Bolton buys land in Gombak

BOLTON Bhd's subsidiary is buying a 9.2 hectare plot of land in Gombak, Selangor from LP Heights Sdn Bhd, for RM72 million.

Ketapang Realty Sdn Bhd. plans to seek approval for the layout amendment of the land to allow the development of gated and guarded community comprising of three-storey semi-detached houses and three-storey bungalow houses.

Currently it has approval for 184 residential units, comprising of 36 units of semi-detached houses, 88 units of terrace houses and 60 units of townvillas.

The proposed development, with a gross development value of RM220 million, is expected to generate RM45 million in gross development profit for the subsidiary.
The development costs will be financed through internal funds and bank borrowings.

By Business Times

Bolton to buy land for RM72m

PETALING JAYA: Bolton Bhd through subsidiary Ketapang Realty Sdn Bhd had entered into a sale and purchase agreement with LP Heights Sdn Bhd to acquire 9.12ha leasehold land for RM72mil cash.

It told Bursa Malaysia yesterday the land was located in district of Gombak, Selangor.

Bolton plans on that land, a gated and guarded residential project with a gross development value of RM220mil and will generate a gross development profit of RM45mil.

It said the proposed acquisition would be funded through internally generated funds and bank borrowings. “The proposed acquisition is in line with Bolton’s objective to focus on its core business of property development, thereby increasing the group’s land bank so as to enhance the group’s future development earnings.”

By The Star

UK house prices drop, retail sales growth slows

LONDON: British house prices fell last month and retail sales growth slowed abruptly according to two surveys on Tuesday that will raise concern the recovery is losing momentum.

The Royal Institution of Chartered Surveyors’ house price balance fell to 8 in the three months to July the first negative reading in a year from a downwardly revised +8 in the three months to June.

The new buyer enquiries balance fell for the second straight month while property coming on the market increased at its fastest pace since May 2007, leaving surveyors braced for further weakness in the coming months.

A survey from the British Retail Consortium, meanwhile, showed the value of sales last month was just 0.5% higher than a year ago on a like-for-like basis, less than half the 1.2% growth recorded in June.

While part of that weakness may be a natural correction after June’s World Cup-related strength, the compilers of the survey also pointed the finger at the weakening housing market and harsh government spending cuts to come.

“The overriding factor is consumer confidence. It’s fallen recently,” said Stephen Robertson, director-general of the BRC. “Talk of public spending cuts is unsettling customers and they are concentrating on essentials.”

Britain’s Conservative-led coalition government, which came to power in May, aims to slash spending in some areas by a quarter, potentially putting thousands of public sector jobs at risk.

With bank lending still restricted, many doubt whether the private sector will be in a position to pick up the slack.

Britain’s economy grew an unexpectedly strong 1.1% from April to June but most economists think that will be the high-water mark, with growth slowing for the remainder of the year.

The Bank of England will publish new growth and inflation forecasts today and is expected to downgrade its GDP forecasts for both 2011 and 2012.

The Bank has kept UK interest rates at a record low of 0.5% since March 2009 and while one policymaker has been calling for a rise, most analysts expect no change in policy for many months to come.

Although inflation remains well above the 2% target, some analysts think the central bank may even feel compelled to restart its quantitative easing scheme to prevent a relapse into recession.

By Reuters

Developer: China property prices to fall

A real estate agent talks to prospective buyer behind a scaled model of a housing development in Beijing. The government has instructed banks to stop extending mortgage loans to people buying third homes in major cities. – AFP

BEIJING: Property prices in China’s major cities will fall later this year because of the government’s tightening campaign and a coming surge in housing supply, the country’s top listed developer said in comments published yesterday.

The government will not end its clampdown on housing speculation even as the economy slows, and developers who try to resist lowering prices are being unrealistic, Wang Shi, chairman of Vanke, was quoted as saying by the Securities Daily.

“Many developers who do not cut prices now are making a bet on policy,” said Wang, suggesting that they were hoping that Beijing would back down on its property controls.

Wang said the issue was of social, not just economic, importance. “Property prices in some cities have risen to levels unacceptable to the middle class,” he said.

Vanke and other big developers, including Evergrande and Greenland, have cut prices, boosting their sales. The value of properties sold by Vanke in July rose 65% from a year earlier to 8.44 billion yuan (US$1.25bil).

Showing its determination to cool the real estate market, Beijing has instructed banks to stop extending mortgage loans to people buying third homes in at least four major cities, including Beijing and Shanghai.

By Reuters

Improvement in property sector, says Rehda

Malaysia's property sector showed signs of improvement with new launches increasing by 21 per cent in the first half of this year compared to the last six months of 2009.

There was a 12 per cent improvement in performance this year and actual sales had increased marginally, according to a survey by the Real Estate and Housing Developers' Association (Rehda).

The survey showed there was a 35 per cent increase in the number of new terraced houses in the market and a 7 per cent rise in semi-detached homes and bungalows.

Rehda president Datuk Michael K.C. Yam said there was pent-up demand for high-end houses and expects the trend to continue in the second half of the year.

The survey showed that majority of the buyers this year were first time owners and owner occupiers.

Meanwhile, the top three most effective marketing tool, which helped push sales, were free/subsidised legal fee and stamp duty, and special financial packages.

"Discounted pricing had dropped, indicating that the property market is moving upwards," Yam said a media briefing in Kuala Lumpur yesterday.

Yam said developers are gearing to launch more houses in the second half of the year, in the all- price category.

The survey involved 133 developers. Some 62 per cent of them were more optimistic of the market conditions against 43 per cent in the second half of last year.

By Business Times

Rehda: Residential property prices on the rise

It is still a good time to buy property as the market is heading upwards, says Real Estate and Housing Developers' Association Malaysia

Prices of residential properties will rise 10-20 per cent over the next six months because of cost and inflationary pressures, says Real Estate and Housing Developers' Association Malaysia (Rehda) president Datuk Michael K.C. Yam.

"The current housing market is simmering. There is no boom or bust, but property prices will rise. The increase will be in high-rise and landed properties in all price categories across Malaysia," Yam said at a half-year property market briefing in Kuala Lumpur yesterday.

He said it was still a good time to buy property as the market was heading upwards, noting also the liquid banking sector and improvement in credit facilities for construction players.

According to Yam, developers are planning more launches in the second half and each project will comprise more than 150 units.

He also said that there was pent-up demand for semi-detached houses, bungalows and terraced houses priced more than RM800,000 each, especially in the Klang Valley and Penang.

"There are a lot of upgraders who want to move from a terraced house to a semi-D or bungalow because of security and to live in a green environment."

Yam said that key challenges for the sector would be higher interest rates, implementation of the Goods and Services Tax and removal of subsidies that would affect the lower-income group.

"We need government support and accommodative policies to ensure the market is simmering. The government should also be more firm in their policies to attract foreigners to buy properties here."

By Business Times

Rehda optimistic of property market outlook

KUALA LUMPUR: The Real Estate and Housing Developers’ Association Malaysia (Rehda) is optimistic of the future prospects of the property market in Malaysia.


Datuk Michael Yam: Majority of developers expect prices to rise.

“For the first half of this year, the Rehda Property Industry survey for the first half 2010 showed that 62% of the developers were more optimistic of the market conditions compared with 43% for the second half of last year,” said Rehda president Datuk Michael KC Yam at a media briefing jointly held by Rehda and RAM Ratings Services Bhd yesterday.

The survey showed that 58% of the respondents had launched new projects in the first half of this year, a significant increase compared with 31% in the previous half, Yam said.

He said with the current favourable market conditions, the survey showed that 69% of the respondents would launch new products in the second half of this year.

“The majority of the developers also anticipated prices to rise in the next six months.

“About 41% said their properties will increase in value by less than 10%, while another 40% of the developers expect their property prices to increase from 10% to 20%,” he said.

On the opportunities in the housing industry, Yam said the financial sector has been accommodative.

“The banking sector is liquid, credit for construction players has improved and housing non-performing loans have declined,” he said.

Yam said the regeneration of brownfield sites and the improvement in government policies had also been lauded for contributing to the favourable market conditions.

He said although the business has gained momentum, the industry still faced challenges like the increase in the base lending rate, removal of subsidies and the high production cost.

Yam said the current state of the housing industry was simmering and not boiling.

“It is still business as usual, but it needs continuous government support and accommodative policies to ensure its stability,” he said.

RAM Ratings chief economist, Dr Yeah Kim Leng, said the current monetary and financial conditions were conducive for sustainable growth.

“Following a 10.1% gross domestic product growth in the first quarter of this year, and with second quarter growth estimated at 8.8%, Malaysia’s first-half GDP growth will likely hit 9.4% year-on-year,” Yeah said.

The Rehda survey is conducted twice a year to assess the current housing industry conditions faced by its members.

By Bernama

Bolton buys land in Ukay Perdana for RM72m

Property developer Bolton Bhd announced today that it has purchased 9.192 hectares (22.98 acres) of leasehold land in Ukay Perdana, Ampang, Selangor, for RM72 million.

Executive chairman Datuk Mohamed Azman Yahya said the acquisition was in line with the company's strategy to expand its landbank with strategic acquisitions of prime parcels in the Klang Valley.

"We intend to develop this site into a modern, thriving community and we are optimistic about the demand for high-end residential units here," the company said in a statement today.

Bolton, through its sub-subsidiary Ketapang Realty Sdn Bhd, entered into a conditional sale and purchase agreement with LP Heights Sdn Bhd to acquire the land which comes with a development order for the development of 184 residential units comprising semi-detached and terraced houses, including town villas.

Mohamed Azman said the company was planning to seek approval for layout amendment of the development order. He said the revised plan was expected to yield an estimated gross development value of about RM220 million.

The project would begin upon obtaining all the approvals from the relevant authorities with an estimated development period of three years, he added.

By Bernama

OCBC sees strong growth in mortgages

OCBC Bank (Malaysia) Bhd expects its mortgage portfolio to hit high double digits this year compared to 12 per cent last year, said a company executive.

"During the first half, mortgages recorded a high double digit and we think this will continue for the rest of the year," head of Consumer Financial Services, Charles Sik told pressmen after the launch of OCBC Regular Premium Life Insurance Financing (LIF) facility in Kuala Lumpur yesterday.

Home loan made up about RM10 billion of the bank's RM32.6 billion gross loans outstanding last year.

The bank's gross loan outstanding increased by 5 per cent on the back of assets valued at RM53 billion as at December 2009.

Sik said that OCBC mortgage lending holds a 5 per cent market share based on outstanding balance while on new business it commands up to 6 per cent. Last year, it recorded RM10 billion in home mortgages.

Explaining the facility, he said LIF was designed for those who wish to take up a more comprehensive life insurance policy which goes beyond protection linked to the purchase of a home.

"Basically, customers do not need to come out with any money upfront, whereas in usual practice the customers need to pay premium and take loan separately from the bank," he explained.

With LIF, customers would be able to subscribe to the scheme and finance it through OCBC home loan mortgage.

Meanwhile, Great Eastern director and chief executive officer Koh Yaw Hui said LIF will be available through its 17,000 agents nationwide.

"With we are confident LIF will be both well distributed and well-received," Koh said.

Great Eastern bancassurance partnership with OCBC since January to July this year has contributed 10 per cent or RM58 million to the insurer's new business mortgage-related insurance.

"Our partnership with OCBC just started last year but we already saw 135 per cent growth in total new business premium during the period from January to July.

"And there is room to grow. This year, we expect to see contribution of between 12 per cent and 15 per cent from OCBC," Koh added.

By Business Times

Strong take-up for Goodwill Polygon's Qube

Property developer Goodwill Polygon Sdn Bhd has sold 70 per cent of its new commercial project called Qube in Shah Alam, Selangor, taking advantage of a shortage of such developments in the city.

The 17-storey office building, with retail lots, has a gross development value of RM130 million and is due to be ready by August 2013.

"Most of the non-Bumiputera lots were sold out; the majority lots left are Bumiputera lots. We really hope they will be taken up soon," said CASB Group of Companies director Prudence Wong. Goodwill Polygon is the property arm of CASB Group.

According to a survey conducted by CH Williams Talhara & Wong, there has been no new supply of retail-cum-business development centres in Shah Alam since 2000. Some 580,000 people live in Shah Alam and there are about 183,000 small businesses in the city.

"Qube will cater to the needs of business owners looking for a more prominent corporate address in Shah Alam. The survey shows that the demand is there for this type of development," she said.

The current office blocks located around Shah Alam are also 98 per cent occupied. The development of Qube 2 is already in the pipeline, and it is expected to be launched as early as next year.

The development sits on a 1.4ha site, of which 0.7ha is for the development of the first phase of Qube and the remaining for its second building.

The size of Qube business suites range between 548 sq ft and 2,300 sq ft each and prices start from RM450 per sq ft onwards. Meanwhile, the retail lots will be leased out for rental income.

Yesterday, the company organised a property seminar "Maximise Profits for Your Business" in Shah Alam to educate business owners and investors on property investment. Four renowned property gurus, Ho Chin Soon, Jeevam Sahadeevan, Master David Koh and Milan Doshi spoke at the event.

By Business Times

Aiming for business with Qube

Goodwill Polygon Sdn Bhd officially launched its new commercial development project QUBE today at a local hotel in Shah Alam. Strategically located in the heart of Shah Alam, QUBE is set to become the sought after business address in Klang Valley with its iconic structure designed to deliver the highest level of architectural visibility and style.

The QUBE business suites is one of its kind which redefines luxury and incorporates a harmonious blend of state-of-the-art technology and cutting edge architectural design, which each element is enriched to provide top-class quality for buyers; a definite promise in exceeding their expectations.

Located in the upcoming growth area in Klang Valley, QUBE has been skillfully designed and will feature impeccable amenities, a higher level of security and exude a sophisticated urban ambience. This intelligent planning comes with eco-friendly features that create a conducive working environment which leads to higher inspiration, motivation and harmony.

Besides this, the building will also be equipped with high-tech facilities to ensure that occupants are able to work in a safe, convenient and comfortable environment.

“We care about our clients’ business and designed QUBE according to feng shui principles by engaging renowned expert Professor Master David Koh to produce an environment where people working in it can be more productive and achieve more with the same effort, and with less stress” said CASB Group of Companies director Prudence Wong.

“In terms of investments, investors do not have to worry as we assure you a rock-solid chance in generating your income. This is due to limited stand alone purpose-built office buildings in Shah Alam which will definitely increase the demand for office spaces, making QUBE very attractive in capital appreciation” added Wong.

Convenience is certainly a great benefit for those working at the QUBE as places to rest and relax after a hard day of work is just around the corner. There are plenty of F&B cafes, restaurants and hypermarkets all situated within a few minutes from the QUBE which will certainly attract bigger crowds to your business.

Goodwill Polygon Sdn. Bhd is one of the property arms’ of CASB Group of Companies. The group’s main mission is to be committed to a world of wealth where there is abundant cash flow and outstanding capital appreciation for their investor and shareholders, all done with pure integrity whereas their vision is to be the leading, most successful and profitable company in the accumulation of wealth through prudent real investment.

Goodwill Polygon understands perfectly that investors would like to enrich their investment with top class quality to complement the overall experience at the QUBE, which is why the group placed immense focus in making QUBE the epitome of a luxurious yet comfortable business location, home away from home with features such as; eco-friendly, high-tech facilities, promising capital appreciation, strategic location, revolutionary design and excellent feng shui.

The potential of QUBE is realized in the Latest Development Survey of Shah Alam provided by CH Williams which reveals that there has been no new supply of incoming buildings around the Shah Alam area since year 2000. In addition, the current office blocks around the area have high occupancy rates of 98%.

In conjunction with the Official Grand Launch, Goodwill Polygon Sdn. Bhd will be organizing a QUBE Executive Event “Maximise Profits for Your Business”. The objective of organizing this seminar is to educate business owners and investors about how to maximize their business profits through branding, location and Feng Shui. Four top Gurus: Grand master David Koh, Jeevan Sahadeevan, Ho Chin Soon and Milan Doshi will be sharing their secrets during this full day seminar.

For both buyers and investors who are interested to view the show unit please call 03-55188333 or check out www.eco-techqube.com to enjoy early bird discounts.

By The Star

Menara Taipan Star in Golden Triangle for sale

Sited behind Shangri-La Hotel Kuala Lumpur and UBN Apartments, the property comprising an 18-storey office building and a 25-storey apartment block is going for an estimated RM306 million.

Menara Taipan Star in Jalan P. Ramlee in Kuala Lumpur's so-called Golden Triangle, has been put up for sale for an estimated RM306 million.

Located behind Shangri-La Hotel Kuala Lumpur and UBN Apartments, the property comprises an 18-storey office building and a 25-storey apartment block.

According to international property consultant Rahim & Co's website, the property is freehold and has a land area of 2,789 sq m.

The office building has a gross floor area of 198,571 sq ft and a net lettable area of 131,184 sq ft.

The buildings belong to Taipan Star Sdn Bhd and the people behind Taipan Star are three directors of SHL Consolidated Bhd.

Sources said the property had been up for sale for sometime.

Rahim & Co did not give additional information apart from what was available on the website.

SHL's annual report for the financial year ended March 31 2009 said the directors of the listed company - Tengku Abdul Samad Shah Sultan Salahuddin Abdul Aziz Shah, Datuk Yap Teiong Choon and Datuk Ir Yap Chong Lee - have an interest in Taipan Star.

Tengku Abdul Samad is SHL chairman, while the other two are its executive directors.

SHL has had a 15-year business relationship with Taipan Star, while Menara Taipan is about five years old. The building has 213 parking bays spread over seven basement levels.

The 50 apartment units range between 2,000 sq ft and 5,610 sq ft.

According to the website, Menara Taipan Star is charged to OCBC Bank.

By Business Times

MRCB sees 6-7pc yearly return from Nu Sentral

MALAYSIAN Resources Corp Bhd (MRCB) expects an annual return of 6-7 per cent from its RM1 billion Nu Sentral retail mall at Kuala Lumpur Sentral in Brickfields, Kuala Lumpur.

Chief executive officer Mohamed Razeek Hussain is confident all 270 retail lots will be taken up before its completion in early 2012.

However, he declined to say how much the rental rates for the 1.2 million sq ft mall are.

"We have a lot of enquiries but we are being selective as we want to control the tenant mix. The lease will be reasonable and not as high as Suria KLCC. We expect up to RM70 million in revenue per annum," he said at the Nu Sentral retail launch last Friday.

MRCB has named Parkson department store and Golden Screen Cinemas as its anchor tenants, each taking 138,000 sq ft and 50,000 sq ft of space.

Nu Sentral will undergo both Singapore's BCA Green Mark (compliance) and Malaysia's Green Building Index (certification), making it the first green retail mall in Malaysia.

"The real estate mantra is always location, location, location, which we already have. What we are saying is position, position, position, setting a new standard and experience. We expect the mall to attract a large number of people," Mohamed Razeek said.

The seven-storey mall is part of the RM1.4 billion Lot G integrated development, a 51:49 per cent joint venture between MRCB and Pelaburan Hartanah Bhd (PHB).

The other component at Lot G is a 27-storey office tower with net lettable area of 450,000 sq ft. The building is owned by PHB.

PHB managing director/chief executive officer Kamalul Arifin Othman said the office tower will be leased to a single tenant.

PHB is in talks with a few parties but he declined to name them. MRCB has some RM8 billion worth of on-going projects at KL Sentral.

By Business Times

Gaming, property units to drive MPHB revenue

Multi-Purpose Holdings Bhd (MPHB) expects revenue to hit the RM5 billion mark in the next five years, driven by its gaming and property development business, says its chief.

In fiscal year March 31 2010, MPHB recorded net profit of RM327 million on revenue of RM3.3 billion.

Some 80 per cent of the revenue came from the gaming business via its 51 per cent stake in Magnum Holdings Sdn Bhd. The rest were from property, insurance, stockbroking and investment holding.

Managing director Datuk Lau Kim Khoon @ Surin Upatkoon said its property division has five projects worth over RM10 billion on the table to roll out by next year.

The biggest is the redevelopment project in Makati City in the Philippines. It plans to convert a 22ha horseracing track into an integrated development, featuring commercial, residential and retail space as well as a hotel.

MPHB has a 40 per cent stake in listed Philippine Racing Club Inc that owns the race track, which has been relocated to Manila.

Lau said in an interview with Business Times recently that the project is estimated to worth over RM5 billion.

"We hope to start construction next year. We are bullish on the development and sales as it is located next to the Makati financial district," he said.

At present, MPHB has three projects worth some RM300 million; two residential developments in Penang and one in Pudu, Kuala Lumpur.

By the middle of next year, it targets to launch a RM3 billion project on a 2.4ha site in Kuala Lumpur.

The seven-year project will comprise a one million sq ft retail podium, 50-storey luxury condominiums, a 35-storey four-star hotel and a 30-storey office tower. MPHB will add one more office tower and a residence complex at a later stage.

"We will retain the hotel, retail podium and one commercial block. Property investment will be a growing business for us," Lau said.

The project will be linked to Berjaya Times Square, Sg Wang Plaza, the new international financial district and Pasar Rakyat redevelopment in Imbi.

MPHB has three joint ventures with Bandaraya Development Bhd to undertake medium- to high-end residential projects worth RM1 billion on land its owns in Rawang and Mimaland in Selangor and in Penang.

The companies are discussing details of the joint-venture agreements, Lau said.

By Business Times

Malls, more malls everywhere

With the opening of 20 malls in the Klang Valley with a total net floor area of 4.4 million sq ft this year, the retail property market is likely to face an oversupply situation with pressure on rental rates, property consultants say.

Many shopping mall projects that were put on hold are back on track, and shoppers can expect to see a plethora of new retail centres on the horizon, especially within the Klang Valley area, comprising Kuala Lumpur, Selangor and Putrajaya.

According to statistics by the National Property Information Centre, as at March 2010, there were currently 49.98 million sq ft of existing retail space within the Klang Valley. Another 7.18 million sq ft is under development and 7.5 million sq ft of new space under planning.

Henry Butcher Retail managing director Tan Hai Hsin believes the new malls that are coming on stream will create an oversupply situation in the market.

“With the completion of at least 20 retail centres this year, the retail property market share will be squeezed,” Tan says, adding that the negative impact will be focused on certain locations with multiple malls.

“For example, the retail market in Cheras will be even more competitive when at least five new retail centres enter the market this year. In Subang, existing shopping centres are facing more challenges with four new players.”

He says newly-completed shopping centres will face pressure on rental rates.

“There are indeed too many malls within the Klang Valley. Newly-opened shopping centres in the last few years have been facing problems in securing sufficient tenants and shoppers. Many of their problems are due to market saturation, not the financial crisis.”

However, not all new malls will be casualties, even when there are already other existing, established shopping centres within the vicinity, says Malaysian Association for Shopping & Highrise Complex Management member Richard Chan.

“The Wangsa Walk Mall was opened in August last year in Wangsa Maju. Despite several prominent shopping centres (Jusco, Giant and Carrefour) already established within the area, retail space for the new mall (Wangsa Walk) has been fully taken-up,” he says.

A new mall can always be successful if it can meet the needs and wants of customers that were not met by existing shopping centres, he says, adding: “Malls are taken up because of a retail gap that cannot be met by the other malls. If you can fill up this gap, to the point of attracting the crowd from far away areas and meet the demands of the people, it will be a success.”

Chan cites KB Mall in Kota Baru, Kelantan, which is attracting customers from as far as Thailand.

“People from Thailand are going to the mall to get things that they cannot get in their own areas,” he says.


Elvin Fernandez feels mall developers should conduct a study and understand the market before constructing.

Khong & Jaafar Sdn Bhd managing director Elvin Fernandez believes that the success of potential new shopping centres is dependent on two key factors – their management and locations.

“Mall developers should conduct a study and understand the market before constructing.

Sometimes, they (the developers) will own part of the mall, say 50%, and divest the rest to different parties to manage. When that happens, you lose control,” he says.

Chan concurs that the number one criteria for the success of a shopping mall is management, rather than location. He says the next most important requirement is “accessibility.”

“The Mid Valley Megamall in Kuala Lumpur is strategically located but would it be successful if it didn’t have all those roads surrounding it? Your shopping centre might be in a good location but it would be pointless if it can’t draw the crowds,” he adds.

Fernandez says rental rates of downtown shopping centres (namely Suria KLCC and Pavilion in Kuala Lumpur) and suburban shopping centres (like Mid Valley in Kuala Lumpur, One Utama and Sunway Pyramid in Selangor) have been holding steady for a while.

Even during the global economic crisis, rates remained fairly steady and we expect them to remain steady for the remainder of 2010, he says, adding that he does not expect a “shoot-up” in rates.

According to Fernandez, rent for average prime space at downtown and suburban shopping centres are currently averaging RM50-RM60 per sq ft and RM30-RM35 per sq ft respectively.

“(Healthy) consumer spending and (good) tourism levels have managed to help keep the (retail) rates up,” he says.

With the improved economic conditions, the outlook for the retail sub-sector in Malaysia seems positive, regardless of the multiple malls, Chan says. “There are more festive holidays in the second half of the year and shopping malls also tend to have sales (in conjunction with the holidays) and year-end sales that will help boost business for the (retail) segment.”

Tan believes that the local retail industry will grow by 5% this year, with total sales turnover expected at RM74.6bil.

By The Star (by Eugene Mahalingam)

Bolton in talks to buy land with RM500m GDV

Property developer Bolton Bhd is in talks to buy land with potential gross development value (GDV) of RM500 million this financial year, says its top executive.

"We target to acquire strategic landbank for our future development in Penang and the Klang Valley," said chairman Datuk Mohamed Azman Yahya.

Bolton plans to use about a third of the RM195 million loan it got in May this year for the purchase.

"With a low net gearing of 0.1 times and having raised additional banking lines, we now have the opportunity to gear up and embark on a landbank acquisition exercise to fuel our growth phase," he told pressmen after the company's annual general meeting in Shah Alam, Selangor, yesterday.
The group would focus on developing high-end residential properties.

Bolton now has 2.4ha to 2.8ha of land and this is expected to keep the company profitable for the next three to four years.

Its plan also includes the launch of four major projects this year, which can bring in RM500 million in sales.

The projects are the recently-launched RM155 million Arata condominiums in Bukit Tunku, the RM202 million "SixCeylon" condominiums and the RM220 million "51 Gurney" niche apartments, all located in Kuala Lumpur.

And later this month, Bolton will unveil The Wharf, a commercial development within Taman Tasik Prima township in Puchong with a GDV of RM650 million.

The group may raise more debt from loans or bond sales or it can also sell new shares to raise funds.

Meanwhile, executive director Chan Wing Kwong said Bolton may venture abroad in two years if the right opportunity arises.

By Business Times

Bolton to launch Puchong property this month

SHAH ALAM: Bolton Bhd will unveil a new commercial development in Puchong, known as The Wharf, later this month, said executive director Chan Wing Kwong.

The development, with a gross development value (GDV) of RM650mil, is a mixed offering of boutique shop offices, service apartments and a retail shopping mall.

The Wharf would highlight green features that would capture the imagination of an ever-demanding market, Chan said after the company AGM yesterday.

Projects in the pipeline include a 33-storey condominium development, known as “Sixceylon” at Bukit Ceylon, Kuala Lumpur, with a GDV of about RM180mil.

Meanwhile, its “51 Gurney” comprises 71 super luxury condominium with a GDV of about RM150mil.

On expansion plans, Chan said Bolton would continue building on its strength in the Malaysian property market and consider venturing overseas in the next one to two years. “We will look within the region,” he added.

For the financial year ended March 31, Bolton posted a pre-tax profit of RM50.7mil on revenue of RM257.5mil against RM38.11mil and RM292.04mil respectively in the previous year.

By Bernama

Magna Prima eyes good, small plots of land in Klang Valley

MAGNA Prima Bhd, a property developer, said there are still many pockets of land available in the Klang Valley that fits its strategy.

"If you are talking about those 500-acre lands, then it will be difficult to find. But if you look closely, there are many good, small plots of land in the Klang Valley that are suitable for smaller property projects like townhouses and apartments, which is what we are focussing on.

"As long as you are not in a hurry, know the prices and market well, you will be able get good value from the land," said chief executive officer Yoong Nim Chee after the company's extraordinary general meeting in Petaling Jaya, Selangor, yesterday.

Yoong said the local property market, especially in the middle to higher income segment, has improved this year and expects the company to benefit from it.
But it is also seeing demand from first time buyers who are only willing to pay between RM200,000 to RM300,000 per unit.

He expects the company to perform better than last year, when it registered a net profit of RM6.67 million, a decline of more than 70 per cent against 2008 net profit of RM27 million.

For the rest of the year, the company will launch several residential properties, including D'Sierra in Selayang, One Villa at Shah Alam, One Jalil at Bukit Jalil, Magna City off Jalan Kuching, Kuala Lumpur, as well a commercial property in Shah Alam, which will be rented out.

The D'Sierra project, a 3-storey townhouse development, is expected to have a gross development value of about RM70 million. The project is expected to be launched within two months. The EGM held yesterday was to secure shareholders' approval to buy the land for the D'Sierra development.

Magna Prima is also planning to launch a high-end property project near the KL City Centre area in the near future. The project will be the company's second project within the KLCC vicinity, since the Avare development which was done a few years ago.

By Business Times

REIT vs direct real estate investment

Investing in real estate can be tricky.

For a start, those who intend to make a quick buck by “flipping” property within a few months will find that it is risky, especially in a property market less buoyant than in Hong Kong or Singapore.

The alternative is hard work, that is, managing residential properties (and absorbing all the hidden costs that come along with it) as long term investments, receiving rent and selling them off for a capital gain or profit.

Another factor that may deter investors from real estate is the difficulty in raising enough capital to purchase a particular property.

So, should you consider putting your money in a real estate investment trust (REIT) instead?

Granted, a REIT does not comprise residential property, but if it is profit you are interested in, it may be an option.

REITs originated in the United States in the 1960s, but it wasn’t until 2005 that Axis REIT became the first property trust to be listed on Bursa Malaysia.

In Malaysia, there are now 14 REITs to choose from on the Main Market, offering investors a choice to own stakes in commercial, industrial, plantation and office real estate.

Aside from being more liquid than investing in real estate, one of the reasons why REITs are more appealing than investing in actual real estate is because of its high yield.

Gross dividend yield in the FTSE Bursa Malaysia index is about 2.9%, while the average yield for a REIT in Malaysia is about 8%.

REITs yield higher returns because commercial real estate generates a huge amount of cash flow from rentals.

If one invests in real estate though, it may be hard to charge the most preferred rental rate, even if the property had been purchased for a hefty price, simply due to market forces.

As for REIT prices on the stock market, they generally tend to be “low risk” because their prices are sustained by the yield factor, hence the volatility element is reduced.

Even so, REITs are not immune to economic difficulties.

REITs such as AmFirst, Hektar, UOA and Axis hit their lowest point in the middle of the financial crisis in 2008 but have since recovered to their pre-crisis prices, if not better.

Part of their recovery, says an analyst, is due to good management, good investor relations and a proven track record when it comes to acquisitions.

Still, one critic of REITs says it is probably more worthwhile to purchase stocks of established companies if they want to play safe.

Advocates of the property trust point to the fact that REITs are a different investment class altogether, choosing to view them as an investment that bridges the gap between a fixed deposit and the stock market.

One drawback of REITs is their inability to benefit from capital gain, unlike real estate.

But with REITs, returns may be secured with less risk which make them a nice way to take advantage of the big booms in the real estate market.

Investors can do without taking on the risk of mortgage payments, unscrupulous tenants and rising tax rates.

However, less risk obviously comes with less reward.

Good capital appreciation is still the main factor driving demand for landed residential properties.

Since 2008, there has been an annual compounded growth rate of 10% for capital appreciation in residential hotspots such as Petaling Jaya, Taman Tun Dr. Ismail and Mont Kiara.

A home can go up in value ten-fold given the right market conditions, which would give one a hefty sum of money right into his or her pocket - this won’t happen with any REIT.

Ultimately, for someone who wants to have more control of their assets and is willing to improve their value, investing in residential real estate can be a good choice.

For someone looking for passive real estate investment, with the added benefits of portfolio diversification and liquidity, a REIT is a good option to consider.

Think of them as allowing investors to be exposed to the real estate market without having to fork out as much capital.

Alternatively, REITs could be purchased as part of a balanced portfolio, until one has enough capital to enter the real estate market.

By The Star

GuocoLand unit ups stake in Tower REIT

PETALING JAYA: GuocoLand Malaysia Bhd’s wholly-owned HLP Equities Sdn Bhd has acquired 4.55 million units, or 1.62%, in Tower REIT for RM5.1mil including transaction costs via a direct transaction.

The acquisition raised GuocoLand’s interest in Tower REIT to 21.66% from 20.04% previously, it told Bursa Malaysia yesterday.

Tower REIT is a real estate investment trust that owns three office buildings – Menara HLA, Menara ING and HP Towers.

By The Star