are joint bookrunners.

Sunway City said last month it would receive RM2.7bil in cash and about 1 billion units in the REIT for the eight properties it will inject into Sunway REIT.

The properties, which comprise of shopping malls, office towers and hotels, have a combined market value of about RM3.7bil. The listing is targetted for July 8.

By Reuters

Hong Leong plans more Guoman Hotels in China

SHANGHAI: Hong Leong Group (HLG) hopes to open more of its signature Guoman Hotels in China after launching its flagship here.

Guocoland China group managing director Violet Lee said it was eyeing to have five Guoman Hotels in China in the next five years.

Guocoland is Hong Leong Group’s property development and investment arm in China.

“Our hope is to have five – in Shanghai, Beijing which is expected to be ready by next year, Nanjing, Tianjin and Chengdu.

“We are still on the lookout for opportunities to develop more Guoman Hotels in Beijing and Shanghai as the huge population in these two cities are capable of supporting more than one in each city,” she told reporters here on Sunday.

The launch of the first Guoman Hotel in China on Saturday was witnessed by the group’s executive chairman Tan Sri Quek Leng Chan. The 442-room hotel cost around USD80mil.

The renowned hotel brand from Britain already has four establishments in central London – the Royal Horseguards, the Cumberland, the Tower and Charing Cross.

Both the Guoman Hotels in Beijing and Shanghai are located within a mixed development measuring some 600,000 and 500,000 square metres respectively.

Besides the hotels, the development – termed Guoson Centre – also comprises shopping malls, a transportation hub, residences, office blocks and SOHO buildings.

The entire Guoson development in the northwestern Putuo district Shanghai cost some USD600mil.

Lee said the group was confident that Guoman Hotel would find its place among the crowded marketplace in both Beijing and Shanghai.

“The hotels there are located within or near transportation hubs,” she said, adding that Guoman hoped to capture the niche market for businessmen and diplomats who were frequent travellers.

She said the launch was also opportune in view of the city hosting the World Expo, which would run from May until end of September.

The expo was expected to bring in 70 million visitors to Shanghai, she said, adding that Guoman Hotel Shanghai projected a 70% occupancy rate during these period.

By The Star

Paramount unit buys land for mixed project

PARAMOUNT Corp Bhd’s subsidiary Omni Assets Sdn Bhd, is buying a 20ha plot of freehold land in Cyberjaya, Selangor, for RM78.4 million, from Cyberview Sdn Bhd.

Paramount group is proposing to undertake a mixed and exclusive mid-upper to high-class secured and guarded residential landed development and high-rise condominium on the land with a gross development value of about RM530 million.

The proposed development is expected to start in 2011, and span six to eight years.

By Business Times

Loh & Loh bids for jobs worth RM2b

Loh & Loh Corporation Bhd is bidding for a RM2 billion worth of construction projects, including water-related ones, in the country.

Its chief executive officer Jason Loh said the company has about RM1.5 billion worth of ongoing projects in the construction and property sectors.

"Currently, property comprises 20 to 25 per cent of our turnover. We are aiming for a higher contribution from the property division," he told reporters after the company''s annual general meeting.

By Business Times

Nod for Starhill REIT disposals

STARHILL Real Estate Investment Trust (Starhill REIT) unitholders yesterday gave the nod to dispose of Starhill Gallery and Lot 10 shopping centres in Kuala Lumpur for RM1.03 billion.

Pintar Projek Sdn Bhd, the manager of Starhill REIT, said the disposal of the two properties to Ara Bintang Sdn Bhd is part of a rationalisation exercise to reposition Starhill REIT as a hospitality REIT, the first of its kind in Malaysia.

The disposal will provide a platform to enable Starhill REIT to focus on a single and dedicated class of assets.

"We are happy that unitholders approved the sale. Now we can proceed with what we have intended to do," Pintar Projek chief executive officer Tan Sri Francis Yeoh said in Kuala Lumpur yesterday.
Starhill Gallery is being sold to Ara Bintang for RM629 million and Lot 10 at RM401 million.

The sales exercise, to be completed by the third quarter of 2010, will be satisfied by both RM625 million cash and Singapore dollar denominated convertible preference units in Starhill Global REIT worth RM405 million.

The disposal will unlock the value of Starhill Gallery and Lot 10 as Starhill REIT is expected to realise an estimated distributable income of RM204.18 million for the financial year ending June 30 2011.

By Business Times