Najib: Tower to benefit all

The 100-storey building will not be a waste and will bring great economic benefits to both Bumiputeras and non-Bumiputeras, says Prime Minister Datuk Seri Najib Razak

Prime Minister Datuk Seri Najib Razak says the proposed Warisan Merdeka project will be a boon to all Malaysians.

"The 100-storey building will be the latest landmark in Kuala Lumpur and will bring great economic benefits to both Bumiputeras and non-Bumiputeras," he said.

"It will not be a waste," he said when asked to comment on charges by some quarters that the tower project, announced during the tabling of the 2011 Budget, would be a waste of public funds.

Speaking to reporters after briefing the 2,500-odd delegates attending the 61st Umno general assembly in Kuala Lumpur yesterday, Najib said the tower, which would be the country's tallest, surpassing the Petronas Twin Towers by 22 floors, was proposed by Permodalan Nasional Bhd (PNB), which felt strongly that it would bring great benefits.

"The tower idea did not come from me, but was proposed by PNB's board of directors which felt it was viable. I did not direct PNB on the matter."

Najib said the tower would be a symbol of a modern and developed Malaysia in addition to creating many economic spin-offs.

It would also be a major commercial hub for both Bumiputeras and non-Bumiputeras.

On his critics, Najib said it was expected.

"When Tun Dr Mahathir Mohamad proposed the Penang Bridge, many criticised him. He was also attacked when he proposed the Petronas Twin Towers. In the case of the bridge, the people of Penang now want a second bridge," he said.

By Business Times

Bina Puri JV wins Ipoh condo job

KUALA LUMPUR: The joint venture (JV) between Bina Puri Holdings Bhd and Beijing Construction Engineering (M) Sdn Bhd (BCEG) has won a RM109mil contract to build The Haven, dubbed to be the most luxurious condominium in Ipoh.

The contract, awarded by Superboom Projects Sdn Bhd – a privately held property developer, is for the construction of the high-end residential project slated for completion in 2013 with gross development value of RM250mil. The Bina Puri led-JV was chosen over seven bidders. The leasehold Haven, Lakeside Residences is a 26-storey building with 489 units located in Tambun, Ipoh.


Peter Chan

Superboom chief executive officer Peter Chan (pic) said The Haven, with its special features and quality, would be the best value luxury condominium in the world.

“Selling at RM338 per sq ft, the price range will be between RM300,000 and RM1.7mil for various units of between 968 sq ft and more than 5,000 sq ft (penthouses).

“The price is definitely lower than the price (of similar residential) in the Klang Valley but it cannot be a lot lesser as the building cost is the same although the price of land per sq ft in Ipoh is about one-eighth of that in Kuala Lumpur,” he said after the signing ceremony for the appointment of the JV as the main contractor for the project.

In terms of price appreciation, Chan said they expected a high increase.

“According to the experts, intrinsically it is worth RM450 per sq ft by the time the market realises its potential.

“The take-up rate has also been encouraging so far prior to the launching scheduled by year-end or early next year. Currently 80% of block A and 20% of block C have been sold.

“Construction works of the two blocks (A and C) have already started but development of block B is expected to begin in the next four to six months,” he said.

Chan said the strength of this development lay in its location besides its facilities and conveniences. There are features such as the attractive limestone and green environment and it is 12 minutes drive to the city centre.

Meanwhile, Bina Puri chairman Datuk Wong Foon Meng said both parties in the JV had equal roles and responsibility. Each company would bring its own niche strength to the project, he added.

“With our vast experience in the construction and property sector, we are confident of delivering the project within the stipulated time-frame,” he said.

To date, Bina Puri had delivered projects exceeding RM7.8bil. So far this year it managed to clinched new projects up to RM1.64bil.

BCEG, on the other hand, has completed several projects worth RM265mil in the Klang Valley. It is part of BCEG Group from China which is on the top-225 international contractors list.

Meanwhile, Superboom’s porfolio included the 576-unit Permai Lakeview Apartments in Ipoh and Subang Galaxy in Shah Alam. It has incorporated The Haven Sdn Bhd primarily to undertake The Haven development.

By The Star

TA to develop residential project in Sydney

TA Global Bhd has signed a 50:50 development sponsorship agreement with Sydney-based property funds management and development company Charter Hall Group to develop the A$600 million (RM1.84 billion) Little Bay residential project in Sydney, Australia.

The project, on 13.6-ha of Sydney’s prime coastal area, was acquired by Charter Hall’s Opportunity Fund No 5 in early 2008.

It is expected to include over 500 dwellings, comprising houses, townhouses and apartments.

In a statement, TA Global executive chairman Datuk Tony Tiah said the development was a highly attractive opportunity for the group to expand in Australia.

By Business Times

UEM Land courts local investors to help develop Nusajaya

NUSAJAYA: Besides targeting foreign investors, UEM Land Holdings Bhd wants to attract more local investors to participate in the development of Nusajaya.

Its Nusajaya project director Zulkifli Tahmali said investors could buy land in Nusajaya and develop it themselves or team up with the company in joint-venture projects.

However, UEM Land would not embark on a project if the potential partner was also involved in property development, he said.

“The best example is our collaboration with Malaysian Biotechnology Corp Bhd (BiotechCorp) in developing BioXCell, a biotech park project,” Zulkifli told StarBiz at the launch of the company’s newest housing project Nusa Bayu here recently.

Occupying a 32.37ha site in the 526.10ha Southern Industrial and Logistics Clusters (SiLC), BioXCell is being developed by Malaysian BioXCell Sdn Bhd.

UEM Land holds 40% equity in Malaysian BioXCell and BiotechCorp the balance.

Zulkifli said UEM Land’s role was to provide land and infrastructure, and manage facilities at the park while BiotechCorp would regulate, market and offer incentives to local and foreign biotech companies to set up operations at the park.

UEM Land is the master developer of the 9,308ha Nusajaya, the key driver of Iskandar Malaysia, the country’s first economic growth corridor.

Nusajaya is one of the five flagship development zones in Iskandar. The other four are the Johor Baru City Centre, Eastern Gate Development, Western Gate Development and Senai-Kulai.

Zulkifli said UEM Land owned 3,885ha in Nusajaya, of which 2,023ha was vacant land. Of the 1,862ha set aside for development, 40% was being developed and 60% demarcated for future development.

The projects currently underway are Puteri Harbour Waterfront Development, Nusa Idaman, Ledang Heights, East Ledang, Horizon Hills, Nusa Bayu and SiLC.

“Land prices in Nusajaya have increased since the launch of Iskandar and with several major projects slated for completion within the next one to two years, the trend is likely to continue,” said Zulkifli.

The projects include the RM1.4bil New Coastal Highway linking Johor Baru city centre to Nusajaya, RM715mil Legoland Theme Park, RM300mil Newcastle University Medical Campus and RM400mil Pinewood Iskandar Malaysia Studio.

Zulkifli said the company would only sell its value-added land with infrastructure facilities and utilities to command better selling prices like what it did for 60.7ha Puteri Harbour Waterfront Development.

He said UEM Land had pumped in about RM200mil for infrastructure and utility facilities at Puteri Harbour and the selling price had rocketed to RM250 per sq ft now from RM12 per sq ft five years ago.

“We also want to attract more Singapore investors to Nusajaya and with the improved bilateral ties between Malaysia and Singapore, Johor is going to benefit the most,’’ said Zulkifli.

By The Star

'Mah Sing's landbanking will gather momentum'

MIDF Research believes Mah Sing Bhd's landbanking activities will gather momentum despite the company's recent RM1.1 billion acquisition of Kinrara, Subang-Damansara and Bukit Jelutong land parcels.

Mah Sing's combined gross development value balance and unbilled sales presently stood at RM6.27 billion and RM1.17 billion respectively, the research house in its equity note today.

It also expected Mah Sing's year-on-year earnings growth for the second half of this year to be in the region of 25 per cent.
Mah Sing has revised its sales target for this year to RM1.5 billion after exceeding its earlier target of RM1 billion in July with aggressive new launches.

MIDF Research said Mah Sing would be able to replenish its unbilled sales with the planned new launches in the fourth quarter of this year, thus translating into higher revenue and therefore earnings going forward.

Projects that are scheduled to be launched include Garden Plaza in Cyberjaya, Star Avenue (Damansara), Southbay Plaza (Penang), Icon City (Petaling Jaya) and Kinrara Residence.

MIDF Research said the proposed issuance of RM325 million seven-year redeemable convertible secured bonds (RCSB) was part of Mah Sing's medium-term strategy to focus on acquiring sizeable land bank for potential mass housing development.

"The RCSB proceeds would be sufficient to acquire sizeable piece of circa 190-200 acres of development land in Cyberjaya," it added.

Mah Sing's current projects in Cyberjaya are Garden Residence and Garden Plaza.

By Bernama

Guard against property bubble build-up

In the horror film Drag Me To Hell, an old gypsy woman was so angered by a loans officer’s refusal to extend her mortgage payment that she attacked her in the bank parking lot and later placed a curse on her.

The young officer, Christine Brown, could have chosen to help Sylvia Ganush but she wanted to impress her boss and get a promotion over her co-worker.

Ganush had knelt before her, begging her not to take away her home. But Brown decided to call security, which was when Ganush lost her head.

Such incidents may only appear in films and one’s imagination but it dramatises the point that foreclosure is a cruel and extreme measure.

In the United States, reports of foreclosures and lately, mistakes, speak of untold suffering and confusion among homeowners.

According to Bloomberg, attorneys general in 50 states last week announced an investigation into whether employees of lenders such as Ally Financial Inc, JPMorgan Chase & Co and Bank of America Corp falsified documents used in foreclosure proceedings.

Lenders were also said to have suspended foreclosures in many states after court documents revealed that people working for some large mortgage firms signed papers without checking their accuracy.

Although the problem is serious in the United States, which is at the heart of the action following the burst of the huge subprime housing bubble, it cannot be assumed that problems of a smaller scale will not appear elsewhere.

In Malaysia, the fact that property loan curbs and taxes did not surface in Budget 2011 should not be taken to mean we should let our guard down on any potential property bubble.

Although talk has subsided on discussions between the authorities and industry, it is believed that the intention to impose some kind of curbs is still very much on the cards.

It was earlier reported that a loan-to-value ratio of 70% to 75% for the purchase of third and fourth homes was being considered as a major step to deal with any potential speculative activities.

We should not wait until the authorities clamp down on the market. Instead, proactive monitoring and self-restraint play an important role in the collective consciousness to stem any occurrence of runaway prices.

Bidding up the prices is another practice that should be looked into against fundamental reasons and proper data collection.

In the current build-up of funds into emerging markets, care has to be taken to avoid excessive speculation in the property market as we do not want our people to lose out in any way should the bubble burst.

Senior business editor Yap Leng Kuen believes that prices for a sound investment should not crash overnight.

By The Star (by Yap Leng Kuen)

Karambunai in the limelight after budget

PETALING JAYA: Sabah-based Karambunai Corp seems to have received more than its fair share of attention in the past month.

More recently, it hit the limelight when recently-revealed Budget 2011 stated that Nexus Karambunai – a renowned resort in Sabah – had committed to develop an integrated RM3bil eco-nature resort.

Under the Karambunai integrated resort plan, there are plans to develop a 150ha eco-nature resort at Karambunai alongside a mangrove centre, water theme park and waterfront properties to push for higher return on investments. It is understood that the RM3bil investment will be privately funded, although there are yet to be any concrete details on how this funding will be raised and by whom.

The budget stated that the project would commence next year. In the same paragraph on the Karambunai initiative, the budget proposed that “to support the tourism industry, the Government will allocate RM100mil.” However, it is not clear if this means that the Government will actually invest that money directly into the Karambunai project.

The major shareholder of Karambunai is its president, Tan Sri Chen Lip Keong, who owns 43.9% stake in the company. The 62-year old also owns gaming company NagaCorp, which is listed in Hong Kong and operates a casino in Cambodia.

Having long languished as a penny stock, Karambunai Corp’s shares have been on an uptrend in recent weeks, recording its 52-week high yesterday at 26.5 sen. This stands in stark contrast to four months ago, when the stock price was hovering at a meagre 5 sen.

Still, scepticism abounds on Karambunai’s ability to execute this grand plan, not least because of its weak financial status. The company has been in the red for the past three financial years.

For the quarter ended June 2010, the company continued to remain in poor financial health, suffering losses of RM14.39mil from a previous loss of RM14.62mil. Revenue was up 7.78% to RM24.03mil. As of the period, the company had cash amounting to RM7.29mil. In addition, it has piled on huge debts with short-term borrowings of RM192.07mil and long-term borrowings of RM283.77mil.

This is not the first time the counter has witnessed such exuberance in the absence of any fundamental development. A month ago, the company made headlines when it was speculated that it would start a casino operation in Sabah.

The speculation came about from a proposal of the 500-acre “eco-nature” resort in Sabah by the Performance Management and Delivery Unit (Pemandu) at the Economic Transformation Plan (ETP) open day a month ago.

This piece of speculation drove the share price from 5.5 sen on Sept 21 to 18 sen in a matter of three days.

On Sept 24, Karambunai informed the stock exchange that it has not submitted any official proposal to the Government, nor had it penned any written documents with any other third parties in respect of any plan to build a casino in Karambunai.

So for now, the company has yet to come up with any concrete plans for the eco-nature resort.

Again this week, on Monday, the company had to clarify to Bursa that it had not signed any understating or agreement with any parties and does not have any corporate developments which merit public disclosure.

The company said its controlling shareholder, in his private capacity, had acted as a promoter to invite interested parties to invest in Karambunai.

Karambunai said its property was included in the Budget 2011 speech after its Nexus Karambunai Hotel general manager attended the Performance Management and Delivery Unit-driven national key economic areas tourism lab together with other members of the private and public sectors.

Incorporated in 1965 as Electrical and Allied Industries Ltd, Karambunai Corp is mainly in leisure and tourism, infrastructure and property development

In 1984, the company announced that it would go into the leisure and tourism market as well as property and construction, manufacturing, trading, infrastructure development, and even aerospace and information technology.

On Sept 13, 1993, the company changed its name to FACB Bhd and later to FACB Resorts Bhd on Sept 30, 1999.

It assumed its present name of Karambunai on Sept 30, 2004. It is now mainly in leisure and tourism, infrastructure and property development

Currently, Karambunai owns about 1,500 acres in Karambunai, a peninsula which lies some 27km north of Kota Kinabalu airport.

Its flagship asset is the Nexus Resort & Spa Karambunai, a luxury 5-star 485 room international-class resort hotel with a world-class 18-hole golf course, combining elements of modern architecture with Borneo design and style.

Its latest development in the area are the beachfront Nexus Residences Karambunai (NRK), which features upmarket beachfront resort villas and will comprise about 2,000 units when completed.

By The Star

Country View banking on location for Nusa Sentral

Andrew Tan ... ‘We are looking at Malaysians working in Singapore using the second link as our main customers as the project is located just minutes away from Singapore via Tuas.’

NUSAJAYA: Country View Bhd is banking on strategic location as the main selling point of its latest property project Nusa Sentral.

Marketing manager Andrew Tan said potential buyers would be attracted to its location within the development of Nusajaya in Iskandar Malaysia.

“Nusajaya is the key element in Iskandar. Many developers started projects within the development zone years ahead before Iskandar was launched,” he told StarBiz at the launch of the project on Sunday.

Phase one of Nusa Sentral comprises of 312 units of five-room double-storey link houses with built-up areas ranging between 2,100 and 2,300 sq ft. The units would be priced between RM338,000 and RM380,000.

Tan said the gross development value of phase one was RM117mil and the project, which sits on a 121.40ha site along Jalan Gelang Patah-Lima Kedai, would keep the company busy for eight years.

Iskandar, the country’s first economic growth corridor covering 2,217 sq km in the southernmost part of Johor, was launched on Nov 4, 2006.

Nusajaya, which spans 9,600ha, is one of the five flagship development zones in Iskandar. The other four are the Johor Baru City Centre, Eastern Gate Development, Western Gate Development and Senai-Kulai.

Tan said Nusajaya was progressing well with two major projects – Kota Iskandar and Puteri Harbour Waterfront Development – already completed.

Other projects slated for completion here include the Newcastle University Medical Campus, Marlborough College, Netherlands Maritime Institute of Technology and Legoland Theme Park.

Tan said accessibility to the area would improve when the RM1.3bil New Coastal Highway linking Nusajaya and Johor Baru city centre was completed by the end of 2011.

“We are looking at Malaysians working in Singapore using the second link as our main customers as the project is located just minutes away from Singapore via Tuas,” he said.

He said apart from Malaysians working in Singapore, the company would target home buyers looking to upgrade from nearby areas such as Gelang Patah, Ulu Choh, Pontian, Pekan Nenas and Skudai.

He said the company would also bank on its pricing strategy as the on-going development projects within a 10km radius from Nusa Sentral were targeted at different market segments.

By The Star

Wesley Church mulling over developer proposals

GEORGE TOWN: The Wesley Methodist Church, which owns the 4-acre site where the Pykett Methodist Boys’ School sits along Burma Road, is considering several proposals from local and Kuala Lumpur-based property developers that are keen to buy the land at RM300 per sq ft.

StarBiz learnt that a major player in the high-end residential property market has proposed to build a new Pykett Methodist School at the site, including a car park for the school, together with condominiums and retail lots.

Another well-known developer on the island has proposed to build a new Pykett Methodist School at a different site owned by the developer.

“The developer will also build some properties for the Methodist Church so that it can generate long-term revenue. In return, the developer gets to develop certain portions of the land to offset the construction cost of the school and other properties for the land owner. The cost of the school and car park will be used to offset the selling price of the land,” the sources said.

Another developer, which has made a bid to purchase the land, said the price of RM300 per sq ft was on the high side.

“Land in the area is priced around RM200 to RM250 per sq ft. At present, the site is gazetted as institutional land and needs to be converted for other usage. The commercial enhancement value charge, for example, is about 50% of the incremental value of the land, based on the difference between the selling price when it was first valued and what it is worth today. The other factor that needs to be considered is that the developer can apply to build up to 30 units per acre on this site,” the developer said.

When contacted, an Eastern & Oriental Bhd spokesman said that the group had not bid for the land.

Due to the shortage of land on the island, the area around Pykett Methodist Boys’ School has become a popular site for new residential projects.

For example, Mah Sing Group Bhd will be launching Icon Residence early next year, which is located at the crossroads of Burmah Road and Anson Road – a stone’s throw from Pykett Methodist Boys’ School. The condominium project has an estimated gross sales value of over RM200mil.

By The Star (by David Tan)

TA Global in JV to develop Sydney residential project

KUALA LUMPUR: TA Global Bhd is teaming up with Charter Hall Group to develop the $600 million Little Bay residential development project in Sydney, Australia.

TA Global said on Tuesday, Oct 19 the alliance would complement its corporate strategy to expand its property development management activities into Australia thereby enhancing TA Global Group’s activities in Australia.

In addition, the alliance is expected to increase the revenue stream and return of TA Global group, it said.

The venture will be undertaken has via its units Global Development Pty Ltd and TA Antarabangsa Development Ltd on a 50:50 development sponsorship arrangement with Charter Hall Group.

At 10.40am, TA Global rose 1.5 sen to 45 sen with 1.49 million shares done.

By The EDGE Malaysia

LTKM plans Kuala Langat project

LTKM Bhd’s wholly-owned subsidiary, LTK Properties Sdn Bhd, is buying four pieces of freehold land, totalling 8.5ha, in Kuala Langat, Selangor, from Hock Ban Seong & Co Sdn Bhd for RM9.48 million.

LTKM said the company plans a mixed residential property development on the lands, with a gross development value of RM65 million.

It said the development could be in three to four phases, with each taking an estimated two to three years to complete.

By Business Times

Major projects under Budget 2011 will drive demand for building materials

The slew of construction projects listed in Budget 2011 will drive up demand for buildings materials. —AP

PETALING JAYA: The construction sector emerged as the clear winner from Budget 2011 but a rally in the past months means stocks valuation are no longer cheap and the risk is higher.

The smart money call is on the building material suppliers, from steel makers to cement producers, analysts said.

“We expect more positive news flow in the coming months for the construction sector,” MIDF Research said in a note yesterday, predicting a slew of project roll-outs and tender awards in the coming months.

While the question of who will bag what remained unanswered, analysts said the sheer number of upcoming construction jobs out there would drive up demand for building materials.

Malaysia Iron and Steel Indsutry Federation (MISIF) president Chow Chong Long said there was enough capacity in the country to meet the anticipated increase in demand for construction steel bars and other products.

“We don’t foresee steel shortages if the construction projects listed in Budget 2011 are implemented next year,” he said in a SMS reply to a StarBiz query.

He noted that steel factories in the country were currently running at about half their installed capacity.

“MISIF does not expect steel demand to increase until the middle of next year as it usually takes up to six months for projects to take off from the date they are awarded,” Chow said.

On Friday, Prime Minister Najib Tun Razak announced that a number of multi-billion ringgit projects would start construction next year.

This includes the RM40bil mass rapid transit system in Kuala Lumpur, six highways, the RM26bil KL International Financial District and a plan for an iconic 100-storey tower by Permodalan Nasional Bhd, on top of smaller builds such as rural roads, schools and hospitals.

Most of the big projects were already made known prior to last Friday because they were part of the 10th Malaysia Plan, or the Economic Transformation Programme.

Hence, it was not really a big surprise for the market when the projects were announced in the budget.

“These construction and infrastructure projects would require a lot of steel bars and cement,” BIMB Securities head of research Rosnani Rasul said yesterday.

“We are comfortable to retain our forecast 7% growth in cement demand in 2011,” she added. Among potential beneficiaries are Lafarge Malayan Cement Bhd and YTL Cement Bhd.

Shares in bigger construction groups Gamuda Bhd, IJM Corp Bhd, MMC Corp Bhd and WCT Bhd declined yesterday, largely in sympathy with the FTSE Bursa Malaysia KL Composite Index’s (FBM KLCI) 9.16 points drop yesterday to 1,480.70 points.

The few big gainers yesterday included Ann Joo Resources Bhd, a steel maker rated as a “buy” by AmResearch and BIMB Securities.

“We expect significant gains for the steel sector, which is a cheaper entry for leverage to the Malaysian infrastructure theme,” AmResearch analyst Mak Hoy Ken wrote yesterday.

Mak’s top pick for the steel sector is Ann Joo. The stock yesterday climbed 14 sen, or 4.7%. to RM3.12 – its highest level since January.

Specialisation may help smaller firms stand out from the pack and MIDF Research sees pre-cast concrete manufacturer MTD ACPI Engineering Bhd as a potential beneficiary.

In the budget, the Government forecast its development expenditure would drop 9% to RM49.2bil in 2011, and the slack in spending to be taken up by the private sector.

One of the key aspects of infrastructure development hinges on the success of the implementation of public-private partnership (PPP) projects.

But given the lack of clear details, “much (uncertainty) still lingers on issues like execution of these projects,’’ Inter-Pacific Research head Anthony Dass noted in his report yesterday.

By The Star

1M’sia Mall project draws mixed responses

PETALING JAYA: The 1Malaysia Mall project proposed under the Economic Transformation Programme (ETP) has drawn mixed responses from retailers and property consultants.

The plan is part of the Government’s initiative to push Malaysian mall operators and retailers to expand overseas and export Malaysian management expertise.

“It is still too early to determine if 1Malaysia Mall is a viable concept. The whole process will take four to five years from site selection, market research, planning, financing, construction, leasing to completion. I encourage the private sector to work with the Government to establish this mall,” Retail Group Malaysia managing director Tan Hai Hsin said in an e-mail reply to StarBiz queries.

Retail Group Malaysia is an independent retail research firm in Malaysia.

Tan suggested two other strategies to help Malaysian retailers expand overseas.

“First, the Government trade agencies in various Asian countries can assist Malaysian retailers who lack the experience in overseas ventures to find local partners (via joint ventures, licensing or franchises) and to introduce them to first-tier or Grade A shopping mall owners in various Asian countries,” he said.

He said there was such an agency in Singapore called International Enterprise Singapore. “Its office in Kuala Lumpur assists Singapore retailers in finding local Malaysian partners and organising meetings with shopping mall owners in Malaysia,” he said.

Second, he said the Government trade agencies in developed countries could assist Malaysian retailers in penetrating First World countries such as Japan, South Korea, the United States, Australia and Britain.

“These countries have mature retail markets and large populations. It is difficult for our retailers to succeed in these markets on their own without some assistance from our Government,” Tan said.

“Government agencies like Malaysia External Trade Development Corp have many offices around the world. A retail unit could be set up in each of these offices for the above two purposes,” he added. The Government’s plan is that by 2020, there will be 21 1Malaysia Malls in the regional emerging markets, starting with Vietnam and continuing to China.

1Malaysia Mall will house Malaysian retailers and food and beverage operators under one roof to cater for these emerging markets whose population has not been exposed to integrated shopping as retail is dominated by street shopping. CB Richard Ellis (M) Sdn Bhd managing director Allan Soo viewed the idea of 1Malaysia Mall as not being practical.

“Although the idea of opening malls to sell Malaysian merchandise in the region sounds good, I think the flaw is that our merchandise lacks breadth, depth and is not of top grade A positioning nor branding,” he told StarBiz in an e-mail.

“We do not have a lot of shoe brands nor fashion brands for instance, compared with Thailand. To fill a typical mall of 500,000 sq ft, we need at least 200 shops. If all these shops stock Malaysian brands, we will have an issue filling up with a full range of merchandise that is really Malaysian and interesting enough to draw the crowd,” he said.

He also said having so many Malaysian malls overseas might mean tourists need not come to Malaysia to shop. Soo is involved in retail development consultancy and leasing as well as property market research. Meanwhile, the Malaysian Retailer-Chains Association (MRCA) applauded the proposed 1Malaysia Mall as it would give more business opportunities to all involved in the industry.

President Datuk Tay Sim Kim said MRCA as the leading retail-chain association in Malaysia was receptive to having a regional presence for 1Malaysia Mall.

“The 1Malaysia Mall concept will provide the opportunity for retailers, operators and the Government to pool their resources together in leveraging the best business deals for their respective companies,” he told StarBiz in an e-mail. He added that local licensing, rental and other local issues might affect retailers if they were to expand to the regional market on their own.

“1Malaysia Mall would also enlarge retailers’ market penetration and enhance growth, thus bringing back more revenue. MRCA members will continue to strive for excellence in their products and services, making Malaysian brands known abroad,” he said.

By The Star

Awareness, marketing activities to lift CIMB Property Mart sales

KUALA LUMPUR: CIMB Property Mart expects sales to further improve this year due to better market conditions, awareness and marketing activities.


Ahmad Shazli

CIMB Bank commercial banking head Ahmad Shazli (pic) said the sales for its auctioned properties have been increasing due to rising awareness for its services.

“Auctioned properties transacted by CIMB Property Mart have been on an uptrend on a yearly basis, from about RM60mil in 2007 to over RM360mil last year,” he told StarBiz in an interview recently. He said people were buying auctioned properties for investment as well as own stay.

While auctioned properties can be attractive, Ahmad said buyers should fully understand the terms and conditions before making any purchase.

CIMB Property Mart offers purchasers a comprehensive, convenient and credible avenue for finding the right property.

Buyers can choose from a vast selection of auctioned properties from all over the country ranging from bungalows, terrace houses, condominiums, apartments, shop lots and vacant land.

CIMB is the auction partner for Star Property Fair 2010, which will be held from Nov 19 to 21 at Exhibition Hall 4 and 5 at Kuala Lumpur Convention Centre.

Visitors will be able to view the latest offerings by renowned property developers, purchase the latest products as well as obtain advice on financing options from participating financial institutions. Among other activities planned include talks and forums, contest and more.

By The Star

Tips for first-time house buyers

SK Brothers Realty general manager Chan Ai Cheng (inset) says if one wants to buy a house, one first needs to figure out how much he can afford.

BUYING a house for the first time is like getting married. You need to be level headed, think wisely, plan well and eliminate the chances of regretting the decision later.

For first-time house buyers, scouring the market for a suitable property can be exhilarating but it can also be frustrating if you don’t find “the one” or you do but it comes with a bust-your-budget price tag.

There are a few factors to consider in the pursuit of buying your first dream house. Firstly, a prospective house buyer should ascertain how much upfront money he or she can fork out, says SK Brothers Realty Sdn Bhd general manager Chan Ai Cheng.

“This is important. There are heavy upfront costs depending on what you buy, including transfer cost, legal fees and so forth,” she says.

Secondly, the prospective buyer needs to check with the bank on the amount of loan that can be secured based on the income level. “At the same time, try to have savings amounting to at least three to six months of loan instalments plus household expenses as reserve fund, in case of an emergency,” Chan says.

In short, if you want to buy a house, you need to figure out your affordability – how much you can afford.

A real estate agent tells StarBizWeek that the rule of thumb is that monthly loan repayments should not exceed one third of the gross monthly income.

“In assessing your repayment capability, the financial institution would also take into account your other debt repayments such as car loan, personal loan and credit cards,” he says.

He adds that the margin of financing can go as high as 95%.

“The higher the margin, the higher you will have to pay per instalment. Plus, at a given rate, a shorter tenure will require you to pay higher instalment,” he says.

He adds that after you have set your finances right, make a list of features you are looking for in a house.

“Be sure that the house you are buying is big enough to meet all your future needs, in case you have additional members in the family,” he says.

“Take good note of the area and the neighbourhood as these aspects will play a crucial role in determining the price of the house in case you want to sell it in future,” he adds.

In terms of financing, buyers have a wide array to choose from be it conventional or Islamic.

Under the conventional financing, one’s outstanding loan consists of principal plus the interest charged.

“The interest is actually the financial institution’s cost in obtaining the funds. Islamic financing works on the concept of buying and selling where the financial institution purchases the property and subsequently sells it to you above the purchase price,” says a banker.

As for the loan tenure, it can range from anything up to 30 years or until the borrower reaches the age of 65, whichever is earlier.

She also advises that it’s better to buy than to rent a home as the latter is largely expense without equity.

Furthermore, she says: “When you invest in a home, it offers the possibility for appreciation in value. At the same time, the equity becomes yours when you’re still paying off your mortgage. You even get to live in it while your investment matures.”

Still, the key determinant ought to always be keeping within the budget.

“That’s most important. It’s easy to be swayed into wanting a bigger home or a bungalow just because your friends or someone else has one. This is nice to wish for but definitely not practical if it’s way out of your budget. Be realistic,” the banker says.

Ask on the “right” timing to buy a house, she says there is no “right” time to buy or sell anymore.

“If you find a home now, don’t try to second-guess the interest rates or the housing market by waiting. Changes do not usually occur fast enough to make that much difference in price and a good home will not stay on the market long,” she says.

By The Star

First home scheme to attract young buyers

PETALING JAYA: To promote home ownership among Malaysians, the Government has proposed to introduce First Home Scheme whereby Cagamas Bhd will provide a guarantee on the 10% down-payment for houses priced below RM220,000.

The scheme is for first-time house buyers with monthly household income of less than RM3,000. It is aimed at young adults who have just joined the workforce.

With the guarantee from the national mortgage corporation, it means that eligible house buyers will be able to obtain a 100% loan.

First-time house buyers will also be given stamp duty exemption of 50% on instruments of transfer on a house priced at not more than RM350,000. The Government has also proposed stamp duty exemption of 50% be given on loan agreement instruments to finance such first-time purchase of houses.

To expedite the process of property registration, the Stamp Act 1949 had been amended to enable the Valuation and Property Services Department assess properties after the payment of stamp duty to the Inland Revenue Board. This will reduce the property registration process from 30 days to one day.


FD Iskandar says the scheme is good news for the housing sector

Welcoming the First Home Scheme initiative, Real Estate and Housing Developers Association (Rehda) deputy president Datuk FD Iskandar Mohamed Mansor said the scheme was good news for the housing sector, “as just over 73% of houses transacted falls under the category of below RM220,000.”

The 50% stamp duty exemption for houses below RM350,000 covers an estimated additional 10% of the market, and together the incentives benefit all-in-all roughly 87% of housing transactions throughout the country.

While Rehda views the measure as a very positive step towards closing the income gap, it acknowledges that properties which are found within these price brackets are not easily found in Greater KL or Penang due to higher land and construction costs in these vicinities.

Concurring with Rehda, C H Williams Talhar & Wong Sdn Bhd managing director Foo Gee Jen expects the First Home Scheme to have a lesser impact on the Kuala Lumpur market as the prices of most houses here exceeded the ceiling set by the budget.

“There will be more significant impact on housing demand in other cities such as Johor Baru, Malacca, Ipoh, and Kuantan,” he noted.


David Ong ... ‘The Government is wielding its influence on two fronts.’

Reapfield Properties Sdn Bhd managing director David Ong said the Government’s “invisible hand” in steering the housing market was important in the light of the current market conditions.

“The Government is wielding its influence on two fronts – to help first time buyers and to signal to developers that a certain type of housing within a certain price range is needed. Developers can probably consider townhouses or condominiums within a certain price range,” Ong said.

Ong said hopefully, with this move, developers would build houses within this pricing category.

Khong & Jaafar managing director Elvin Fernandez said the Government’s move not only recognised first-time house buyers, “but also acknowledged them as newcomers into the workforce.”

“The perimeters set out in the budget are correct. This is the type of house this group will be able to afford. They will need this kind of assistance,” he said.

The move, he said, did not mean that the Government was not considering raising the downpayment for house purchase to 20% or 30%.

“That may still come later on as increasing the percentage of downpayment does not fall within the budget,” Fernandez said.

Ireka Development Management Sdn Bhd chief operating officer Lim Ech Chan said the First Home Scheme would enable first-time buyers to afford their first home and promote a healthy property market overall, encouraging more affordable housing to be made available.

Amphil Corp Sdn Bhd chief executive officer PK Poh said it was an excellent measure to provide the means for young households to purchase “starter” homes “as it will be a sort of forced savings and a hedge against inflation, besides saving money on rental.”

“In our major cities, this would often mean buying small one- or two-room apartments in areas a little further from their workplace than they might like. However, the securing of such a loan is still subject to the banker’s determination of the repayment ability of the borrowers.”

On the development of the 1,072ha Malaysian Rubber Board land in Sungai Buloh by the Employees Provident Fund, Poh said most developers were looking forward to the finalisation of the master plan and the granting of conversion and planning approval from the state.

“The land area comprises both freehold and leasehold lands and needless to say, developers would want to see how they could position themselves and participate in the roll-out of this massive development,” he added.

The mixed development comprising affordable houses as well as commercial, industrial and infrastructure facilities, is estimated at RM10bil and is expected to be completed by 2025.

By The Star

Full loan for first-time house buyers

FIRST-TIME house buyers with a family income of less than RM3,000 per month need not pay the 10% down payment under the My First House Scheme (Skim Rumah Pertamaku).

The 10% down payment will be guaranteed by Cagamas Bhd for houses priced below RM220,000.

This will allow the first-time buyers to obtain 100% loan.

They will also be given stamp duty exemption of 50% on instruments of transfer on a house not exceeding RM350,000.

The Government also proposed a stamp duty exemption of 50% for loan agreement instruments to finance first-time purchasers.

There will also be a housing assistance programme with an allocation of RM300mil for the construction and repair of some 12,000 houses nationwide – particularly in Sabah and Sarawak.

For estate workers, the Government will help them own houses under a RM50mil housing sponsorship scheme.

The scheme is open to all Malaysian estate workers to assist them in obtaining housing loans with a maximum of RM60,000 for the purchase of low-cost houses at 4% interest, and a repayment period of up to 40 years, which can be extended to the second generation.

For government servants, the goodies include an increase in the maximum loan eligibility from RM360,000 to RM450,000 effective Jan 1.

Fomca secretary-general Muhammad Sha’ani Abdullah said these moves would help first-time purchasers get housing loans, but failed to tackle the core issue of house prices which had skyrocketed.

“A first-time buyer may get the loan to buy a house, but it may not be the type of house he wants because prices are just too high,” he said.

He added that the Government should set specifications and standards for houses under the RM220,000 price range.

“A house can be priced at RM220,000, but the specifications and the quality of the house may not be much better than a low-cost house,” he said.

Malaysian Small Holders Plantation Co-operative secretary Datuk Aliasak Ambia said the move to help estate workers to own houses was a good move.

“The co-operative provides houses for estate workers to live in while they are still working, but once they leave their jobs, they will not have any homes of their own,” he said.

By The Star

Govt scheme to boost house ownership

Township developers are happy that the government is moving to help young adults with income of less than RM3,000 a month to own a home.

Prime Minister Datuk Seri Najib Razak said yesterday the government will introduce a scheme via Cagamas Bhd, which will provide a 10 per cent guarantee down payment for houses below RM220,000.

This scheme is for first-time house buyers. It allows them to own a home without having to pay the 10 per cent downpayment.

Najib said first-time house buyers purchasing homes under RM350,000 will be given a stamp duty exemption of 50 per cent.



Mah Sing Group Bhd group managing director Tan Sri Leong Hoy Kum applauded the move as it will reduce the cost of buying a home by as much as RM3,000.

Leong said it would directly and indirectly benefit the buyers of several of Mah Sing's projects, where the properties are priced below the RM350,000 range.

Mah Sing has double-storey homes in Bayu Sekamat, Hulu Langat, priced from RM240,000, and residential suites in Garden Plaza, Cyberjaya, priced from RM108,000.

To facilitate civil servants in owning houses, the government is raising the maximum loan eligibility to RM450,000 compared with RM360,000 currently, effective January 1 2011.

Glomac Bhd group executive vice-chairman Datuk Richard Fong said this will allow civil servants to own more expensive homes.

Fong said he expects the company's townships, especially Bandar Saujana Utama in Sg Buloh, to sell better.

"It is very encouraging for the property sector, for the civil servants and first time house buyers. While developers like Glomac will benefit, it will encourage more people to come forward and buy homes instead of shying away," he said.

Fong also said the government's move will be a big boost for properties priced below RM300,000.

By Business Times

RM1bil for bumiputra property trust scheme

PETALING JAYA: A syariah-compliant Bumiputra Property Trust Scheme will be launched this year with a size of RM1bil.

“To ensure meaningful and sustainable participation of bumiputra, the Bumiputra Property Trust Foundation (BPTF) will provide opportunities for bumiputra ownership of prime commercial properties in major towns. The BPTF will establish a fund to enable ownership of prime commercial properties in the Klang Valley, through a group ownership scheme,” according to Budget 2011.

The proposal is similar to one made in Budget 2006, where it was stated that the Yayasan Amanah Hartanah Bumiputra would be created, to be chaired by the Prime Minister, with an initial capital of RM2bil. This body then set up a subsidiary called Pelaburan Hartanah Bumiputra Bhd, which has since changed its name to Pelaburan Hartanah Bhd (PHB). PHB has a joint venture with Malaysian Resources Corp Bhd (MRCB) to develop a RM1.4bil Lot G integrated development in Kuala Lumpur Sentral.

PHB chief executive Kamalul Arifin Othman also said in reports last year that he expected PHB’s revenue to grow 17% to RM70mil in 2009, driven by rental income from properties it had bought, which include four buildings in the Klang Valley. The buildings that PHB has bought include Menara Bumiputra-Commerce in Kuala Lumpur from CIMB Group for RM460mil and CP Tower in Petaling Jaya, from CIMB-Mapletree Management Sdn Bhd for RM200mil, it had been reported.

Budget 2011 however, did not include any incentives for the real estate investment trust (REIT) sector, which disappointed players in the sector. It had been earlier speculated that the Government could be looking to reduce or remove entirely the withholding tax for REIT investors.

By The Star

Condo home with ‘70s feel

Selangor Dredging Bhd’s latest offering is a small development comprising 38 units on slightly more than an acre.

Located off Jalan Ampang, the developer will be tearing down the bungalow and building two interlocking L-shaped blocks of 10-storey condominium in its place.

Managing director Teh Lip Kim says unlike a high-rise condominium project where its main selling point will be the view, the main selling point for Dedaun is its location and overall design and concept. There is a restriction on height in that location and the maximum for that site is 10-storeys.


The living area and master bedroom (below pic) with its floor to ceiling sliding glass doors can be opened to create a “balcony” effect.

“Although one is living in the city, there will not be that busy hustle and bustle feel once one turns into the slip road that leads into Dedaun. There will be a certain elegance about the place, a quiet serenity although it is just a short walk away from Jalan Ampang,” she says of the niche development. The project will have a lush green perimeter around it, hence the name Dedaun (the leaf).

The project will have a gym, a function room with pantry facilities, a rooftop swimming pool on one of the blocks and a children’s wading pool. There will be three garden units with private gardens and three penthouses with their own swimming pools. There will be two units per floor.



In line with the overall 1970s era that she is trying to portray, Teh is using materials and techniques that will give the place that certain bygone era look.

Teh says she was inspired by the family’s home when she was conceptualising the place. There is the hand-crafted copper front door to create that entrance statement in the foyer or what she calls the waiting area. Each unit will have its own private lift lobby. There was a time when metal doors were used, she says.

In the old houses, there was a lot of cross ventilation and she has made that an important feature in Dedaun. There are a lot of floor to ceiling sliding doors and windows in both the rooms and the living area. There is therefore a lot of natural lighting and airiness about the place.

Space is a premium and Teh has created an aura of space with the open concept with living room flowing seamlessly into the dining and dry kitchen area.

“It is an elegant residential area and despite the changes that have taken place, it will continue to be an upscale area to live in,” Teh says.

Selangor Dredging is one of several developers who have targeted that part of Kuala Lumpur for their niche developments currently. Other developers who are building in that area include Singapore’s CapitaLand group, Gamuda group, Nam Fatt Bhd and Tan Sri Yap Yong Seong, popularly known as Duta Yap who has gone into a joint venture with a South Korean partner. There is also another Singaporean developer who is building their project there.

Among the current on-going projects within the same pricing category as Selangor Dredging’s Dedaun, which is selling for about RM1,000 per sq ft, the largest development is probably CapitaLand’s Sastera@U-Thant with more than 100 units over 1.77 acres.

Other projects by Selangor Dredging includes Park Seven around the KLCC area, AmanSari in Puchong Kinrara, 20trees in the Melawati area and Five Stones in SS2. PJ.

By The Star