Sime Darby to offer homebuyers better financing schemes

SIME Darby Property (SDP) is introducing its third instalment of the Parade of Homes campaign from March 6 to June 15 that offers homebuyers better financing solutions that will allow them to continue buying property despite the current economic sentiment.

SDP is teaming up with partners Maybank, CIMB and HSBC to offer, among others, a special easy payment scheme that allows buyers to pay the difference between the purchase price and the loan amount in monthly instalments of up to 12 months.

Buyers will enjoy an interest-free period during construction and an exclusive rate of BLR minus 2.3 per cent after vacant possession, SDP said in a statement.

There is also an early bird cash rebate of as much as RM10,000 for purchasers who sign their sale and purchase Agreement (SPA) during the campaign period.
Buyers will enjoy "zero entry" cost which entitles them to free stamp duty on memorandum of transfer, legal fees and disbursement on SPA and stamp duty on loan documentation.

On top of these incentives, SDP will also offer its Guaranteed Buy-Back programme, which provides property buyers peace of mind by allowing them to sell their property back to the company.

The first Parade of Homes in June 2008 attracted over 15,000 visitors and generated sales worth more than RM246 million over nine days, while the second one in November 2008 generated over RM146 million in sales.

By Business Times

SATS to unveil mega Senai project in Q2

The multi-billion ringgit development features residential, commercial properties, medical centres and high-tech park

SENAI Airport Terminal Services Sdn Bhd (SATS) will be launching the multi-billion ringgit Senai Aviation & Airport City mixed development project in the second quarter of the year.

Sited on 1,133.11ha beside the Senai International Airport, the project would be undertaken by SATS’ wholly-owned subsidiary Enigma Harmoni Sdn Bhd and comprise three main components, said deputy chief executive officer Shahrull Allam Abdul Halim.

Residential, commercial and hospitality amenities will be featured in the first component spanning 323.74ha while an air cargo logistics centre and high-tech park will occupy 404.68ha each.

The entire development would take about 10 years to complete.

Enigma Harmoni has received planning approval from the Kulai Municipal Council for the project which also includes a Customs Inspection Quarantine Complex (CIQ).

“We will launch the high-tech park first as this is a vital component of the entire development,’’ Shahrull said in an interview with StarBiz.

It will be the second high-tech park in the country after Kulim Hi-Tech Park in Kedah.

He said the investment in infrastructure was estimated at about RM1.2bil.

Other facilities will include private medical centres, international schools, premium hotels and duty-free shopping centres.

The high-tech park aims to attract investments in the avionics/aeronautics industry, information and communications technology industry including integrated circuit design, high-tech manufacturing, bio-medical and bio-technology, solar industry, food and agri-technology and environment including renewable energy.

He said among the companies and investors targeted were those in the pharmaceutical industry from Austria, Germany and Switzerland; oil and gas, and solar energy sectors in the United States; and Japan’s motor vehicle sector.

“It is a pre-requisite for companies operating in our park to have research and development (R&D) elements,’’ added Shahrull.

He said there would be a flagship building known as the knowledge centre where most of the R&D activities would be undertaken.

The building will incorporate collapsible office and laboratory incubator concepts where higher learning institutions could bring their undergraduates to undertake R&D studies or programmes with the companies or the industries.

Shahrull said it would collaborate with Universiti Teknologi Malaysia main campus in Skudai, Johor to participate in the university-industry R&D programmes.

He said SATS was looking at participation from China companies in the development and construction of Senai Aviation & Airport City.

Shahrull said it would collaborate with established high-tech park operators in China’s Pearl River Delta region to market the Senai park.

“Ours will probably be the first integrated high-tech park in the world connected to the airport. Similar parks like the ones in Frankfurt and Dubai are located several kilometres from the airport,’’ he said.

Opened in 1974, Senai Airport is managed by SATS which took over the operations of the airport from Malaysia Airport Holdings Bhd in 2003.

By The Star

Aero Mall to open by year-end

AERO Mall, the first stand-alone and external airport mall in Malaysia currently under construction at Senai Airport, is scheduled to open by year-end.

The RM70mil mall offers 3,716.12 sq m of retail space.


Chan Kwai Yew with an artist's impression of the Aero Mall.

Senai Airport Terminal Services Sdn Bhd general manager finance and retail development Chan Kwai Yew said the mall would be positioned and marketed as the new lifestyle hub in the area.

“Shopping, dining and entertaining at airports is getting popular as airports are no longer just places for air travellers or well-wishers to send off airborne passengers,’’ he said in an interview.

Chan said Singapore’s Changi Airport Terminal 3 was the best example of this as it had successfully attracted non-air travellers and residents from nearby areas to shop and dine there.

SATS is targeting the business community, executives and senior managers working in the nearby industrial estates and the 192,000 population (2005 figure) in the Senai-Kulai area.

Chan said Aero Mall would also complement the Senai Aviation & Airport City to be launched in the second quarter of the year.

Meanwhile, Plaza Premium Management Ltd has chosen Senai airport for its third Plaza Premium Lounge in the country after KL International Airport and the Low-Cost Carrier Terminal.

Plaza Premium Lounge is the world’s first commercial VIP lounge open to airport users irrespective of airlines, travel class, air miles or membership programme.

“We have invested RM500,000 for the Senai lounge and see good prospects as Senai-Kulai is located within the Iskandar Malaysia growth corridor,’’ said chief financial officer Clarence Chiu.

By The Star

Property market the first to be hit by downturn and the last to recover

Malaysia’s property market is set to enter tougher months ahead, as the negative sentiment from global real estate market hits the nation’s shore.

That is the overall view shared by industry players at the recently-held Rahim & Co seminar 2009.

The one-day event covered a wide range of topics on the domestic economy and property market and included prominent speakers such as economists, former government servants, valuers and property consultants.

Malaysian Institute of Economic Research (MIER) projects Malaysia will have 50% chance of full-year recession this year and is quite certain that the country will dip into technical recession in the first half of this year.

MIER executive director Prof Datuk Mohamed Ariff Abdul Kareem expects the domestic economy to return to normalcy only in two to five years.

He opines the world may witness further economy deterioration, as he sees more companies will collapse within six months times.

He says that typically the property market is the first to feel the strain during an economic crisis and, unfortunately, the last to recover.



Prices trending downwards

As an open economy, Malaysia is not spared from the global financial crisis as well as property market meltdown. Since late last year, the domestic property market has started to show signs of weakening.

Rahim & Co executive chairman Datuk Abdul Rahim Rahman says Kuala Lumpur City Centre’s (KLCC) high-end condominium is heading towards a 15%-20% price depreciation in two to three months.

He says buyers are looking for more realistic pricing, reflecting the current conditions. In a worst-case scenario, he is projecting up to 30% drop in prices over that period.

Average price stands at RM1,500 per sq ft in KLCC presently. In other suburbs such as Bangsar, Damansara Heights and Cheras, he predicts a 10%-15% decline.

Abdul Rahim tells StarBizWeek that rental of office space in KL should not be affected at least until the end of the year but he expects prices to come down after that.

“If I am in the KLCC area, I want to save a little bit of money due to the downturn. I will downgrade my office, which I will reduce from RM8 to RM6 per sq ft. So, the KLCC landlord may have no choice but to reduce by 10% to 15% (to prevent the tenant moving out). But at this time, the rental rates are maintained,” he elaborates.

There will be additional 8 million sq ft of office floor in KL by 2011 or 2012. Currently, the rental rates at KLCC and the KL vicinity are between RM6 and RM8 per sq ft and between RM4 and RM6 per sq ft respectively.

Retail scene

On the retail sector, he says Malaysia is fortunate as there are not many retail centres being planned now or coming on stream. Thus, he says retail space is mostly occupied and rental rates have been maintained. However, he points out that the segment may witness a downtrend should the unemployment rate rise.

Abdul Rahim says the commercial sector is least affected now, but in the long-term, affordable housing will be the least affected by the crisis, as people still need a house to stay in.

Ho Chin Soon Research Sdn Bhd managing director Ho Chin Soon advises developers not to be unduly concerned about the external factors such as interest rates and global economy but instead concentrate on their branding.

No matter what the economic cycle is, there are always buyers out there, he says, citing SP Setia Bhd’s recent RM300mil sales which it had chalked up in less than two months largely owing to its financing package promotion.

He concurs with most of the consultants that KLCC high-end properties are seeing a correction now.

“I saw this notice on the sale of a KLCC Marc Residence – “Financial crisis, desperate seller, asking price RM960 per sq ft”, but assuming he sold at RM900 or RM850 per sq ft, he still makes profits if he had bought from the developer for RM650 per sq ft. But the ones who bought at RM1,000 per sq ft and sold at RM800 per sq ft, will be making losses,” he says.

However, he notes that the number of such transactions are few and far between and that the real picture will be revealed by the National Properties Information Centre in a report scheduled to be released in April this year.

The United States’ economy is the backbone of world economic stability.

As such, consumer confidence of the property market will only be restored once the US stabilises.

“The US is in recession but once it stabilises, it will be good news,” says Ho.

Meanwhile, Real Estate and Housing Developers’ Association Malaysia president Datuk Ng Seing Liong concurs that the current world economic crisis will certainly affect the property market.

He expects the sector to trend downwards by 5% to 10% this year.

“There will be definitely a drop in terms of demand and prices but the situation in the country is still under control,” he tells StarBizWeek.

Good time to buy

Ng says this is a good time to buy houses as property is always a good investment.

“We hope that the next stimulus package will bring some goodies to this sector to spur sales and generate economic growth,” he says.

International Real Estate Federation Asia Pacific executive director Yu Kee Su says generally, the prospects of the property market is not so bright but compared to other countries, it is holding steady in terms of pricing.

“Certain areas like Bandar Utama for example is still stable and there has been no drop in prices,” he says.

He feels many developers will scale down their launches as he expects the slowdown to last up until 2010.

By The Star (by K.C.Law & Edy Sarif)

Building a city

CYBERJAYA, the information and communications technology city once regarded as an out-sourcing hub, is fast emerging as a hub for data centre and disastrous recovery in the Asia Pacific region.

Some of the multinational corporations that have already set up data centres in the area are HSBC, DHL and Dell.

Cyberjaya, launched back in 1997, has 4.3 million sq ft of office space as of last year, up from just 2.6 million sq ft in 2006.

Another one million sq ft of office space for ICT companies and data centre is expected to be ready this year which has been fully booked.



Cyberjaya’s master developer, Setia Haruman Sdn Bhd’s chief operating officer Lao Chok Keang attributes the achievement to a combination of factors – reliable and high-speed connectivity of up to 10 gigabytes per second (which meets ICT companies’ requirement) and dual source from Tenaga Nasional Bhd’s (TNB) supply and an uptime of power supply of up to 99% (near uninterrupted power supply). Over and above that, it also has standby generation sets.

In addition, Lao points out that these top notch facilities are available at very competitive pricing, compared with double the cost in Singapore.

Whilst the world is grappling with an economic crisis, Lao says the city has yet to feel the pinch as investors, MNCs and government agencies are still flocking to Cyberjaya.

“Even after Lehman Brothers’ went into bankruptcy last September, seven local companies and MNCs announced their plans to set up offices in Cyberjaya. They include the Los Angeles-based award winning visual effects company Rhythm and Hues Studio, KRU Studios Sdn Bhd, Hewlett Packard, Verizon Communication Inc unit Verizon Business, Dublin-based Experian, British-based RBC Dexia and Panasonic,” Lao says.

However one deal failed to go through; the company came close to sealing a 15-acre land deal with US insurance giant, AIG for its data centre and share services centre before it went into trouble last year.

“Besides US and Europe, a lot of companies in Singapore and Hong Kong are relocating to Cyberjaya. At this moment, we are facing some backlog as a lot of companies are looking for huge space of over 30,000 sq ft but we can’t supply that. They have to wait for about a year for someone to buy the land and build for them,” he says, adding however that smaller space of about 1,000 sq ft is still available.

But that’s a good problem.

Land sale

Lao is not too worried about the drop in property value in Cyberjaya amid weak market sentiments as Setia Haruman is the sole supplier of land totalling some 7,130 acres.

The Government acquired the land more than 10 years ago and through the government-linked company, Cyberview Sdn Bhd has assigned all the land rights to Setia Haruman under a development agreement signed in 1999.

In due time, Setia Haruman will have to reimburse to the Government the land cost that has been paid by Cyberview, which amount to over RM1bil. Setia Haruman has sold about 1,138 acres of land to-date.

He says over the last 10 years, Setia Haruman has adjusted upwards its selling price by around 5% annnually.

In the last three years, the company has sold about RM500mil worth of land to investors each year to be developed for lease or sale purposes.

Major purchasers include Cyberview, EMKAY Group, Prima Properties Group, UEM Land Bhd, Ascendas of Singapore, Glomac Bhd, Malaysia Road Transport Department (JPJ), Bank Negara, Bernama and Volunteers of Malaysian People (Rela Corps).

In recent months, it sold about RM200mil worth of land, including to UEM Land (98 acres for RM102.5mil), EMKAY (25 acres for RM52.3mil) and Rela Corps (9 acres for RM23.5mil).

As such, Lao is confident that Setia Haruman will be able to maintain its revenue and profitability this year.

“We expect Cyberjaya to be fully opened up in 10 years; but this does not mean it will be fully developed by them, as the city will still have pockets of land available for further development, such as in Shah Alam,” he says.

One-stop city

The ultimate plan is to promote Cyberjaya as a complete integrated city – a place for people to live, study, work and play.

Located about 20 minutes drive from Kuala Lumpur, it is free from the much-dreaded traffic jam and has an attractive environment.

“Kuala Lumpur is getting congested nowadays and property prices can cost more than RM1,000 per sq ft, while prices at Cyberjaya are still below RM100 psf.”

He says some senior executives from Kuala Lumpur have bought bungalow lots in Cyberjaya and the next step would be to convince them to move their corporate headquarters to the city.

“They have chosen Cyberjaya as their residence. So, there’s no reason why we cannot attract corporate headquarters here. Over the next five years, we will actively promote Cyberjaya as a place for headquarters,” he says.

Setia Haruman is not the only promoter of Cyberjaya. Government agencies such as Small and Medium Industries Development Corporation (Smidec) and Malaysia’s embassies worldwide are also doing their part.

Others such as Cyberjaya’s anchor investors or long-term developers such as Quill Group of Companies and Prima Properties Management Sdn Bhd, which have also helped draw reputable MNCs and organisations such as DHL, BMW, HSBC, IBM, CapitaLand and the World Health Organisation in as tenants.

Lao says a lot of large companies opt for Cyberjaya because of its ready infrastructure and talent pool.

“It is easy to recruit staff here, as we have two universities – Multimedia University and Limkokwing University of Creative Technology – producing a lot of information technology graduates and creative people. And that is why KRU Studios, and Rhythm and Hues Studio have set up shop here,” he adds.

Currently, there are about 36,000 workers in Cyberjaya and Lao hopes to double the working population every five years.

“This year, we plan to spend about RM210mil in development expenditure, of which RM150mil will be for infrastructure such as roads and drainage system, water reservoir, water treatment plant and opening up of new land.

“Another RM60mil will be used for construction of CBD Perdana 2 this year – a commercial project comprising 32 retail outlets and 92 corporate office suites, with a gross development value of RM210mil,” he says.

By The Star (by K.C.Law)

Seeking a solution

Developers continue to face uphill task in projects

Confidence is certainly in short supply in these times of gloom but it is what is needed if the country is to get out from the rut of the spiralling global financial quagmire.

During unprecedented crisis times like these, a strong leadership is paramount to make the most of the situation and ensure confidence returns to the people and businesses as it is the foundation for an economic recovery.

The second stimulus package or mini-budget to be announced on Tuesday (March 10) hopefully have all the right ingredients, including measures such as tax rebates and other direct incentives for Malaysians, to instil confidence in them and businessmen in order to arrest the slide in local demand and the economy.

While most countries have already been submerged by the US-led financial tsunami, Malaysia can still count on its many resources – resilient, prudent and hardworking Malaysians; talented human resources; world-class infrastructure and vast natural resources, to steer the ship (hopefully safely) across the stormy waters of these highly globalised world we are in today.

Nevertheless, the signs that the country is also being gradually sucked into the widening global crisis are already showing and a recession cannot be discounted.

Instead of being alarmed or worse, to be in denial of such a possibility, it is best to face this reality with a high level of preparedness by harnessing all the strengths and resources at our disposal.

There is certainly a dire need for more enabling government policies that will complement the initiatives of the private entrepreneurs and businesses to ensure the country’s economy will not succumb to a long and gruelling hard landing like what many other countries are now in.

Given the magnitude of the damages wrecked by the global financial crisis since it unfolded in the middle of last year, the country’s leaders, at both the Federal and state levels, should by now have realised the fragility of Malaysia’s economy and have introduced more flexible and business-friendly measures aimed at raising the country’s competitiveness in the various industry sectors.

There is much to be done to ensure Malaysia is fully prepared to face the onslaught of the full scale of the global crisis, which is expected to go into next year. A speedy, efficient and transparent implementation and disbursement of the funds under the two stimulus packages are most critical to ensure these measures work to arrest a widespread decline in the economy.

In the case of the property sector, property sales has almost ground to a halt while new project launches have plummeted by more than 50% in the last two quarters of last year compared with the same period in 2007. This year, more projects are expected to be deferred as the economy worsens.

Industry players are finding it hard to surf through these current difficult times and their woes are further amplified by the strict imposition of various government policies, such as the bumiputera housing policy. Given the rising number of unsold bumiputra units, the policy has resulted in increased financial burden for developers to bear the high holding cost, which inadvertently is passed on to other future buyers.

The bumiputera quota has long been a requirement in the local housing scene. Developers have to reserve 30% of available units in a housing scheme for a period of six months for purchase by bumiputeras at a discount of 5%-15%. As land is a state matter, regulations differ in the various states. Although in most states, the bumiputera quota is set at 30%, in Johor, it is 40%, while in some suburbs such as Shah Alam in Selangor, it goes as high as 70%.

Although the general practice is that developers can apply to the state government for permission to release unsold bumiputera units after six months or upon reaching 50% of a project’s construction, the various states have imposed their own conditions for such release.

Some state governments introduced heavy monetary penalty or levy before granting the release of these unsold units. Johor, Selangor and the Kuala Lumpur City Hall came out with a levy system where an amount equivalent to the discount given to bumiputera buyers must be paid to a fund in exchange for the early release of these unsold bumiputera units. Industry players lamented this latest ruling as an enormous liability to them, especially in Johor where the bumiputera price discount is as high as 15%.

Given the need for more flexible and business-friendly environment to ride out the rough economic conditions, it will be most timely for the government to meet the request of the Real Estate and Housing Developers’ Association (Rehda) for a review of the bumiputera housing policy in the current socio-economic context.

Rehda has advocated firmer guidelines for a more consistent implementation of the bumiputera quota policy and its release mechanism. Among the proposed initiatives are to cap the bumiputera quota at 30%, have an automatic release of unsold bumiputera units after six months or upon reaching 50% of a project’s construction, whichever is faster, and to do away with the payment of any levy or penalty to any authorities as a result of the quota units not been taken up by the target group.

Having policies that are in tune with the needs of the times is certainly one of the ways to smoothen out an otherwise rough road ahead for industry players and instil confidence back in the people.

·Deputy news editor Angie Ng has faith that by coming together as one nation, Malaysians have what it takes to ride out the crisis and emerge stronger.

By The Star (by Angie Ng)

Berkeley aims London homes at Asian investors

LONDON-BASED Berkeley Homes is targeting investors in Malaysia, Singapore and Hong Kong for the sale of its projects in central London.

The high-rise properties comprising 292 apartments are collectively known as City Quarters.

“These are 125-year leasehold properties,” Berkeley group managing director Piers Clanford tells StarBizWeek.

“In City Quarters, there are four blocks of buildings known as Times Square and two buildings known as the Sugar House and Hoopers Yard.”

In the past two months, the London property market has attracted much attention from overseas investors, according to Clanford.

“This is because property prices have dropped between 15% and 20% since 2007. The interest rate for housing loan has also come down to 0.5% while the rental yield is about 5% annually.

“Furthermore, the pound has weakened by about 25% compared with a year ago,” he says.

So far, eight Malaysian investors have paid deposits for the properties in City Quarters, Clanford says, adding that Berkeley has sold about 70% of the properties.

The apartments are priced between £345,000 for a one-bedroom 500-sq-ft unit to £1.8mil for a three-bedroom 1,850-sq-ft unit.

There are also 1,150-sq-ft duplexes with two bedrooms priced at £850,000.

The properties, which are gated, come with concierge and night porter services, landscaped water gardens, courtyards and underground car parking bays.

The Times Square buildings, comprising 205 apartments, and the 45-unit Hoopers Yard building are completed.


The Sugar House is a 19th century Victorian building currently being refurbished by Berkeley Homes.

The 42-unit Sugar House is a 19th century Victorian building that is being refurbished for completion in August.

“The Sugar House will have high ceilings and a grand entrance staircase,” Clanford says.

Berkeley Homes will be at the G-Hotel in George Town to promote City Quarters today and tomorrow.

By The Star (by David Tan)

Survey: Property outlook sentiment deteriorates further

MALAYSIA'S property outlook sentiment has deteriorated further, according to a survey carried out by a local property website.

The thinkproperty.my Property Outlook Index remains firmly in the negative, currently at -51 per cent, the lowest it has been since the survey began in May 2008.

"This is not positive news, but we believe Malaysia is weathering the storm better than neighbouring countries," said Asim Qureshi, chief executive officer of Think Media Sdn Bhd, which owns thinkproperty.my, in a statement yesterday.

"But with unemployment rising and Malaysia's trading partners suffering from an economic slowdown, we believe the index will possibly fall further before it rises again," he added.
The survey also found that with interest rates declining, people have become less keen on fixed deposit investments.

"Most investors would look for alternative investment opportunities to fixed deposits, given that fixed deposits yield around 2 per cent to 2.5 per cent," said Qureshi.

Thus the perception of property as the most favoured investment type has remained steady over the course of February, despite the overall fall in confidence.

Within the property sector, the survey showed that there has been a continued shift in preference to landed property. Thirty per cent of respondents favoured link houses in February.

Qureshi said landed properties are generally considered a safe-haven during economic downturns.

The retail and office sub-sectors, meanwhile, are less favoured than they were a few months ago, with 8 per cent of survey respondents favouring both sectors compared with 21 per cent in June 2008.

The survey, an on-going one since May 2008, polled nearly 1,500 people through the thinkproperty.my website.

The survey asked respondents their opinion on the outlook for the Malaysian property market over the next 12 months. The index takes the number of respondents that believe prices would rise, subtracts the number of participants that believe prices would fall, and then divides this figure by the total number of participants, and calculates this on a rolling 30-day basis.

By Business Times

Puteri Hotels enters Saudi Arabia via Arac

PUTERI Hotels Sdn Bhd, a subsidiary of Johor Corp, is making an entry into the hospitality market in Saudi Arabia, through a joint venture with Arab Resort Areas Co (Arac).

It formed a joint-venture company called Arab-Malaysian Hospitality Management (AMHMC) with Arac on May 3 last year, to build and manage a chain of hotels and resorts under the Aramas Hotels and Aramas Resorts brand.

In a statement issued recently, Puteri Hotels said the first hotel will open its doors in Madinah in September.

To be named Aramas Hotel Madinah, it will be unique because of the cultural hospitality products and Islamic values adapted to the service, food and accommodation.

Puteri Hotels said Muslims now formed about a fifth of the world population and this number is projected to reach 2 billion by 2010.

As such, it believes that a hotel and resort chain imbued with the halal concept and other Islamic values will be well-received.

Being syariah-compliant, the hotels will be run strictly on Islamic principles, serving alcohol-free drinks and halal foods, and without the usual discotheques, nightclubs and bars.

Puteri Hotels said it aims to develop ultra-comfortable and fully-facilitated guest rooms, with high-definition in-room entertainment, featuring a broad range of television channels and movies.

Arac is a subsidiary of Taiba Investment and Real Estate Development Co, which currently owns and operates various upmarket properties in Saudi Arabia, including the Taiba Residential Suites, the Arac Yanbu Resort and the Arac Hotel Al-Ula.

By Business Times

KL Metro Group plans RM200m water homes project on Penang island

GEORGE TOWN: Kuala Lumpur Metro Group, developer of water chalets and water homes in Port Dickson and Malacca, is planning to develop a RM200-million water homes resort project in Teluk Kumbar on Penang island.

KL Metro Group managing director Datuk Low Tak Fatt said on March 6 the project, comprising 326 water chalets and sky pool villas, was scheduled to start by year-end and to be completed in 2012.

KL Metro said the project would be self financed and have three designs while the land area would range from 800 sq ft to 1200 sq ft. Prices start from RM500 to RM600 per sq ft.

The 80 water chalets would have a jacuzzi on the balcony, 166 water chalets a private pool and another 80 sky pool villas (multistorey) would each have a private pool.

"We are hoping to sell 75% of the units, which wouldl be leased back to us. The rest of the units will be run as a resort with five-star facilities," Low said at a press conference.

Low said all the units would be furnished and KL Metro targeted 80% to 90% of the buyers to be foreigners. "So far, we have attracted buyers from over 27 countries," he said.

Out of the total area of the project, 18 acres would be above water while only two acres will be on land.

Chief Minister Lim Guan Eng, who was at the press conference, said the state government will fast track the approvals for the project.

"This project will benefit the tourism sector and we will ensure that all conditions and specifications are met by the developer before approvals are given," Lim added.

The project involves sea reclamation of 2.5 acres to build the club house, swimming pools, podium car park and other facilities.

KL Metro Group won CNBC's international property award (2007) in London for the current project, Legend International Water Homes under the category "best architecture and best development".

Touted to be the largest water chalet developer in the country, the developer completed 392 units of water chalets and service suites, now managed by The Legend Group of Hotels and Resorts.

Phase Two of the project, the Legend International water Homes is expected to be completed by May this year.

By The EDGE Malaysia (by Regina William)

Cement makers pin hope on stimulus package

Listed cement companies appear to be doing well based on their latest quarterly results but analysts and industry association agree that it could be quite a different scenario this year.

Cement producers, like its construction peers, are counting on the Government stimulus packages to provide growth.

There is also the issue of rising costs for the industry.


The demand for cement is expected to drop this year as the construction sector slows down.

While there is hope that quick project implementation could help boost the industry in the second-half year, analysts and the industry association, however, expect demand to likely rise only in early 2010.

Cement and Concrete Association of Malaysia executive director Grace Okuda says the 5% electricity tariff reduction effective March 1 will not be enough to reduce the cost of production for the industry.

Cement producers are still absorbing the 26% electricity tariff hike announced in August last year, Okuda says.

“The industry was hard hit by the hike as it is a major user of energy and a 5% reduction is not much compared with the previous hike,” she says.

Agreeing with similar sentiments by stock analysts, Okuda says: “We expect cement demand to drop in 2009.”

However, if the implementations of the Government’s stimulus packages are quick, it could help boost cement demand for the year, she says.

Okuda also confirms that construction activity has slowed down.



An analyst with a bank-backed brokerage says her firm has a “trading buy” on the construction and related sectors, in the hope of a higher amount from the mini-budget stimulus package to be announced on March 10.

Cement makers such as LaFarge Malayan Cement Bhd are waiting for the Government package despite the fact that it exports 30% of production.

“But the RM7bil stimulus package announced earlier is not enough to help the construction sector and thus, the cement manufacturers,” she says.

The next package will have to be bigger to boost demand for cement, the analyst adds.

AmResearch analyst Mak Hoy Ken says even with the fiscal pump-priming, there will be an “implementation lag”. “A boost in demand will be seen by the first month of next year,” he says.

Mak points out that unlike steel, cement prices has only recently (in the past six months) shot up, which further put a dampener on demand.

Following the liberalisation of the sector on June 5 last year, there have been two rounds of price hikes for cement by 15% to 20% in June and about 8% in August the same year due to an unprecedented 63% hike in diesel price and 26% rise in electricity tariffs respectively.

Cement price currently stands at about RM275 per tonne from RM220 in early 2007.

However, rebates are often given to customers for the sale of cement, so the real price is hard to determine, Mak adds.

The country’s largest cement manufacturer, LaFarge Malayan Cement, reported a 79.5% jump in pre-tax profit to RM129.4mil for its fourth quarter ended Dec 31 compared with the previous corresponding period.

The company, in its Feb 18 announcement, said the huge gain was mainly attributable to higher revenue, lower maintenance costs due to the timing of scheduled plant shutdown as well as the non-recurring gain on the sale of certified emission reductions of RM29.6mil.

Smaller but also main board-listed Tasek Corp Bhd did not report year-on-year quarterly performance due to a change in financial year-end but posted a pre-tax profit of RM28.3mil for the fourth quarter ended Dec 31 on a revenue of RM143.2mil.

Tasek recorded a slight rise of 0.2% in revenue to RM143.25mil in the fourth quarter compared with RM142.96mil in the preceeding quarter.

However, pre-tax profit fell to RM28.3mil against RM34.1mil in the third quarter, “affected by lower demand for local cement and higher operating costs,” the company said in its Feb 23 announcement.

YTL Cement Bhd, a major local cement producer which analysts estimated as being larger than Tasek but smaller than LaFarge, posted 11.3% growth in pre-tax profit to RM69.9mil and 55.9% jump in revenue to RM492mil for its second quarter ended Dec 31 compared with a year ago.

“The increase in revenue and pre-tax profit were substantially attributed to overseas operations and better selling prices,” it said.

By The Star (by Loong Tse Min)

YNH Property eyeing premium clients

An artist's impression of the Fraser Residence Kuala Lumpur.

GEORGETOWN: YNH Property Bhd aims to tap companies on the Fortune 500 and Forbes lists for its RM550mil Fraser Residence Kuala Lumpur mixed-development project to be managed by world-renowned hospitality service provider, Fraser Hospitality Pte Ltd.

Group executive chairman Datuk Dr Yu Kuan Chon told StarBiz the group was launching the project because it believed there was room for a premier international serviced residence brand in Malaysia.

“We engaged Fraser Hospitality as management service provider because more than 80% of its guests are on Fortune 500 and Forbes’ lists,” he said, adding that the agreement to engage Fraser Hospitality was inked on Wednesday.

The 446-unit Fraser Residence will be constructed next to Renaissance Hotel, facing both Jalan Ampang and Jalan Sultan Ismail. The project comprises two towers with one-and-two-bedroom serviced apartments.

There will also be office suites, a retail mall, a sky gymanasium, infinity lap pool and whirl pool sauna. Construction work is expect to start this year and scheduled for completion in four years.

YNH has also engaged Fraser Hospitality to manage Fraser Place Kuala Lumpur, which is scheduled for completion in the third quarter of 2009. “This project offers gold-standard serviced residences comprising studios, one-and-two-bedroom units and luxurious penthouses,” Yu said.

On a separate matter, Yu said YNH had on Feb 19 entered into a memorandum of understanding with Pantai Holdings Bhd to jointly build, lease and operate a private hospital in the Manjung Point township development in Sri Manjung, Perak.

“A Pantai hospital will add value and provide first-class medical facilities and services in our existing and future developments in the Manjung Point township. Pantai, with its experience and expertise, sees Sri Manjung as a very attractive investment,” he added.

By The Star (by David Tan)

RM650m development to take shape soon in Danga Bay

The Oakwood serviced apartments in Danga Bay, a RM650 million project under Iskandar Malaysia in Johor, is expected to kick off next month and be completed in 2012.

The project will be developed by Global Corporate Development Sdn Bhd, a joint venture between Iskandar Waterfront Development Sdn Bhd (IWD) and Danga Bay Sdn Bhd (DBSB).

The serviced apartments will be managed by Oakwood Asia Pacific (OAP) Pte Ltd.

The project, with 230 fully-furnished luxury units, is the crown jewel flanked by two 38-storey towers of residential units, called Iskandar Residences. The latter comprises 523 units on 2.5ha.
While the Oakwood apartments are for lease to locals and expatriates seeking mid- to long-term accommodation, the Iskandar Residences units are up for sale from RM450 per sq ft for early birds.

Johor Menteri Besar Datuk Abdul Ghani Othman, who is the Iskandar Regional Development Authority co-chairman with Prime Minister Datuk Seri Abdullah Ahmad Badawi, witnessed the signing of the joint-venture agreement between IWD and DBSB in Danga Bay yesterday.

IWD was represented by its chairwoman Arlida Ariff, and DBSB by its director Johar Salim Yahaya.

The management agreement appointing OAP as the operator of the Oakwood serviced apartments was signed between Arlida and OAP managing director P.G. Matthew.

Ghani, who is spearheading the rollout of the Iskandar Malaysia development blueprint, said the launch marked the first among a host of signature waterfront developments in Danga Bay, ranging from affordable to high-end homes such as the Danga Villa Island project.

Other highlights include hotels, no-frills to six-star, and a water theme park.

By Business Times (by Chuah Bee Kim)

Danga Bay to draw global attention

JOHOR BARU: Danga Bay is set to transform itself into one of the most sought after waterfront development addresses in the world in the near future, with several up-scale waterfront property development projects to be launched soon, said Johor Mentri Besar Datuk Abdul Ghani Othman.

The upcoming projects are three hotels, including a six-star hotel, a marina, an international convention and exhibition centre, office towers and another wet-and-dry theme park.

“These projects reflect a strong confidence on the growth prospect in Iskandar Malaysia despite the global economic slowdown,” he told reporters yesterday, referring to Danga Bay’s location in the special economic zone of Iskandar Malaysia.

“The Danga Bay waterfront project site has an excellent road and highway connectivity to major destinations,” he said, adding that the bay area would also benefit from water taxi and ferry services to Nusajaya, the Johor State New Administrative Centre, Singapore and nearby Indonesian islands.

Ghani said investor confidence in the economic growth corridor remained strong and that the stakeholders were fully committed to deliver all planned projects under Iskandar Malaysia.

Iskandar Malaysia, launched on Nov 4, 2006 was the first in a series of economic growth corridors; as at today, it had received RM43bil worth of investments, from the RM47bil targeted by 2010. Ghani was speaking at the launch of a RM650mil integrated mixed development project at Danga Bay, near here, by Global Corporate Development Sdn Bhd.

The project is a joint-venture project between Iskandar Waterfront Developments Sdn Bhd (IWD), a company majority-owned by Iskandar Investment Bhd (IIB) and Danga Bay Sdn Bhd.

Khazanah Nasional Bhd is the largest shareholder in IIB with a 60% stake while the Employees Provident Fund and the Johor government-linked entity Kumpulan Prasarana Rakyat Johor Bhd, hold 20% stake each.

Meanwhile, IWD chairman Arlida Ariff said work on the Oakwood serviced apartments and other residential units at Danga Bay would start next month and was expected to be completed in 2012.

Located on a 2.5ha site, the Oakwood project is made up of three towers - the 28-storey Oakwood Residence tower and two 38-storey towers known as Iskandar Residences.

The Oakwood Residence has 230 fully furnished serviced apartments which will be leased out and managed by Oakwood Asia Pacific Pte Ltd while the other two towers will have 523 apartments for sale.

By The Star (by Zazali Musa)

Malaysia property outlook worsens: Survey

A survey by thinkproperty.my shows Malaysia's negative property outlook has deteriorated further, now at 51 per cent, the lowest since the survey began in May 2008.

"Clearly we saw a sharp drop in the index in February.

"With unemployment rising and Malaysia's trading partners suffering from the economic slowdown, we believe the index will possibly fall further before it rises again," said Think Media Sdn Bhd chief executive officer Asim Qureshi.

The survey also showed the popularity of fixed deposits has fallen to a 10-month low at 27 per cent.
"Most investors will look for alternative investment opportunities to fixed deposits given that fixed deposits yield around two to 2.5 per cent," he said in a statement.

[The survey, however, showed there has been a continued shift in preference to landed property.

Thirty per cent of the respondents favoured link houses in February while the retail and office sectors were less favoured with eight per cent compared to 21per cent in June 2008.

Some 1,500 participants responded to the survey which provided the current status of the property market and revealed some interesting trends.

Thinkproperty.my is a property related content website owned by Think MediaSdn Bhd.

By Bernama

I&P targets fewer projects this year

Property developer Island & Peninsular Sdn Bhd (I&P) expects revenue this fiscal year to decline as much as 36 per cent to RM500 million as it plans fewer launches.

I&P, a wholly-owned unit of Permodalan Nasional Bhd, posted revenue of RM780 million in its fiscal year ended December 31 2008.

Group managing director Datuk Jamaludin Osman said that I&P will continue to offer homes that are "packaged tastefully" and within the price range sought by buyers in choice locations.



"We will be more cautious during the current economic downturn, releasing a smaller number of units at all our projects at any given time,"he told Business Times after signing a pact with Universiti Teknologi Mara (UiTM) to incorporate artistic features at its Alam Impian development in Shah Alam, Selangor, yesterday.

I&P has a landbank of 5,263ha, with eight ongoing township projects in Selangor and Kuala Lumpur that are worth a few billion ringgit.
The developments are Alam Impian, Bandar Kinrara in Puchong, Alam Sari in Bangi, Alam Damai in Cheras, Bayuemas in Klang, Alam Sutera in Bukit Jalil, Seri Beringin in Bukit Damansara, and Taman Setiawangsa in Kuala Lumpur.

Jamaludin added, however, that all was not doom and gloom as I&P houses continued to sell even with the weak market sentiments.

He cited its Bandar Kinrara development: 60 per cent of the 160 two-storey link-houses costing more than RM400,000 each and 100 per cent of the 22 semi-detached homes of over RM1.2 million each have been sold since their launch in December last year.

Jamaludin also said that I&P had no plans to acquire more land as its landbank was sufficient to keep it busy for the next few years.

However, he did not rule out acquiring land in the Klang Valley that could be developed immediately.

By Business Times (by Sharen Kaur)

I&P to set more moderate pace for launches amid slowdown

ISLAND & Peninsular Sdn Bhd (I&P) will launch new houses this year, albeit at a more moderate pace, as recession looms.

Group managing director Datuk Jamaludin Osman said that I&P was well aware that the property market had softened and would introduce more affordable homes pegged at below RM400,000 each.

I&P will launch the houses at its Alam Sari project in Bangi, flagship Bandar Kinrara development in Puchong, and Alam Impian township in Shah Alam, Selangor, he said.

"If the market feels that products in this price range will move faster, we will call to it. If people are willing to invest their money in houses, we will launch more units then," he added.
According to Jamaludin, I&P has a few launches on the drawing board but is studying the economic situation before moving ahead with its plans.

"Some say we are in recession, but people are buying our properties in Alam Impian and Bandar Kinrara. The market is no doubt slow, but it is still a good time to buy. Prices will escalate when the economy recovers," he said.

Jamaludin was speaking to reporters in Kuala Lumpur after signing a pact yesterday with Universiti Teknologi Mara (UiTM) to bring the concept of "Township of the Arts" to life at Alam Impian.

I&P, a wholly-owned unit of Permodalan Nasional Bhd, has eight projects in hand in Selangor and Kuala Lumpur that are worth a few billion ringgit.

Its more exciting project is Alam Impian, launched in December 2006.

The 494ha RM4.5 billion township will offer 10,000 homes for a population of 50,000 upon completion in 2024.

To boost sales, I&P is considering developing a hypermarket and commercial lots after building 600 homes, Jamaludin said.

It has launched 308 houses, of which 257 have been built and sold.

By May, it will launch Canting 2 featuring 103 super link-homes that cost below RM400,000 each.

It may launch more, and bigger, super link-homes by the year-end, priced at RM400,000 to RM500,000 each.

Next year, I&P intends to launch semi-detached houses and shoplots, subject to approval and demand.

Central to Alam Impian's concept of "Township of the Arts" is the assimilation and application of arts and cultural characteristics in all aspects of the development.

Jamaludin said that I&P was considering building an art gallery, theatre and pavilion in the near future.

By Business Times

Atis buys Mutiara Goodyear shares for RM15mil

KUALA LUMPUR: Atis Corp Bhd has acquired 15 million RM1 shares in property developer Mutiara Goodyear Development Bhd for RM15mil.

In a circular to Bursa Malaysia, Atis said the investment represented a strategic opportunity to strengthen its financial position.

“The growth of the property development sector is expected to continue, albeit at a slower pace, given the uncertainties surrounding the current

economic condition and softer demand due to weak sentiment,” it said.

Atis said the investment would not have any effect on the issued and paid-up share capital and shareholdings of its substantial shareholders.

It expects the investment to contribute positively to its earnings for financial year ending March 31, 2010 and beyond.

By Bernama

US mortgage problems hit new peaks

NEW YORK: A stunning 48 per cent of America's homeowners who have a subprime, adjustable-rate mortgage are behind on their payments or in foreclosure, and that's not the worst of it, new data yesterday showed.

The reckless lending practices in states like Florida, California and Nevada that were the epicentre of the housing crisis are no longer driving up the nation's delinquency rate. Instead, the foreclosure crisis now is being fuelled by a spike in defaults in states like Louisiana, New York, Georgia and Texas, where the economies are rapidly deteriorating and thousands are losing their jobs.

A record 5.4 million American homeowners with a mortgage of any kind, or nearly 12 per cent, were at least one month late or in foreclosure at the end of last year, the Mortgage Bankers Association reported. That's up from 10 per cent at the end of the third quarter, and up from 8 per cent at the end of 2007.

Prime and subprime fixed-rate loans saw sharp increases in the fourth quarter, a sign that the problem is now the economy.
Duress is no longer isolated to borrowers with lower credit quality. As joblessness grew, so did late payments on prime fixed-rate loans that represent two-thirds of mortgages.

"We're seeing increases in fixed-rate categories and that's where the problems are coming from," said Jay Brinkmann, the association's chief economist. "The foreclosure picture is more clearly driven by the jobs market."

That trend highlights one of the biggest challenges confronting the Obama administration's mortgage relief plan launched this week. While the US$75 billion plan could help change the loan terms or refinance up to 9 million homeowners, unemployed borrowers will have a hard time qualifying.

Yesterday, the Labour Department said new unemployment claims last week totalled 639,000, lower than expected, but still at elevated levels.

Few economists expect a turnaround in the battered labour market anytime soon with companies laying off thousands of workers weekly.

The tally of initial requests for unemployment benefits fell to 639,000 from the previous week's figure of 670,000, the department said. Analysts expected a smaller drop to 650,000.

By AP, Reuters

Yen So Park project to kick off by year-end

A artist's impression of the Yen So Park integrated development in Hanoi, Vietnam. Inset Chow Chee Wah.

PETALING JAYA: Gamuda Land Sdn Bhd’s maiden overseas project in Vietnam, the 500-acre Yen So Park integrated development in south Hanoi, will be launched later this year after a delay of about six months from its initial June launch.

The project was delayed after Vietnam succumbed to inflationary pressures and its currency fell last year, and more recently, the impact of the US-led global financial crisis.

Touted to be the most ambitious in Hanoi so far, the project has a gross development value of RM8bil. To be completed in 10 years, it comprises high-rise office towers, four-and-five-star international hotels, a convention centre and waterfront retail cum shop offices.

The initial launch will consist of the commercial components, including a high-rise office tower with retail podium, an international hotel and shop offices, complete with an urban park.

The first phase of landed residences comprising semi-detached houses, terrace houses and mid-range apartments will be launched in mid-2010.

“We are putting in the final touches for the project and are excited over what it can do to raise the profile and name of Gamuda Land in the regional market,” managing director Chow Chee Wah told StarBiz.

Work on the park and upgrading of the existing Yen So lake was underway, he said. According to Chow, the property market in Hanoi has stabilised from the impact of the global financial meltdown.

“Unlike Ho Chi Minh City, there is less property speculation in Hanoi and prices have not come off much. Having done the due feasibility studies, we are confident the project will go down well with the buyers there. It has been our focus from the very beginning to plan according to the actual stable demand of the market,” he added.

Gamuda Land will be investing up to RM1.4bil to design and build Vietnam’s largest modern sewage treatment plant capable of treating half of Hanoi’s wastewater; upgrade and clean the existing Yen So lake; and build a world class public park on the site.

These are in exchange for development rights on the project site. Chow said from 2010, the project would be able to contribute close to 50% of Gamuda Land’s earnings with the other half coming from projects in Malaysia.

“The project will offer the company a cushion to fall back on should our main traditional market in Malaysia go into low gear like what is happening now,” he said.

Gamuda Land’s local projects have not been spared from the weakening market sentiment caused by the global financial crisis that has resulted in weaker property sales since the third quarter of last year. The company’s monthly sales had slumped 30% since last August.

It recently launched the Gamuda Land Investment Scheme where buyers for selected products in Horizon Hills in Nusajaya, Johor and Jade Hills in Kajang need only to make a 10% deposit while the buyers’ banks will release the progressive payment to the developer during the construction period.

Gamuda will bear all legal fees, stamp duty on the sale and purchase agreement, fees on loan agreement and memorandum of transfer and also service the interest during the construction period.

Even after the property has been granted vacant possession, Gamuda will bear the payment of the loan principal and interest for 12 months. The other housing schemes available in the market now only cover up to the point of vacant possession.

By The Star (by Angie Ng)