MNC Wireless buys Tetap Tiara properties

MNC Wireless Bhd has bought properties from Tetap Tiara Sdn Bhd for RM2.6 million, which forms part of the integrated commercial development of one block of building comprising office suites and a multi-level shopping, recreational, entertainment and commercial complex with multi-level car park known as “Jaya One Phase 3”.

MNC intends to use the properties as its operation office as it is currently operating from rented premises.

By Business Times

Fajarbaru unit acquires KL land

FAJARBARU Builder Group Bhd said its unit Wajatex Sdn Bhd has bought a piece of land in Sentul, Kuala Lumpur, for RM23.6 million cash and plans to develop property on it.

It is buying the land, measuring 9,330 sq m, from Jalar Bakti Sdn Bhd, Fajarbaru said in a statement to Bursa Malaysia

By Business Times

China property investment up 33.6%

BEIJING: China's annual real estate investment growth quickened to 33.6% in the first seven months from a year earlier, and compared with an increase of 32.9% in the first half, the National Bureau of Statistics said yesterday.

Property sales rose 13.6% in the January-July period from a year earlier in terms of floor space and gained 26.1% in terms of value, the agency said in a statement on its website, www.stats.gov.cn.

The data came after the country announced last month that it would expand home purchase restrictions to smaller cities, where prices had risen faster than in major cities.

By Reuters

Mixed outlook for property in H2

Reapfield says prices in the condominium market, excluding Mont’Kiara and KLCC, have not gone down and rental remains strong.

PETALING JAYA: The outlook of the property market is mixed, with developers reporting firm sales while property agents report tell-tale signs of a slowdown in certain market segments.

Rahim & Co executive chairman Datuk Abdul Rahim Rahman said: “The market is giving a mixed indication, but what is happening in the United States and Europe is very serious and will have an effect on this part of the world. For example, the take-up rates of newly-launched condominiums have been very encouraging with more than 60% sold just a few months after launching. However, on the rental market, leasing has been less active and rental rate has not increased that much.”

“The quick and healthy take-up rates reported by developers mean that people are still confidently investing despite the seriousness of the US and European debt issues,” he said.

He expects the number of launches to continue to be fairly healthy with good take-up rates, especially for those outside the Kuala Lumpur city centre

“The market is not saturated. Although prices of landed units may have gone up quite a bit, it is possible to buy detached houses at RM1mil in Shah Alam,” he said.

Senior vice-president Gerard Kho of real estate consultancy Reapfield, reckoned that the market might be rather flat when compared with the first half of this year and the whole of last year. The market during the last 18 months have been exceptionally buoyant and the full impact of the US-Europe problems were not factored in by the market then.

“We are not sure what will happen in the second half of this year, but we are taking a cautious stand,” said Kho.

He said the prices of landed units would continue to go but they are seeing a disparity between asking price and transacted price widening. This disparity was seen a couple of months ago, he said. Prices have gone up compared with the first half of this year but the increase was less.

“We expect this situation to continue - growing disparity between asking and transacted price,” Kho said.

As for the condominium market, excluding the KLCC and Mont' Kiara, prices have not gone down and rental remains strong. Kho said prices were flat in the Mont'Kiara and KLCC market.

The company was also seeing more listings coming into the market which means there were more units available now and buyers were waiting on the sidelines looking for a good buy, he said.

“But they are not going for fire-sale prices,” he said.

“People today will be buying at more realistic prices, unlike the first half of this year when they were prepared to pay more than the current market prices. As more stocks entering the market, the market may soften but despite that, high-rise units costing less than RM500,000 are expected to do well.

“If one is looking at the Klang Valley specifically, whether the market is up or down, there will be demand,” he said.

Kho said in terms of market activities, the first half of this year was the most buoyant compared with the Jan-June 2009 and Jan-June 2010 periods.

As for the healthy take-up rates, this may largely be attributed to the attractive lending terms offered by the banks together with the various rebates offered by developers.

In a 23-acre development known as Empire City next to the Lebuhraya Damansara-Puchong (LDP) by the Empire Group, a marketing agent reported that sales have been brisk with five to six units sold on a daily basis about two weeks ago.

Known as serviced office suites, the units are located on top of what will be a five-star hotel.

“This enables the buyer to apply for a 90% loan because this project is on a commercial title. If it were a residential title, he can only get 70% loan, if this is his third mortgage,” the agent said.

He explained that buyers need only pay a deposit of RM5,000. There is a 5% rebate. If a unit costs half a million, a buyer gets RM25,000 discount. He needs to pay the remaining 5% (RM25,000) upon signing the Sale and Purchase Agreement, less the RM5,000 booking fee. His initial capital outlay amounts to only RM20,000. The entire 23-acre development is expected to be completed by 2015.

Rebates have become a feature in today's launches and may be a sign of the competitive property market, particularly for condominium sales.

In a three-acre development in Jalan Kiara 3, near Mont'Kiara heading towards Segambut, Mitrajaya Homes group relaunched Kiara 9 Residency over the weekend. The completed project comprises about 200 units of condominiums and 16 units of 3.5 storey villas. The condominium block is 70% sold, the villas, 50% sold.

There is a 20% rebate for condominium units facing west, those facing east, a 12% discount and those facing another upcoming condominium block, a 15% discount.

Some of the discounts could go as high as RM200,000. Landed villas come with a 5% rebate.

As an indication, a 2,200 sq ft unit complete with cabinet fixtures and electrical appliances on the 10th floor facing another ongoing block of high-rise apartment is priced at RM1.7mil, and a discount of up RM256,000 has been given.

By The Star

Johor second half outlook positive

Sweetener: Johor Baru’s close proximity with Singapore has attracted buyers to properties in Iskandar Malaysia.

The outlook for the Johor property market is likely to remain positive in the second half of the year based on the number of property transactions taking place in the state.

Johor Real Estate and Housing Developers Association (Rehda) branch chairman Simon Heng says its members who took part in the Malaysia Property Expo (Mapex) events recorded a 15% increase in sales.

Some 33 developers who participated in the four-day event held in last November raked in RM331mil in sales over a one-month period and the figure jumped to about RM384mil in Mapex held in May 2011.

“Our members reported better sales in the first half of the year and expect the momentum to continue in the second half of 2011,'' Heng says in an interview with StarBizWeek.

The 30-day period starting from the first day of Mapex is the benchmark used by Rehda to determine the value of sales by participating developers. There were several contributing factors that drove demand for properties in the Johor property market this year especially in the Johor Baru district.

As the pulse of the state, the Johor Baru district has the highest concentration of Johor-based and non-Johor-based developers compared with other districts such as Batu Pahat, Kluang, Muar and Segamat.

Price uptrend

“Many property buyers in Johor Baru are anticipating prices of properties will rise and have decided to make their purchase before the prices escalate again,'' says Heng.

He says the economic recovery meant that consumer confidence was returning after a two-year low period following the global recession sparked off by the US subprime crisis and European financial woes in 2008 and 2009.

Iskandar Malaysia, Heng says, is another main factor that contributed to the positive growth in the Johor Baru property market as it helps to boost demand for houses in the area.

Prior to the inception of Iskandar Malaysia in November 2006, demand for high-end residential properties was best described as lacklustre, but now demand for such properties is on the uptrend. It is common to see developers with projects in Iskandar Malaysia selling their double-storey link-house from RM350,000 up to RM450,000 each. The units are selling like hot cakes.

“Shophouses are also selling well and reports from our members show that a lot of buyers from Kuala Lumpur are buying the shophouses as investment,'' he says.


Heng: ‘Shophouses are also selling well.’

Heng says many of the buyers consider prices of shophouses in Johor Baru are much lower than those in Kuala Lumpur and that they would make good investments in view of the development taking place within Iskandar Malaysia.

Iskandar Malaysia covers 2,219 sq km located in the southernmost part of Johor and divided into five flagship development zones the Johor Baru City Centre, Nusajaya, Eastern Gate Development, Western Gate Development and Senai-Kulai.

Heng says even prices of properties in the Senai-Kulai area, on the northern part of the Johor Baru district which was one described as “hulu” or remote, are going up due to better accessibility and connectivity. A single-storey terrace house at Bandar Putra Kulai by IOI Properties Bhd launched in June 2010 was priced RM130,000 each and sold for RM200,000 in June this year. The two-storey link house in the same housing scheme which was sold at RM189,00 a unit in June last year, was going for RM269,000 each in June this year.

“Iskandar Malaysia is now gaining momentum with many ongoing projects by both the public and the private sectors at several stages of development,'' says Heng.

He says the completion of the New Coastal Highway, the Eastern Dispersal Link Expressway and the Southern Link next year would improve accessibility and connectivity within Iskandar Malaysia; hence help to push demand for properties.

The Kempas-Tebrau, Mount Austin, Nusajaya and Kulaijaya areas are expected to be the property hot spots with several projects to be launched within the next one to two years.

Investment boost

Meanwhile, KGV International Property Consultants (M) Sdn Bhd director Samuel Tan Wee Cheng says the property sector constitutes 30% of the total committed investments while the manufacturing sector makes up about 40%.

He says although the Iskandar Regional Development Authority (Irda) wants the services sector to be the forefront, the manufacturing and the property sectors are still the main contributors to the cumulative investments in Iskandar Malaysia.

Irda chief executive officer Ismail Ibrahim says that as of June 2011, Iskandar Malaysia has received about RM95bil in committed investments, up from RM73bil in the first quarter of the year.

He says that while Iskandar Malaysia is a main factor that pushed demand for high-end properties, the stakeholders must ensure that buyers who could not afford them are not left out.

“It is good for developers to be able to sell high-end properties especially to foreigners but we need to have a balanced approach to ensure locals are not sidelined in the name of progress,'' says Tan.

Rising demand

He says demand for properties in Johor Baru was up in the first half of the year as many prospective buyers missed the opportunity to buy the properties at lower prices due to the 1998 and 2009 economic recession.

Typically, buying a property would be the last option most people would consider committing to during economic uncertainties given concerns over job security.

“The moment the economy starts to show signs of recovery, those who missed the boat earlier will invest in properties as properties are always a good hedge,'' he says.

Tan says confidence in Johor is now at all time high especially with the progress made by Iskandar Malaysia since its inception five years ago, although many are sceptical in the early days on whether it would take off successfully.


Tan says the property sector constitutes 30% of total committed investments.

He says that as the Government-backed economic growth corridor in the country, Iskandar Malaysia has strong backing from the Government in terms of funding for infrastructure development projects.

“Road upgrading and new road projects within Iskandar Malaysia will improve accessibility and connectivity and buyers will look at other locations which were previously unpopular,'' says Tan.

For instance, Rawang and Shah Alam in Selangor used to be out of the radar among property buyers in the Klang Valley but now, buyers are flocking there as better infrastructure has turned them into preferred locations.

Tan says foreign investors, who were largely interested in Singapore and the Klang Valley, are also gradually turning their gaze to Iskandar Malaysia. A definite sweetener is Johor Baru's close proximity with Singapore which has attracted buyers especially Singaporeans to properties in Iskandar Malaysia. “Like it or not as close neighbours, Johor and Singapore complement each other in economic activities due to a long history of economic interdependence,'' says Tan.

With the republic's investment arm Temasek Holdings showing its serious commitment to invest in Iskandar Malaysia, more Singapore property players such as Mapletree and CapitaLand would likely invest in the property sector here.

Tan hopes that the Government will take a proactive step to correct the misconception that Iskandar Malaysia is Nusajaya as there are other areas that need equal attention in terms of infrastructure projects and investment flows.

By The Star

Mah Sing to develop M Sentral

Mah Sing Group Bhd is proving its mettle as a versatile developer with good landbanking skills and the ability to enter into promising joint ventures with owners of land in strategic locations.

The company's latest 60:40 joint venture with Asie Sdn Bhd for the redevelopment of 4.08 acres of the former Pekeliling flats area, along the busy thoroughfare of Jalan Tun Razak-Jalan Pahang in Kuala Lumpur, has stirred quite a lot of excitement in the market given the project's prominent location.


Leong says Mah Sing will engage an international architect for the project.

To be named M Sentral, the project comprising service residences and retail units with an estimated gross development value (GDV) of RM900mil, forms the first part of a privatised urban regeneration project of the old Tunku Abdul Rahman flats covering 58 acres.

The project is the largest privatised urban regeneration project in Kuala Lumpur so far.

Private company, Asie, has been granted the concession rights to develop the whole of the 58-acre site into a mixed development with potential GDV of RM9bil.

The project with the theme “River Garden City” will comprise residential and commercial property, community, leisure, recreation and infrastructure facilities.

Asie and its subsidiary Usaha Nusantara Sdn Bhd will undertake the development of the maiden parcel on the 4.08 acres jointly with Mah Sing's wholly-owned subsidiary Grand Pavilion Development Sdn Bhd.

The project site has the Titiwangsa LRT and monorail stations and various city landmarks like the Istana Budaya, Lake Titiwangsa, National Heart Centre and Kuala Lumpur Hospital in close vicinity.

With the right master planning, the urban regeneration project will be able to add significant value to the land.

According to Mah Sing group managing director and chief executive Tan Sri Leong Hoy Kum, the renewal project is a comprehensive redevelopment to encourage the community to live, work and play in the city centre.

“The 4.08 acre site is on a prime location facing Jalan Tun Razak and will be one of the most visible plots of the entire 58 acres. Linking this maiden development to the entire site will be a sky bridge that Mah Sing will put up with the understanding that we may be the potential joint venture partner for other parcels within the land,” he shares with StarBizWeek.

Leong says Mah Sing will engage an international architect for the project, “someone we have worked with and who has the ability to understand our vision and come up with a concept and design that will promote development and enhance the surrounding.”

“We shall go along with the over-arching theme of River Garden City, and make sure that our design is modular so that we can expand the theme to envelope the land as and when it becomes necessary. We are keen to show our execution abilities to turn the land into a new riverside garden city,” he adds.

M Sentral will comprise smaller sized and more affordable service residences with lower entry prices to cater to the strong demand for such units. There will also be some retail units.

“We are looking at small units from 500 sq ft, priced between RM700 and RM800 per sq ft. From our preliminary plans, the service residences will make up approximately 75% of the units and we are looking at 1,000 units overall,” he adds.

The target market for M Sentral are executives, expatriates and those working in the medical fraternity in view of the ease of access to prime commercial areas, tourist attraction areas, medical facilities, amenities and network of public transportation in the surrounding areas.

“The location, concept, product and branding will be its key success factors,” Leong stresses.

He says the land is ready for immediate development as demolition works, soil investigations and partial earthworks have been completed.

Awareness programme and registration of interest for M Sentral are expected to commence in the second half of this year.

Subject to authorities' approval and fulfilment of conditions precedent, the proposed development is expected to commence by the first half of 2012 and to be developed over a span of five years.

Based on Mah Sing's fast project turnaround model and marketing prowess, the project previews are set to start as early as the second quarter of this year.

While most analysts have given the thumbs up for the project, there are also sceptics who think that the land cost could be too high.

UOB Kay Hian Research says the total implied consideration of RM106.6mil or at RM600 per sq ft for the 4.08 acre land, is considered costly compared with other recent land transactions nearby.

CIMB Research however takes a positive view of the acquisition, noting that “the purchase price of RM600 per sq ft is fair for a project with such a high GDV and in such a strategic location being adjacent to a very busy ring road.” Its proximity to an integrated LRT and monorail station also enhances its accessibility.

“This venture could be the start of many joint ventures with the land owner, and Mah Sing may be able to participate in the entire urban regeneration project which is estimated to have a GDV of RM9bil,” adds CIMB Research.

TA Research is also positive of the deal and is confident that Mah Sing will be able to secure other development rights for the remaining 53.9 acres of concession land for the ease of project coordination and management.

“This will serve as an earnings catalyst to support future earnings growth. This is especially true in this period of time where a prime and sizeable landbank in a strategic location is hard to come by,” it notes.

Assuming a 20% PBT margin and the investment cost of RM106.6mil, the research house says the development could offer potential yields of 15% return per annum over the development period of five years.

Leong is confident that M Sentral will turn out to be another success story for the company.

He says Mah Sing has enjoyed great success for its M brand series of projects so far.

M Sentral will be the third project in the series, he says, adding that all the three projects M Suites, M City and M Sentral are all well served by good public transportation links.

Besides the existing LRT and monorail networks, there may also be future MRT stations that may be located close to these projects potential Great Eastern Mall stop for M Suites, potential Ampang Point stop for M City and potential Titiwangsa stop for M Sentral.

M City is served by LRT network at the Dato Keramat and Jelatek stations, and Star line (Ampang station).

M Sentral's central location also makes it the next major transit hub.

M Suites Jalan Ampang, next to Great Eastern Mall, comprising service apartments from 500 sq ft are nearly 100% sold. M City Jalan Ampang comprising service residences, SoHo, sky villas, three-storey shops and lifestyle retail outlets, is also well received.

Only the SoHo in M City has been previewed in May, and units in phase 1A have all been taken up and about 30% of phase 1B has been sold so far.

The five acre project has garnered much interest with its garden city concept with over four acres of greenery with thematic hanging gardens and lagoon parks.

Leong says urban renewal projects allow Mah Sing access to prime land, and the company will continue to acquire strategically located land as part of its growth plan.

“We would like to take part in more urban regeneration projects by both the Government and the private sector. We have been aggressively acquiring land and with our track record and branding, we are frequently presented with various proposals. We have the appetite and balance sheet, but we are also very selective of the lands that we buy.

“These must be good ones which fit our business model and allow us to value add. We believe our track record, know how, branding and financial capacity can help to unlock and enhance the land's value,” he adds.

By The Star

MPI, Glomac team up to promote new residences

SINGAPORE: Malaysia Property Inc's (MPI) Singapore Gallery has launched a marketing initiative with Glomac Bhd to promote three new residential launches - Suria Residen (Kuala Lumpur), Mutiara Damansara Residences and Glomac Damansara Residences (Selangor) to Singapore home buyers and investors.

Glomac's group managing director/chief executive officer, Datuk FD Iskandar said Singaporeans, who were considering a second vacation home or making Malaysia their permanent resi-dence, would enjoy substantial savings during this one-week showcase at MPI Singapore Gallery.

"The attractive incentives, coupled with a strong Singapore dollar, will ensure upfront affordability with the long-term aim of capital gains and attractive rental yield," he said when announcing the partnership here yesterday.

MPI chief executive officer Kumar Tharmalingam said with a reputed developer like Glomac as partner, it affirmed once again MPI's standing as a Malaysian government-supported authority in bridging retail and institutional investors with the right developer and investment company respectively.

"With Glomac showcasing their newly-launched developments at MPI's Singapore Gallery, it assures Singapore home buyers and investors that their money is parked in a safe venture," he said.

From August 5-11 2011, Singapore buyers will enjoy exclusive incentives, which include a low booking fee of RM5,000, special discounts for select units, developer interest-bearing scheme until completion, absorption of sales and purchase agreement legal fee and first 12 months' maintenance charges.

Suria Residen, located at Batu 9 Cheras next to Venice Hill, is expected to be completed in 2013. The 0.48-hectare development will feature 16 double-storey semi-detached houses, each with a built-up area of 3,480 sq ft.Prices start from RM1.328 million.

Mutiara Damansara Residences, which is expected to be completed in 2015 and Glomac Damansara Residences in 2014, are freehold serviced apartments.

Mutiara Damansara Residences is located 25 minutes from Kuala Lumpur City Centre while Glomac's Damansara Residences, a mixed development that includes commercial and retail modules, is located 20 minutes from Kuala Lumpur City Centre.

By Bernama

Polls a factor, property survey reveals

GEORGE TOWN: The general election appears to be a factor in property purchasing decisions by certain investors, a survey carried out by an online property portal has revealed.

PropertyGuru, Asia's leading property portal, and its Malaysian arm HomeGuru, have said 40 per cent of over 2,000 respondents of a survey carried out in Malaysia have said they will buy properties after the elections, while 49 per cent stated the polls would have no effect on their buying decision.

"About 800 of our respondents feel the coming general election will affect their property buying decision and say they will buy properties only after the election," HomeGuru Sdn Bhd country manager Steven Tan told Business Times.

The findings were part of the company's "Malaysia Property Sentiment Survey" for the second half of 2011.

He said 18 per cent of the respondents said they used the Internet to do a research on property market trends, 16 per cent for home loan packages, 15 per cent for real estate agents and 15 per cent scoured online for auction properties.

Tan was in Penang on Thursday with AllProperty Media Pte Ltd group chief executive officer Steve Melhuish to relaunch Property-Guru's northern region property website, Fullhouse.com.my.

Other finds of the survey included the fact that 20 per cent of its respondents said potential profit from capital appreciation of property is the most attractive reason to invest in property.

"About 19 per cent say property investment is good for retirement planning and 18 per cent see property as solid and safe investment," Tan added.

"Our sentiment survey indicates that north Malaysia will continue to experience a sharp growth due to high demand from local and overseas buyers in the next two years," Melhuish said.

"This is based on the fact that an average of 46 per cent of 120 survey respondents from northern Malaysia - notably Penang - say that property prices for apartments/condominiums, terrace and link-houses and town houses are reasonable."

PropertyGuru, which was founded in 2006, has a presence in 8 countries, including offices in Malaysia, Singapore, Indonesia and Thailand, along with partnerships with property websites in Australia, Hong Kong, India and Macau.

By Business Times

KLIFD takes shape

Kuala Lumpur: 1Malaysia Development Bhd (1MDB), the government-owned firm in charge of setting up the Kuala Lumpur International Financial District (KLIFD), has picked Akitek Ju-rurancang (Malaysia) Sdn Bhd and its international partner, Machado Silvetti and Associates (MSA), as the project's master planners.

The US$8 billion (RM23.7 billion) KLIFD, one of Malaysia's biggest projects, aims to tightly cluster financial institutions and top global firms on 30.3ha of land in the Imbi area, fronting Jalan Tun Razak here.

A detailed masterplan of the project is expected to be completed in the first quarter of next year, 1MDB said in a press statement yesterday.

The project is a joint venture between 1MDB and Mubadala Development Corp, Abu Dhabi's investment arm.

1MDB had, in late 2010, organised a design competition for master planners, attracting some of the world's best.

"The two companies (Akitek Jururancang and MSA) represent the fusion of local and international talents that best translate 1MDB's vision for the future financial district, through their concept and rendering of the masterplan," said Datuk Azmar Talib, chief operating officer of 1MDB Real Estate Sdn Bhd, a subsidiary of 1MDB.

He said the two companies share a vision for a "highly functioning, interesting, innnovative and aesthetically pleasing urban district" that would establish KLIFD as a financial centre of choice.

Construction work is expected to take off in June, according to news reports earlier this year.

The project is seen to be providing significant stimulus for the construction and related industries.

It will leverage on Malaysia's existing strength in Islamic finance and play on its strategic location to complement other financial centres within the region.

The RHB banking group is expected to be the first to set up presence there.

According to 1MDB, the Akitek Jururancang-MSA partnership is to deliver a sustainable, modern and progressive KLIFD.

This will be projected through buildings, a pedestrian-friendly green public realm and seamless links to public transportation.

"We have a real contribution to make to the urbanscape of Kuala Lumpur in line with the objective of the Greater KL initiative to make Kuala Lumpur a world-class city. The increasing emphasis on the greening of the city - as manifested in the recent River of Life and upgrading of the Lake Gardens - signals a welcome reception of KLIFD's unique 'Financial Centre in the Park'," Akitek Jururancang's managing director Datuk Seri Esa Mohamed said in the same statement.

The River of Life is a project name for the beautification of a 10.7km stretch of the Klang and Gombak river.

Akitek Jururancang's partner MSA, a US-firm based in Boston, has worked on projects like The Mint Museum (Charlotte, North Carolina) and the Boston Public Library.

It won an architecture prize last year for its work on the Suliman S. Olayan School of Business at the American University of Beirut, Lebanon.

By Business Times

Tambun sees strong demand for mainland Penang properties

KUALA LUMPUR: Investors looking for exposure to the Penang property market have naturally gravitated to the island, with Eastern & Oriental Bhd being the current hot favourite. They have largely ignored the mainland.

But if the latest sales numbers from leading mainland Penang player Tambun Indah Land Bhd are any indication, property companies focusing on the mainland could look as interesting as those across the narrow South Straits that separates it from Penang island.

Listed in January this year, Tambun Indah, a leading mainland Penang property player, yesterday announced a 54.2% jump in revenue for 1HFY11 ended June 30 from RM57.32 million to RM88.4 million.

In a statement, managing director Teh Kiak Seng attributed the increase to contributions from ongoing development projects.

However, higher costs narrowed the growth in pre-tax profit to 16%, or RM21.76 million in 1HFY11, compared with RM18.76 million in 1HFY10. Due to higher minority interests, net profit fell 16% to RM11.12 million in 1HFY11, or 5.03 sen per share, compared with RM13.25 million in 1HFY10. The group registered a net profit of RM23.76 million in 2009, slightly higher than RM23.47 million a year before.

The substantial jump in revenue may be an indication that the property boom on wealthy Penang island is spilling over to the mainland. And the company offers good dividends too. It has proposed an interim single-tier dividend of 4.6 sen, to be paid on Sept 7. This translates into a net dividend yield of 6.1%.

“We commenced construction of five new projects in 1HFY11, recognising the rising demand for residential properties following the rapid industrial developments in mainland Penang. At the same time, we noted positive take-up rates for our ongoing Pearl Garden and Pearl Villa developments, which together constitute approximately half of 1HFY11 group revenue,” Teh said.

Tambun Indah embarked on five new projects in 1HFY11 — Pearl Villas, Dahlia Park, Impian Residence, Tanjung Heights and Capri Park. Teh expects these projects to contribute to the group’s performance in the remaining half of FY11 ending December.

“At present, our GDV [gross development value] stands at RM1.7 billion, which will last us until 2016, with unbilled sales of RM225 million,” he wrote, adding that he is optimistic of the group’s performance for the remaining half of FY11.

Tambun Indah started operations in 1995. Its maiden project was Taman Tambun Indah, a township of over 800 houses, 300 bungalows, 40 semi-detached units, shop offices and terraced houses. The group has a landbank of over 121ha, mainly in mainland Penang.

In a year that saw most IPOs falling under water, Tambun Indah’s shares were last traded at 76 sen, up 8.6% from the IPO price of 70 sen. The stock has traded between 86.5 sen and 65.5 sen since it was listed, and is currently trading at 1.1 times its book value of 68 sen as at June 30.

The company has a market capitalisation of RM168 million. Based on annualised earnings for 1HFY11, it is trading at a price-earnings ratio of around 7.6 times earnings for this year.

In an earlier note issued during the listing, MIMB Research said it expects Tambun Indah’s net profit to grow by 10% in 2011 and 11% in 2012, mainly underpinned by property projects in the pipeline with a GDV of RM1 billion. “Dividend yield of 7% to 8% is one of the highest in the property sector. We value Tambun Indah Land at a fair value of 81 sen, based on a 30% discount to realiasable net asset value,” it said.

By The EDGE Malaysia

Magna Prima plans RM478m Melbourne property devt

KUALA LUMPUR: MAGNA PRIMA BHD is making into foray into Australia to undertake a mixed residential and commercial project in Melbourne with an indicative gross development cost of A$148 million (RM482.18 million).

The company said on Friday, Aug 5 it expected to record a profit of A$62 million (RM200.32 million) from the project.

Magna Prima had on Friday signed a conditional contract of sale with Yucai Australia Pty Ltd to purchase 2,761 sq metres of land for A$26 million (RM84.01 million) on Beckett Street, Melbourne.

The land would be developed into a mixed residential and commercial project to be known as Dynasty Living.

The project would comprise a contemporary 26 level mixed development of 320 residential apartments contained within a main tower, complemented by seven retail/commercial tenancies.

The apartments and retail/commercial tenancies would have 130 single and 51 tandem car spaces providing for 181 apartments.

“The indicative gross development cost is A$148 million with an expected profit of A$62 million. Construction is expected to commence in the fourth quarter of 2011, and to be completed in 2013,” it said.

Magna Prima said the development cost would be its own funds and/or bank borrowings. The planning permit from the Minister of Planning was obtained on May 5, 2002 and amended on Oct 6, 2009.

“As part of the company’s plan of putting a strong footing for growth, the proposed acquisition will be the company’s first step in placing the group on the global map,” it said.

Magna Prima said the proposed acquisition was in line with its strategy of acquiring niche suitable development land with strong potential for prime and sizable new developments.

“The board is of the view that the proposed acquisition provides the group with a rare and valuable opportunity to venture into the robust, high-income and mature Melbourne property market,” it added.

By The EDGE Malaysia

SP Setia denies talking to E&O

PETALING JAYA: Property developer SP Setia Bhd yesterday quashed rumours that it was among those eyeing a stake in property and hospitality company Eastern and Oriental Bhd (E&O).

The company told Bursa Malaysia that while it would continuously assess possibilities for strategic partnerships and land-banking opportunities, it was not in any acquisition or takeover talks with E&O or its shareholders.

By The Star

Mah Sing lands M Sentral deal

Mah Sing has been given the first contract for the RM9 billion privatised urban regeneration project in Kuala Lumpur

Kuala Lumpur: Asie Sdn Bhd has dished out the first contract for the RM9 billion privatised urban regeneration project in Kuala Lumpur to Mah Sing Group Bhd, Malaysia's fifth largest property developer by revenue.

The contract given to Mah Sing entails it to undertake a niche development on 1.6ha.

Called M Sentral, it will feature serviced residences and retail lots worth a combined RM900 million.

The urban regeneration project, dubbed Tamansari Riverside Garden City and mooted more than 10 years ago, is one of key developments under the Entry Point Projects.

Asie, a private concessionaire, has full rights and approvals to build residential and commercial properties, leisure, recreation and infrastructure facilities on 15 parcels of development land with five air rights in Precinct 2-Pekeliling of the River Corridor Development under the Blue Corridor policy of Kuala Lumpur City Plan 2020.

Located on 23ha along Jalan Tun Razak-Jalan Pahang, the former site of the Tunku Abdul Rahman flats or Pekeliling flats, the 15-year project is envisaged to be bigger than Mid Valley City.

Yesterday, Mah Sing's wholly-owned unit, Grand Pavilion Development Sdn Bhd, signed a joint venture agreement (JVA) with Asie and its subsidiary Usaha Nusantara Sdn Bhd to develop M Sentral.

Under the JVA deal, Usaha Nusantara will grant Grand Pavillion the sole and absolute rights to develop the 1.6ha land for an entitlement of RM106.60 million. This will be settled via 60 per cent in cash (RM63.96 million) and 40 per cent stake in Grand Pavillion.

Mah Sing will continue to have 60 per cent shareholding in Grand Pavillion, it said in a statement issued yesterday.

Mah Sing group managing director and group chief executive officer Tan Sri Leong Hoy Kum said work on M Sentral will commence by the first half of next year, pending authorities' approval and fulfillment of conditions. It will take five years to develop.

Leong said there is a provision for a sky bridge's connection to the remaining 58 acres, in line with the understanding that Mah Sing may be the potential joint venture partner for other parcels within the land, subject to terms and conditions to be mutually agreed upon.

By Business Times

Mah Sing to develop part of Pekeliling flats area

Well connected: Pekeliling flats area is close to transportation facilities.

PETALING JAYA: Mah Sing Group Bhd has secured a project to develop part of the former Pekeliling flats area into serviced residences and retail units with an estimated gross development value (GDV) of RM900mil.

To be known as M Sentral, the project will comprise serviced residences and retail units along Jalan Tun Razak-Jalan Pahang and forms part of a privatised urban regeneration project in Kuala Lumpur, the property company said in a statement yesterday.

According to Mah Sing's press release, the entire regeneration project has an estimated GDV of RM9bil, and covers 58 acres. Mah Sing also said that this is the largest privatised urban regeneration project in the city centre, with M Sentral being the first part of the entire project.

For its venture, Mah Sing's wholly-owned subsidiary Grand Pavilion Development Sdn Bhd together with private company Asie Sdn Bhd which has full rights to develop the 58 acres and its subsidiary Usaha Nusantara Sdn Bhd will develop 4.08 acres into “smaller sized and more affordable” serviced residences as well as some retail units.

No additional information was provided about Asie. But earlier media reports indicated that the urban renewal development of the decades-old Pekeliling flats dated back to as far as 1997, when the project was approved by Kuala Lumpur City Hall.

Asie was then said to be among several companies that vied for this major renewal project. It is unclear what had stalled the project up to now.

Under the RM900mil GDV joint-venture project between Mah Sing and Asie, there is a provision for a sky bridge connection to the balance of the 58 acres, “with the understanding that Mah Sing may be the potential joint-venture partner for other parcels within the land subject to terms and conditions to be mutually agreed upon,” Mah Sing said.

“I think it stands a good chance (of developing the rest of the land) owing to its track record,” CIMB Investment Bank Bhd research head Terence Wong said.

Analysts noted the project “could not afford to fail” given its prime location in the city centre.

Subject to relevant approvals, the proposed development M Sentral is expected to start by the first half of next year and will be developed over a span of five years.

Wong said the project would be “positive” for Mah Sing in terms of earnings and had inputed a 5% to 10% earnings increase from it together with Mah Sing's latest acquisition of 205.72 acres of freehold land in Johor Baru for the development of its Mah Sing i-Parc, an integrated industrial and business park.

Mah Sing group managing director Tan Sri Leong Hoy Kum said in the statement: “Acquisition of strategically located land is part of our growth strategy, and urban renewal projects allow access to prime land in the city centre.

“M Sentral is just the beginning as we would like to take part in more urban regeneration projects by both the Government and the private sector.”

Mah Sing's well-known property development projects include M-Suites and M-City, both located along Jalan Ampang, KL.

Leong said M Sentral was poised to be “the next major transit hub” and the target market for the project included local executives and expatriates.

M Sentral is within the catchment area of Kuala Lumpur, Jalan Ipoh, Sentul and also Petaling Jaya as it is close to transportation facilities such as light rail transit (LRT) and monorail stations, he said, noting that the Titiwangsa Monorail Station and the Titiwangsa LRT stations were within walking distance while the Sentul KTM station was about 3 km away.

A future mass rapid transit has also been planned for Titiwangsa, according to Leong.

Under the joint-venture agreement, Mah Sing's unit Grand Pavilion will be granted the right to undertake the development of the land for RM106.6mil. This amount will be partly settled in cash (RM63.96mil) and partly by giving Asie's unit Usaha Nusantara, a 40% stake in Grand Pavillion.

Shares in Mah Sing ended yesterday up 4 sen to RM2.44 in a weaker broader market.

On Wednesday OSK Research was positive on the joint venture agreement between Mah Sing Group Bhd's wholly-owned unit, Grand Pavilion Development Sdn Bhd and Asie Sdn Bhd and its subsidiary, Usaha Nusantara Sdn Bhd.

In a statement OSK said the agreement was for the proposed joint development of prime leasehold land along Jalan Tun Razak here, measuring approximately 1.65 hectares.

"The agreement will enable Mah Sing to replenish its landbank and project pipeline as well as gain access to sizeable prime landbank in the Klang Valley," it said, Bernama reported.

OSK said under the agreement, Grand Pavillion also intended to undertake a niche development, M Sentral, comprising flexible-sized and more affordable serviced residences with an estimated gross development value of RM900 million.

"We think it is fair deal, considering the current market value of land in the surrounding area, as well as its strategic and prime location," it said.

It said the proposed development was expected to commence by first half 2012 and would take five years.

Under the agreement, Usaha Nusantara would grant Grand Pavilion the sole and absolute right to undertake the development of the land for RM106.6 million, to be settled 60 per cent in cash and 40 per cent by way of issuance of shares in Grand Pavillion

OSK has maintained its forecast and 'buy' recommendation on Mah Sing with an unchanged fair value of RM3.01.

By The Star

AmInvest: Property bubble building up but not alarming

AmInvestment Bank Group director of retail funds says he sees a small bubble in the property market, but it's no where near big yet

KUALA LUMPUR: There is a property bubble building up in Malaysia and the region but it is nowhere near alarming levels as the main indicators are still at comfortable levels, AmInvestment Bank Group said.



"As an investor, I love bubbles because that's where the money is. At this juncture, I see a small bubble in the property market, it's no where near big yet and I'm not seeing any property bubble bursting soon," AmInvestment Bank Group director of retail funds Ng Chze How said.

"For that to take place, I think you need to see a few factors taking place. Firstly, you need to see very high overall borrowings and leveraging, which is currently not happening. Secondly, is to look at the non-performing loans (NPLs). Across this region, the NPLs are still very healthy. Thirdly, you need to look at the liquidity in the market. There's so much liquidity, so much cash sitting in the system."

Ng was speaking to the media after the launch of the country's first Asia Pacific REITs unit trust fund by AmMutual here yesterday.

The unit trust funds will be solely investing in REITs in Asia.

For a start, it is looking at Australia, Hong Kong, Singapore, besides a minimal exposure in Malaysia. The fund will be managed by Funds Management Division (FMD) of AmInvestment Bank Group.

"When we are creating this fund, we want it to be riskier than bonds but safer than equities. This fund does that. It offers investors opportunities to diversify away from stocks and bonds and thus, reducing investors' overall portfolio risks," said FMD chief executive officer Datin Maznah Mahbob.

She added that investors will receive high dividend yields from investing in REITs as the fund is structured to distribute a high percentage of its profit to shareholders.

Over the past five years, the performance of REITs in Asia had outperformed global REITs by more than three times. During the period, REITs in Asia grew 46.2 per cent, while REITs globally grew 14.4 per cent.

"We are comfortable with Asian properties, in line with the region's continued growth, which will lead to an increasing demand for commercial occupancy rates in Asia, which are averaging to above 90 per cent.

"For certain countries in Asia Pacific, we are seeing an uptrend in rental rates for both offices and the retail sector, which will bode well for unitholders of REITs as this translates to higher income distribution," said Andrew Wong, chief investment officer of equity, asset allocation, and fund management.

The approved fund size is 200 million units with an initial offer price of 50 sen per unit. The initial offer period ends this Sunday, and its minimum investment being RM1,000 for Malaysian residents and the minimum additional investment for Malaysian residents is RM500.

The fund is distributed by all AmBank branches, AmBank Agency sales force, AmPriority Banking, AmPrivate Banking and Hong Leong Bank.

By Business Times

Mutalib to helm 1Malaysia Housing Programme?

PETALING JAYA: The recently announced 1Malaysia Housing Programme (Prima) is likely to be helmed by the low-profile Datuk Abdul Mutalib Alias, according to sources.

Prima is a scheme designed by the Government to ensure the availability of affordable quality homes within the Klang Valley for the people, in particular the youths.

Abdul Mutalib is currently the special officer in the Works Ministry.

Previously, he was a political secretary for former Minister of Science, Technology and Innovation Datuk Dr Jamaludin Jarjis and also for former Finance Minister Tun Daim Zainuddin.

Although Prima is still in its infancy stage, the Government has indicated some moves to expedite projects under the scheme.

One of the initiatives could entail making land available and providing funds to developers participating in Prima under public-private partnerships programme.

Prime Minister Datuk Seri Najib Tun Razak launched Prima for first-time buyers to own homes of up to 1,400 sq ft in July.

Depending on the location, the houses would be priced at between RM150,000 and RM300,000 while the minimum size would be 800 sq ft.

The buyers, making up those who earn not more than RM6,000 a month, would enjoy financing of up to 105% from selected financial institutions.

The additional 5% is for insurance and sales and purchase legal fees.

A total of 42,000 houses would be built in 20 strategic locations in the Klang Valley, Rawang and Seremban with eight projects expected to commence this year.

In addition to Prima, the Government had also earlier announced the My First Home Scheme which aimed to support first time home buyers with a monthly income of below RM3,000 to secure financing for homes priced at between RM110,000 and RM220,000.

This measure underscored the growing concern surrounding the housing needs of the middle income group, which has a monthly household income of RM2,300 to RM6,000.

This group is believed to comprise about 40% of the population.

By The Star

Prices of new homes in China’s major cities up

Housing fair: Visitors attend the annual summer housing fair in Shanghai recently. Guangzhou and Shenzhen led price rises in July while prices in Shanghai saw an annual decline of 0.1%. – EPA

BEIJING: Average new home prices in 100 major Chinese cities rose 0.2% in July from the previous month to 8,874 yuan (US$1,380) per sq m, with growth slowing slightly under the influence of official policy tightening, a private data provider said on Monday.

But the index compiled by China Real Estate Index System (CREIS), which is affiliated with China's largest online real estate company Soufun Holdings Ltd, showed July prices were up 6.8% from a year earlier, compared with June's 5.2% gain.

The data gives a snapshot of housing inflation, a main driver of rising consumer prices, before Beijing releases its official data on the 18th each month.

“Some developers have started to cut prices quietly and more will do so in August,” said Ge Haifeng, deputy managing director in charge of index research at CREIS.

“With supply rising in September and October, Chinese developers will face more downward pressure,” he said.

“They need to reach their annual sales targets.”

The 0.2% rise in prices in July from the previous month compares with June's monthly gain of 0.4%.

In line with Beijing's tougher crackdown on property speculation in major cities, property inflation was more buoyant in smaller cities in July.

New home prices in the top 10 Chinese cities rose 3.9% in July from a year earlier, but stayed roughly the same in month-on-month terms.

Among the top 10 cities, the southern cities of Guangzhou and Shenzhen led price rises in July, with annual growth of 10.1% and 10% respectively, while prices in Shanghai saw an annual decline of 0.1%, it said.

China has rolled out measures, including credit controls and purchase restrictions, to cool home prices and curb speculation as part of an effort to check inflation.

Beijing last month expanded purchase restrictions in second and third-tier cities, further dimming the real estate sector's outlook and boosting expectations for price falls in the rest of the year.

A slowdown in the property sector would come just as the country's broader economy eases.

Separate surveys published on Monday indicated the factory sector struggled with the weakest activity in 28 months in July as manufacturers grappled with credit shortages and softening global demand.

By Reuters

Mah Sing, Asie to develop prime land

Mah Sing Group Bhd’s wholly-owned unit, Grand Pavilion Development Sdn Bhd, has signed a joint venture agreement with Asie Sdn Bhd and its subsidiary, Usaha Nusantara Sdn Bhd, to develop a 1.63-hectare prime land along Jalan Tun Razak-Jalan Pahang.

In a statement today, Mah Sing said Usaha Nusantara would grant Grand Pavilion the sole and absolute right to undertake the development of the land for an entitlement of RM106.60 million to be settled via 60 per cent in cash and 40 per cent stake in Grand Pavillion.

The joint-venture land formed part of the 23.42ha privatized urban regeneration project in Kuala Lumpur with a gross development value (GDV) of RM9 billion, whereby Asie has been granted full rights of and approvals for a mixed development, it said.

Mah Sing said the urban regeneration project would comprise residential and commercial properties and community, leisure, recreation and infrastructure facilities on 15 parcels of development land together with five air rights in Precinct 2-Pekeliling of the River Corridor Development under the Blue Corridor policy of Kuala Lumpur City Plan 2020.

It said for this first joint venture, it intended to develop a niche development, named M Sentral, with an estimated GDV of approximately RM900 million.

"The M Sentral will comprise smaller-sized and more affordable serviced residences as there is strong demand due to lower entry prices, as well as some retail units," it said.

By Bernama

Mah Sing top CIMB property sector pick

Kuala Lumpur: CIMB Research is "overweight" on the property sector, the research house said in a report yesterday, saying that Mah Sing Group Bhd is its top pick among the property stocks.

The research house added that SP Setia Bhd, which dominates the Klang Valley and Johor property sector, remains its core holdings.

CIMB Research also said that it is bullish on Penang developer Eastern and Oriental Bhd (E&O), noting that residential property prices in Penang have enjoyed higher appreciation over the past 20 plus years than the average in the Klang Valley and Johor.

"We are bullish about E&O and consider it to be undervalued. The stock is trading at a 45 per cent discount to our fully diluted revised net asset value (RNAV) per share of RM2.82," analyst Terence Wong wrote in the report.

"E&O remains 'outperform' in our books with an unchanged target price of RM1.98, which is based on a 30 per cent discount to RNAV," he wrote in the report.

Wong added that a potential re-rating catalyst for the sector includes a pick-up in merger and acqisition (M&A) activities, continued robust sales, landbanking exercises and accelerating earnings growth.

The research house also said it is not surprised that the M&A theme is resurfacing as it is becoming increasingly difficult to acquire decent landbank in the Klang Valley and Penang Island as developers hoard land and are aggressively bidding for strategic parcels.

"For Klang Valley, the population has grown to nearly seven million and development has spread as far south of Kuala Lumpur as Cyberjaya. Penang, being an island with a hilly centre and underdeveloped west coast, also limits the availability of land for development," said Wong.

By Business Times

'Property bubble burst unlikely in Malaysia'

A property bubble burst is unlikely to happen in the Asia Pacific, including Malaysia, as there are no signs to indicate such a trend in the next two years, says AmInvestment Bank Group.

Director for Retail Funds Ng Chze How said real estate investment trusts (REITS) would also not experience a burst including those acquired by the group.

"I don't see a burst or a crash in the property market. "You have high wages, ample liquidity, small percentage of non-performing loans and these plus steps taken by the government to prevent the economy from
overheating, augur well for the property market.

"I don't see a property burst (happening) in the next six months, one year or two years down the line," he told reporters at the launch of Malaysia's first

Asia Pacific REITs fund, AmAsia Pacific REITs, here today.

He said with these factors in place coupled with an economic recovery, there
would be more upside in the market. AmAsia Pacific REITs invests in a diversified portfolio of REITs listed in the Asia Pacific region.

Ng was optimistic the REITS selected by the group would see high occupancy
rate and increasing rental.

"Selected Asian properties have yet to reach their previous peak, as such, there is room for potential growth," he said, adding that properties were seen as a good hedge during the current inflationary period.

By Bernama