IJM Land and MRCB shares suspended, they are to announce potential corporate exercise today

An artist’s impression of IJM Land’s RM4.3bil The Light Waterfront phase two project.

PETALING JAYA: Market talk of a potential merger, or takeover, involving IJM Land Bhd and Malaysian Resources Corp Bhd (MRCB) has intensified with the suspension of the shares of IJM Land, its parent IJM Corp Bhd and MRCB since 9am yesterday pending a material announcement on a potential corporate exercise.

The companies are expected to announce details of the corporate exercise later today.

An analyst with a local research house said there was room for consolidation in the local property sector to make way for more competitive and bigger entities in the likes of their better capitalised counterparts in Singapore.

There are various possibilities how the exercise will be carried out. One involves the merger of IJM Land and MRCB into a new entity and the other is via the takeover route, he told StarBiz yesterday.

He said the rationale for a merger or takeover was for both parties to leverage on each other's strengths and synergies going forward.

With the Employees Provident Fund (EPF) having close to a 42% stake in MRCB, he said there was value in MRCB due to its expected involvement or major role in the redevelopment of the Government's land in Sungai Buloh, and a possible strong uplift to the construction order book from the rollout of the 10th Malaysia Plan projects.

Another analyst said while MRCB had proven itself in commercial development, especially the award-winning KL Sentral development, its track record in residential development has not been significant.

IJM Land, with its good track record in residential projects and township development, will be a good match for MRCB as its expertise will be most valuable to the enlarged group's expanded landbank, he said.

Strong brand

The property development arm of IJM Corp has the advantage of a strong brand and is a trusted developer of quality niche properties and new townships.

It is well regarded for its township building expertise as well as expertise in building medium to high-end residences and commercial projects.

Among its flagship projects are The Light Waterfront project in Penang as well as the Seremban 2 and Shah Alam 2 townships.

The analyst said MRCB's advantage of being one of the frontrunners for the redevelopment of the Sungei Buloh land could be the main impetus for the coming together of both companies.

We believe MRCB has been helping the EPF in drawing up the masterplan for the 3,300 acres in Sungei Buloh. However, details on the plot ratio, size of initial development, and other issues are not available as yet. But we understand that the Government is expected to announce the award and details by the first quarter of 2011, he added.

The Government and the EPF will form a joint venture to promote the development of the Sungei Buloh land into a new hub for the Klang Valley. The land is believed to have a gross development value (GDV) of RM10bil.

KL Sentral's development is also progressing well with over RM4bil of GDV having been completed. MRCB, together with its partners, are undertaking RM4.3bil worth of development, to be completed mostly in 2012.

Most of the development centres on Lot G, comprising two office towers, one retail mall and a hotel, with a gross floor area of about three million sq ft. The retail mall, to be called Nu Sentral Mall, will be kept for rental income. Two more properties KL Sentral Park and 348 Sentral (office and apartments) would also be injected into its property investment units for rental income. We understand that about 53% of tenants have been secured for KL Sentral Park and Shell would be taking up office space at 348 Sentral, the analyst said.

He said there would be about RM6bil worth of GDV remaining for development in KL Sentral with construction to start mostly in 2011 and 2012.

This development would include office suites (Lot B), office towers, St Regis Hotel/Residences, and a luxury high-rise development (joint venture with CapitaLand and Quill).

The analyst said MRCB was targeting at least RM1bil of new jobs next year. Among others, it is eyeing some portion of the civil works for the RM43bil MRT project proposed by MMC Corp Bhd and Gamuda Bhd.

The group is also expecting renewals to environmental projects, including the Sungai Pahang rehabilitation project, which is valued at about RM200mil. It is also looking at RM300mil to RM400mil worth of new transmission jobs from Sabah and Sarawak, he said.

By The Star

Skudai to get new RM500mil hub

Datuk Lim Kang Hoo (right) with Teras Hijaujaya Sdn Bhd director Lim Chern Herng looking at the model of the Danga Utama project.

Danga Utama commercial project is latest development in growth corridor

JOHOR BARU: Teras Hijaujaya Sdn Bhd, the developer of commercial project Danga Utama, wants to position the development as the new business hub in the Skudai growth corridor.

Chief executive officer Datuk Lim Kang Hoo said the Skudai growth corridor would derive immense benefits from its close proximity to Nusajaya and Danga Bay, the two main growth components in Iskandar Malaysia.

Spanning over 9,307ha, Nusajaya is one of the five flagship development zones in Iskandar Malaysia, the country's first economic growth corridor launched in 2006.

Our project is located just a few kilometres away from the Skudai exit of the North-South Expressway and Second Link to Singapore and also from Danga Bay, Lim said at the project's launch recently.

He said the company had, under phase one, sold 85% of the 129 three-storey shop offices with mezzanine floors priced from RM1.35mil.

Other components in phase one include six six-storey corporate office towers with selling prices from RM6.1mil.

Lim said the project on a 7.3ha site along Jalan Skudai and Jalan Sutera Danga would be completed in the next four to five years with gross development value of RM500mil.

He said phase two would have high-end condominium towers and retail outlets overlooking Sungai Skudai which would be rehabilitated under the 10th Malaysia Plan.

The Federal Government has allocated about RM300mil for a comprehensive river beautification programme which include dredging, widening and complete clean-up of filthy rivers in the country.

We want to repeat the success of Danga Bay in our Danga Utama project. Phase two will also see us introducing water taxi services from Danga Bay to the project here, said Lim, who is also Danga Bay Sdn Bhd CEO.

Located along Jalan Skudai, Danga Bay is now one of the most sought after addresses for waterfront development properties in Johor Baru, with Lim as one of the players behind the transformation of Danga Bay.

Upcoming projects in Danga Bay include three hotels, high-end condominiums, a marina, an international convention and exhibition centre, and office towers.

Iskandar Regional Development Authority has also chosen a waterfront area in Danga Bay for the wellness township development project in Iskandar.

Khazanah Nasional Bhd and Temasek Holdings Ltd will be jointly developing the project on the 202ha site.

By The Star

Mulpha offers Hayman prime properties

PETALING JAYA: Mulpha Australia Ltd, a subsidiary of Mulpha International Bhd, is offering exclusive properties for purchase for the first time at Australia's premier island resort, Hayman.

In a statement yesterday, it said these residences represented the first private ownership opportunity ever offered at Hayman.

It said the first Hayman Private Residence, estimated at about A$18mil, would be delivered this month, making it one of the highest prices paid for a property in Queensland this year.

Mulpha Australia head of hotel investment Lloyd Donaldson said the decision to offer premium residential property on the island was due to long-standing interest from frequent visitors.

The group, which bought Hayman in 2004, also announced a pre-release of six Hayman Marina Residences to selected Hayman clientele.

By The Star

Ukay Bistari project to be ready soon

The Ukay Bistari mixed development project delayed for five years is expected to be completed by July 2011, state housing, building management and squatter affairs committee chairman Iskandar Abdul Samad said.

He said three blocks of Ukay Bistari service apartment and management office, namely A, D and E were expected to be completed by next month. Only the external electrical, firefighting, architectural and piping works remain to be done.

“The handing over of the units in three blocks to the buyers should be carried out by early next year,” said Iskandar, adding that Block B and C were expected to be completed by February 2011 while Block F was scheduled to be ready by July next year.

Iskandar, who visited the project site yesterday, said the 256 low-cost flats units would be completed by January 2011.

As for the 60 medium low-cost units and 120 medium-cost units, Iskandar said the sale and purchase agreements for these units would be terminated and the buyers would get a refund.

“Buyers will get their refunds plus compensation which comes up to RM5mil,” he said.

He said they would be discussing with the Ampang Jaya Municipal Council (MPAJ) to provide the certificate of fitness (CF) for the completed blocks.

He said the safety of the buyers will not be compromised.

“We will check on the access and hazards,” he said.

In response to a question on Ukay Bistari Land Owners’ (PHUKB) intention to vote en bloc for the coalition which successfully resolved their stalled housing woes, Iskandar said the state government’s priority was to complete the project.

“We will do our part to ensure the work is completed as it is our responsibility. We are not doing this to secure votes,” he said.

According to Block A contractor Abdul Rahman Abdul Manaf, only 20% of works are left to be done.

He said if all payments were on schedule, buyers should be able to move in by January next year.

“Internally everything is done and we are just left with some external electrical and piping works,” he said.

Meanwhile, PHUKB committee chairman Dr Mohamed Rafick Khan Abdul Rahman said he was not keen on the idea of sectional CF for the completed block.

“There is no water supply currently and a water tank would be placed to provide water temporarily.

He added that on an official level, the committee would have to discuss further with the local authorities and state conditions with regards to the CF.

Ukay Bistari in Ampang consists of 2,214 mixed-development units with double and two-and-a-half storey houses, low-cost apartments, service apartments as well as shops and office lots.

It was reported that the project was launched in August 2003 with scheduled completion between August 2005 and June 2007.

A total of 353 units of the double-storey houses were completed in October 2006 while another 103 units were completed in May 2008.

By The Star

IJM Land, MRCB propose merger

The entity that will emerge from the proposed merger between IJM Land Bhd and Malaysian Resources Corp Bhd (MRCB) will be a mega property owner and developer with an implied market value of RM7 billion.

IJM Land chairman, Datuk Krishnan Tan Boon Seng, said the entity was also expected to expand its presence not only in Malaysia but also in the region.

He said the creation of a leading listed property development entity would provide a platform for both parties to tap each other's strengths and capabilities.

"The proposed merger is also expected to provide an opportunity for both entities in terms of product offerings, land bank, management expertise and regional expansion plans," he told reporters after signing the memorandum of understanding with MRCB on the merger today.

Tan said the merged entity would benefit from better project management practices which were expected to give rise to improved operational efficiencies and economies of scale.

"By leveraging on each other’s core competencies, over time, the value of the merged entity can be further enhanced through the adoption of best practices currently being practised by IJM Land and MRCB respectively," he said.

Meanwhile, MRCB chief executive officer, Mohamed Razeek Hussain, said the merged entity would also be well-placed to pursue strategies that could propel its future growth on the back of a combined net assets in excess of RM3 billion.

"With the significant increase in size, the merged group will be able to further strengthen its market leadership in the commercial and residential segments of the property market and compete more effectively in both the local and international markets," he said.

The proposed merger was expected to be finalised within three weeks, Tan said.

Mohamed Razeek said the merged group was expected to have a combined landbank of over 3,600 hectares with presence in the Klang Valley, Penang, Johor, Perak, Negeri Sembilan, Sabah and Sarawak.

The principal activity of IJM Land is investment holding while its units are involved in property development, construction, hotel operations and investment holding while MRCB is engaged in construction-related activities, infrastructure, property development and investment and provision of management services to its subsidiaries.

In a filing to Bursa Malaysia, the companies said the proposed merger would be implemented through a scheme of arrangement under Section 176 of the Act.

For the purpose of the scheme of arrangement, a newly-incorporated company would be formed (newco) to facilitate the proposed merger.

The shares in IJM Land and MRCB will be exchanged for securities in newco or a combination of shares in newco and cash.

The exchange will be based on RM3.65 per share in IJM Land and RM2.30 per share in MRCB.

The newco is to be admitted to the Official List of Bursa Securities upon completion of the proposed merger, in place of IJM Land and MRCB.

The proposed merger is subjected to approvals from the boards of directors of IJM Land and MRCB, shareholders of both companies and the relevant authorities.

RHB Investment Bank and Newfields Advisors have been appointed joint advisers to both the companies.

By Bernama

MRCB revenue up but profit down

MALAYSIAN Resources Corp Bhd’s (MRCB) third quarter net profit fell by 63 per cent to RM3.7 million despite higher revenue.

Group pre-tax profit, however, increased by a quarter to RM15 million, helped by its ongoing property projects at Kuala Lumpur Sentral in Kuala Lumpur, MRCB said in its announcement.

Its revenue increased by 5.4 per cent to RM270.9 million.

For the nine months to date, MRCB’s net profit increased by 16 per cent to RM25.8 million.

By Business Times

China cools hot property mart

BEIJING: Some of China's top trust companies have halted property-related lending and investment following a regulatory order, four sources told Reuters yesterday.

Seeing risks in rapid credit expansion to real estate projects, the China Banking Regulatory Commission (CBRC) last week instructed trust firms to assess the risks posed by their portfolios in a fresh move to rein in the red-hot property market.

The CBRC ordered a self-examination last Friday in a document, and our application to invest in a property project was turned down by our company on the same day.

I don't know whether it's a regulatory requirement or a decision by the company, a source at Ping An Trust told Reuters yesterday.


Pedestrians walking past a property advertisement billboard showcasing various building projects put in front of an old residential building in Beijing. — AP

Two sources close to Zhongrong International Trust cited a company document as saying that it had halted all new plans to invest in the property sector, except affordable housing a niche strongly supported by the government.

One of the sources added that China might order a complete halt to all property-related businesses by trust firms.

A source at China Credit Trust Co Ltd said his company had adopted a more prudent approach following the CBRC's order but had not yet halted property business.

Funds from trust companies have been an important alternative channel for Chinese developers to raise capital as the country has tightened controls on bank lending.

Trust companies are hybrid institutions combining features of commercial bank lending, private equity and asset management. Until recently they had been loosely regulated and had expanded rapidly.

By repackaging loans into equity- or fixed-income-linked products, trusts have been able to offer bank clients, typically rich individuals, much more attractive yields than are available on certificates of deposit.

The CBRC in July ordered trust companies to halt the launch of wealth-management products via banks.

Property-related trust investment totalled 150 billion yuan (US$22.6bil) in the first 10 months of this year, compared with 40 billion yuan in the whole of 2009, according to Use Trust Studio, a private data provider.

By Reuters

'Landed property prices to rise further'

Property prices will continue with the uptrend despite speculation of a bubble building up in the property market, said SP Setia Deputy President and Chief Operating Officer, Datuk Voon Tin Yow.

"The market is still very strong. In terms of the uptrend in landed property prices, it is just a matter of catching up, with the higher income individuals are receiving, and other factors related to society," he added, after speaking as a panelist at the launch of the Bursa Malaysia Business Sustainability Programme today.

He added the uptrend seen is due to the supply shortage in landed properties and is an adjustment, rather than a bubble.

"If we analyse the price of a RM1 million landed property, it would be very expensive. But if we analysed in terms of built-up area, it would be worth the price.

"Of course, the uptrend, cannot go on for the next 10 years at this rate," he quipped.

He added the increase in prices are mostly in landed properties, but not strata title developments.

"The trend will continue for sometime but in the foreseeable future, there would not be any bubble forming in the property market," Voon said.

By Bernama

Mah Sing buys land for RM157.3m

Uptrend Housing Development Sdn Bhd, a wholly-owned unit of Mah Sing Group Bhd, has acquired 24.41 hectares of freehold land in Batu Feringgi, Penang, for RM157.3 million in cash.

In a statement here today, Mah Sing said the land would be developed into a resort-style project named, Feringgi Residence@Penang, with an estimated gross development value of RM800 million.

By Bernama

KL to get first vertical car park

PETALING JAYA: Kuala Lumpur see the city's first multi-storey automated car parking system in Times Avenue, a new 15-storey building to be developed by Takashimaya Construction & Development Sdn Bhd.

The company has no ties with Japan's Takashimaya Co Ltd, which is known for its chain of department stores.

The automated car parking system was based on South Korean technology and being used in Japan, South Korea and the United States, said the company's project director Kelvin Lee Seong Seng.


Kelvin Lee ... ‘We may replicate the project to give us recurring revenue.’

About 140 parking bays will be available in the project that also comprises 20 retail units on its first three floors and 36 office suites from the fourth to the nine floors. There will be two penthouse offices.

The narrow strip of land of about 13,000 sq ft along Jalan Imbi next to Berjaya Times Square was purchased a few years ago. Work on the project will begin by the year-end.

We wanted to go into property development. When that small piece of land came up for sale, we decided to buy it.

At 13,000 sq ft, it is a small piece of land. We wanted to have office suites and some basic retail facilities to serve the office units.

But with the size constraint and the need for parking facilities, we decided to put in an automated system to maximise the efficiency of the land and enable more cars to be stored, Lee said.

The system stacks up the cars vertically.

All the office and retail units will be sold but the company will operate and manage the car parking facilities.

This is a pilot project. We will see how it goes and may replicate it to give us a recurring revenue. The branding will be important, Lee said.

The plan is to fix parking charges at RM5 for the first hour and RM1 for every subsequent hour.

The project will have a gross development value of about RM130mil. Construction cost will total about RM70mil.

By The Star

MRCB, IJM Land up news report

Malaysian Resources Corp and IJM Land Bhd rose in Kuala Lumpur trading after the two property developers said they are considering various corporate proposals, responding to a Business Times report they may merge.

Shares of Malaysian Resources rose 1.4 per cent to RM2.15 at 9:05 a.m. local time, set for its highest close since Nov. 11.

IJM Land gained 3.7 per cent to RM3.08.

By Bloomberg

Opposition to changes in property law

VAEA amendments deemed unfair to owners

FOR owners and occupiers of stratified buildings, their biggest concern is whether the building they own or occupy will continue to be managed properly after the strata titles are issued and the management of the property is handed over to the joint management body or management corporation. Buildings that are properly maintained and managed usually are better sought after and can fetch higher capital appreciation and rental.

The maintenance and management of common property in all stratified buildings are governed by three laws the Housing Development (Control and Licensing) Act 1966 (HDA), the Strata Titles Act 1985 (STA) and the Building and Common Property (Maintenance and Management) Act 2007 (BCP).

The three Acts are specific laws relating to the maintenance and management of common properties in a strata scheme.

In all these three acts, the people who can be appointed to carry out the maintenance and management of the common properties are a qualified person or agent (HDA), agents and servants as it thinks fit (STA) and any person or agent (BCP) .

While the three laws do not compel the appointment of valuers to maintain and manage common properties, the proposed amendments to the Valuers, Appraisers and Estate Agents Act 1981 (VAEA) compel all property managers to be valuers.


Datuk Teo Chiang Kok says practically all properties in the country are currently not managed by valuers.

Building Management Association of Malaysia president Datuk Teo Chiang Kok says practically all properties in the country are currently not managed by valuers.

There are tens of thousands of persons engaged by landlords and as managing agents involved in property management. These practitioners collectively have years of experience and have proven track record, expertise and competencies in all aspects of property management, he says in an interview.

But their rice bowl may be affected if the proposed bill to amend the VAEA into the Valuers, Appraisers and Estate Agents (Amendment) Bill 2010 create an absolute exclusivity and monopoly for valuers to be the only ones allowed to undertake property management.


The liberalisation proposed will result in only valuers becoming the controlling parties.

The amendments pertaining to property management are contained in two embedded clauses in the proposed Bill.

According to Teo, these amendments seek to usurp the rights of owners and the Commissioner of Buildings (COB), and conflicts with the intend and functions of the joint management boards as provided for in the BCP (Act 663).

They also usurp the rights of owners and their management corporations and conflicts with the provisions of the STA (Act 318) that allows for the establishment of management corporations, Teo adds.

Teo says the STA and the BCP expressly allow property owners or legally incorporated entities or the developers the rights and responsibility to act as property managers to maintain and manage the properties, and to also appoint managing agents to perform property management and related services.

There is no requirement whatsoever in these Acts that these managing agents must necessarily be valuers, nor are there any related references in this regard in the VAEA.

The Commissioner of Buildings established under Section 3 of the BCP has already been vested with the necessary powers and authority to oversee and regulate property management. The proposed amendments to Section 21 of the VAEA Act would be in conflict with the BCP and the COB, he explains.

Teo points out that the amendments that seek to give valuers the exclusive monopoly to property management and create a closed-shop rent-seeking occupation, are definitely unfair terms of trade which The Consumer Protection Act seeks to prohibit and directly affronts the objectives of The Consumer Protection Act.

The amendments are also in conflict with The Competition Act which seek to ensure the economy and business sector are not distorted in favour of monopolies and oligopolies, he adds.

Teo explains that the inclusion of property management as a function that can be performed by valuers was added into the Valuers Act by way of an amendment in 1997.

The main reason for this introduction was to prevent foreign valuers to practise valuation in Malaysia under the guise as property managers.

We feel the valuers' concept of liberalisation is not altruistic as made out to be, but self-serving. Currently only valuers can be partners and shareholders in valuation firms. The liberalisation proposed is to allow non-valuers to own up to 49% of a valuation firm and only valuers can be the controlling partners or shareholders.

This liberalisation move is to allow valuation firms to grow faster than organic growth by inviting minority investors in preparation for the onslaught of foreign valuation firms coming into the Malaysian market. It is not addressing the multi-disciplinary and inclusive nature of property management, he adds.

Following a meeting between the BMAM members, the Board of Valuers, Appraisers and Estate Agents, Institution of Surveyors Malaysia, and Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia with Deputy Finance Minister Datuk Dr Awang Adek Hussin on Oct 18, all stakeholders involved in property management have agreed to withdraw the proposed amendments pertaining to property management from the Bill and a moratorium imposed on the implementation and enforcement pertaining to property management in the Act.

Teo says this is to allow industry practitioners to carry out a holistic review to develop and agree on a structure that is inclusive, fair, equitable and acceptable to all parties.

By The Star

Developers unfazed by new ruling

KUALA LUMPUR: Most developers participating at the Star Property Fair 2010 are unfazed with the lower loan-to-value ratio imposed by Bank Negara early this month on buyers taking up a third loan on a new house as they believe the new ruling would not significantly impact their bottomline.

The decision to impose the new ruling is to cool down the property market and to curb speculations.

Effective from Nov 3, house buyers who have signed up for two mortgages and intend to apply for a third loan will only be eligible to get up to 70% financing of the value of the house.

The Haven Sdn Bhd personal assistant of principal Yeo Kong Meng said: As a medium to high-end developer, we have not found this new ruling to have impacted our sales so far.

We also don't think this cap on home financing will have a severe impact on our bottomline going forward.

He said many home buyers were already placing at least 20% deposit to book the company's properties, prior to the new ruling.

Yeoh also said 60% to 70% of the company's customers were housebuyers, while 30% bought property for investment. Many of our house buyers have high disposable incomes; paying a higher deposit for their new property is not an issue.

Event manager K.Kalai said the company's main property project The Haven in Ipoh would comprise of three-condo towers built next to a natural lake and had a total gross development value (GDV) of RM230mil.

Tower A is almost fully taken up and is priced at RM338 per sq ft. The price range of a unit starts from RM331,500 onwards, he said, adding that all three towers would be fully built by 2013.

Penang-based Ivory Properties Group Bhd project director Murly Manokaran said property sales had not been impacted at all by the new ruling.

We actually welcome the new ruling, he said, adding that it would ensure that banks had housebuyers who were less likely to default on their loan payments.

Sime Darby Property executive (property division) Rizal Affendy Abdul Latif concurred with the other developers that the new ruling had not impacted sales.

We have so far not experience a slow down in sales due to a higher deposit on a third house. Most housebuyers with an investment intention are prepared for a higher deposit, Rizal Affendy said, adding that Sime Darby's strong reputation on delivering quality homes might have helped ensure sales remained strong.

We are targeting sales of about RM50mil for this fair but it will include following up with enquiries after the fair, he said, adding that the bulk of the house buyers were likely to be first or second-time home buyers.

Plenitude Heights Sdn Bhd executive (sales and marketing) Kevin Ho also concurred that the new ruling should not significantly impact the company's sales.

The uptake of Plenitude Heights properties so far has been satisfactory despite the new ruling, he said.

Rimbunan Raya Sdn Bhd senior manager Moses Ooi Chong Seng said the company was a niche and high-end developer.

Our current project The Enclave, in Perak, is a gated exclusive boutique residential development comprising of 45 bungalows, of which there are only eight units left for sale with price tags ranging from RM1.5mil to RM3mil, Moses said, adding that sales were good despite the new ruling.

By The Star

Association calls for level playing field in property management

PROPERTY management practitioners want an open market and level playing field where the profession will be regarded as an open occupation based on competency, expertise and experience and not by mere legislation or purely by qualification.

According to Building Management Association of Malaysia (BMAM) president Datuk Teo Chiang Kok, if the proposed Bill to amend the Valuers, Appraisers and Estate Agents Act 1981 (VAEA) into the Valuers, Appraisers and Estate Agents (Amendment) Bill 2010 Act and changes pertaining to property management are to be passed, it will create an absolute exclusivity and monopoly for valuers to be the only ones allowed to undertake property management. Entrepreneurs who are now operating as managing agents will all have to wind up their businesses or become employees of valuers.

The two embedded clauses on property management in the proposed Bill will cast the net so wide to include facilities management, building maintenance management, building facilities management, building management and managing agents, he says.

Stressing that legislation compelling and restricting property owners to only appoint valuers to manage their properties has never been imposed anywhere in the world, Teo says property management is fundamentally a general management function like marketing management, sales management and operations management.

It should be an open occupation based on competency, expertise and experience and not by mere legislation or purely by qualifications. Owners either individually, or via company holdings or collectively as in sub-divided buildings, must have the inherent and indivisible rights and freedom to choose whomever they have confidence in to manage, operate, maintain, preserve and enhance their investments in their properties.

Their skills have been honed and recognised by property owners. Many have been head-hunted and gone on to work in neighbouring countries including China, Singapore and Indonesia. Some may migrate and contribute to the country's brain drain, Teo says.

He says that although 95% of the 20 clauses in the Bill to amend the Act covers mostly housekeeping matters, the two clauses are worrisome for BMAM members with regard to their future livelihood.

BMAM has no problem with 95% of the housekeeping clauses but we are opposed to the two clauses that will make property management the exclusive domain of valuers.

An open and competitive environment will ensure best practices and will be the most efficient and best value for property owners and consumers. Valuers must be confident to compete on an equal footing and level playing field. Owners must have the unfettered rights and freedom to choose and engage the best and deserving in a competitive environment, he points out.

BMAM is organising a roadshow and forum to raise awareness on the role and importance of property management, starting with Penang today.

Registered in November last year, the principal members of the BMAM are Real Estate and Housing Developers Association of Malaysia (Rehda), Institution of Engineers Malaysia, Malaysia Institute of Architects, Malaysia Association for Shopping and High-rise Complex Management, Associated Chinese Chambers of Commerce and Industry Malaysia, Malaysian Institute of Estate Agents, joint management bodies, management corporations and managing agents.

Stressing that the association is not against valuers performing in property management, Teo says the members are totally against the exclusivity and monopoly to be created solely for valuers.

Our main basis of objection is that property management is a multi-disciplinary occupation and valuers are not the only persons competent and qualified to perform property management. Property management partnerships and entities should be open to all disciplines without limitations that only valuers must be the controlling partners or shareholders.

Being a multi-disciplinary management function, he says property management encompasses a wide range of activities from operations, leasing, maintenance, credit control, safety and security to engineering.

Teo points out that different types of buildings require different emphasis of property management skills.

The demands and skills required for a shopping centre are very different from a medium-cost condominium. No one profession can fulfil all the needs of property management. Allowing free competition will promote greater competency and efficiency in the industry, he says.

By The Star (by Angie Ng)

Growing appetite for investments

Medini is a mixed-development comprising three clusters – lifestyle and leisure, cultural and Iskandar financial district in Iskandar Malaysia, Johor. The three clusters are pivotal to the whole development of Nusajaya City.

Investors still committed to Iskandar Malaysia despite downturn, says Millennium Development

MILLENNIUM Development chairman Oussama Kabbani, whose company is involved in the development of Iskandar Malaysia, says the success of the growth corridor is its proximity to Singapore.


Oussama Kabbani ... ‘We are in a position to make the best of this recovery.’

Once the bullet train to Singapore becomes a reality, it will be possible to time one's journey to the city state. Even if it is delayed, it will happen. And the same goes for Medini, says Harvard-trained urban planner Oussama who was in Kuala Lumpur recently.

Medini is a mixed-development comprising three important clusters namely lifestyle and leisure, cultural and Iskandar financial district in Iskandar Malaysia, Johor. The three clusters are pivotal to the whole development of Nusajaya City.

When we first came three years ago, there was no housing, no Kota Iskandar, no shopping centres. In the last three years, the change has been unbelievable. Now there is warehousing and industries. Despite what the world economy has gone through, commitment from investors is still there. The world's appetite for investment is rising. We are in a position to make the best of this recovery, says Oussama.

Millennium Development is a member of Saraya Holdings, a Middle Eastern real estate development company. Its expertise is in development management services.

The company undertakes work on behalf of developers and investors in real estate. Essentially, they set up the development strategy and undertake all the work done by a developer.

The only difference is the investment does not come from Millennium Development but from the investors, which can be the Government or private sector.

Oussama says Millennium Development offers clients a portfolio of services which includes business development, urban planning, architecture, finance, marketing, legal and construction management.

We are only the catalyst. If you go through the check list, all the right factors are there, the location and the government support, among them.

How demand is created from abroad is a question of influence, he says.

Many projects sank during the recent economic crisis but Medini grew greater. The fundamentals are there. In a year or two, things will be coming up. LegoLand, the housing community, he said.

Oussama said credit goes to the investors and public-private initiatives, adding that where there is population and growth in wealth, there will be increasing aspiration for better social infrastructure and this is where Millennium Development adds value.

Southeast Asia is ripe for that. There is demand and big apirations but these aspirations are not limited to this region alone. The same is happening in China, the Middle East and Africa.

On the various development projects that are being undertaken around Kuala Lumpur by the Government in various public-private enterprises, Oussama said when one builds, one has to bear in mind that one is building for generations.

You have to be careful and creative about many things; the timelessness, a place of different incomes, all of which are timeless factors that make cities what they are. And they must be memorable.

By The Star

Flux in world economy affects everyone

These are interesting times. This has been said before, and will be said again at each fall and rise of the economic cycle.

But the enigma today is not so much whether it is a fall or a rise in the economy, but in the rebalancing of economies around the world. One may ask, how would that affect us in Malaysia? Lots.

Whether it is a 30-something looking for his first home, or a middle-aged person planning for retirement, the flux in which the world economy is in today affects everyone.

Let's go into the big decisions, not the details of how much your cup of coffee costs today. A 30-year-old looking to own his first property will wonder whether it is time to buy. The low interest rates are in his favour, but spiralling house high prices are not.

In the stock market, there stock prices are trending upwards. To place all of one's money in the bank seems folly at this point. Or is it, really? Let's lay some cards on the table to better gauge the situation.

The West is on capital preservation mode, while we in the East, are on growth. The United States and Britain are embarking on printing more money to help lift their economies and reduce unemployment.

But in Asia, the property markets of Hong Kong, China, Singapore are so hot that the respective governments are putting measures to chill these markets.

Bank Negara did the same recently when it imposed a 70% loan-to-value cap for third and subsequent housing loans. These measures will, in all likelihood, work only partially.

> Asia is the place to be in at this point in time. With the United States embarking on a second round of quatitative easing effectively flooding the economy with more dollars this flow of funds are expected to arrive on Asian shores to benefit from Asia's vibrancy and growth. The first round was its various stimulus packages after the fall of Lehman Brothers in late 2008.

This means by next year, there may be huge flow of funds into Asian economies, effectively pushing up stocks and properties. We may be seeing the tiny seeds of that exuberance germinating today.

It started with the property market in the last quarter of 2009 and now stocks are also trending upwards. Are valuations fair? If it is the beginning of a bull run a huge IF then maybe.

> Get your cash ready. You may want to cash in on the uncertainty ahead.

So despite the volatility, consider the accelearation, be it both stocks and properties. That does not mean there are no challenges ahead. If anything, with the rebalancing of the economies in the different regions, massive uncertainty exists.

In fact, fund managers and bankers are very cautious about what's around the corner and also about next year, despite the strong performances in Asian stocks and the property market today.

The various capital controls and measures by governments in this region all point to these uncertainties and challenges ahead.

Given these trends, volatility is expected. The same for uncertainties. That does not mean stock valuations are not fair. Or that houses are over-priced.

In some locations, it is over-priced. The funny thing is, there is demand for it, particularly for certain types of properties.

Don't throw caution to the wind and don't follow the herd instinct. Whatever goes up very fast, also comes down very fast, particularly if prices are pushed up by inflows from the West. They enter a region quickly and exit just as fast.

> Consider how much you are ready to lose, not how much you can make.

You are tired of renting and there is a real need for that house. First, choose where you want to stay. That's the location. Secondly, what type of residential units will you be comfortable in.

If your financial position allows you to get your dream home, then you may want to work towards that. You may have to forgo changing your car. A property is a long term purchase.

> Be it a house or stocks, buy on value, and need. Nobody knows how long this state of uncertainty this rebalancing of economies is going to last. Or when the fragile situation in Western economies will take a turn for the worst and affect the exuberance that exists in Asia today.

As property professionals and economists generally say: You don't know a bubble exists until it bursts. Until then, it's a bull run. Hang on to the safety bar when you go on the roller coaster. These are interesting times.

Assistant news editor Thean Lee Cheng thinks there's something to be made and to be lost in the coming days.

By The Star

Malaysia Pacific, S. Korean firm in Iskandar green city project pact

MALAYSIA Pacific Corp Bhd (MPC) has signed a memorandum of understanding (MOU) with South Korea's information technology firm LG CNS for a green city project in Iskandar Malaysia.

The MOU is to promote and develop a long term cooperation and collaboration for the Lakehill Resort and Aptec "Smart Green City" related projects in Iskandar Malaysia.

LG CNS offers IT consulting, system and network integration and outsourcing services.

The green city park will enable the services of LG CNS to be used as a strategic planner in providing information and communications technology related services in design construction and maintenance of the Smart Green City project.

However, the details and scope of the project will be determined via mutual agreement at the time of the contract which will be approved by the board of directors of MPC and LakeHill Resort Development Sdn Bhd.

MPC in a statement to Bursa Malaysia yesterday said the MOU will be effective for six months from the date of the signing and can only be renewed if both parties agreed to do so.

By Business Times

Hong Kong announces measures to cool property mart

HONG KONG: Hong Kong's government on Friday unveiled its latest attempt to cool the red-hot property market, amid public anger at spiralling prices and fears highlighted by the IMF of a real estate bubble.

Financial Secretary John Tsang announced a sliding scale of new stamp duties to take effect midnight Friday aimed at restraining what he called "short-term speculative" inflows into the glitzy financial hub's property market.

"These are extraordinary measures under exceptional circumstances. Our aim is to curb short-term speculative activities and to reduce the risk of any asset bubble," Tsang told journalists.

The densely populated city of seven million is famous for its sky-high residential rents and super-rich tycoons. It notably attracts wealthy buyers from mainland China looking for a relatively safe place to invest with high living standards.

But the International Monetary Fund this week urged Hong Kong to rein in soaring prices, amid fears that overheating is spreading from high-end luxury properties to the general market.

Under the levies outlined by Tsang, anyone reselling a property within six months of purchase would be subject to a hefty 15 per cent stamp duty. A 10 per cent duty would apply to sales within six-to-12 months and five per cent to sales within 12-24 months.

Luxury home values in the former British colony recently topped their pre-1997 Asian financial crisis peak, according to government data released in October.

Friday's announcement marks the latest in a series of measures already taken to cool the ever-expanding market.

Stamp duty on luxury property was hiked by half a percentage point in April to 4.25 per cent, while a number of government land auctions have been held to increase supply.

But prices have crept ever higher, and are up 20 per cent in the past year.

The IMF warned in a report on Thursday that, "depending on the amplitude of the upswing, the resulting downturn could prove both protracted and painful".

Concerns have been amplified after the Federal Reserve unveiled a massive stimulus package to kick-start the US economy, raising fears that a flood of speculative money could overheat Hong Kong's volatile asset markets.

The Hong Kong dollar is tied to the greenback, although the IMF reiterated its support for the city's currency system, calling it a "robust anchor of monetary and financial stability".

Earlier this month, the city's biggest realtor, Centaline, recorded the highest commercial property price per square foot in Hong Kong's history.

A 79th floor unit in The Centre - a downtown skyscraper owned by Hong Kong's richest man Li Ka-shing - sold for HK$338 million (US$44 million), or about HK$25,580 a square foot.

Homes with a price tag of at least HK$20 million have surpassed previous highs for both the number of transactions and total sale proceeds, Centaline also said.

Spillover into the lower-end property market, where the vast majority of Hong Kong people live, has seen prices creep ever further beyond the reach of average incomes.

In October, Hong Kong's leader announced a halt to automatic residency for wealthy property buyers, in a move that analysts said was aimed squarely at cash-rich investors from mainland China.

At a rowdy legislative session that was dogged by about 200 protestors denouncing high property prices, Chief Executive Donald Tsang said: "Housing is currently the greatest concern of our people."

By AFP

Sunway unit gets RM14.7m deals

SUNWAY Holdings Bhd's associate, Sunway Geotechnics (M) Sdn Bhd, has accepted contracts worth RM14.7 million at Bandar Springhill, Port Dickson, Negeri Sembilan.

The first contract from UCSI Education is for piling and pilecap works for the Medical Centre and Faculty of Medicine UCSI University for a block of 12-storey hospital, one block of two-storey M&E complex and one unit of guard house.

The second from UCSI Resort includes piling works for the construction of a 17-storey hotel with 319 units, 14-storey student hostel with 390 units, a single-storey restaurant and swimming pool and a three storey car park.

The medical university should be completed on March 21 2011 while the hotel is expected to be ready on February 27 2011.

By Business Times

Making Penang more connected, liveable

The concerns of Penang's business community were raised last night during a gathering of the island state's captains of industry, where issues relating to Penang's infrastructure, talent pool and a liveable environment were highlighted.

"If Penang is not to lose its manufacturing sector and de-industrialise, we need to seriously think about making this place more connected and more liveable.

"By focussing on attracting foreign direct investments alone is not enough, for all high-income economies are dependent on both capital and a highly-mobile talent," Malaysian International Chamber of Commerce and Industry northern region) chairman Datuk Seri Nazir Ariff Mushir Ariff said during the chamber's annual dinner at G Hotel in Penang.

Founded in 1837, MICCI is the oldest private sector business organisation in Malaysia and today boasts a base of close to 1,000 corporate members.

The chamber traces its history from the formation, in 1837, of its ancestor, The Penang Chamber of Commerce and Agriculture.

Stating that it is not a coincidence that the biggest and brightest stars in the high income bracket are all city-regions where business can be conducted easily and comfortably, where talented workers are spoiled for choice in schools and healthcare centres for their families, where local culture is vibrant, Nazir pointed that these cities are usually home to world-class research centres and universities.

"Successful city regions," he added, "also specialise and this means that Penang does not need to become a replica of Hong Kong, Singapore or San Francisco to succeed."

"We should cut the cloth according to our size. We can achieve a good standard of living for our own people and at the same time attract talent and capital to achieve sustainable growth.

"The first step, however, is to get our house-in order."

He said if Penang is serious about becoming a habitat of choice for business, it was imperative for the state to "look and feel like a habitat that works."

"And here," Nazir noted, "the State Government's "Cleaner Greener" initiative needs more pith.

"There is no need to go through the list of things that need to get done. Suffice it to say that the clock is ticking and if we are to secure future growth, we have to make our cities more connected and liveable."

By Business Times

Atlan sells land for RM145m

ATLAN Holdings Bhd has sold seven pieces of land in Penang measuring 24.7ha to Utara Malaya Realty Sdn Bhd for RM145 million cash.

In a statement yesterday, Atlan said its wholly-owned subsidiaries Blossom Time Sdn Bhd and Radiant Ranch Sdn Bhd sold the land as part of its business strategies.

"The directors have decided to sell as opposed to continue with its original development plans for the land after taking into consideration the estimated time frame and resources required to develop the land over the next five years given the competition of other developments within the vicinity."

The sale will enable the company to realise proceeds of RM145 million and an estimated after-tax gain of disposal of about RM80 million.
The proceeds will substantially be utilised for the repayment of bank borrowings and working capital of the Atlan Group which is expected to result in an interest saving of RM8 million an annum.

By Business Times

Brem Holdings in pact to buy land

BREM Holdings Bhd’s 75 per cent owned unit, Harmony Property Sdn Bhd, has agreed to buy two parcels of 33.28 acres vacant land from Pembinaan Tegas Megah Sdn Bhd for RM69.5 million.

The land in Setiawangsa, Kuala Lumpur, has positive residential property development potential and is part of its plan to
accumulate strategic landbank.

By Business Times

Comprehensive plan needed to revive JB

An aerial view of Johor Baru city centre. Visitors used to stop by before the opening of the CIQ complex.

Opening of new immigration complex and shifting of govt offices left city centre deserted

JOHOR BARU: Comprehensive planning is needed to ensure the Johor Baru city centre transformation succeed together with strong political will and concerted efforts from various parties.

Views from property developers, owners, businesses, non-governmental organisations, town planning experts, chambers or commerce and Johor Baru folk must be taken into account in drawing up the urban renewal plan.


Prof Ahmad Nazri Muhamad Ludin ... ‘It is vital to rejuvenate Johor Baru.’

It is vital to rejuvenate Johor Baru into a vibrant city as it has lost its appeal,'' said Universiti Teknologi Malaysia dean in the Faculty of Built Environment Prof Ahmad Nazri Muhamad Ludin in an interview.

Under the 10th Malaysia Plan, some RM1.8bil will be allocated under the transformation plan with the Iskandar Regional Development Authority and the state economic planning unit as the project's facilitator.

Many blamed the opening of Bangunan Sultan Iskandar Customs, Immigration and Quarantine (CIQ) complex at Bukit Chagar in 2008 as the reason why the city centre is now deserted.

Prior to the opening of the CIQ complex, motorists and visitors especially Singaporeans and locals working in Singapore entering Johor via the old CIQ would stop at the city centre to change money and patronise the eateries.

But the traffic now has been diverted to Jalan Tebrau and Stulang Laut, hence money changers and eateries in the two areas enjoyed brisk business.

He said the shifting of state government offices to the state's new administrative centre of Kota Iskandar in Nusajaya in 2009 from Bukit Timbalan here made matters worse.

Lunch crowds especially office workers have declined and the public dealing with the government offices now have to go to Nusajaya,'' said Ahmad.

He said unlike Kuala Lumpur, after the federal offices moved to Putrajaya, it still has contents such as Jalan Tuanku Abdul Rahman, Jalan Petaling, Jalan Chow Kit and Central Market to attract crowds, but not Johor Baru.

Ahmad said people did not see a need to come to the city centre as its suburban areas were also developing; in fact Johor Baru has more vibrant suburban neighbourhoods than the city centre itself.


Samuel Tan Wee Cheng says that opening up Sungai Segget is the right move.

KGV-Lambert Smith Hampton director Samuel Tan Wee Cheng lauded the plan to redevelop the former sites of Lumba Kuda and Bukit Chagar low-cost flats in the same way as KLCC.

He said the development should include high-rise condominiums and serviced apartments as these could attract Malaysian professionals working in Singapore and expatriates based in the republic.

The sites' close proximity to the CIQ and the proposed extension of the MRT line from Singapore to Johor Baru Sentral are the good selling points to attract buyers,'' said Tan.

He said incentives should be given to property owners in the form of soft loans to upgrade their rundown properties in the city centre as the upgraded properties could fetch better rental returns for owners.

Tan said these properties could be turned into boutique hotels, specialty retail stores, food and beverage outlets as well as offices like in Singapore's Arab Street, Emerald Hill, Joo Chiat and Tanjung Pagar areas.

He said opening up Sungai Segget which flows alongside Jalan Wong Ah Fook in the city centre was the right move as water elements would bring back life and soul to the area.

Under the transformation plan, RM200mil will be spent to clean up Sungai Segget, one of the dirtiest rivers in the country with its reputation for being a dumping ground for raw sewage; RM6mil was spent several years ago to cover the stretch.

Southern region representative of Malaysian Association for Shopping and Highrise Complex Management Jenny Chan said old parts of Johor Baru city should be preserved in the renewal plan.

She said Johor could learn from Malacca and Penang in retaining and preserving old buildings in Jonker Street and George Town.

Chan said old buildings within the enclave of Johor Baru city might not be as old as those in Malacca or George Town but still worth preserving them due the uniqueness of the faade such as art dcor and neo-classical designs.

A vibrant city should be a blend of the old and the new. Look at London and Istanbul where the two elements blend well in the two cities attracting tourists from all over the world,'' said Chan.

She said regulat street performances, arts and culture activities, al fresco hawker centre could attract crowds back to the city centre after office hours and weekends and it was high time for Johor Baru to have its own Central Market like in Kuala Lumpur.

By The Star

Paramount seeks to buy land after stake sale

Developer eyes Klang Valley land as it wants to ride on ETP

KUALA LUMPUR: Paramount Corp Bhd is going on a land acquisition spree in the Klang Valley following its sale of a 20% stake in Jerneh Insurance Bhd for RM130.8mil.

The company is expanding its land bank as it is positive on the Government's plan for greater Kuala Lumpur under the Economic Transformation Programme (ETP).


»Land is getting scarce, hence the new pieces of land we are looking to buy will be smaller. So we will have to build high-rise homes« ONG KENG SIEW

Land is getting scarce, hence the new pieces of land we are looking to buy will be smaller. So we will have to build high-rise homes, managing director Ong Keng Siew told Starbiz after Paramount EGM.

At the EGM, shareholders unanimously approved the sale of Jerneh to Ace Ina International Holdings Ltd.

Of the proceeds, Paramount plans to use RM36.19mil to pay a special dividend of 40 sen per share, which will be given within three months after completion of the disposal.

After minusing the estimated expenses for the proposed disposal, the remaining RM90.31mil will be used to buy land in the Klang Valley for property development purposes.

Executive deputy chairman Datuk Teo Chiang Quan said the company would also use some of its cash for land acquisition purposes.

Paramount has RM235.47mil cash as at Sept 30 versus RM50.59mil in borrowings.

Teo is positive on the outlook of the property sector, especially if infrastructure plans under the ETP are properly carried out.

If the authorities are determined to make Kuala Lumpur a world-class city and implement the mass rail transport system and high-speed bullet train, this will be very good for the country.

Imagine if there is a bullet train linking Kuala Lumpur and Singapore, where properties are 10 times more expensive than ours. With good accessibility, properties in KL will be greatly enhanced, Teo said.

He added that there was pent up demand for good properties in Kuala Lumpur now.

He cited an example where last month, 125 Paramount homes in Kemuning Utama, Shah Alam, with prices starting from RM520,000 were snapped up within two hours.

Property upgraders are looking for more sophisticated homes that are gated and guarded. That is why you see prices for such homes holding very steady, said Teo.

Earlier in the week, Paramount announced its third-quarter results to Sept 30 which saw its revenue dropped 11.93% to RM98.29mil while net profit rose 32.65% to RM21.59mil.

For the nine-month period, revenue increased 9.64% to RM329.34mil while net profit improved by 45.89% to RM63mil.

The higher net profit was attributed to the overwhelming response to its property launches and better progressive billings.

Teo said Paramount was now setting up an international school using British syllabus in Kota Damansara.

The school is scheduled to open in September 2011 and will have 600 students.

We already have 400 students registered for this curriculum. We will also offer Baccalaureate Diploma Programme for students in year 12 and 13, said Teo.

Meanwhile, Ong said a new KDU College campus would be constructed in Glenmarie.

Paramount plans to launch a 200ha mixed-development project, Banyan Hills, in Sg Petani, Kedah, by the first quarter of 2011.

The company has also bought a 20ha freehold land in Cyberjaya for RM78.4mil from Cyberview Sdn Bhd.

It plans a mixed and mid-upper to high-class guarded residential properties and high-rise condominium with a gross development value of RM530mil there.

By The Star

MRCB, IJM Land shares rise after merger talk

Shares of Malaysian Resources Corp Bhd and IJM Land Bhd perked up amid a weak broader market yesterday after a popular finance blog speculated on a possible merger.

The rise comes as retail investors have become more active in the market recently. Last month, they accounted for almost half of the volume traded.

IJM securities, namely the mother share and the warrants, were among the top 10 most-actively traded securities yesterday.

The mother shares gained 5.5 per cent, or 15 sen, to close at RM2.89, its highest in 40 months. The warrants were up by 16 sen to RM1.78, a record close.

Meanwhile, MRCB , the master developer for the KL Sentral development in Brickfields, ended the day 9 sen higher at RM2.10 with more than 11 million shares traded.
The Malaysia-Finance Blogspot, under a post headlined "Does a MRCB-IJM Land merger make sense?", noted that "the word had switched from an IJM Land privatisation to a merger with MRCB. Something along the lines of a UEM Land-Sunrise deal it seems".

Early this month, UEM Land Holdings Bhd launched a RM1.4 billion conditional takeover offer for Sunrise Bhd.

But the price gains also indicate that financial-based blogs are becoming more influential, at least among the smaller retail investors.

Last month, another blog said that MMC Corp Bhd had made a bid to take over the UEM Group. MMC shares rose to a 27-month high on October 5 after it confirmed interest in UEM.

Jupiter Securities head of research Pong Teng Siew said financial blogs are increasingly gaining momentum in the marketplace due to renewed retail interest in equities.

By Business Times

Good property buys and special offers await visitors

KUALA LUMPUR: Top property developers from around the country will showcase their most attractive residential projects at the Star Property Fair 2010, which opens on Friday at the Kuala Lumpur Convention Centre here.

Developers including Ivory Properties Group, Sime Darby Property, SP Setia, CapitaLand, Mah Sing Group and the Naza Group will have innovative booths to reflect the theme “Stylish Living II” and showcase their newest living concepts.

Visitors to the fair will not only pick up good buys but also be rewarded with special offers if they sign up for a property during the three-day event. For example, buyers of the Sastra U-Thant joint-venture project between CapitaLand and Juta Asia Properties Sdn Bhd will be given two return air tickets, two-night hotel stay plus S$2,000 (RM4,800) worth of vouchers for a shopping spree in Singapore.

CapitaLand Commercial marketing vice-president Catherine Yao said the offer was in conjunction with the CapitaLand Group’s 10th anniversary celebrations in Singapore.

It will only be valid for buyers at the Star Property Fair 2010.

There are over 130 booths showcasing landed properties as well as high-rise residential developments.

Visitors may also sit in for talks by world-class architects and designers such as Bali-based Karl Princic and Steve Leung from Hong Kong on luxury development and modern contemporary design.

There will also be presentations by local experts such as Feng Shui master Prof David Koh, Vastu Shastra master T. Selva, interior designer Eric Leong, real estate consultant Milan Doshi and investment advisers Kevin Cheong and Peter Chan.

Admission to the fair – open from 11am to 7pm – and talks are free. Visitors can also obtain advice on financing options from participating financial institutions.

Besides properties offered by developers, there will be auctions by CIMB Property Mart.

Buyers trying to locate properties available in the secondary market can use the services at the StarProperty.my portal section.

By The Star

Paramount net rises

PARAMOUNT Corp Bhd, a property developer, said its net profit for the third quarter to September 30 was up 33 per cent due to higher profit margins and contribution from the new Surian Industrial Park development.

Revenue was RM98.3 million compared with RM111.6 million in the corresponding period last year due to lower progressive billings.

Given the buoyant property market and the lock-in unbilled sales brought forward, the company is confident of a better performance this year.

In addition, it expects to realise gains from its disposal of a 20 per cent stake in Jerneh Insurance Bhd.

By Business Times

Rising building material, labour and hidden costs main concern for Johor developers

JOHOR BARU: Escalating prices of building materials, higher manpower costs due to shortage of labour as well as hidden costs are among the main concerns of property developers in Johor.

KSL Holdings Bhd executive director Ku Hwa Seng said these problems did not just apply to Johor. He believes that developers nationwide also faced similar predicament.

He said the infrastructure projects outlined in the 10th Malaysia Plan (10MP) and Budget 2011 would further push up prices of building materials and labour costs in the next five years.

“The demand for residential properties in Johor, especially in the Johor Baru district, has improved as the economy gets better but developers might have problems kicking off new launches,’’ Ku told StarBiz.


Ku Hwa Seng says infrastructure projects outlined in 10MP and Budget 2011 would further push up prices of building materials and labour costs in the next five years.

He said building materials prices had increased between 10% and 15% in the last 12 months while labour costs had risen by 50%, compared with two or three years ago.

Ku said that shortage of labour was still the main problem for construction companies.

Mahabuilders Bhd group chairman Mustapha Hassan said while the increase in the prices of building materials was relatively stabilised, the same could not be said for the labour costs.

“Like it or not, we still need foreigners to work at project our sites, locals are not interested or else many projects will be delayed not only the ones by the private sector but also by the public sector,’’ he said.

Mahabuilders is among the few in Malaysia specialising in acquiring and reviving abandoned property projects and labeled as a white knight the construction industry.

Among the company’s revived projects to date include Taman Baiduri Johor Baru, Skudai Villa, Indera Wangsa Larkin, Senai industrial park and Pandan City Johor Baru.

By The Star

Glittering night for developers

Property Man of the Year 2010 Datuk Alan Tong Kok Mau (holding trophy), group chairman of Bukit Kiara Properties, sharing a light moment with Yang di-Pertuan Agong Tuanku Mizan Zainal Abidin. Looking on are organising chairman Datuk Robin Tan Yeong Ching (left) and FIABCI Malaysia president Yeow Thit Sang (right).

PETALING JAYA: It was a glittering and memorable night last Thursday when the best of the country’s property developers were honoured at the Malaysia Property Award 2010.

Amid the glitz and glamour of the event was a strong message to property developers that profits aside, going “green” is not only the way forward but also will be the future demand for residential and commercial properties globally, including in Malaysia. The two most-talked-about issues were sustainable property developments and caring for the environment.

The highlight of the night was centred on the winner of the “Property Man of the Year Award 2010” Datuk Alan Tong, who is also dubbed Malaysia’s Condo King.

“Winning this award is an acknowledgment by the panel of judges that hardwork pays. As a property developer, I believe that being diligent, transparent and having consideration for property purchasers are the most important traits of any good developer,” he said.

Tong received the prestigious award from the Yang di-Pertuan Agong Tuanku Mizan Zainal Abidin, who graced the event at The Shangri-La Hotel in Kuala Lumpur in a glittering ceremony attended by local and foreign guests.


From left: See Hoy Chan Holdings group director Datuk Teo Chiang Kok, Star Publications (M) Bhd group managing director and chief executive officer Datin Linda Ngiam and Malaysia Property Award 2010 judge Datuk Ng Poh Tip.

The nine other winners of the Malaysia Property Award 2010 included Sunway City Bhd’s Sunway City Ipoh for the Master Plan category; Coronation Springs Sdn Bhd’s Springtide Residences in Tanjung Bungah, Penang (Residential Development – High Rise); SP Setia Bhd’s Precinct 3, Setia Eco Park in Shah Alam, Selangor (Residential Development – Low Rise); Sunway Pyramid Shopping Mall Expansion in Bandar Sunway, Selangor (Retail Development); and Quill group’s Quill 7 in KL Sentral, Kuala Lumpur (Office Development).

The other winners are The Westin Langkawi Resort & Spa, Langkawi, Kedah (Hotel Development); Cahaya Jauhar Sdn Bhd’s Kota Iskandar (Phase 1) in Nusajaya, Johor (Public Sector); Gloharta (M) Sdn Bhd’s Bunga Raya Island Resort & Spa in Kota Kinabalu, Sabah (Resort Development) and Gamuda Bhd’s Stormwater Management and Road Tunnel (SMART) (Special Award for National Contribution).

Winners of the MPA in their relevant categories will represent Malaysia the following year at the International Prix d’Excellence, an annual competition that honours the world’s best property projects.

SunCity property investment managing director Ngeow Voon Yean said bagging two awards in the FIABCI Malaysia Property Award 2010 was a recognistion of all the hardwork and dedication of the Sunway Group staff.

Quill group executive director Datuk Michael Ong said: “We are delighted to have won the award. It has been a long journey for us,” he said. The property developer won the award for its magnificent 30-storey office tower set in the heart of KL Sentral, Malaysia’s largest transit hub – QUILL 7.

The International Prix d’Excellence is an annual competition which honours the world’s best property projects.

The 2010 Malaysia Property Award was organised by FIABCI Malaysia with Malayan Banking Bhd as the official sponsor.

By The Star

Melati Ehsan looking for land outside prime areas

MELATI Ehsan Holdings Bhd is on the lookout to buy more land to develop a range of mix property development including condominiums and shoplots.

Its sales and marketing manager Tan Lai Huat said the company is scouting for land in not so prime areas in the Klang Valley.

"Unlike other developers, our target market is for a different segment of people. Hence, we go and look for land in not so prime areas as we feel that we can cater to a different market," Tan said at the launch of the show units of Laman Bayu in Kota Damansara yesterday.

Melati Ehsan has so far completed eight projects in Kota Damansara, which were mainly residential areas like semi-detached homes and bungalows.
Besides Laman Bayu, it is also developing a project in Kota Damansara comprising 90 terrace houses and 12 semi-detached units. It will be completed by the end of next year.

The company also plans to launch a new project at Bukit Tengku in Section U10 in Shah Alam, Selangor comprising 133 units of two-storey bungalows to be priced between RM5 million and RM6 million each.

"Although there has been some revisions towards the bank loan whereby third homeowners are only allowed loans up to 70 per cent of the amount, we believe it will not affect the sales of our new projects as most of the buyers for our projects are upgraded young families," Tan said.

By Business Times

One of its kind Hayman

It is a bit of a coup for Mulpha Australia Ltd to have come to own Hayman Island, located off the east coast of Queensland in the Whitsunday Island group in Australia.

Of these group of islands, Hayman is closest to the Great Barrier Reef and is made up of a lush green sub-tropical forest. The island has an award-winning resort, simply called Hayman and is also owned and operated by Mulpha Australia.

Hayman is marketed as a private island destination, considering that it is the only resort on the island and will remain so, and seems to cater to the well-heeled.


Shane Green

For example, Hayman’s soon-to-be-launched private beach villas, which will boast dedicated butlers and a private pool, are being offered at whopping A$1,350 per night. Bookings for the first month are close to be fully taken up, says Shane Green, the resort’s general manager.

Mulpha Australia (a wholly-owned unit of Mulpha International Bhd) bought Hayman in 2004 as part of a portfolio of hotels offered by the Principal Hotel Group.

Green, who came on board in July, says plans are under way at “taking Hayman to the next level” by reinvesting money to upgrade current facilities at the resort.

“We’re looking at giving the visitor a new level of experience, with a focus on the spa and relaxation, a sort of re-imagination of Hayman if you like,” he says. Green is quick to add the changes would make use of the existing infrastructure of Hayman and that the refurbishment work would be completed in 24 months.

According to Lloyd Donaldson, the head of hotel investment for Mulpha Australia, the company is investing between A$20mil (RM62mil) and A$30mil into Hayman, of which A$5mil has already been mostly spent on the eight new beach villas which are coming onstream on Dec 10 this year.

Hayman has 212 rooms, consisting of suites, penthouses and beach villas.

More importantly, Mulpha Australia has secured the necessary approvals for building 42 private homes on Hayman. To be noted is that about 75% of the island is made up of a national park and so cannot be developed.

Hence, the 42 homes carry a sort of exclusivity premium. Adding that to the fact that these homes will have wide oceanic views, it’s no wonder these houses are being priced between A$15mil and A$20mil.

So far, three such houses have been sold and few more are close to being sold. The first house is about to be delivered to its new owner.

Green, an experienced hotelier, whose last postings were in the United States where he oversaw the development of major resorts and upscale residential projects in Los Angeles, Miami and Las Vegas, said that to ensure consistency of design and aesthetics, all the homes to be built on the island will have to be designed by the Kerry Hill architectural firm.

Kerry Hill is also the designer of Hayman’s new beach villas and also of Mulpha International’s planned luxurious bungalows in Bukit Tunku, Kuala Lumpur.

By The Star

Mulpha's embedded values

An aerial view of Sanctuary Cove, a resort-styled property development by Mulpha.

PROPERTY developer and investment firm Mulpha International Bhd (MIB) has come to be better known in Australia than in Malaysia, says its executive chairman Lee Seng Huang.

"Due to the quality of our assets Down Under, we are better known in the financial and property circles there," he says in a recent interview with StarBiz.

"In Malaysia, MIB suffers from legacy issues and is still perceived by some as being a trading company. But we have moved on to be a regional player. MIB is the largest Malaysian property player in Australia today," he says.

MIB's Aussie property portfolio (owned by its wholly owned subsidiary Mulpha Australia Ltd) is today worth around A$1bil (RM3.1bil), says Lee. The prized assets include a few five-star hotels such as the InterContinental Sydney, a resort-styled property development called Sanctuary Cove in northern Gold Coast that has a gross development value of around A$2bil (RM6.2bil) and Hayman, a five-star private island destination in Australia's Great Barrier Reef.

Topping all that is MIB's 25% stake – making it the single largest shareholder – in FKP Property Group, Australia's leading property investment company. The Australian-listed FKP is also the largest private sector owner-operator of retirement villages in Australia and New Zealand.

All these assets were acquired by Mulpha Australia between 2002 and 2004. FKP and MIB were recently in the news in Australia over rumours that FKP's second-largest shareholder, Stockland, itself a leading Australian property developer, could be seeking to take over FKP.

Lee says MIB is not keen on selling its shares in FKP as there is still a lot of upside potential in the latter. Talk of the takeover is said to have led to the slight increase in FKP's share price in recent weeks, pushing it up to around 90 Australian cent a piece.

Interestingly, MIB's 25% stake in FKP alone has a market value of A$275mil (RM855mil). MIB's other significant strategic stake in a listed company is its 22% holding in Mudajaya Group Bhd. MIB's Mudajaya stake has a market value of some RM350mil.

Combined, these stakes are worth around RM1.2bil, which is close to the market capitalisation of MIB of RM1.27bil at today's prices.

"There is a lot of embedded value in MIB," says Lee.

UBS Malaysia, in a recent note to clients, commenting on the potential bid for FKP by Stockland, highlighted the fact the MIB seems to be undervalued. "MIB looks undervalued currently. Its market capitalisation is around RM1.27bil, which is almost equivalent to its stake within FKP and Mudajaya, hence everything else comes free," UBS said.

However, it should be noted that MIB has slightly over RM1bil in debt. Still, that debt level has not been a concern for MIB because of its huge asset base. In any case, those assets that are seemingly "free" to MIB investors, are looking rosier by the day. In Australia, MIB is poised to pocket over A$100mil (RM309mil) if the sale of its Hilton Airport Melbourne hotel goes through.

Lee has confirmed that the hotel had been put up for sale and that the compay is in advanced talks with potential buyers but he declined to comment on pricing. News reports in Australia had put the figure at about A$100mil.

MIB's Hayman resort is also enjoying a new income stream from the sale of a few plots of land on the island as exclusive holiday homes.

Lloyd Donaldson, head of hotel investment for Mulpha Australia, said the company had secured the necessary approvals to build 42 homes on Hayman Island. So far three have been sold at prices from A$15mil (RM46.4mil) to A$20mil (RM61.4mil), depending on the size of the house. These prices are believed to be a record high for holiday homes in Australia.

Then there's the Sanctuary Cove, which was acquired by Mulpha Australia in 2002 for A$208mil (RM644mil). According to Sanctuary Cove executive general manager, Alison Quinn, more than A$60mil (RM186mil) of property sales were achieved in the first half of 2010.

MIB also has Leisure Farm Resort, it's prized Malaysian asset, a vast award-winning resort-styled residential development in Johor. Leisure Farm is strategically located within Iskandar Malaysia and is only a 15-minute drive from Tuas in Singapore via the second link.

Leisure Farm reported a rise in profits in the first half of 2010 to reach RM8.6mil from RM2.2mil in the previous corresponding period.

According to MIB, sales of its Bayou Water Village (one of its seven themed residential precincts) increased after its completion in the last quarter of 2009, with 18 of such units having been sold in the first half of this year.

Analysts also say that Leisure Farm is likely to benefit from the fact that since early this year, Malaysia and Singapore have agreed to cooperate on the development of Johor.

MIB has another 600 acres of land in Leisure Farm to develop.

Back to Australia. To be noted is the fact that MIB has had to equity account for losses stemming from writedowns of its Australian assets, mainly FKP. This is because under all assets are required to be marked to market under Australian accounting rules. Hence when the global financial crisis hit, the values of MIB's and FKP's assets had to be written down.

"FKP has a huge retirement asset portfolio. During the better years, these assets were written up but when the crash came, they had to write it down. These are accounting losses stemming from FKP and does not mean that FKP is not doing well," Lee explains.

When asked if there was going to be any more writedowns of FKP's assets that would impact Mulpha's profits, Lee says that is unlikely. "We have indicated such to the market. The cycle has turned and all the asset values are slowly increasing. What we went through was a period of extreme conservatism by the valuers in Australia as a whole."

When asked about dividends, Lee says MIB's board is reviewing its policy regarding dividends. MIB has not been paying dividends but Lee says that by the year-end, the company should have a clear strategy on dividends.

"Previously, when we had no dividends, we were conducting massive share buybacks. As we are not doing share buybacks at the current price of MIB shares, we should be looking at using that money for dividends."

Dividends would tie in nicely if MIB is able to unlock the values of its assets and use the proceeds for rewarding shareholders.

However, MIB is also inclined to reinvest its profits. "MIB's investment philosophy is to maximise the value of its assets and recycle that money into other assets that can generate more value," says Lee.

By The Star

Engine of growth for UEM Land

Under Datuk Wan Abdullah Wan Ibrahim's stewardship, UEM Land has seen major developments taking place in Nusajaya as well as in Cyberjaya

UEM Land Holdings Bhd, a 77.1% unit of UEM Group Bhd, is leveraging on its vast land bank in Nusajaya as its engine of growth and sustainable income over the mid- to long-term.

The company has about 8,300 acres left in Nusajaya, of which about 2,700 acres are currently being developed. It also has 98 acres in Cyberjaya which is currently been developed into a high-end gated and guarded community, Symphony Hills.

From just two projects in Nusajaya – Kota Iskandar Phase 1 and Nusa Idaman – with a total GDV of RM1.2bil in 2006, the company has steadily increased its project offerings in the past four years.

It now has eight major projects in Nusajaya with a total GDV of close to RM13bil. This comprise a broad spectrum of offerings, from various types of residential units in Nusa Idaman, Horizon Hills, East Ledang and Nusa Bayu catering for all market segments; to industrial land in Southern Industrial & Logistics Clusters (SiLC) and Nusajaya Industrial Park; and commercial land in Puteri Harbour and Afiat Healthpark and government offices in Kota Iskandar.

In August this year, it started to expand beyond Nusajaya with the launch of Symphony Hills in Cyberjaya.

The company's expansion can be attributed to the leadership of managing director cum chief executive officer Datuk Wan Abdullah Wan Ibrahim. His vision is to propel UEM Land to become a global community builder.

Wan Abdullah, who joined UEM Land on Jan 1, 2006, is described as a caring employer who shares his dream and vision with his employees and motivates his subordinates to put in their best efforts to achieve the company's goals.

Under his stewardship, UEM Land has successfully seen major developments taking place in Nusajaya as well as in Cyberjaya.

The company has several ongoing projects in Nusajaya, and they comprise catalyst development projects such as Kota Iskandar, the new Johor state administrative centre; Puteri Harbour, an integrated urban waterfront development; Southern Industrial & Logistics Clusters – a managed industrial park which includes Bio-XCell, a new biotech ecosystem being developed under a joint venture with Malaysian Biotechnology Corp Sdn Bhd; Afiat Healthpark, a centre for modern medicine, traditional & complementary medicine and other wellness themed developments.

The residential projects consist of East Ledang, Horizon Hills, being developed under a joint venture with Gamuda Bhd; Nusa Idaman, Ledang Heights and Nusa Bayu.

Other smaller developments include Fortune Point comprising mainly shop houses which serve as the commercial area within the Nusajaya Industrial Park 2 as well as the Symphony Hills project in Cyberjaya.

Several projects in the pipeline include Northern Estuary (a new eco-themed upmarket residential precinct adjacent to Puteri Harbour), Nusajaya West and Regional Commercial Centre.

"The response and take-up rates for our projects have been quite strong. For the various residential projects that have been launched in Nusajaya, the average take-up rate is 77% while at Symphony Hills, which was launched in early August, it has achieved sales of slightly above 50%.

"Sales for industrial land in Southern Industrial and Logistic Cluster (SiLC) phase 1 and 2A (with a total saleable area of 275 acres) have almost been sold out. It is now starting on phase 2B which brings to market an additional 260 acres of light/medium industrial lands," Wan Abdullah says.

Its top contributors had traditionally been Puteri Harbour and SiLC but for the last two years, Nusa Idaman has also started to contribute strongly to sales.

Moving forward, the company expects East Ledang and Symphony Hills to turn in higher contribution as they reach their maturity.

"The positive market sentiments have helped boost sales, particularly for Nusa Idaman and Ujana Apartments in East Ledang. Overall, our sales has been steadily picking up since the start of the year. Our total sales for the first quarter was about RM83mil, increasing to about RM117mil in quarter two and about RM124mil in the third quarter," Wan Abdullah adds.

On plans to expand internationally, he says it is one of the key rationales behind the proposed Sunrise acquisition to create a stronger, more capable entity that will be able to undertake more projects not only in Malaysia but also overseas.

By The Star