UEM CEO: Nusajaya can be considered as the UN of Johor

UEM Land Holdings Bhd does not limit itself to Singaporean property buyers and investors when it comes to its development projects in Nusajaya.

Managing director and chief executive officer Datuk Wan Abdullah Wan Ibrahim (pic) says although Singaporeans always remain important to the company, it is open to all other nationalities.

“In fact, Singaporeans are among the 50 nationalities who are buyers for our residential properties in Nusajaya,’’ he tells StarBizWeek.

Wan Abdullah says Nusajaya can be considered as the “United Nations of Johor” due to the large presence of foreign property buyers in the development zone.

Nusajaya is one of the five flagship development zones in Iskandar Malaysia – others are the JB City Centre, Eastern Gate Development Zone, Western Gate Development Zone and Senai-Kulai.

UEM Land is the master developer of the 9,308ha Nusajaya, the key driver of Iskandar Malaysia.

The company has four ongoing projects – East Ledang, Nusa Idaman, Puteri Harbour and Nusa Bayu while Horizon Hills is a joint venture with Gamuda Land Bhd.

“We, like any other Malaysian developers, welcome buyers and investors from all over the world and we are more than glad to serve them,’’ he says.

Wan Abdullah says it is only logical that Singaporeans make up a large number of foreign property buyers in Johor Baru due to its close proximity with the republic.

He says Singaporeans have been buying residential properties in Johor Baru dating from the late-1970s till today due to a large difference in pricing of properties in the republic and Johor.

Wan Abdullah says the recent opening of the property gallery in the republic demonstrates its commitment to better serve the company’s current prospective customers and investors regardless of their nationalities.

He says the gallery showcases its ongoing projects in Iskandar Malaysia’s Nusajaya and Kuala Lumpur and the proximity provided the opportunity for the company to be more engaging with its Singaporean buyers.

“We choose Heritage Place as it is located within one of Singapore’s renowned business districts and a large number of foreign tourists visit the area,’’ says Wan Abdullah.

He says prior to the opening of the gallery, the company regularly organised trips for Singaporeans to Nusajaya on weekends regularly to view the projects and it would continue to do so.

On the portfolio of its foreign property buyers, Wan Abdullah says most of them are Singaporeans and other nationalities with businesses in Johor Baru.

“The other category is Singaporeans who lived in the Housing Development Board flats here and bought landed houses in Nusajaya and come here regularly.

“Others are expatriates working in Singapore but with houses in Johor Baru and come normally on weekends and look forward to retire in this part of the world.”

By The Star

Tipping point

This year will be the tipping point for Iskandar Malaysia, says Iskandar Regional Development Authority (Irda) chief executive officer Ismail Ibrahim (pic) in an email interview. From the time the project was launched by former premier Tun Abdullah Ahmad Badawi to March this year, the growth corridor had a total cumulative committed investments of RM87.56bil versus the targeted amount of RM47bil needed for its first phase (2006-2010).

Of that total, 61% are from domestic investment (RM53.3bil) and 39% are foreign investment (RM34.21bil). A total of 43% has been spent on the ground for projects and infrastructure. Many catalytic development and infrastructure projects would be completed and operational. The focus will also be on the creative, tourism, oil and gas and education sectors.

Here are excerpts from the interview:

SBW: How has the eurozone problem affected Iskandar?

Ismail: We have not seen any drop in investment from eurozone countries, which include Spain, so far. Rather, we see the current eurozone crisis as an opportunity as the unstable situation there may spur companies to look at better places to invest.

How much of Spanish investments are already realised or invested here?

Total investments in the region of RM5bil.

In the course of trying to attract investments, what do foreign investors want?

Some of the areas of concern, in no particular ranking, are:

·Safety and security

·Strategic location

·High standards of infrastructure and facilities

·Liveable community/environment

·Supportive government

·Political stability

·Knowledge workers supply

·Good incentive for foreign/local professional workers – 15% tax rate scheme for knowledge workers in Iskandar Malaysia

·English speaking country – multilingual workforce

·One-stop business centre – ensuring business transactions are fast, seamless and convenient

I think the issue of crime in Johor is one of perception rather than fact, but that doesn’t mean that we can be idle. Irda is constantly working with the federal and state governments, the police and other stakeholders to improve security.

In fact, 10 of the 32 Quality Living Projects announced by Prime Minister Datuk Seri Najib Tun Razak at the launch of the Corridor & City Labs Open Day a few months ago concerned security issues. This includes setting up an integrated CCTV surveillance system of 1,500 CCTVs and 190 community police posts to be set up by 2020.

The 9,000-strong police force in Johor would be augmented with a 900-strong battalion of auxiliary police.

We’ve also increased the number of patrol cars, mobile police stations and CCTVs, and we’ve set up a special task force and hotline for investors to report security issues to the authorities.

All of these have had a positive effect: the Johor 2011 crime index has fallen by 24% and street crime by 42% compared to 2010. There’s of course still a lot of work to be done but we’re determined to change perceptions over time.

What are your challenges?

The most challenging part was getting the buy-in from our various stakeholders. While this is a continuous process, I believe many already see for themselves that Iskandar Malaysia is truly taking shape.

With the looming economic uncertainty, we will remain competitive. Our strategies may vary depending on the dynamics of the current and future of the world economy but we are consistent in our marketing approach. We are blessed with recent interest from Singapore and efforts of attracting investments from Singapore especially in high value industries such as high-tech and aerospace industries looking for expansion opportunities will be intensified. One of the efforts currently pursued is setting up of a Singapore Industrial/SME Park in Iskandar Malaysia.

What does the future hold considering the global situation?

While investments to date have surpassed early targets, attracting further investments from a wider range of foreign and domestic investors, particularly in priority sectors, is necessary. We are seeing a shift from the West to the East and are thus broadening the investor base by targeting Asian sources such as Singapore, China, Japan, India and South Korea. The investors sought should have long-term investment horizon.

What is the latest development on transporation?

The land transport authorites of Singapore and Malaysia are studying a rapid transit system (RTS) link between Singapore and Johor Baru. The architecture and engineering consultancy consists of two phases. Phase one is expected to be completed by year-end.The Joint Ministerial Committee for Iskandar will decide on the option to be adopted in phase two. Taxi services between Johor Baru and Singapore are also being improved.

Effective June 1, commuters taking cross-border taxis will be able to board and alight anywhere on the domestic leg of the journey.

For example, a commuter that takes a Singapore cross-border taxi can board or alight anywhere in Singapore. Similarly, a passenger taking a Malaysia cross-border taxi can board or alight anywhere in Malaysia.

But commuters need to board and alight at the designated terminals when they are not on the domestic leg, i.e. a commuter that takes a Singapore cross-border taxi can only board and alight at PasarBakti terminal in Johor Baru and likewise, a Malaysia cross-border taxi can only pick up or drop off commuters at the Ban San Street terminal in Singapore.

By The Star

Continuous improvement needed for developers to remain competitive

FIABCI MALAYSIA is urging local property developers to “raise the bar” in order to remain competitive at the annual FIABCI Prix d’Excellence Awards, which comprises the best of the best from around the world.

“The Malaysian real estate projects are some of the world’s best in the true sense. (However), the competition will get tougher each year as more and more countries enter the competition with their own national winners,” FIABCI Malaysia president Yeow Thit Sang said recently at an appreciation dinner for Malaysian developers that were honoured at this year’s FIABCI Prix d’Excellence Awards.

Yeow however commended the Malaysian companies that were recognised at this year’s Prix d’Excellence Awards.

“There is total transparency and independence in the judging process. None of the 47 judges knew who was marking which project. There was no comparison of opinion between any of them. All the marks were given independently,” he says.

FIABCI Malaysia is the organiser of the annual Malaysia Property Awards (MPA), which is considered the “Oscars” of the property industry.

Over the years, there has been an increasing emphasis on the environment and participants at the MPA have to take this into consideration.

“The impact a particular project has on the environment currently accounts for between 20% and 25% of the judging criteria,” says Yeow.

He also says the standard of judging for the MPA has increased over the years.

“It comprises a four-tier process,” says Yeow, adding that the judges comprise past presidents of FIABCI Malaysia.

“We also have a public auditor who collates all the marks,” he says.

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

This year’s FIABCI Prix d’Excellence Awards, which was held in May at St. Petersburg, Russia, crowned four Malaysian developments in total, namely UEM Land Holding Bhd (for the Master Plan category), Mulpha International Bhd (Residential Low Rise) category, SP Setia Bhd (Specialised Project/Purpose-Built category and Sunway City (Ipoh) Sdn Bhd (Resort category).

Established in 1992, this year’s MPA will be held in November.

Separately, Yeow says he is optimistic about the outlook of the local property market for this year, adding however that things can turn for the worse should the global economic situation deteriorates.

“The economies of the world have a great influence on the local market. If Europe and the United States are affected – because they are buying from us, it will affect us. Eventually, our products cannot sell and there will be unemployment.

“Once unemployment comes in, the real estate market will be affected. If you’ve bought a house and you’re servicing the loan and lose your job, what are you going to do?”

By The Star (by Eugene Mahalingam)

Green developers to be rewarded

Signing off: Ahmad Fuad (second right) launching Platinum Sentral.

The Kuala Lumpur City Hall (DBKL) is planning a incentive scheme to reward developers to design and construct green and sustainable buildings.

Mayor Tan Sri Ahmad Fuad Ismail said DBKL was still in talks with the Federal Territories and Urban Wellbeing Ministry to implement the scheme to recognise and reward developers who construct buildings that could conserve energy and water, provide a healthier indoor environment, better connectivity to public transport as well as adopt recycling and green programmes.

Ahmad Fuad said the incentives could be in the form of reduction in fees paid to DBKL.

“We are still developing a mechanism for the scheme. Reduction in development charges and assessment fees are just some of the incentives that can be offered to developers and building owners.

“If developers can prove that their projects are green and sustainable, I think we should to give them some recognition,” he said after launching the Platinum Sentral building by the Malaysian Resources Corporation Bhd (MRCB) in KL Sentral.

Platinum Sentral is the first Platinum-rated building in Malaysia and Green Building Index (GBI) certified.

“We are happy to note that MRCB is spearheading green building development in KL.

“DBKL has made it compulsory for all new developments in the city to be in compliance with GBI.

“This is to ensure that all projects will not only be sustainable but are also people-friendly in terms of design and usability,” said Ahmad Fuad.

By The Star

UEM Land Q1 pre-tax profit up at RM54.3m

KUALA LUMPUR: UEM Land Holdings Bhd recorded higher profit before tax of RM54.3 million for the first quarter ended March 31 2012 from RM17.6 million in the preceding year corresponding quarter.

Revenue increase to RM303.7 million from RM187.6 million previously.

While the property market was expected to remain cautious in the short term, given the prevailing lending environment, UEM Land was confident of its prospects in the current financial year.

By Business Times

WCT plans two more malls

WCT managing director Taing Kim Hwa (left) at the Paradigm Mall launch

PETALING JAYA: WCT Bhd plans to add two more shopping malls to its portfolio to create a steady stream of income to the group.

WCT's maiden retail project, AEON Bukit Tinggi Shopping Centre, was opened in Klang in 2007 and is currently leased to retailer Aeon Co Bhd while its second, the Paradigm Mall, was launched yesterday.

Executive director Choe Kai Keong said WCT's third mall, at KL International Airport 2 (KLIA2) integrated complex, was targeted to be opened by April next year.

“We will be managing the 350,000-sq-ft shopping mall ourselves. Meanwhile, the fourth mall will be part of a 60-acre mixed development in Overseas Union Garden with an expected total gross development value of RM4bil.

“We are in the midst of acquiring the land now,” he said after the launching of Paradigm Mall in Petaling Jaya yesterday.

WCT Land Sdn Bhd general manager Ben Chong said Paradigm Mall would be managed by WCT itself.

“After the experience and learning curve of our first mall in Bukit Tinggi, we are now prepared to manage a mall on our own.

“This would allow us to have the ultimate control on rental rates and other extra income generation,” he said.

By The Star

Mah Sing may gain up to 25% margins from Southville

KUALA LUMPUR: Property developer Mah Sing Group Bhd is expected to benefit from its latest land purchase in Bangi, Selangor, due to the large pre-tax profit margins the company can gain from the development.

Analysts said the development of Southville City on the Bangi land could achieve pre-tax profit margins of up to 25%.

The project would be developed on a 408-acre freehold land and four-acre leasehold land.

Maybank Investment Bank Bhd analyst Wong Wei Sum said in a report that the development, slated for a launch in the first-half of 2013, could translate into a net profit of RM50mil per annum or six sen per share. This is on the assumption of a 25% pre-tax profit margin and an eight-year development period.

She has retained a “hold” rating on the stock on the premise that higher interest costs had lowered the company's 2012-2013 net profit forecasts by 0.2% to 1.2% and had also raised net profit forecast for 2014 by 4.7%.

“Post-acquisition, Mah Sing's net gearing would jump to 0.6 times from 0.3 times as at end-Dec 2011. There's no change to our RM2.95 revised net asset value estimate,” Wong added.

Hong Leong IB said it was “positive” on the land acquisition.

“We are positive on this acquisition as land cost makes up 16% of overall gross development value, meaning margins should be healthy.

“This is a very quick turnaround project, with Phase 1 to be launched in the second half of this year. We expect earnings contribution to commence in the first half of 2013. Phase 1 will comprise double-storey link homes indicatively priced from RM530,000.”

Hong Leong IB has retained its “buy” call on Mah Sing with a target price of RM2.44, which is a 30% discount to revised net asset value.

Meanwhile, analysts at Kenanga Research have maintained their “market perform” rating on the stock and lowered their target price to RM2 from RM2.18 previously.

They said that it was a sector-driven call due to the unexciting sector dynamics, coupled with Mah Sing's higher-than-average net gearing level among developers under their coverage.

By The Star

UEM Land Q1 earnings up 207% to RM54.17m

KUALA LUMPUR: UEM Land Bhd's earnings jumped 207% to RM54.17mil in the first quarter ended March 31, 2012 from RM17.61mil a year ago while its unbilled sales totalled RM1.85bil.

It said on Friday that revenue increased 61.8% to RM303.72mil from RM187.68mil. earnings per share were 1.25 sen compared with 0.44 sen.

"The group recorded higher revenue in the current quarter as compared to the preceding year corresponding quarter mainly due to contribution from the group's development from East Ledang, Nusa Bayu, Nusa Idaman, MK28 and Quintet as well as sale of inventories from Dutamas and Meridin," it said.

UEM Land said the higher profits were in line with the higher revenue.

On the outlook for the property market, it expected it to remain cautious in the short term given the prevailing lending environment.

"Ongoing projects have an unbilled sales of RM1.85bil as at March 31, 2012. The revenue and profits from these future billings will be recognized substantially over 2012 and 2013," it said.

UEM Land said the group was well positioned to launch several competitively priced residential and commercial projects in the Klang Valley, Cyberjaya and Nusajaya.

It pointed out these projects together with the other ongoing projects would underpin the group's performance in meeting its current year's revenue and profit targets.

By The Star

Properties boost Equine net profit

PETALING JAYA: Equine Capital Bhd posted a net profit of RM7.38mil in the fourth quarter ended March 31, 2012, a 226.99% increase compared with RM2.26mil a year earlier.

However, Equine’s pre-tax profit for quarter under review declined 60.94% to RM1.25mil from RM3.19mil previously.

The company achieved a 15.93% increase in revenue to RM47.06mil from RM40.59mil. Revenue for the quarter was derived mainly from its property development segment, it told Bursa Malaysia.

By The Star

SP Setia has big plans in Penang

GEORGE TOWN: After recently acquiring 21.3 acres in Tanjung Bungah for RM185.6mil, SP Setia Bhd is now looking at an adjacent 14-acre site.

SP Setia Property (North) divisional general manager Datuk S. Rajoo said the group was now in an advanced stage of negotiation to buy the property.

“We expect to ink the deal soon. The two properties are an integral part of the group's business plan to launch about RM2.5bil worth of properties on the island this year and in 2013,” Rajoo said.

“Land on the island is becoming scarce. Since SP Setia wants to continue playing a dominant role in the property market on the island, it is seizing every opportunity to expand its landbank, capitalising on attractive deals,” he said.

SP Setia's business plans for Penang include the launch of residential and commercial properties worth over RM638mil in the second half of 2012.

In 2013, besides the RM1.1bil project in Tanjung Bungah, SP Setia will also launch a RM175mil condominium project in Sungai Nibong, and the Wave and Breeze condominium projects for Setia Pearl Island, with a gross development value (GDV) of RM350mil and RM300mil respectively.

“In the second half 2012, the key projects include the RM250mil Setia Triangle, the RM335mil Setia Greens 2, and a RM53mil condominium project in Teluk Kumbar,” he said.

The Setia Triangle project on 6.8 acres in Setia Pearl Island comprises two-, three-, and four-storey shop offices with built-up areas of 3,000 sq ft, 4,500 sq ft, and 6,000 sq ft respectively. Each unit will be priced between RM1.95mil and RM3.6mil.

“There will also be a residential component comprising a 225-unit condominium, priced between RM575,000 and RM1.2mil,” Rajoo said.

The Wave consists of 535 condominium units priced from RM300,000 to RM750,000, while the Breeze comprises 450 units with a price tag of RM500,000 onwards.

“The scheme in the Teluk Kumbar development comprises 98 condominium units with built-up areas of 1,000 sq ft and 1,4000 sq ft, priced between RM500,000 and RM700,000.

“To date, we have launched over RM1.1bil worth of residential properties in Setia Pearl Island. Once the Setia Triangle, Wave, and Breeze are launched, the GDV for Setia Pearl Island will rise to RM2bil,” he said.

Rajoo said SP Setia had also recently acquired two pieces of land in Balik Pulau for RM38mil, where the group planned to develop both landed and high-rise properties.

He added that the group's projects in Penang should generate about 15% of the its revenue for the fiscal year ending Oct 31.

By The Star

SP Setia shortlisted for London site

Keen suitors: SP Setia and a number of other Malaysian developers are said to be among the international bidders for the redevelopment of Battersea Power Station — AFP

PETALING JAYA: SP Setia Bhd is said to be one of the bidders that have ended up in an informal shortlist for the Battersea Power Station site in London.

According to a Bloomberg report quoting Britain's Sunday Times, the shortlist also includes London Riverside Development Corp, backed by billionaire brothers David and Simon Reuben, and Chelsea Football Club Ltd.

London Riverside, whose investors included Godfrey Bradman, one of the developers of Broadgate in London's City district, was said to have made the highest bid for the Battersea site of more than £330mil, the paper said, without citing anyone.

Meanwhile, an industry source told StarBiz that besides SP Setia, a number of other Malaysian developers were among the international bidders for the redevelopment of the 15.8ha site.

According to him, a good number of the bids “are quite strong” and a decision on the successful bidder is expected soon.

The offer for sale of the freehold of the 15.8ha site was by private treaty via informal tender.

The submission of bids was no later than 12 noon, London time, on May 6.

Last year, SP Setia Bhd made two earlier bids of £262mil and £324mil for the site but failed. The company said it was keen to make a fresh bid for the latest sales tender exercise for the site.

The Battersea site is located in a prominent central London riverside location and has valid outline planning permission for a major mixed use development totalling about 750,000 sq m in gross external area.

The dilapidated coal-fired power station has been closed since 1983 after 50 years in service. The site has seen several failed redevelopment attempts in the past three decades.

Irish developer Real Estate Opportunities was the last to try its luck with a £5.5bil redevelopment plan but the plan collapsed in December last year after the company went into administration.

By The Star

Rehda eyes RM10b 'green allocation'

The Real Estate and Housing Developers' Association Malaysia (Rehda) is lobbying for a RM10 billion annual allocation from the government to help upgrade existing buildings to be energy efficient.

The association wants this to be in the 2013 Budget.

Rehda president Datuk Seri Michael Yam said the fund would cover up to 30 per cent of the costs to make the buildings green.

With this in mind, the association is also asking the government to recognise other international green certifications like Singapore's Green Mark, Australia's Green Star, UK's BREEAM and the United States' LEED.

This was to enable those buildings already certified with those certifications to qualify for incentives provided by the government, Yam said.

Among other incentives that Rehda is seeking are stamp duty waiver for transfer of green certified properties from developers to buyers for the next five years, and double tax deduction on training expenses incurred by property development firms.

Yam said this yesterday at the launch of "Green Tour KL 2", a showcase of prestigious green rated developments in the Klang Valley.

Green Tour KL 2 is organised by Rehda Youth. It was officiated by Datuk Loo Took Gee, the secretary-general for the Energy, Green Technology and Water Ministry.

Yam said the building sector, at present, contributed about 40 per cent of the global greenhouse gas emissions but added that it could be reduced as green buildings had lower carbon emissions.

Currently, less than 0.5 per cent of all commercial and residential buildings in Kuala Lumpur were green certified, Yam said.

During Green Tour KL 2, projects showcased were the new Rehda headquarters in Kelana Jaya; KEN Rimba, Legian Residences, a project by KEN Holdings Bhd in Shah Alam; 11 Mont Kiara by Sunrise Bhd, a unit of UEM Land Holdings Bhd; Sime Darby Idea House in Shah Alam; and S11 House here.

By Business Times

RM4b plan for river projects

EKOVEST Bhd and Malaysian Resources Corp Bhd (MRCB), project delivery partners acting on behalf of the government, plan to call for some RM4 billion worth of tenders by as early as next year to help clean and beautify the Klang and Gombak rivers.

The work is part of the River of Life project.

Minister of Federal Territories and Urban Wellbeing Datuk Raja Nong Chik Raja Zainal Abidin said the cleaning tenders will be out first.

"We have set aside a total of RM3 billion for cleaning and RM1 billion for beautifying. We expect the rivers to be cleaned and certified as Class B (where it is safe to touch) within the next five years," Raja Nong Chik told reporters after launching the Asian Strategy and Leadership Institute (Asli)'s Second National Conference on Greater Kuala Lumpur/ Klang Valley - Towards a World Class Sustainable City here yesterday.

He said at present the river was "toxic".

"Both rivers are at Class 3 or 4, which is very bad," he added.

On Invest KL, Raja Nong Chik said so far two companies from the US and Europe have put in strong interest to invest in Malaysia.

"Last year, we had six; this year so far there are two companies from the US and Europe. I was in Europe in March and received a lot of enquires from companies there interested in the services sector, manufacturing and oil and gas here," he said, without elaborating on the companies.

Meanwhile, Asli chief executive Datuk Dr Michael Yeoh said the conference brought together key experts in city planning and development, policy formulators and decision makers, entrepreneurs and investors, foreign multinational corporations, universities, think tanks and civil society organisations to discuss how the Greater KL/Klang Valley National Key Economic Area will benefit the stakeholders and the business community.

By Business Times

Far East customers may not get what they want in London property rush

Attractive: The number of Asian buyers of the best quality newly-built London homes jumped to 37% in 20 10 from 4% in 2009. The majority usually buy off-plan before the home is built.

LONDON: When Hong Kong businessman He paid a £35,000 (US$56,000) deposit on a four-bedroom apartment in Britain, he believed it was a 40-minute walk from central London, his lawyer said. In fact it was a 40-minute journey by high-speed train.

The £350,000 home was in Lincolnshire, eastern England. He sued the developer for misrepresentation last year, getting his money back before the case got to court in what his lawyer told Reuters was an attempt by the developer to avoid its marketing material being splashed around a courtroom.

His experience shows the potential pitfalls facing a growing number of Far Eastern people buying British homes unseen as developers target places such as Hong Kong, Shanghai and Singapore because British buyers are struggling to get mortgages.

“It is a matter of developers saying: Here are some people who are likely to be interested. They probably do not know too much about the market, so why don't we advertise there',” said David Eldon, former chairman of HSBC's Asia unit who has witnessed the practice during two decades in Hong Kong.

“I think they are being a little economical with the truth,” he said, adding that properties could be sold for higher prices in the Far East.

Major developers including Barratt, Taylor Wimpey and Berkeley have stepped up efforts to court cash-rich Far Eastern buyers since 2009 after the global financial crisis sapped demand at home. Developers do not all use exactly the same marketing methods.

Berkeley said it had had many repeat purchases from Asian buyers over 20 years, although it acknowledged a mistake in one of its press releases. Taylor Wimpey said it offered a high level of service to all customers. Barratt declined to comment.

The number of Chinese and Pacific Asian buyers of the best quality newly-built London homes jumped to 37% in 2010 from 4% in 2009, data from property consultancy Savills showed. The majority purchase for investment and are used to buying off-plan before the home is built.

He was told his flat was 40 minutes from central London at a face-to-face meeting with the developer, said David Linklater, head of litigation at law firm Alan Broadhurst, who represented He. Broadhurst declined to give his client's full name or the developer's identity.

“Lots of people go to the fairs in Hong Kong and get a sheet of paper with a picture of Big Ben. You think you are going to be the Queen's neighbour when actually the Queen has a great big garden with a big wall around it,” said Linklater, who deals with 20-30 unhappy overseas buyers a year.

Sold at exhibitions in plush hotels, many properties are not in the most desirable London neighbourhoods despite the prominent pictures of Harrods or Buckingham Palace. Details of exact locations tend to be omitted rather than inaccurate.

“There is a lot of embellishment going on working off the naivety of the Chinese buyer,” said James Moss, managing director of property consultancy Curzon Investment Property.

A brochure advertising 375 Kensington High Street, a luxury London scheme marketed in the Far East and developed by a Berkeley joint venture alludes to the proximity of the High Street Kensington underground station in a brochure entitled “London's most sought after new address”.

The station, which is at the heart of one of London's most popular shopping districts, is a 15-20-minute walk away while the flats are at the scruffier end of the same long street and closer to two other tube stations.

In a press release issued in Hong Kong on Friday, the development was described as “a short walk from the luxury shopping available at Harrods.” The world-famous store is a 50-minute walk according to the Transport for London website.

“To an unsuspecting buyer, you think wow, it is amazing, but actually it is the wrong end of Kensington High Street, right next to Kensington Olympia,” said Camilla Dell, managing partner at Black Brick Property Solutions, which helps overseas buyers find London homes.

A Berkeley spokesman said the “short walk” description was “an error.”

“We have had a lot of customers from Asia over the last 20 years, many of whom are repeat purchasers,” he said.

“It (the development) has excellent transport links and easy access to well-known shops; the distances to which are clearly marked in our brochure. In addition, by far the majority of buyers have or will visit our developments before buying.”

By Reuters

Mah Sing buys 172ha in Bandar Baru Bangi

The company has targeted to buy land that can generate gross development value (GDV) of RM5 billion.

Mah Sing Group Bhd, one of the country's top developers, has bought 172ha of land in Bandar Baru Bangi, Selangor, for RM333.26 million, or RM18.55 per sq ft.

The group acquired 170ha of freehold land from Boon Siew Development Sdn Bhd and around 1.6ha of leasehold land from an individual party.

The land acquisition is the third for Mah Sing this year. This means Mah Sing has achieved 73 per cent of its landbank target for this year.

For the latest acquisition, Mah Sing intends to develop Southville City in a few phases. Southville is expected to generate GDV of RM2.15 billion and it will be completed over the next five years.

The first phase of the gated and guarded project will offer affordable homes for young families, mainly double-storey-link houses, indicatively priced from RM530,000.

The remaining phases will offer linked-semi-detached (semi-D) houses, semi-Ds and bungalows for home upgraders.

Mah Sing group managing director and chief executive Tan Sri Leong Hoy Kum said almost 70 per cent of the houses will be offered at below RM1 million each to meet the strong market demand for bread and butter properties. Some 30 per cent of the township will comprise commercial components, mainly offices.

The master layout and development order for the project had been obtained, Leong said in a statement yesterday.

He said registration of interest for the properties is expected to began in the third quarter of the current year.

Leong said Southville City is expected to beat the success of the group's award winning Aman Perdana township in Meru-Shah Alam, M Residence @ Rawang, Kinrara Residence in Puchong and Garden Residence in Cyberjaya.

With Southville City, Mah Sing now has 28 ongoing projects in Greater Kuala Lumpur.

"This positions us to indirectly support the opportunities arising from the Greater KL National Key Economic Areas (NKEA) implementation, such as the additional demand for housing, as population is expected to increase from six million to 10 million by 2020," he said.

Mah Sing is still scouting for prime land suitable for development to meet market demand.

"The land must fit our quick turnaround business model. We are keen on privately-held and government land," Leong added.

By Business Times

Mah Sing to build township

PETALING JAYA: Mah Sing Group Bhd plans to undertake the building of a mixed township near Bangi, Selangor, after acquiring 412 acres there.

In a statement yesterday, it said it was paying RM333.26mil or RM18.55 per sq ft for the land.

In its third landbanking exercise, 408 acres of freehold land there will be from Boon Siew Development Sdn Bhd for RM330.8mil and the remaining 4 acres of leasehold land from an individual party.

Under the project Southville City, Mah Sing will provide 17,500 people with homes. Its first phase of this gated and guarded project will feature mainly double-storey link homes indicatively priced from RM530,000 onwards.

About 70% of the project's residential component will be priced below RM1mil to meet strong market demand for bread and butter properties.

The land is situated along the North South Highway, 3.2km from Universiti Kebangsaan Malaysia and 2.6km from the Sony plant. To allow direct access to the project, Mah Sing is planning a new interchange on the North South Highway just 2.5km from the existing Bangi interchange.

Mah Sing group managing director and group chief executive Tan Sri Leong Hoy Kum said: “The inherent appeal of the location along the North South Highway, proposed direct interchange and Mah Sing's expertise in township masterplanning make Southville City a very exciting development to look forward to. We believe our project offerings comprising residential and commercial products, mainly shops that meet market demand, complemented with extensive soft and hard landscaping, clubhouse and various facilities and amenities will do very well.”

Apart from the existing access routes, there are also plans to build a linkage from the Putrajaya Interchange to Jalan Kajang-Dengkil. This will further enhance access to the township.

The group is still actively looking for land to add to its landbank, which must also fit its quick turnaround business model.

“We want to replicate and even beat the success of our award-winning Aman Perdana township in Meru-Shah Alam and M Residence@ Rawang as well as Kinrara Residence in Puchong and Garden Residence in Cyberjaya where we have created self contained, secured lifestyle townships,” Leong added.

Following this acquisition, Mah Sing has met approximately 73% of its 2012 full-year landbanking target, which is to buy land that can generate a gross development value of RM5bil.

The group is still actively looking for land to add to its landbank, which must also fit its quick turnaround business model.

By The Star

I-Bhd to reap i-City reward

I-Bhd, the master developer of i-City, is now ready to reap the fruits of its labour as most of the major infrastructure works at i-City in Shah Alam have been completed.

The group will be realising i-City's conservative gross development value (GDV) of RM3bil over the next eight years but Kenanga Reseach reckons the real GDV could be close to RM5bil.

“Our computation reveals that the current total GDV guidance of RM3bil is based on average selling price (ASP) of less than RM400 per sq ft.

“We think that this is extremely conservative since recent sale of i-Residences was priced at RM500 per sq ft.

“Assuming the ASP hits a high of RM550 per sq ft, total GDV will be much closer to RM5bil,” Kenanga said in a recent report.

According to the research house, since obtaining the Multi Super Corridor status in i-City four years ago, the group had been rather quiet as it was focused on completing the major infrastructure works of i-City given the onset of the global financial crisis in 2008.

“Today, the group has spent some RM30mil on major infrastructure works, which means its upcoming projects are now readily developable.

“Up till 2010, I-Bhd was cautious with its launches and so far, has completed only 0.6 million sq ft of gross floor area of offices, of which Al-Rajhi has bought 250,000 sq ft and the rest are currently being occupied by Maybank and Orisoft among others,” it said.

It said i-City's projects would likely be completed in the next eight to 10 years and it enjoys strong state government support as i-City is positioned to improve tourism and content of knowledge-based industries, which will inevitably enhance the value of Shah Alam.

The entire development, which spans 72 acres, of which 15% has been developed, is one of the few large freehold land banks in Shah Alam.

According to Kenanga, i-City's annual GDV was expected to be between RM450mil and RM500mil, based on 1 million sq ft of gross floor area per annum.

The group has just launched i-Residence with a GDV of RM230mil at an average selling price of RM500 per sq ft. It features mostly service residences and some duplex units. The take-up rate has been extremely encouraging at 65% since the launch in March, which could be due to the attractive unit pricing of RM320,000 to RM650,000 per unit and also the attractive financing packages.

“For the remaining part of the current financial year ending Dec 31 (FY12) the group will be launching its Sovo/Soho project at i-City with a GDV of RM200mil, which will likely be priced similar to i-Residence,” it said.

Kenanga estimated FY12 to FY13 net profit at RM11.4mil to RM24.3mil, which would yield more than 100% year-on-year growth each, based on targeted FY12 and FY13 property sales of RM225mil to RM270mil.

The research house also noted that I-Bhd had zero gearing balance sheet and had maintained a net cash position for the last five years.

By The Star

Bandar Raya quarterly revenue at RM155m

Bandar Raya Developments Bhd (BRDB) registered a pre-tax profit of RM17.492 million for the first quarter ended March 31, 2012, from the RM7.818 million posted in the corresponding quarter last year.

Revenue for the three-month period also grew to RM155.042 million from RM137.185 million previously.

In a filing to Bursa Malaysia today, the company said the higher revenue is mainly due to higher earnings from its property and manufacturing divisions.

The jump in pre-tax profit is fully contributed by the property division, and despite a loss of RM1.8 million from the manufacturing division under Mieco Chipboard Bhd (MIECO), the company said.

Moving forward, BRDB said under its property division, the company has planned several launches in Kuala Lumpur and Johor, which are at various stages of readiness to market subject to obtaining the necessary regulatory approvals.

Meanwhile for its manufacturing operations, BRDB said MIECO is experiencing a more challenging market for particleboards and related products in view of the external uncertainties as well as higher raw material costs, resulting in compressed margins.

"MIECO has expanded its downstream facilities to cater for more value-added and environmentally-sensitive products, which are rapidly becoming the global market preference, particularly in markets like Japan.

"The resilient property industry continues to support domestic demand for particleboards and its related products," it added.

By Bernama

Impiana acquiring 20pc stake in Heritage Lane

KUALA LUMPUR: Impiana Hotels & Resorts (IHR), operator of Impiana KLCC Hotel, will take a 20 per cent stake in the owning company Heritage Lane Sdn Bhd.

It expects to sign a share sale deal with Heritage Lane, which is a wholly-owned unit of KLCC (Holdings) Sdn Bhd, within a month.

"We are finalising the deal," IHR chairman Datuk Seri Farouk Abdullah said at the official launch of the new RM100 million 188-room wing.

Farouk had first mentioned that it was negotiating to buy the stake in 2005.

To a question on how much the stake would cost, Farouk said it was being finalised.

IHR also owns and operates Impiana Resort Cherating, Impiana Hotel in Ipoh, Impiana Koh Samui, Impiana Phuket Cabana Resort and Impiana Private Villas Kata Noi, among others.

Meanwhile, group chief executive officer of KLCC Group of Companies Hashim Wahir said Heritage Lane hopes to be able to see return on investments earlier than the usual seven to 10 years taken by a new hotel. This is because the hotel's occupancy is strongly supported by events held at the Kuala Lumpur Convention Centre.

With the addition of the new wing, the hotel has a room inventory of 519.

Meanwhile, Kuala Lumpur Mayor Tan Sri Ahmad Fuad said that the development order had been issued for the Malaysia Truly Asia Attraction, which forms part of the Greater KL initiative.

He said that it was in the midst of relocation some 32 residences from the area.

Kuala Lumpur City Hall, in partnership with Themed Attractions Malaysia, will open the world-class cultural attraction in 2014.

By Business Times

MRCB enjoys 48pc Q1 pre-tax profit surge

Malaysian Resources Corporation Bhd (MRCB) recorded a 48 per cent hike in pre-tax profit to RM35.6 million for the first quarter ended March 31, 2012, from RM24 million in the same quarter last year.

Revenue also rose to RM328.6 million versus RM221.5 million, the company said in a statement today, citing strong contribution from its property division due to progressive works at Kuala Lumpur Sentral for the higher profits.

Recurring rental income from the newly completed KL Sentral Park office also contributed to the improved results for the current quarter.

The newly completed KL Sentral Park office, the group’s latest property investment addition continues to attract encouraging interests, with tenancy expecting to reach full occupancy by this year, MRCB said.

Ongoing construction of CIMB Tower at Lot A, Shell Tower at Lot 348 and the integrated Nu Sentral retail mall, three office towers and one block of hotel at Lot G were progressing on schedule to complete within this year.

The Eastern Dispersal Link Expressway in Johor Baharu was opened to traffic on April 1, 2012 while negotiations with the government for toll collection are still in progress.

Among the group’s major construction works, the Ampang LRT extension line project commenced work late last year.

By Bernama

L&G unit gets RM7.8mil aid

PETALING JAYA: Land & General Bhd (L&G) is providing up to A$2.5mil (RM7.8mil) to its 50%-owned subsidiary Hidden Valley Australia Pty Ltd (HVA) within the next 12 months as financial assistance for a proposed retirement estate project in Melbourne.

The property investment and development firm told Bursa Malaysia recently that the proposed retirement estate consists of 298 residential units, built as standalone and duplex-style accommodation, with the average selling price at A$456,000 (RM1.42mil) per unit, which is expected to generate a project surplus of A$60.1mil (RM187mil).

HVA is in the midst of obtaining approvals from the Australian authorities to start the proposed project in the second half of this year.

The project, expected to be completed in March 2023, will be built in 10 stages. Each stage is expected to take 12 months.

The total gross development expenditure is estimated to be A$116.2mil (RM362.2mil), which primarily will be funded with bank borrowings and internal funds or collections from progress billings.

L&G said that due to current market sentiment, banks were only willing to extend facilities if there were similar commitments shown by shareholders.

“Therefore, the availability of the financial assistance is crucial during the early stages of the proposed project. Both joint-venture shareholders of HVA will provide advances proportionate to their respective shareholdings,” it said.

L&G has a 50% stake in HVA via wholly-owned subsidiary Land & General Australia (Holdings) Pty Ltd or LGAH, with the other half owned by HVA director Craig Williams.

L&G said the financial assistance was for working capital and preliminary expenses for costs including advertising and promotion, project consultancy and overheads.

The financial assistance for HVA is without any specific repayment timeframe or interest, and will be funded via L&G's internal funds.

L&G also said any additional financial assistance to be provided above A$2.5mil (RM7.8mil) would require L&G shareholders' approval once it exceeded 5% in aggregate.

The proposed retirement estate is part of the 2,500-acre Hidden Valley development.

According to the website www.hiddenvalleyaustralia.com.au, the development is a 50-minute drive to Melbourne's central business district via the Hume Highway. The attractions include an 18-hole golf course and a country club.

By The Star

Mah Sing share price at RM1.92 on Bangi mixed devt project

KUALA LUMPUR: Share price of Mah Sing Group Bhd rose to a high of RM1.92 in the afternoon session on Monday on news it was buying 412 acres of freehold land near Bangi for a mixed township.

At 4.07pm, it was up four sen to RM1.89. There were 46,200 shares done at prices ranging from RM1.85 to RM1.92.

At midday, Mah Sing announced the mixed development included double storey link homes indicatively priced from RM530,000 onwards.

It was acquiring the land at RM18.55 per square foot under its strategy to expand its landbank and under the project called Southville City.

OSK Research said it was maintaining its forecasts at this juncture as well as its Buy call on Mah Sing at an unchanged fair value of RM2.69, which is based on a 20% discount to its RNAV valuation.

"The stock's relatively inexpensive valuation makes it an attractive value proposition, especially for investors seeking a cheaper exposure to mid-sized property stocks," it said.

By The Star

Pull of the overseas property markets

KUALA LUMPUR: Investing in the overseas property market seems to be popular among Malaysian investors despite the eurozone crisis, which is affecting economies worldwide.

Among the target markets are the UK, France and Germany.

Firms like Permodalan Nasional Bhd (PNB), which has three London properties in One Exchange Square, 90 High Holborn and Milton and Shire House, and Syarikat Takaful Malaysia, which is scouting for commercial buildings, or offices in London, are just a few proofs that Malaysian companies are investing in overseas property markets.

The UK, particularly London, is the centre of attraction for international investors who want to invest in commercial property markets, said Amiri Capital UK partner Bindesh P. Shah.

This, he said, is due to the UK having a large liquid market with go-od legal and regulatory infrastructure, therefore making it easy and reliable both to buy and sell property.

The full repairing and insuring (FRI) leases in UK makes the obligation of up-keeping the property fall on the tenant, therefore making it relatively easy to manage.

"What it means is when you buy a building, every year, as the investor, as the owner of the building, your responsibility is just to make sure the building's there and collect your lease payment, but the responsibility for maintaining the building both inside and outside rests with the tenant.

"Whereas in many other markets, responsibility of the maintenance of the buildings still rests with the owner of the building," Bindesh said in an interview with Business Times.

Bindesh said the sovereign debt crisis that is linked to Europe has created uncertainties among international investors and many of them fail to understand the heterogeneous nature of Europe.

"The debt crisis is referred to the European debt crisis when in fact it is a debt crisis of certain countries in Europe and so, not every country is in that crisis situation ... Main economies in Europe including Germany and France, have strong fundamentals," he said.

He also said there are not many barriers for Malaysian investors to go into the residential and commercial property markets in the UK and Europe. In fact, now is a good time to invest.

"It's an old contrarian investing idea, which is whenever everyone else is rushing out of the market it usually means there's actually some good opportunities being left."

Another Amiri Capital partner, Richard Ellis, said there has been less investment in European property markets, so there is a strong compelling reason to invest there.

"There hasn't been a rush of capital into these assets and there's still good pricing on some really good-quality buildings," he said.

Speaking on two different types of property in Europe - core and opportunistic - Ellis said the sovereign debt crisis, while serious, can and is being resolved.

When investors invest in the core properties in Europe, he said they will benefit from capital appreciation when the capital flows return to the main markets.

Core properties are the most liquid, most developed, least leveraged, and most recognisable properties. It tends to be held for a long period of time and the majority of its income comes from the cashflows instead of value appreciation.

Core property is seen by some investors as a substitute to bond, said Ellis, adding that rather than investing in a government bond, they invest in core property as it has higher returns or yield. "So, rather than getting one or two per cent return for a bond, you can get up to seven per cent from a property."

Ellis also said the shortage of bank liquidity combined with many distressed investors as well as refinancing deadlines looming means that there will be opportunities to acquire good-quality buildings at good prices, hence the opportunistic properties.

By Business Times

BLand of the rising sun

The Bien Hoa City Square Amber Court Condominium (Phase 1) project by BLand in Ho Chi Minh City, Vietnam. BLand is probably the first Malaysian developer to have delivered completed units to purchasers in Vietnam.

BERJAYA Land Bhd (BLand) wants to enlarge its presence in North Asias property markets and plans to make a debut in Japan within one to two years.

It is in the design stage of commencing a luxury resort and residential development on a prime site in the ancient capital of Kyoto and is also preparing to undertake an integrated resort development in the island of Okinawa.

BLand chief executive officer Datuk Francis Ng says in line with the companys expansion into the region, Japan has been identified as an important investment destination with its resilient economy, technological advancements, developed legal framework, and a strong work as well as business culture.

Ng says Japan’s proximity to China and South Korea provides synergies and value.

We believe Japans proximity to China and South Korea would provide potential synergies and value to our two proposed developments in Japan, Ng tells StarBizWeek.

The development in Okinawa would be anchored by a branded luxury resort with a shopping mall, a wellness centre and other commercial component, as well as high-end residences.

According to Ng, BLand is seeking to extend its presence and brand both regionally and internationally, and it has invested some RM1.5bil in property development ventures overseas. The expenses are mostly for cost of infrastructure, land acquisition and planning approvals.

BLand, the property arm of Berjaya Corp Bhd, also has development projects in Hebei in China, Jeju in South Korea, Ho Chi Minh City and Hanoi in Vietnam.

Work is underway in these countries and we are focusing on what we are good at; namely resort and integrated residential and commercial developments featuring villas, condominiums, hotels and serviced residences, retail centres and offices, Ng adds.

In Vietnam, BLand has completed and handed over condominium units to the purchasers of its two maiden projects, Amber Court Condo in Ho Chi Minh City and Canal Park Condo in Hanoi.

This is in spite of the uncertainties and volatility of the Vietnam property market over the last few years.

Making a mark

Ng says BLand is probably the first Malaysian developer to have delivered completed units to purchasers in Vietnam.

We are proud to be able to share with our buyers, who are mostly young and hardworking, the joy of living in a planned development complete with beautiful landscapes and parks.

Going forward, he says the launches will be staggered out according to market demand.

In China, BLands 51% owned subsidiary, Berjaya Great Mall of China Co Ltd, is undertaking the development of the Great Mall of China. The balance 49% is owned by Berjaya Group founder Tan Sri Vincent Tan through his private arm, Berjaya Times Square Cayman Ltd.

The mall project in Yanjiau city, Hebei province, has a gross floor area of 18.5 million sq ft and is scheduled for completion in 2017.

Ng shares his enthusiasm for BLands maiden project in South Korea, Berjaya Jeju Resort, which marks the companys entry into that country.

Construction work is set to kick off this October while the sales launch would be in April or May 2013.

The project on the honeymoon island of Jeju will be developed into a world-class integrated tourism and recreational destination.

He says over RM300mil had been spent on site preparation for the sea-front resort-type residential and commercial development. The infrastructure that include roads, bridges and utility support are already in place.

As required by the local authorities, the site has been properly landscaped and the park areas fully fitted out with playground equipment. Given its superb location and Jejus international appeal as one of the New Seven Wonders of Nature and awarded the only Triple Crown by Unesco,

Global appeal

Berjaya Jeju Resort is expected to attract substantial interest from Korean buyers as well as those from China and Japan.

Dream project: An artist’s impression of Berjaya Jeju Resort. Among the components will be 1,282 residences including villas and apartments worth a GDV of US$1.5bil; a casino, two hotels, shopping mall, indoor arena and a valley resort and wellness resort.

The development is undertaken by Berjaya Jeju Resort Ltd, a 71.2:19:9.8 joint venture between BLand, Jeju Free International City Development Centre (JDC) and an American partner, Swan Street Partners LLP.

Ng says the development is a strategic investment to BLand as the geographical location of Jeju made it a well-connected city with a potential market of over 750 million people.

Jejus free international city status coupled with various tax incentives, such as a five-year corporate tax exemption from the first year of profits, and property tax exemption of 15 years for both Korean and foreign investors, are the primary factors why Jeju is seen as a good investment.

The Jeju project is a long term investment for us which will stand us in good stead for other opportunities in South Korea, he adds.

Located on 184 acres in Yerae-dong in Seogwipo City in southwest Jeju, the project has an estimated gross development value (GDV) of US$3.5bil.

Among the components will be 1,282 residences including villas and apartments worth a GDV of US$1.5bil; a casino, two hotels, shopping mall, indoor arena and a valley resort and wellness resort.

Mah: ‘Our immediate target buyers are of course the Koreans, especially those from Seoul.’

BLand senior general manager for properties marketing Mah Siew Wan says there is no restriction on foreign buyers to purchase property in Jeju and the target buyers are the South Koreans, Chinese, Japanese and Taiwanese.

Our immediate target buyers are of course the Koreans, especially those from Seoul. It is said that it is every Koreans dream to own a home on Jeju island, Mah adds.

South Korea has a population of more than 70 million, of which 560,000 are residents in Jeju.

The first phase of the development will comprise the Maision villas and market block. It was initially planned for launch in the first quarter of 2011 but had been delayed because of the global financial crisis and soft property market.

Meeting specific needs

We reassessed the situation and revised the plan and strategies to suit the changing market trend. We are now ready to launch the project, she says.

Meanwhile, Blands hospitality division is also spreading its wings in the international arena, and has 16 properties in Malaysia, London, Singapore, the Philippines, Seychelles, Sri Lanka and Vietnam.

Ng says going offshore offers an ideal opportunity for BLand to market its hospitality and property offerings to a global audience.

In this highly competitive market, developers have to put extra efforts to get the attention of property investors who look for good buys beyond their home markets. Many have gone international, not just in terms of the location of the projects, but also with the buyers they are hoping to attract.

He adds that before venturing overseas, BLand adopts a stringent selection approach which explains why its portfolio of offshore projects comprises only prime and attractive properties that can find ready rental and sales.

Property buyers all over the world are becoming increasingly global in their appetite for investments. The wealthy in Asia such as those from China, Indonesia and Malaysia, have been snapping up properties in Australia, Singapore and London.

We spend time and efforts to study the market, and then plan and design to cater to their needs. The idea is to be familiar with trends and preferences of the property buyers; such as the average sizes of homes, the lifestyles of families, and the typical layouts. We need to learn these specific needs in order to do well in any country, Ng explains.

By The Star

Conditions that can derail growth in the property sector

In my last article, I touched on two reports that offered a very positive outlook for the property market in Malaysia and its neighbours in this region.

According to the Malaysian Property Market Report 2011, the property sector recorded a significant growth in the five preceding years, and the value of property transacted and the number of transactions also rose substantially in 2011, compared with the previous year.

And according to the Asia Property Market Sentiment Report 2012, Malaysians were generally quite positive about the property market, with more than half expressing a desire to acquire new property in the next six to 12 months.

Sadly, these upbeat sentiments could all change as a result of recent events and some prevailing conditions if they are allowed to continue unabated.

The most recent is, of course, the Bersih 3.0 rally and the ensuing violence that have certainly raised a lot of concerns, at the very least, about conditions in this country.

It may still be too soon to realise the full impact of the April 28 event. Nevertheless, the experience of our northern neighbour should give us some invaluable lessons on how a prolonged open show of dissent and how the authorities deal with such incidents can have an adverse impact.

The Red Shirts and Yellow Shirts rallies that brought Bangkok to a standstill for months in 2010 and which eventually caused the downfall of Prime Minister Abhisit Vejjajiva, should offer some invaluable insights.

Of course we have to concede that the Bersih 3.0 rally was on a much smaller scale, and it lasted only for a day, so the effects would be dramatically different.

But incidents such as Bersih and the Anti-Lynas protest also bring to light how people power causes can sometimes be hijacked and be diverted from the real issue.

In the property sector, for instance, it is not uncommon to see groups banding together to object to one thing or another in an upcoming project even if all conditions are met.

Things are aggravated further by a lack of clear-cut guidelines on what is and is not allowed in a project. When guidelines are not clear, city or local council officials are inclined to make decisions based on political expediency. In such instances, investors or developers usually end up with the short end of the stick.

Then there is the personal safety issue. A day before Bersih, 12-year-old schoolboy Nayati Shamelin Moodliar was abducted while he was walking to school from his home in Mont Kiara, Kuala Lumpur.

Thankfully, the boy was released unharmed just over a week later upon payment of a ransom. All the same, the incident has certainly raised concerns about the level of security in the Mont Kiara area.

Indeed, the police may tout facts and figures on how much the crime index has dropped over the years, and how safe the streets are now. But the reality is that parents are still worried and anxious about letting their children out of the house, and out of sight.

Another urban centre where personal security is an issue is Johor Baru. We may not like it that the Singaporeans complaint about rampant carjacking when they visit Johor, but we cannot deny that these things happen.

Apart from these, we are constantly being tested by natural disasters that rock this region. While Malaysia is not located in the Ring of Fire, the 2004 tsunami and occasional tremors only show that we are not exactly a safe distance from a major disaster.

Then, there are the man-made calamities floods and landslides caused by irresponsible and uncontrolled interference in the natural landscape.

What, you may wonder, do all these have to do with property' Put simply, disturbances of any kind public show of dissent, criminal activities or natural disasters are not good for the economy and, by extension, for the property market.

As mentioned earlier, we have done fairly well over the past few years. The economy has been growing at a steady pace, and property was selling well.

Many homebuyers have seen their investments record substantial increases in value in the secondary market, and are still looking forward to bigger gains.

However, this feel-good factor can very easily be reversed by any number of developments groups taking the law into their own hands, street crimes, another big natural disaster or worse a man-made calamity.

How well are we dealing with all these conditions' Are the authorities making the right moves' Do we continue to pander to the loudest voice, never mind what is right or wrong'

Value, location and design are no longer the only considerations when we look for a new home to buy. The security situation has also become a prime consideration.

We also now have to check if our new home is located in a flood-prone area, or if we are likely to feel an earth tremor.

The property sector is already facing so many challenges.

Recently, Bank Negara introduced stricter lending guidelines that substantially reduced the quantum of loan an individual could qualify for. That essentially means that fewer people will be able to get loans and among those who still qualify, the amount they can get will be much lower.

The impact will be significant and it may take some time before the market adjusts to the new lending regiment.

At the same time, costs to the developer continue to rise. Land prices, particularly in urban areas, are going up. The cost of building materials have been increasing over the past few years and is expected to rise further. The cost of labour has also risen.

Anymore uncertainty in the political front, or concerns about personal safety, will only make things worse. We cannot afford to continue on this road.

Teh Lip Kim is the MD of SDB Properties Sdn Bhd, a lifestyle property company. Bouquets and brickbats are welcomed. Send by e-mail to md@sdb.com.my.

By The Star

UEM Land’s Nusajaya wins Fiabci award

KUALA LUMPUR: UEM Land Holdings Bhds Nusajaya development emerged as the winner in the Master Plan Category at the prestigious Fiabci Prix dExcellence Awards 2012.

The award was received by UEM Lands managing director and CEO, Datuk Wan Abdullah Wan Ibrahim, at a presentation ceremony in St Petersburg, Russia, the company said in a statement.

We are honoured with achieving this accolade from a renowned world body like Fiabci for our new regional city Nusajaya. As the master developer of Nusajaya, we are proud that Nusajaya is presented with this international recognition as we continue to push forward and realise its signature and catalytic developments, Wan Abdullah said in a statement.

Aptly, 2012 sets the stage for Nusajaya to achieve its tipping point where the splendour of its diverse signature developments will unfold.

Nusajaya was conceptualised to be a self-sustaining city that was conducive for business, living and leisure, it said.

Its unicity was manifested in the diverse yet complementary signature projects and catalytic developments in seven key sectors government, residential, commercial, industrial, leisure, health & wellness, and education, the statement said.

The Fiabci award recognises projects that best embody excellence in all real estate disciplines involved in their creation.

Winning projects are judged based on a set of criterias which include architecture, development, environmental impact, financials and marketing and are selected by an international panel of real estate professionals and experts.

Last October, Nusajaya was also named the Best Master Plan at the Fiabci Malaysia Property Award 2011.

By The Star

Foresight in resolving social and community problems crucial for the local authorities

There have been quite a number of cases when open parks and fields have been turned over for development purposes; a move that usually invite protests from the local residents.


LOOKING around our housing estates, work and recreation spaces, I believe many of us must have a wish list of things for a better living, work/study and recreational environment.

Although headway has been made in the residential arena with more practical and creative designs and concepts (depending on who the developers are), more value-adding initiatives are still needed in our work place and recreational facilities.

Im sure many of us have noticed there are quite a number of office buildings in some zones of Kuala Lumpur that are built up to the maximum plot ratio and are too close to the pedestrian walkways and roads. A high percentage of the built-up space has been sold which explain why the buildings dont have enough parking spaces for the office workers and visitors.

Allowing such building designs will further exacerbate the severe parking space shortage in the city.

During the construction of these buildings, the presence of the many tractors, cranes and fork lifts so close to the roads pose a threat to pedestrians and other road users. To prevent any untoward incident, the local authorities should ensure that all new buildings maintain a safe distance from the walkways and roads.

Given their role as the governing authority for land matters and project plans, local authorities that include district and municipal councils, play a highly crucial role in determining the well-being of the local communities and in how the areas that come under their administration fare.

Despite being one of the non glamourous public bodies with their placing in the lower rank of the public administration order, the local authorities are actually important institutions at the local level and the guardian of public property and facilities.

Among their traditional duties are the provision and upkeep of public health and sanitation, general maintenance functions of infrastructure and public facilities, as well as overseeing all land and development matters.

Thats why grouses over clogged drains, poor garbage management, potholes and floods, to town planning matters, environmental protection, building control, and issuance of certificate of fitness for occupation, come under their purview.

Being the authority that is closest to the people, their performance has a direct and immediate impact on the peoples daily lives. Their efficiency or inefficiency in discharging duties will affect the public and rate payers in many ways.

That could explain why the local councils are the recipients of a fair number of letters to the editors to newspapers.

With the many developments going on around us and an expanding population, there is a need for the local authorities to be more proactive and act as the catalyst of change and progress in their areas.

They should not just uphold their traditional roles but be effective thinkers and implementors of plans for social and economic development in their areas.

They must act fast and efficiently at all times, and must also have the foresight and initiative to undertake preventive measures to resolve some of the lingering social and community problems in the long run.

There have been quite a number of cases when open parks and fields have been turned over for development purposes; a move that usually invite protests from the local residents.

Instead of signing over public parks, lakes and open spaces for development purposes, the local authorities should act as the guardian of these public spaces and wherever possible undertake enhancement efforts to further add value to these facilities.

Local authorities should also promote best industry practices in building designs and development planning practices for more environmental friendly designs and healthier living environment.

To prevent over building and congestion, plot ratio of building projects should be strictly adhered to. This is so that the infrastructure, utilities and amenities are not strained.

Our local authorities can take a leaf from their counterparts in the more developed countries such as South Korea and Japan with well structured and transparent practices in building matters.

Over there, fair trade practices are standard operating procedures for all industry players where even the sale of property has to abide by the balloting process; and strict building design guidelines have to be followed even on matters concerning the amount of lighting to a building and natural ventilation.

Deputy news editor Angie Ng hopes shopping complex owners will set aside space for a library and garden which although non-revenue generating, will be much appreciated.

By The Star (by Angie Ng)

Far East buyers beware in London property rush

LONDON(Reuters): When Hong Kong businessman Mr. He paid a 35,000 pound ($56,000) deposit on a four-bedroom apartment in Britain, he believed it was a 40-minute walk from central London, his lawyer says. In fact it was a 40-minute journey by high-speed train.

The 350,000 pound home was in Lincolnshire, eastern England. He sued the developer for misrepresentation last year, getting his money back before the case got to court in what his lawyer told Reuters was an attempt by the developer to avoid its marketing material being splashed around a courtroom.

His experience shows the potential pitfalls facing a growing number of Far Eastern people buying British homes unseen as developers target places such as Hong Kong, Shanghai and Singapore because British buyers are struggling to get mortgages.

"It is a matter of developers saying: 'Here are some people who are likely to be interested. They probably do not know too much about the market, so why don't we advertise there'," said David Eldon, former chairman of HSBC's Asia unit who has witnessed the practice during two decades in Hong Kong.

"I think they are being a little economical with the truth," he told Reuters, saying properties could be sold for higher prices in the Far East.

Major developers including Barratt, Taylor Wimpey and Berkeley have stepped up efforts to court cash-rich Far Eastern buyers since 2009 after the global financial crisis sapped demand at home. Developers do not all use exactly the same marketing methods.

Berkeley said it had had many repeat purchases from Asian buyers over 20 years, although it acknowledged a mistake in one of its press releases. Taylor Wimpey said it offered a high level of service to all customers. Barratt declined to comment.

The number of Chinese and Pacific Asian buyers of the best quality newly built London homes jumped to 37 percent in 2010 from four percent in 2009, data from property consultancy Savills showed. The majority purchase for investment and are used to buying off-plan - before the home is built.

Mr. He was told his flat was 40 minutes from central London at a face-to-face meeting with the developer, said David Linklater, head of litigation at law firm Alan Broadhurst, who represented He. Broadhurst declined to give his client's full name or the developer's identity.

"Lots of people go to the fairs in Hong Kong and get a sheet of paper with a picture of Big Ben. You think you are going to be the Queen's neighbour when actually the Queen has a great big garden with a big wall around it," said Linklater, who deals with 20-30 unhappy overseas buyers a year.

PICTURES OF HARRODS

Sold at exhibitions in plush hotels, many properties are not in the most desirable London neighbourhoods despite the prominent pictures of Harrods or Buckingham Palace. Details of exact locations tend to be omitted rather than inaccurate.

"There is a lot of embellishment going on working off the naivety of the Chinese buyer," said James Moss, managing director of property consultancy Curzon Investment Property.

A brochure advertising 375 Kensington High Street, a luxury London scheme marketed in the Far East and developed by a Berkeley joint venture alludes to the proximity of the High Street Kensington underground station in a brochure entitled "London's most sought after new address".

The station, which is at the heart of one of London's most popular shopping districts, is a 15-20 minute walk away while the flats are at the scruffier end of the same long street and closer to two other tube stations.

In a press release issued in Hong Kong on Friday, the development was described as "a short walk from the luxury shopping available at Harrods". The world-famous store is a 50-minute walk according to the Transport for London website.

"To an unsuspecting buyer, you think wow, it is amazing, but actually it is the wrong end of Kensington High Street, right next to Kensington Olympia," said Camilla Dell, managing partner at Black Brick Property Solutions, which helps overseas buyers find London homes.

A Berkeley spokesman said the "short walk" description was "an error".

"We have had a lot of customers from Asia over the last 20 years, many of whom are repeat purchasers," he said.

"It (the development) has excellent transport links and easy access to well-known shops; the distances to which are clearly marked in our brochure. In addition, by far the majority of buyers have or will visit our developments before buying."

Ingrid Skinner, managing director of Taylor Wimpey Central London, said: "Buyers need to be able to trust the company they are buying from. At Taylor Wimpey we offer the same high level of service to all of our customers."

HIGH PRESSURE

The ballrooms of Hong Kong's luxury hotels hold property shows nearly every weekend. The city's two Mandarin Oriental hotels are particularly popular.

At one event attended by Reuters on Friday, prospective buyers were offered San Pellegrino bottled water, chocolate cupcakes and a choice of finger sandwiches. An HSBC banker was on hand to help with financing and a lawyer in case a purchaser was ready to sign.

Buyers can feel the pressure.

Judith, a native of Zhejiang in China who lives in London and declined to give her full name, said her father paid the deposit on six off-plan flats in Colindale, north London, at a Shanghai exhibition a year ago despite the fact she warned him about its remote location.

"The moment my father sat down, the agent wanted him to pay a reservation fee. Once he showed that he liked them, they said he had to pay the fee or someone else would snap them up," she said.

They are in a legal dispute with the agent in an attempt to recover 24,000 pounds, claiming they were sold the properties on the basis they could be converted into nine units, which they subsequently discovered was not possible.

"The developer and agent are not obliged to educate the buyers, it is down to the buyers to educate themselves," said Ken Xiao, president of Chinese Property Professionals Society in London. "Of course the agents will try to show the shiny side because they are trying to sell the property."

There may be little legal recourse. Those buying new homes as an investment are not protected under the National House Building Council's consumer code as opposed to those looking to occupy them, a spokeswoman for the watchdog told Reuters.

Estate agents said overseas buyers of property as an investment were at risk of getting lower-than-expected returns as the mass marketing of the homes at events meant many landlords would likely have to vie for tenants all at once, pushing rents down, Dell said.

"I have yet to see a development where the rents have exceeded the advertised rent," said Ashley Jones, managing director at London-based estate agent Barclay Residential. "I cannot see all of this having a happy ending."

By The Star

Mega project woes

Unhappy group: Residents are protesting against the development in front of the newly-completed block of shophouses.

PALM Grove residents are unhappy with the Klang Municipal Council for approving a mega project, including two hotels and a mall near Taman Palm Grove in Klang.

The IGateway project occupies a 6ha site in Taman Datuk Abdul Hamid, which is separated from Palm Grove by two service roads, Lebuh Turi and Lebuh Siput.

Palm Grove Rukun Tetangga chairman S. Kanapathy said the mega project was launched 15 years ago but was later abandoned.

“A new developer, Legenda Erajuta Sdn Bhd, took over in recent years and is also completing two abandoned three-storey shophouses in Lebuh Turi.

“Legenda Erajuta is also busy selling its retail outlets which are due for completion in two years,” he said during a protest held by the residents.

Kanapathy said the area had also been hit by frequent flash floods due to the construction of the shophouses.

He said although the shophouses had been completed there was no access road and separate drainage.

“When the mega project is completed we are sure to face a lot of problems, including traffic congestion. The mega project will rob us of the serenity of this peaceful housing estate,” he said.

By The Star

Shangri-La expects better performance this year

KUALA LUMPUR: Shangri-La Hotels (Malaysia) Bhd expects overall performance to improve this year as it completes the renovation of one of its hotels and expands its stable.

Shangri-La's profits slipped in 2011 as renovation at its second-best performing hotel Rasa Ria Resort in Sabah led to a sharp drop in occupancy.

Coupled with a lower occupancy and contribution from UBN Tower, the group posted RM60.56 million net profit on the back of RM429.73 million revenue. Its net profit in 2010 was RM69.9 million.

The renovation of Rasa Ria began in March 2011 and will be completed this month. It will see all the newly-renovated rooms back in the market in the second half of the year.

"The year will be better as Shangri-La KL's performance is going up and we will have Rasa Ria back," managing director Kuok Oon Kwong told reporters following the company's annual general meeting yesterday.

Shangri-La Hotel Kuala Lumpur will continue to be the group's best performer. Last year, it contributed RM161.87 million towards group revenue and a pre-tax profit of RM32.35 million.

Later this year, a Shangri-La-managed Traders Hotel will open in Puteri Harbour, Johor Baru.

The opening of several amusement and theme parks including Legoland, Hello Kitty Town, Little Big Club and a Lat-themed restaurant from September should augur well for the hotel.

In 2010, Shangri-La signed a heads of agreement with Teluk Datai Resorts Sdn Bhd (TDR) to form a 49:51 per cent joint venture to develop the resort. Khazanah Nasional Bhd has an indirect 70 per cent stake in TDR.

The resort development in Langkawi is conditional upon Shangri-La taking up a 20 per cent stake in Traders Hotel Puteri Harbour.

"We are still going through the legalities," Kuok said of the status of it taking the stake in Traders Hotel.

As for the Langkawi hotel, she said no agreement has been signed and expects that the earliest the hotel will be ready will be within the next three to four years.

Meanwhile, Kuok expects its hotel in Kuala Lumpur to feel an impact after the opening of the 412-room Grand Hyatt Kuala Lumpur in mid-2012. "There is bound to be some impact on all hotels and not just us when new rooms are added into the market," she said, adding that this is assuming the market does not grow.

Kuok said that there has been no scheduled renovation.

Over the past few years the group embarked on a complete makeover of the Rasa Sayang Resort and renovated the Golden Sands Resort, both in Penang. It also renovated Shangri-La Kuala Lumpur and, most recently, Rasa Ria.

By Business Times

KHSB, HK firm plan eco-development in Kuala Selangor

SHAH ALAM: Kumpulan Hartanah Selangor Bhd (KHSB) and Hong Kong-based Sun Lohas Group Ltd signed a memorandum of understanding (MOU) on the proposed eco-development concept of a 2,013ha land in Bestari Jaya, Kuala Selangor.

Chairman of KHSB Raja Idris Raja Kamarudin said the main concern of the MoU was to enable Sun Lohas to carry out a financial and legal due diligence as well as feasibility study on the proposed development known as Sun Lohas City.

He said the development would start in six months after considering factors such as immigration, labour and legislation. “Sun Lohas has proposed to us a unique concept to develop our land in Bestari Jaya. If the concept is workable and feasible, the proposed project would offer an opportunity for skill development in this state,” he said in a press conference after the MoU signing here yesterday.

Sun Lohas chairman Chen said the gross development value of the project was estimated at RM8bil.

By Bernama.

KHSB in pact to develop 2,013ha site

KUALA LUMPUR: Kumpulan Hartanah Selangor Bhd (KHSB) and Sun Lohas Group Ltd yesterday signed a memorandum of understanding (MoU) on the proposed eco-development on a 2,013ha site in Bestari Jaya, Kuala Selangor.

The MoU is to enable Sun Lohas to carry out a financial and legal due diligence as well as feasibility study on the proposed development known as “Sun Lohas City”.

The gross development value of the project is estimated at RM8 billion, while the development is expected to be completed within 10 years’ time.

By Business Times

Amcorp Properties sells London flats

PETALING JAYA: Amcorp Properties Bhd is selling an apartment development in London, England for £9.3mil (RM46mil) to International Trading Group (Holding) SAL and Universal Distributors Holding SAL.

Amcorp Properties told Bursa Malaysia it agreed on Wednesday to sell its subsidiary Riverich Ltd, which owns a freehold 10-apartment unit development at 101 Lexham Gardens, London.

Riverich had bought the development in December 2010 for £7.3mil (RM35.9mil) cash.

By The Star