Buying in England and Wales

The last couple of years, British house builders and developers have been making regular visits to Malaysia to promote and sell their properties. Some of them sold off plan, others offered completed projects.

Sales and marketing director Paul Bennett of St James Urban Living says England and Wales has three models when selling residentials. The Scottish system is totally different and not covered here.


St James Urban Living sales and marketing director Paul Bennett

St James Urban Living is part of The Berkeley Group Holdings plc, one of Britain’s largest house builders and in the FTSE 250 top UK companies by market value. It has various brands Berkeley Homes, St George and St Edward and has been marketing properties in Asia for over a decade.

● To buy off plan

When buying “off plan” you pay a Reservation Fee (normally £500-£2,000) to secure your property. At this point, you will be given a date when the developer expects the property to be completed. You have the opportunity to choose your kitchen design, bathroom tiling, accessories and finishes.

You appoint a solicitor to work on your sales contract.

Once the contract is agreed between your solicitor and the developer you can exchange contracts with a 10% deposit payable by the purchaser on exchange of contracts (normally three-four weeks after you reserve) with the remaining 90% being paid in one payment when the property is completed and ready for occupation.

Buying off plan allows you to take advantage of market growth during the construction process.

● Buying a completed unit

The process is the same as above: you pay a reservation fee; 10% when you exchange contracts; the remainder to complete the sale and you will then be handed the keys to your new property.

The main difference being you do not get the early choice of the prime plots and you have to accept the builders pre-selected kitchen and bathroom selections.

● Trust funds

In England and Wales, solicitors have special, secure client accounts specifically for holding funds from mortgage lenders or individuals between exchange and completion. The solicitor transfers the funds to the developer’s bank account.

By The Star

Naza TTDI targets 18 new launches this year

NAZA TTDI Sdn Bhd, the property development arm of Naza Group, plans to launch 18 new projects this year with a combined gross development value (GDV) of RM1.6 billion.

Naza TTDI chairman SM Nasarudin SM Nasimuddin said the launches are part of its long-term plan to become one of Malaysia's top 10 property companies in the next three years.

"We also plan to launch our projects outside of the Klang Valley and make our maiden venture overseas such as in Singapore, Vietnam, Indonesia and China," Nasarudin said at a briefing on its financial performance in 2010 and outlook this year in Shah Alam, Selangor, yesterday.

Group managing director SM Faliq SM Nasimuddin said the new projects are expected to increase Naza TTDI's net profit in 2011 by 22 per cent to RM100 million from RM82 million in 2010.

Group turnover this year is targeted to hit RM1 billion, up 57.5 per cent from RM635 million in 2010.

Faliq added that the company hopes to rake in a net profit of RM267 million and a turnover of RM2.2 billion by 2015.

"In future, we hope to form joint ventures or embark on merger and acquisition plans with companies that have strategic assets and landbanks as part of our expansion plan at home and abroad," said Nasarudin.

He said the company aims to boost its landbank to over 200ha in the next two years from 161ha currently.

The project launches this year will comprise both residential and commercial developments such as TTDI Grove in Kajang, TTDI Alam Impian in Shah Alam, TTDI Dualis in Puchong, as well as a 35-storey tower in Jalan Tun Razak, Kuala Lumpur.

The company has also formed an associate construction company, Naza TTDI Construction, as it feels it is the right time to start diversifying and entering the construction business.

Naza TTDI Construction will complement Naza TTDI's business, offering complete construction services in the fields of building, civil engineering and infrastructure works.

On its RM650 million Matrade International Exhibition Centre, Nasarudin said piling works are ongoing and it will call the media for an update in June.

He added the company has no plans to go for a listing yet but may do so in the future, should the need to raise funds arise, coupled with right stock market conditions.

Established 37 years ago, the Naza Group, which also has operations in automotive, hotels and food, has completed more than 14,000 residential and commercial units, including in Taman Tun Dr Ismail, Petaling Jaya, Section 13 Shah Alam and the Platinum Park in Kuala Lumpur City Centre.

By Business Times

Naza TTDI plans 18 new launches

SHAH ALAM: Property developer Naza TTDI Sdn Bhd plans to launch 18 new property projects with total gross development value (GDV) of RM1.6bil this year.


SM Nasarudin SM Nasimuddin

Chairman SM Nasarudin SM Nasimuddin said the new projects were expected to increase the group's net profit this year by 22% to RM100mil from RM82mil last year.

“Having said this, the group's turnover this year is targeted to hit RM1bil, up 57.5% from RM635mil in 2010,” he said yesterday at Naza TTDI 2010 Performance Review & 2011 Plans event.

SM Nasarudin added that these new launches would comprise both residential and commercial developments such as TTDI Grove in Kajang, TTDI Alam Impian in Shah Alam, TTDI Dualis in Puchong and a 35-storey tower at Jalan Tun Razak.

“This year's launches are in line with our aspirations to be among the top 10 property developers in the country over the next three years,” he said, adding that by 2015, the group was targeting to achieve a net profit of RM267mil and turnover of RM2.22bil.

Meanwhile, group managing director SM Faliq SM Nasimuddin said in addition to the new launches, Naza TTDI had also established an associate construction company, Naza TTDI Construction (NTC).

“This company will complement Naza TTDI's business and offer complete construction services, specialising in the fields of building, civil engineering and infrastructure works,” he said.

SM Faliq also said the group was looking at expanding its land bank locally and regionally over the next few years.

The group currently has an existing land bank of over 161.87ha in Malaysia.

“Apart from that, we are also looking at the potential of penetrating other markets in the region such as Singapore, Vietnam, Indonesia and China with high-impact and high-visibility projects that will provide the necessary profile to propel us into the global property market,” he said.

By The Star

LBS Bina to make high-end jump

The small property developer with a market value of about RM228 million wants to reposition itself as a builder of high-end property

LBS Bina Group Bhd, well known for building affordable homes, wants to reposition itself as a builder of high-end property, an indication that demand for expensive properties is still strong.

The small property developer with a market value of about RM228 million plans to focus on the medium-high to high-end market segment to earn better profit margins.

"We are transforming ourselves. We need to make profits as we are answerable to shareholders," LBS Bina managing director Datuk Lim Hock San told Business Times in an interview recently.

Property prices in certain parts of the country and especially the Klang Valley have been rising strong, helped by cheaper loans and easy purchase schemes offered by developers.
Last year, Bank Negara Malaysia had to set a limit on loans for those wanting to buy more than two houses as it sought to curb speculation.

Spearheading LBS Bina's brand in the high-end market will be its jewel project called D'Island Residence in Puchong - an eight-year project with a gross development value (GDV) of RM2.9 billion.

Overall, the D'Island Residence will be developed on 175 acres and once completed, it will have a total of 237 units of super-link house, 298 semi-detached units, 148 bungalow units and 352 high-end condominiums as well as commercial units.

The signs are good as during the soft launch recently, 51 units of super-link houses were sold. The official launch is in April 2011.

It also plans to launch 122 units of super-link houses that cost just below RM1 million each and 74 units of semi-detached houses at above RM2 million.

A property analyst said most developers are now pricing in higher land and development costs into selling prices to sustain profit margins.

The key items that have risen significantly are land and construction materials, especially steel.

"Of course LBS Bina has a big task to convince investors that we are able to provide return on investment for high-end projects. Location will be a key element as well," Lim added.

Still, LBS Bina will continue to build affordable homes pegged below RM350,000, albeit at a redu-ced scale.

The group has been building affordable homes at Bandar Saujana Putra - its flagship development spanning over 835 acres.

This self-integrated township was first launched in February 2003 and LBS Bina has handed over more than 5,000 units of various types of properties since then.

This year, the group plans to build 60 per cent of houses priced above RM350,000. As of March 3 2011, LBS Bina had sold properties worth RM121.7 million and 83 per cent of them were in the medium-high segment.

LBS Bina shares fell 3.3 per cent to close at 59 sen yesterday.

By Business Times

New residential property prices to go up 13%

KUALA LUMPUR: The average prices of newly developed residential property this year is expected to grow by 13% against last year in line with the increase in raw materials cost, according to a survey by Real Estate & Housing Developers' Association Malaysia (Rehda).

The survey showed that the average terrace house in Malaysia last year had gone up to RM176,590 in the third quarter from RM168,667 in the first quarter.

High-rise property price in the same timeline had gone up to RM165,530 each from RM163,300.

Rehda president Datuk Seri Michael Yam said since a year ago, raw materials prices such as steel and cement had increased significantly.

“Generally, the majority of the survey respondents are optimistic of the property market for the next six months as the overall sentiments governing the market are positive,” he said at a media briefing yesterday.

Meanwhile, for new properties in the Klang Valley, Rehda national treasurer Teh Boon Ghee said they might rise around 15% this year.

“But, it is also interesting to look at this price increase from a different angle as 88% of the transactions in 2009 were from the secondary market and only the remaining 12% came from new development. The 13% and 15% expected increase only applies to new homes while the momentum for secondary market is slower than that,” he said.

On the new home loan guideline by the Government under My First Home Scheme, Yam said although Rehda supported the move, it would be challenging to develop houses priced between RM100,000 and RM220,000 in the Klang Valley and Penang.

“In these developed urban areas, it would be impossible to develop anything below RM200,000.

“This is because the land costs in these areas are very high. The land component out of the total development cost in these areas may be around 40% to 50%,'' he said.

For comparison, the land cost per sq ft in Sungai Petani is RM1.30, Cyberjaya RM36 while in Kuala Lumpur, it could be as high as RM2,000.

But due to the new guidelines, Yam said developers might have to relook at their unit size if the development was in the Klang Valley.

“At the average price of about RM400 per sq ft, they can develop a 500 sq ft studio unit or a one-bedroom apartment. This is actually the trend in most developed cities around the world. But to enable developers to embark on this, the Government must encourage local authorities to review their Planning Act as it is now based on number of units per acre.

“Let's say, the authority allows a developer to build only 50 units per acre. Would it build 50 units of 500 sq ft houses or 50 units of 2,000 sq ft houses?” he said.

The survey were answered by 135 or 14% out of 972 Rehda members that comprises of housing and property development companies from all 12 states in Peninsular Malaysia.

By The Star

ETP will boost property mart, say developers

Property developers are upbeat that they will do better with hints of better market conditions ahead due to the Economic Transformation Programme (ETP).

More developers will be launching new projects nationwide in the second half of the year, findings by the Real Estate and Housing Developer's Association Malaysia (Rehda) showed.

These include terrace houses, condominiums and apartments priced from RM100,000 to RM500,000, and service apartments, semi-detached houses and bungalows worth RM500,000 to more than RM1 million.

The survey showed developers will raise the prices for new houses by an average 13 per cent this year.

Some have indicated their prices may rise by 20 per cent to 50 per cent, depending on the locality of the projects.

Rehda president Datuk Seri Michael Yam said while the housing market may have strong underlying demand due to the country's demography, young population, and now the ETP, the pressure of increased building materials, labour costs and land prices pose huge challenge to industry players.

The survey had 135 developers responding to market conditions in 2010 and their outlook for 2011.

Fifty-nine per cent of them said the ETP is expected to add value to their developments.

Rehda national council member NK Tong said despite the price rise, he believes demand for new houses will be higher.

"People will buy in anticipation of a brighter economy. People who are trying to predict the property market will have to view the local and global economy, which for this year looks positive," Tong said.

The ETP aims to generate RM76 billion for the country by 2015. Since the launch in October 2010, the government had announced 60 projects, including the Mass Rapid Transit and the greater Kuala Lumpur Light Rapid Transit extension.

The government is aiming for a population boom in Greater Kuala Lumpur/Klang Valley (Greater KL/KV) to 10 million by 2020 from the current six million, with foreigners making up some 20 per cent of the population. Tong said the additional 1.6 million foreigners expected in Greater KL/KV by 2020 from the current 540,000 will help boost property sales.

By Business Times

I-Berhad plans mixed REIT

I-BERHAD, an integrated ICT developer, aims to launch a mixed real estate investment trust (REIT) worth more than RM1 billion in four to five years.

The idea is to unlock the value of investments at i-City, the company's 29ha knowledge and tourism hub in Shah Alam, Selangor.

I-Berhad chief executive officer Datuk Eu Hong Chew said the REIT will comprise data centres, an office tower, hotel, mall and carpark block.

"We are growing our property portfolio. When we have developed 30 to 40 per cent of i-City, we will launch the REIT," Lee told Business Times recently.
I-City, the first private initiative to be awarded the Malaysian Super Corridor Cybercentre status, is currently 20 per cent developed. The project started in 2005.

The company has so far built cybercentre office suites, data-centres and innovation centre with a combined 500,000 sq ft of space.

Al Rajhi Banking Group owns 200,000 sq ft of the space and the rest have been leased to multi national firms and small- and medium-sized enterprises.

Lee said I-Berhad will double the existing 1,000-bay carpark block within the next two years to enhance its value.

It has RM50 million in cash to fund the construction of new properties for the next three years.

Lee added that the company will not borrow from banks at this point. It plans to plough back future profits for its investments in i-City.

The company, helmed by its executive chairman Tan Sri Lim Kim Hong, aims to be profitable in fiscal 2011 with expected growth in all its three divisions - property development, property investment and tourism.

For the nine months ended September 30 2010, I-Berhad posted a net loss of RM1.73 million on revenues of RM6.4 million.

State-owned investment fund Permodalan Nasional Bhd holds 20 per cent of I-Berhad.

By Business Times

Axis said to launch RM3b Islamic REIT

Malaysian REIT manager Axis REIT Management Sdn Bhd is set to list the world’s largest Islamic real estate investment trust valued at over RM3 billion ($988 million), three sources with direct knowledge of the deal said on Friday.

Axis REIT Management, which also manages Axis REIT, is now conducting book building for the Axis Global Industrial REIT, said the sources who asked not to be identified as they are not authorised to speak to the media.

The REIT will manage 33 properties located in three Asian countries including Australia and Hong Kong. Some of the assets were bought and leased back from Australia’s Goodman Group.

Axis REIT’s chief executive officer Stewart LaBrooy declined to comment on the deal when contacted by Reuters. The deal’s principal adviser is Malaysia’s CIMB .

By REUTERS

PM: Housing prices still manageable

Datuk Seri Najib Tun Razak and Tan Sri Dr Zeti Akhtar Aziz at the press briefing.

KUALA LUMPUR: The rise in residential property prices is still manageable and measures such as the My First Home Scheme will allow those in the lower-income brackets to own homes.

Prime Minister Datuk Seri Najib Tun Razak said at a press briefing yesterday, following the annual meeting with Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz, that the rise in house prices was being monitored.

“We're watching the increase in property prices closely which we think is still manageable,” he said, adding that the My First Home Scheme, which was launched on Tuesday for those earning less than RM3,000 a month, was a people-friendly measure to enable the lower income groups to own houses.

Those who qualify for the scheme can obtain 100% financing to buy their first home with a repayment period of 30 years for houses costing between RM100,000 and RM220,000.

Najib added that the Government was also looking into the supply side of housing to see if measures had to be taken to build more residential properties around the RM200,000 level.

According to data released by the Valuation and Property Services Department, the national house price index rose 6.2% year-on-year in the third quarter of 2010 after rising 6.2% in the second quarter and 5.7% in the first quarter.

Najib said any new issues of Islamic bank licences and foreign banks looking to increase their shareholding in local banks would be looked at on “merit” and on a “case-by-case” basis.

He said last week during a visit to Australia that the Government was open to allowing Australia & New Zealand Banking Group Ltd (ANZ) raise its stake in AMMB Holdings Bhd, which owns AmBank (M) Bhd.

Currently the limit for foreign shareholding in local commercial banks is 30%. ANZ has a 26.59% stake in AMMB, making the Australian bank the single largest shareholder.

Najib said the foreign shareholding limit for banks here would be reviewed individually and there would not be any changes to the Banking and Financial Institutions Act 1989 because this was an “administrative issue”.

So far, there has been no proposal by ANZ to raise the bank's stake in AMMB and other foreign banks have also not applied.

Meanwhile, Najib said the economy was expected to grow by 5% to 6% this year but would face challenges due to slower global growth, which would affect external demand.

He said the challenges were from higher crude oil prices, inflation and the sovereign debt crisis in the euro-zone.

“We'll monitor these developments closely and take the necessary steps,” Najib said.

He added that several interim measures would have to be taken to support private consumption and investment should energy prices continue to rise to a “critical point”.

However, Najib said the Government was committed to long-term subsidy rationalisation, although on a gradual basis, with savings from the lower subsidy to go to those in the lower-income brackets.

By The Star

Residential properties to appreciate 13pc

Residential properties are expected to appreciate an average 13 per cent between January and June due to spiralling building materials and petrol prices.

President, Real Estate and Housing Developers Association Malaysia (REHDA), Datuk Seri Michael Yam said:"Property prices in specific locations within the Klang Valley will remain extremely high due to expensive land cost".

In the third quarter of last year, terrace houses in Kuala Lumpur were averaging about RM430,000.

Yam said while government efforts to encourage first time home ownership, through the "My First Home Scheme", would promote the sale of properties priced between RM100,000 and RM220,000, there was a need to review the price limit to RM350,000 for properties in the Klang Valley.

"Developers also face cost pressures in terms of absorbing road building cost," Yam told a press conference on property market trends this year.

REDHA council member, Anthony Cho Tian Han, said developers faced several constraints in that they were not able to sell off every unit in a housing project as developers had to reserve a minimum 30 per cent for Bumiputera ownership over a long period of time.

As for foreign buyers in the property market, Yam said, they were not as aggressive as many believed. "A majority of the buyers are still locals," he said, adding that Singaporeans, Europeans, Indonesians and South Koreans accounted for a cross-section of the foreign purchasers.

By Bernama

The challenge of owning a house in urban areas

AFFORDABLE housing is a subject matter which a great many homebuyers are talking about. Often, friends will comment how crazy the housing market has become.

Those who own one house, which is their primary residence, might feel the pinch when it's time to upgrade. Those who own more are probably enjoying the growth in equity.

For those who do not own a home and just starting their careers or a family, it's a nightmare for them. When salaries have not kept pace with the appreciation in home prices, the dream of owning a home becomes more distant by the day.

Knowing that is a growing problem, the Government on Tuesday launched My First Home Scheme, a programme that will enable people earning less than RM3,000 a month to get 100% financing from banks to buy houses costing between RM100,000 and RM220,000 to be repaid over a period of 30 years.

The monthly repayment sum should not exceed a third of their gross salaries but can go up to 50% if a bank allows for such a percentage.

The premise of the scheme is great but the way home prices are going, one will find it hard to find a home between that price range in the major urban centres of Malaysia.

It should be possible to find homes priced in that range in the rural and smaller towns in the country, but not in the major urban centres of the country.

The plight of the young or those with a salary of up to RM3,000 a month over housing needs will exacerbate as urban migration rises.

In 2009, according to Unicef, 71% of the population in Malaysia was urbanised but those flocking to the large and expensive cities will rise even further as the economy develops, more so as services widen its gap with manufacturing as the engine of growth.

The other issue is the rising cost of living.

Let's say a person working in Kuala Lumpur earning just under RM3,000 a month wants to buy a house costing RM220,000. If he or she is lucky to find such a house and is charged 4% interest over a period of 30 years, the person will have to pay around RM1,050 a month in house repayments.

Knowing that houses costing that much would be a long way out, a person would most probably need to own his or her own vehicle and factor the cost of vehicle ownership, utilities and the ever-rising cost of food.

He or she will do well to balance his ledger at the end of every month.

The best solution, as I have said before, is for the federal and state governments to actually build homes costing that much in the major urban centres for the public to buy because I don't think there is a private sector developer in town who will be willing to sell homes at that price.

Deputy news editor Jagdev Singh Sidhu wonders if it's even possible for a higher middle income family to afford a second house in Kuala Lumpur.

By The Star (by Jagdev Singh Sidhu)

Penang heritage zone 'refresh'

More than RM400,000 in grants have been approved for four physical rejuvenation projects in the heritage city.

Khazanah Nasional Bhd - via its wholly-owned unit Think City Sdn Bhd - will re-introduce the affordable housing concept into George Town's World Heritage Site in Penang via its public grants scheme - George Town Grants Programme (GTGP) - this year.

Think City's programme director Dr Neik Khor yesterday said more than RM400,000 in grants from the GTGP have been approved for four physical rejuvenation projects in the heritage city. They include a restoration project along Lebuh Pantai for communal student housing, and another rejuvenation of 10 shophouses belonging to Wawasan Open University for a student hostel.

"In line with Think City's objective to encourage private sector and civil society initiatives to promote economically sustainable housing models, these projects were chosen for their potential to kick-start regenerative efforts in their respective locations," Khor told a media briefing in Penang to announce Think City's third tranche of GTGP.

A total of 18 grants worth RM1.18 million under the scheme's third round have been approved and 17 of these are for physical restoration projects. They include the refurbishment of the Penang Road Catholic Cemetary (RM21,600), restoration of the Nagakavidhu Chettiar Lodge (RM62,000) and the repair and restoration of the Datuk Koya tomb (RM25,120).

Think City was set up in 2009 to manage urban rejuvenation in the Unesco world heritage site of George Town. The GTGP , a Think City initiative, was launched in December 2009 and three rounds of grants applications have been conducted.

George Town's historic city, which was nominated by the government for world heritage listing together with Malacca, covers 109.38ha on the island's north-east and is known as the core zone. Surrounding the core zone is a 150.04ha band referred to as the buffer zone.

"At the close of round three," Khor noted, "Think City has 34 physical conservation projects, 16 cultural mapping porjects, 3 shared spaces projects and 6 technical assistance grants."

Think City now manages 60 projects with approximately RM6.9 million committed.

"Based on the same principles we applied with the earlier three rounds of grants which are aimed at protecting George Town's outstanding universal values while helping in the process of urban regeneration, projects for round 4 of the GTGP must be catalytic, build capacity via partnerships and include a developmental element, among others," Khor said.

By Business Times

Rehda says property prices to increase up to 20pct in next 6 months

Kuala Lumpur: Real Estate and Housing Developers' Association (Rehda) Malaysia expects property prices to increase up to 20% in the next six months in general as material and land costs continue to rise.

Its president Datuk Seri Michael Yam said on Thursday, March 10 that building material costs increased 5% to 10% annually. For instance, steel bar was transacted at RM2,350 to RM2,580 per tonne at end-2010 from RM1,800 at end-2009.

Yam said at a media briefing for the 2011 property outlook that for the full year of 2011, property prices were expected to increase by an average of 13%.

“The range of the increase will range between 2% and 50%, depending on the location and the development type. With higher property prices, condominiums are a good buy in KL, compared to terraced homes,” he added.

The estimation is based on a half-yearly survey done by Rehda with its members, comprising housing and property development companies, as at December last year. Some 135 out of 972 members from all states, or 14%, responded.

Yam noted that 58% of the respondents indicated they had increased their launch prices by an average of 11% (minimum: 5%; maximum: 40%) in the second half last year, compared to the previous launches in the first half of 2010.

By The EDGE Malaysia (by Racheal Lee of theedgeproperty.com)

Gefung makes foray into Indonesia property sector

KUALA LUMPUR: GEFUNG HOLDINGS BHD is making its foray into Indonesia and is planning to undertake a mixed development property project in east of Jakarta.

Gefung said on Thursday, March 10 it had signed an MoU with PT Greenworld Development to undertake the project totaling 50.74 acres east of Jakarta.

It said the proposed involvement in property development was in line with the group’s strategy to diversify its revenue stream.

It said the site was along Jalan Pengangsaan Dua, Rawa Terate Village and surrounded by established neighbourhoods in the Kelapa Gading sub-district which is mainly a middle to upper middle class area.

It added Kelapa Gading had six shopping malls within a 20-km radius and it was 14km from central Jakarta.

By The EDGE Malaysia

Mixed views on KL-Singapore rail link

PETALING JAYA: The proposed Kuala Lumpur-Singapore high-speed rail link has gained support owing to its potential to boost growth and there are also concern the project could burden the Government with financially.

A transport consultant has come out in support of the proposed high-speed rail link between Kuala Lumpur and Singapore saying such a service would be a boost to growth ambitions of Malaysia.

But others cautioned about the cost of such a project on government finances, pointing out that the mass rapid transit (MRT) project for Greater Kuala Lumpur and the extension of the light-rail transit (LRT) project is estimated to cost a staggering RM57bil.

Land Public Transport Commission (SPAD) recently said that the Government was conducting a feasibility study on the rail project. The proposal was cited as a high-impact project under the Economic Transformation Programme.

It was reported that the cost of the KL-Singapore high-speed rail was between RM8bil and RM14bil.

Frost & Sullivan vice-president, Asia Pacific transportation & logistics practice and country head, Malaysia Gopal R said the KL-Singapore link was a critical and landmark link that needed to be established through high-speed rail.

“This is a cross-border link that has already been leveraged by different other modes of transport like air and road.

“With the next decade attributable to the growth of the services sector, a high-speed rail connectivity can greatly help organisations to leverage on Greater KL to establish larger offices with competent workforce that can commute most effectively in markets like Singapore.

“In effect, Greater KL will transform into a service sector hub with this model, if high-speed rail connectivity is available towards the north and southern directions, creating a sustainable economic profile for the city,” Gopal told StarBiz.

A transport analyst with a local research house said although there was a need to establish KL-Singapore high-speed rail, the high cost of such a project remained a concern.

“This is because we already got two huge rail projects in hand the MRT system that is estimated to cost RM50bil and extension of the two LRT systems that would cost RM7bil.

“Alternatively, the Government could rely on the private sector to fund the project.

“But, the proposal is still under study. If it is proven viable, I think it would only kick-off in 2012 because the project involves cross-border link,” he said.

On the timing of the high-speed project, taking into consideration that countries globally are still recovering from the economic crisis, Gopal said the economic activity in Malaysia as well as the region was on the rise and the momentum would surely continue into the immediate future. “Therefore, the timing is just right to embark on high-speed rail projects,” he said.

Gopal added that almost all high-speed rail networks had been promoted as a tourist experience and consequently been a must see attraction cities such as in Shanghai, Taipei and Tokyo.

“The connectivity options in any mega city has certainly influenced property values due to the ability of residents to save time in commuting,” he said.

SPAD said it was currently conducting a feasibility study on a high-speed rail link between Kuala Lumpur and Singapore, which is expected it to be completed in May.

“The study will look into the viability, business case, benefits and the possible implementation plan of the project,” it said.

On the types of systems for high-speed rail, it was reported that there were basically two main systems namely, magnetic levitation technology and conventional rail network.

By The Star

Mara ventures into properties

Majlis Amanah Rakyat (Mara), a government agency set up to develop Bumiputera entrepreneurs, is venturing into the property business as it seeks to rely less on the government for funding.

Mara Inc Sdn Bhd chief executive officer Abd Halim A. Rahim said the move is in line with the government's wish to see agencies become independent and generate their own revenue.

Mara, an agency under the preview of the Regional and Rural Development Ministry, was set up to promote Bumiputera participation in commercial and industrial activities.

Since 1952, Mara has disbursed loans worth over RM2.1 billion to more than 160,000 Bumiputera entrepreneurs. The money comes from the government.

It now aims to develop its landbank, starting with the Klang Valley. However, it is not known how much land Mara has.

To start with, Mara Inc will develop 0.9ha at Persiaran Gurney, Kuala Lumpur, in a 51:49 joint venture with Zikay Group .

Mara Inc and Zikay, via their joint venture company Symbolic Avenue Sdn Bhd, will develop a project called Gurney Avenue, featuring three blocks of medium to high-end condominiums, retail and shop lots, worth some RM300 million.

"This is an on-going exercise within Mara to develop land. We will have more projects of similar nature coming up after identifying the land that we want to develop," Abd Halim said.

Abd Halim was speaking to Business Times yesterday in Kuala Lumpur, at the signing of the joint venture agreement between Mara Inc and Zikay.

Zikay group chief executive officer Anuar Mohamed said the project, now in design stage, is slated to launch by the end of this year or early next year.

"We have not priced the properties. We are bullish on sales as it is a prime asset in a strategic area," Anuar said.

The price of condominiums within the vicinity of Persiaran Gurney is above RM1,000 per sq ft, he said.

By Business Times

EPF appoints chief executive for Kwasa Land

PETALING JAYA: The Employees Provident Fund (EPF) has appointed Mohamad Lotfy Mohamad Noh the chief executive officer of Kwasa Land Sdn Bhd, a 100% subsidiary of EPF and the master developer of the Rubber Research Institute Malaysia (RRIM) land in Sungai Buloh, sources said.

They also said that according to initial plans by Kwasa, the RRIM project would consist of an integrated township development with a good mix of residential, commercial and industrial properties with facilities and amenities.

“The development is expected to feature breathtaking landscape parks, green lungs, open spaces, walkways and water bodies,” one party familiar with the plans said. “The township will also incorporate full information technology and data infrastructure (MSC City Status) and complete urban transportation integration.”

The RRIM land will also house the depot of the planned mass rapid transit (MRT) project.

StarBiz reported recently that Syarikat Prasarana Negara Bhd, the project owner of the MRT, will be allocated a parcel of land in the RRIM development project for commercial development as part of the “rail-plus-property” model being used to offset the cost of building the MRT.

Negotiations are believed to be ongoing between Prasarana and EPF for this purpose.

The RRIM land, measuring more than 3,000 acres, has been dubbed the “new hub” of the Klang Valley and will be developed over the next 15 years.

Mohamad Lotfy currently heads the property investment department at the EPF, a position he has held since 2005. He was formerly a director of Malaysian Resources Corp Bhd (MRCB). Mohamad Lotfy resigned from the board of MRCB in October last year, likely due to his impending role in Kwasa Land.

Mohamad Lotfy, 52, began his career with Public Bank Bhd in 1982 before moving to then Kwong Yik Finance Bhd in 1986. Subsequently, he joined MK Associates Sdn Bhd (part of the MK Land Holdings group) in 1989 as a sales manager and was promoted to deputy general manager in 1991.

In 1993, he joined Land & General Bhd as a general manager, moving on to Golden Hope Development in 2003 and later Golden Hope Properties.

It has been reported that Kwasa will appoint or partner with various parties to co-develop the massive project, with parcels of land to be tendered out to different developers using an open and transparent basis.

“Developers are lobbying and pitching development plans to EPF even as we speak,” a source said.

As it stands, there is still little visibility on the selection criteria.

In fact, some industry players are wondering how open and transparent EPF is going to be on this development and whether the terms of the joint ventures are going to be fair or lopsided towards the pension fund.

Last March, the Government announced that EPF would form a joint venture to develop 3,000 acres of land in Sungai Buloh owned by RRIM into a new hub for the Klang Valley. The new hub, which is also part of 10th Malaysia Plan will lead to over RM5bil of new investments, it was then reported.

Earlier, market talk put MRCB as one of the lead developers for the project by virtue of its link to EPF, which controls MRCB.

At press time, EPF had yet to respond to queries from StarBiz.

By The Star (by Yvonne Tan)

Call to include PJ South in MRT project

The Selangor Petaling Business and Industry Association is requesting that the government consider Petaling Jaya South in the RM43 billion Mass Rapid Transit (MRT) project.

Based on the original proposal, residents in Petaling Jaya may not benefit from the MRT project immediately as there were no MRT lines or stations slated for the Petaling Jaya South area.

"For example, Taman Medan, Taman Maju Jaya and Taman Seri Manja have been left out of the limelight although the area is densely populated," its Deputy President Tee Kee Tian said in a statement today.

Tee said Petaling Jaya South provided a very important linkage between Subang Jaya and Sunway via Sungei Way.

"We hope the government can take into account the people's feedback and suggestions, and review the alignment of the MRT to include some stations in Petaling Jaya south so that more people can enjoy the convenience of the mega project," he added.

The government recently disclosed details of the Sungai Buloh Kajang line and the 51 kilometer line should bring massive economic benefit and employment opportunities.

By Bernama

Sunway unit bags RM74.1mil contract

PETALING JAYA: Sunway Holdings Bhd's unit Sunway Construction Sdn Bhd (SunCon) has secured a contract worth RM74.1mil from Bio-XCell Sdn Bhd to undertake the engineering, procurement, construction and commissioning of a central utilities facility at Biotechnological Park Bio-XCell in Nusajaya, Johor.

“The proposed project is targeted to be completed by May 25, 2012.

“It is expected to contribute positively to the earnings of Sunway group for the financial year ending Dec 31, 2011 onwards,” Sunway Holdings said in a note to Bursa Malaysia yesterday.

The proposed project is subject to normal construction risk of materials price fluctuation, according to the company.

“However, with the past experience and expertise of SunCon in construction projects in Malaysia, this risk could be mitigated at this juncture.”

By The Star

Mydin to invest RM1.4b on 14 hypermarts

Mydin Mohamed Holdings Bhd plans to open 14 new hypermarkets nationwide over the next few years by investing RM1.4 billion, its managing director, Datuk Ameer Ali Mydin said today.

He said the group is also mulling the idea of raising some RM350 million via a bond issuance to fund its expansion plan but declined to reveal details.

The amount can fund three hypermarkets, namely one in Seremban and two in Johor Baru, as on average, each hypermarket will cost RM150 million, he told reporters after Prime Minister, Datuk Seri Najib Tun Razak unveiled the nine new projects under the Economic Transformation Programme (ETP) here, today.

He also said it took between 12 to 15 months to complete a hypermarket.

By Bernama