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Thursday, September 30, 2010

E&O aims to grow F&B, property units in region

EASTERN & Oriental Bhd (E&O) wants to expand regionally to grow its property development and food and beverage (F&B) units, its chief said.



The developer's businesses are currently in Kuala Lumpur and Penang, where it is involved in property development and investment, and operating hotels and restaurants.

Under the F&B division, E&O operates the Delicious Chain of restaurants in Malaysia and it wants to expand this to Singapore, Thailand and Indonesia, said its executive director, Eric Chan.

"F&B contributed some RM3 million to E&O's net profit last year and we aim to increase this going forward," Chan said yesterday, after the company's shareholders meeting in Kuala Lumpur.
E&O operates six Delicious outlets and one Chinese restaurant.

The company has RM500 million in its coffers to spearhead the F&B expansion. However, the bulk of the cash will be used to generate fresh cash flow by launching new projects and buying more land, Chan said.

On the property development front, Chan said E&O aims to launch flagship projects in Singapore and Jakarta, Indonesia, but there are no concrete plans yet.

"Our priority is to launch projects locally. We have more than RM4 billion worth of high-end housing projects to launch in Penang and Kuala Lumpur. We will launch as long as the market can take it.

"If there are no negative policies being implemented, then we expect the markets in Penang and Kuala Lumpur to be positive," he said.

Among the projects that E&O plans to launch are seafront terraces, villas and semi-detached homes in Penang, and condominiums at Jalan Yap Kwan Seng and Jalan Kia Peng as well as in Bukit Tunku in Kuala Lumpur.

Chan said E&O aims to achieve record sales of RM1 billion. No time frame was, however, given.

For its financial year ended March 31 2010, E&O posted RM70.5 million in net profit on revenue of RM352.4 million.

By Business Times

MPPP revises plot ratio for high-rise properties

GEORGE TOWN: The Penang Municipal Council (MPPP) has revised the plot ratio guidelines for high-rise properties on the island to allow developers to construct a total of 122,000 sq ft per acre compared with 42,000 sq ft per acre previously.

Real Estate Housing Developers’ Association (Rehda, Penang) chairman Datuk Jerry Chan told StarBiz that developers could now develop up to 87 units, with a total built-up area of 122,000 sq ft per acre.


Datuk Jerry Chan ... More flexibility for developers

“The condition that comes with the new plot ratio guidelines is that 5% of the units is to be sold at not more than RM200,000.

“Another 10% is to be sold below RM300,000, and another 5% at a price not exceeding RM500,000,” he said.

The new plot ratio guidelines are applicable in areas where it is allowed to develop 30 units per acre and above, according to the local control plan, and in areas designated as commercial/tourism areas under the MPPP’s structural planning and development control plan.

The new plot ratio guidelines are not applicable for prime residential areas such as Jalan Tunku Abdul Rahman (popularly known as Ayer Rajah Road), Jesselton area, existing established housing zones and general housing areas, George Town Heritage Site (which includes the buffer zone), certain areas in Tanjung Bungah and Tanjung Tokong.

These terms and conditions were communicated to Rehda Penang and other professional bodies in a letter dated July 28, 2010.

Chan said the MPPP also implemented in July the Green Building Index (GBI) guideline to encourage the development of green development projects.

“According to the GBI, if the project qualifies for the platinum and gold standard of the GBI, the developer can still pay the old development charges of RM5 per sq ft and RM7 psf respectively for residential and commercial properties.

“If the project fails to qualify for either the platinum and gold standard, the developer will have to pay triple the amount,” he said.

Chan said the 122,000 sq ft built-up area per acre was still lower than the guidelines for super-condominium projects which could exceed 180,000 sq ft built-up area per acre.

“The new plot ratio guidelines will see the development of more affordable high-rise properties priced from RM200,000 to suit different ages and budgets,” he said.

Previously, the plot ratio guideline for high-rise on the island was 60 units per acre or 42,000 sq ft per acre.

“This means a developer could either build 60 units of 700 sq ft apartments or 30 units of 1,400 sq ft apartments. Each unit must also have three bedrooms.

“The old plot ratio guideline, which had been enforced for over 30 years, was inflexible and did not give the developer the room to construct units of mixed sizes and lay-outs and price them according to the needs of different income groups,” he said.

By The Star

3 local firms in talks to invest in India's Sri City

Three Malaysian companies are expected to establish an investment presence in one of India's top special economic zones (SEZs) by the end of the year.

Integrated SEZ developer Sri City (Pte) Ltd vice-president C. Saravanan on Tuesday said the companies, which are engaged in industrial engineering, are likely to plough in an estimated US$25 million (RM77 million) into India's first integrated business city known as Sri City, located 55km away from Chennai in South India.



"The Malaysian companies are among several foreign firms we are in advanced negotiations with and we hope to sign a deal with them by the end of the year," Saravanan told reporters in Penang.

He, however, did not disclose the name of the Malaysian companies, except to say that the firms were mulling setting up a presence in South India for manufacturing and distribution purposes.

Saravanan and Sri City Pte's deputy general manager for marketing M. Ganesh were in Penang as part of a six-day official visit to Malaysia to meet top investors who are keen on investing in India.

They are also due to meet government and investment promotion officials in Perak and Kuala Lumpur this week.

Apart from meeting potential investors, Saravanan said the company is also looking for joint-venture opportunities with local consultants and companies.

"There is an estimated US$30 million to US$40 million (RM93 million to RM124 million) worth of joint-venture projects for Malaysian companies in Sri City for the development of social infrastructure like residential enclaves, education zones, leisure and entertainment zones."

He singled out the development of golf courses within Sri City as a project which could potentially attract Malaysian companies.

"As developers of this economic zone, our equity would be to provide land for these proposed projects," Saravanan added, saying that his company has ear-marked US$250 million (RM770 million) in setting up Sri City and a total of US$150 million (RM462 million) has been spent, to date, on infrastructure support.

Sri City, which was set up in 2008 and covers more than 2,400ha of land, was master-planned and designed by Singapore-based Jurong Consultants Pte Ltd.

The zone has attracted 35 multinational companies with total investments of US$150 million. Eleven of these investors have already begun operating in Sri City.

"We are hoping to lure another 15 more companies to the SEZ by the frist quarter of 2011," he added.

Located on the border of Andhra Pradesh and Tamil Nadu, Sri City offers smooth connectivity to three sea-ports, two international airports, a national highway and railway services.

"We have earmarked some 300ha of land for open spaces and our plans are to develop Sri City as a green city, as we aspire to be the world's first carbon-neutral city," Saravanan said.

By Business Times

BMAM voices dissatisfaction with valuers' proposal

Investors will lose interest in buying condominiums and apartments in Malaysia if the proposed amendments to the Valuers, Appraisers and Estate Agents Acts 1981 take place.

The Building Management Association of Malaysia (BMAM) is up in arms against the Board of Valuers, Appraisers and Estate Agents who had proposed to amend the Act.

The proposal was tabled in Parliament for first reading at its last session in July.

"If this (the amendments) takes place, the management fees (of high-rise residential units) will increase by 100 per cent, and many people including foreign investors will lose interest in buying condominiums and apartments," said (BMAM) president Datuk Teo Chiang Kok in a press conference to voice its dissatisfaction with the proposed amendments yesterday.

Teo said the amendments would encompass all facets of property ownership and monopolise the functions of property management including building and leasing management, general maintenance and facilities management.

There are almost two million strata title residential holders in the country and based on a minimun fee of RM50 per unit per month, valuers stand to make RM1.2 billion annually, he said.

"It's indeed a very lucrative business and that is why monopoly is not good ... We urge the government to do something about it as this is their (valuers) second attempt to see the amendment through after their first attempt five years ago failed," he said.

Teo also said that the property management industry should not be monopolised by several hundred valuers, but should instead be allowed to operate in an open market.

"We have a pool of good talent who can readily do the job but if the proposed amended Act comes in force, there is definitely going to be a brain drain in this sector ... even those taking diploma courses for this type of work will not be able to find jobs," he said.

Teo said shopping complexes and malls would also not be spared as their shareholders will not be allowed to pick the people they want to manage their buildings.

BMAM has asked for an appointment to meet the Minister of Finance to sort out the issue, he added.

By Business Times

China steps up control of property market

China on Wednesday announced it had taken further steps to cool its red-hot property market, ordering banks not to provide loans for third home purchases and above.

The new measures are aimed at preventing house prices from rising too fast, the State Council, or cabinet, said in a statement, amid fears of a speculative bubble that analysts say could derail the world's second largest economy.

The cabinet said down payments on all home purchases would now have to be at least 30 percent, and limited the number of homes that people can buy in cities where prices are too high, have risen too quickly or where supply is tight.

The new measures urged banks to strengthen their oversight of consumer loans, banning them from being used to buy homes.

The cabinet also called for a trial reform of the property tax now being carried out in some cities to be sped up and gradually expanded to the whole of China.

This is widely expected to entail an expansion of the tax on commercial real estate to cover residential houses.

The measures are the latest in a series issued this year -- such as tightening restrictions on advance sales of new developments -- to try and prevent the property market from overheating.

Official data has suggested that these efforts have started to pay off, with growth in China's property prices slowing for the fourth straight month in August.

By AFP

Syed Mohamed set for IIB top job

Datuk Syed Mohamed Ibrahim, the property head at DRB-HICOM Bhd, is slated to join Iskandar Investment Bhd (IIB) as its chief executive officer (CEO), replacing Arlida Ariff who currently holds the post.

Arlida's contract expires at the end of this year and it is believed that her term will not be extended, sources said.



"The offer has been made and he (Syed Mohamed) may even start this year," one of the sources said.

IIB confirmed that Arlida's contract finishes at the end of the year, but declined to comment further.

Syed Mohamed and Khazanah Nasional Bhd, the parent of IIB, also declined comment.
Syed Mohamed has been the group director of DRB-HICOM's property and infrastructure division since early this year.

He returned to Malaysia after a stint as chief operating officer of Seera City Real Estate Development Co, a firm leading the RM24 billion, 15-year project known as the "Knowledge Economic City" in Madinah, Saudi Arabia.

The city is one of six new cities being built by Saudi Arabia and is intended to be an education and technology hub.

Before that, Syed Mohamed was the CEO of Tabung Haji's property arm, TH Properties Sdn Bhd, the developer of Bandar Enstek, a RM9.2 billion township in Negri Sembilan.

He will succeed Arlida, an engineer by profession, who was appointed IIB executive director on July 2 2007. She became the president and CEO on January 1 2008.

Under her watch, IIB has brought in significant projects like the Legoland theme park, factory outlets, and some world-renowned universities.

The RM750 million theme park, which is among the main attractions at Medini North in Iskandar Malay sia, will be the fifth Legoland in the world and is scheduled to open in 2012.

Since the set-up of IIB in November 2006, the company has also awarded over RM3 billion worth of construction jobs in Iskandar Malaysia.

In Medini North, there are RM1.7 billion worth of ongoing projects, including Legoland Malaysia and 1Medini, a residential project by WCT Bhd and IIB.

Arlida said recently that she was in talks with several local and foreign investors to build a three-star resort hotel, a four-star business hotel, a retail mall and a high-rise tower in Medini North worth RM1 billion.

IIB is also trying to get two other universities to set up engineering and multi-programme schools in EduCity, the 120ha education enclave in Nusajaya. One is with Singapore's Raffles Education Group.

In June, IIB signed a deal with the Management Development Institute of Singapore (MDIS) to set up an MDIS campus in EduCity.

The MDIS campus is the third in EduCity, the other two institutions being the UK's Newcastle University of Medicine and the Netherland's Maritime Institute of Technology.

By Business Times

Wednesday, September 29, 2010

Australia commercial property deals on the rise

Australian commercial property transactions are climbing as the nation’s economic growth draws investors seeking income and capital growth, CB Richard Ellis Group Inc said.

About A$2.6 billion (US$2.5 billion) of properties changed hands in the third quarter, 75 per cent more than a year earlier, the world’s largest commercial real-estate broker said in an e- mailed statement today. Office properties accounted for about 70 per cent of the transactions, when on average they make up 50 per cent, it said.

“This type of stock is ready to sell, with a large number of new office buildings featuring long leases and attractive depreciation benefits available for incoming investors,” Kevin Stanley, executive director for global research and consulting at CBRE, said in the statement. Investors are drawn by the “bright prospects for income and capital growth in the office sector” driven by recent employment growth, he said.

Australian job growth exceeded forecasts in August, with employers adding 30,900 workers, sending the unemployment rate down to 5.1 percent, the lowest since January 2009.

While the gain in property transactions hasn’t pushed rents up yet, the increase in vacancy rates in major markets has slowed, Stanley said.

Industrial property deals accounted for 23 per cent of third-quarter sales, and retail for 7 per cent, CBRE said. Overseas investors purchased 42 per cent of the properties up for sale in the quarter and 36 per cent in the year to date, according to CBRE. On average they account for about 15 per cent.

By Bloomberg

Tuesday, September 28, 2010

JB to get own ‘KLCC’


Datuk Abdul Ghani Othman and Mukhtar Hussain signing the plaque at the branch opening

JOHOR BARU: Johor wants to develop the former sites of the Lumba Kuda and Bukit Chagar low-cost flats in Johor Baru into an area similar to Kuala Lumpur City Centre.

Mentri Besar Datuk Abdul Ghani Othman said the components of the project would include buildings that resembled the iconic Petronas Twin Towers, hotels, condominiums, serviced apartments and retail complexes.

“On clear days, the towers would have a commanding 360 degrees views of the city centre and our neighbour Singapore,” he said yesterday.

Ghani was speaking to journalists at the opening of the HSBC Amanah Malaysia Bhd’s first Islamic bank branch in Johor at Taman Nusa Bestari and also its seventh branch.

He said the Lumba Kuda and Bukit Chagar sites would also be the last stop for the mass rapid transit (MRT) services from Woodlands, Singapore to Tanjung Puteri in Johor Baru. A rapid transit system (RTS), which would be centralised at Kempas KTM station, will connect commuters to other parts of Johor Baru and Pasir Gudang.

Ghani said Johor was opened to all options on the type of RTS to use; whether to have a bridge across the Straits of Johor or an underground sea tunnel linking Johor and Singapore.

“The distance might be short: only about 1.6km but if the sea tunnel project is viable and can help reduce congestion above land, why not,” he said.

Ghani said the Iskandar Regional Development Authority and State Economic Planning Unit would have until the end of the year to complete their studies on the city centre transformation plan and submit their findings to the Federal Government.

Under the 10th Malaysia Plan, some RM1.8bil will be spent to turn Johor Baru into a vibrant city in line with its status as one of the five flagship development zones in Iskandar Malaysia.

By The Star

Iskandar Malaysia moving in the right direction


Selling fast: Tham (right) and sales and marketing manager Patrick Chin with the model of the SuriaMas Block C Apartment Tower.

JOHOR BARU: Iskandar Malaysia and Singapore are two major contributing factors that will drive growth of the property market in south Johor.

IJM Land Bhd general manager (southern region) Tham Huen Cheong said the country’s first economic growth corridor was moving in the right direction since its inception in Nov 4, 2006.

Located in the southern most part of Johor, spanning 2,217 sq km and under its Comprehensive Development Plan (2006-2025), Iskandar will be transformed into an international metropolis.

The figure released by the Iskandar Regional Development Authority showed Iskandar received RM62.32bil cumulative investment up to June, surpassing the 2010 target of RM47bil.

“Developers are benefiting from the investment flow with demand for properties on the upward trend,’’ he said at the launch of SuriaMas Block C Apartment Tower.

The project located in Larkin is a privatisation project between IJM’s subsidiary Suria Bistari Development Sdn Bhd and the Johor government.

The 13-storey block with the gross development value of RM35mil is made up of 152 units with built-up area from 82.03 sq metre to 104.98 sq metre, and selling prices between RM220, 000 and RM330, 000 each.

He said the opening of the two Integrated Resorts (IR) in Singapore also saw good demand for apartments units especially those located just few kilometres away from Bangunan Sultan Iskandar, Customs, Immigration and Quarantine Complex in Bukit Chagar.

Tham said it was a known fact that Johor and Singapore were economically inter-dependent and positive economic growth on both sides of the Causeway would create a spill over.

“Apartment units are popular with Malaysians working in Singapore as most of the apartments blocks are located within the gated and guarded precinct,’’ said Tham.

He said many chose to stay in apartments nearby the CIQ due to the shorter travelling time commuting to work to the republic.

The safety factor was another consideration as security guards patrolled the area regularly.

Tham said apartments in the Larkin area fetched good rental due to its close proximity to Johor Baru city centre and was surrounded by amenities such as schools, banks, shopping complexes, private hospitals and public transport terminal.

He said a three-room unfurnished apartment unit in the area could easily fetch RM850 monthly rental, while for the fully-furnished three-room unit could derive rental between RM1,200 and RM1,800.

Tham said it was still considered cheap compared with a room in any Housing Development Board public flats in Singapore, which could be leased out to tenant from S$500 monthly.

By The Star

1MDB gearing up for expansion plans in real estate industry

PETALING JAYA: The Government’s strategic investment unit, 1Malaysia Development Bhd (1MDB) seems to be gearing up for involvement in the real estate industry judging by its large recruitment plan recently.

1MDB placed a two-page recruitment advertisement in The Star on Sept 25, mostly for senior positions within various units in the real estate team of the company.

The vacancies were for positions in the project management unit, design and planning unit, supply chain management unit, project implementation unit, branding and marketing unit, quality assurance unit and corporate functions.

Sources familiar with the company said the new line-up would be for the redevelopment of the Sungai Besi Airport area and a new international financial district in Kuala Lumpur.

“1MDB is gathering resources right now to kick-start its expansion plan in the real estate industry,” the sources told StarBiz yesterday. The company, when contacted, declined to comment.

As reported in June, the Sungai Besi airport would be developed into a green mixed-use development that will feature a commercial hub.

To be known as “City of Malaysia”, the project will be jointly developed by Middle Eastern investors including the Qatar Investment Authority and 1MDB.

In its advertisement, 1MDB said: “At 1MDB, we strive to be a strategic enabler for new ideas and new sources of growth to further strengthen Malaysia’s competitiveness. Through innovation, creativity and high performance, we unlock strategic values to drive long term sustainable economic development. Join our real estate team to be part of this mission.”

According to its website, 1MDB has a unique difference in its pursuit of economic growth.

It creates business opportunities and forges global partnerships to bring home foreign direct investment for new high-impact growth.

It forms equal-capital joint ventures in investments with high multipliers, especially energy, real estate, tourism and agribusiness.

This business model has proven successful with an early indication of US$3bil investments from the Middle East.

By The Star

SunCity project in Penang

SUNWAY City Bhd’s wholly-owned unit, Sunway City (Penang) Sdn Bhd, had on August 4 agreed to buy 32.74ha of land for residential development in Barat Daya district, Penang, from Sungei Ara Holdings Sdn Bhd for RM38.76 million.

SunCity said the area will have an estimated gross development value of RM800 million when fully developed.

“The proposed development for the new land bank consists of semi-detached houses and bungalows which will strengthen SunCity’s presence in Penang,” it told Bursa Malaysia yesterday.

By Business Times

Plenitude to buy Penang land

PLENITUDE Bhd’s wholly owned unit, Plenitude Estates Sdn Bhd, has agreed to buy 21.3ha of freehold land in Balik Pulau, Penang, from United Formula Sdn Bhd and Affluent Base Sdn Bhd for RM40.1 million.

The land is earmarked for mixed development that includes double-storey and super-link houses as well as 2-3 storey shops with an estimated gross development value of RM230 million.

The development should start in the first half of 2012 and last five years.

By Business Times

PKNS plans to set up Astronaut City in Bernam Jaya

KUALA LUMPUR: The Selangor Economic Development Corp (PKNS) plans to set up an "Astronaut City" in Bernam Jaya, Northern Selangor, says its Chief Executive Officer Omar Othman. "However, it is still in the preliminary stage. We are just talking about it. There is nothing concrete yet," he told Bernama here today.

Ohman said PKNS was organising an "Astronaut Congress" to be held at the Shah Alam Convention Centre on October 8. "We are trying to schedule a visit by the astronauts to our Selangor Science Park, which is also the Solar City to exchange ideas," he said after a visit by national astronaut Datuk Dr Sheikh Muszaphar Shukor to PKNS's exhibition booth at the Global Finance Conference here today.

Themed, "Dawn of the New Decade: Alternative Investments in Asia", the two-day conference, organised by the International Herald Tribune and the London Speakers Bureau, ended today.

PKNS, the investment arm of the Selangor state government, is the only exhibitor displaying multi-billion ringgit high-profile properties to attract potential international investors.

Malaysia's first Solar City, located in Selangor Science Park 2, is an integrated urban mixed redevelopment with high-tech industrial, commercial residential and recreational components.

Meanwhile, Sheikh Muszaphar said "we are impressed with the world class infrastructure that PKNS has put in place in the Solar city". "We are bringing 100 astronauts from all over the world to visit Solar City namely from the United States, Iran, India. "Probably, we can promote space science as the Solar City has a lot of opportunities and potential," he added.

By Bernama

Monday, September 27, 2010

UEM Land counts on Nusajaya


From left: UEM Land strategic marketing GM Zamry Ibrahim, strategic marketing and communications director Zulkifli Tahmali and Mohamad Razif Abdul Wahab looking at the model of the company’s Nusa Bayu mixed property development project.

NUSAJAYA: UEM Land Holdings Bhd is banking on the on-track development of Nusajaya as the main selling point for its latest mixed property development project.

Senior marketing and sales manager Mohamad Razif Abdul Wahab said that Nusa Bayu, to be launched early next month, would be the company’s fourth ongoing project in Iskandar Malaysia.

The other three projects are East Ledang, Nusa Idaman and Puteri Harbour while Horizon Hills is a joint venture between UEM Land and Gamuda Bhd.

“Nusajaya is progressing well and moving on the right track as planned, attracting investments from both local and foreign investors,’’ Razif told StarBiz.

UEM Land is the master developer of the 9,308ha Nusajaya, the key driver of Iskandar Malaysia, the country’s first economic growth corridor launched on Nov 4, 2006.

Nusajaya comprises eight catalyst developments — Kota Iskandar (Johor’s new administrative centre), Southern Industrial and Logistic Clusters, Puteri Harbour Waterfront Development, EduCity, Medical City, International Destination Resort and Nusajaya Residences.

Razif said that Nusa Bayu, sited on 105.21ha along the Pontian Link, would have 5,000 residential and commercial properties and a gross development value of RM700mil.

He said the initial launch was set for 130 double-storey link houses, with a built-up area of 1,400 sq ft each and costing under RM300,000.

He said the company would target young families, first-time homebuyers and Malaysians working in Tuas and Jurong in Singapore, as the project was easily accessible from the Second Link crossing.

“We conducted a market study and found that there was a huge gap for new houses priced between RM200,000 and RM300,000 in Nusajaya,’’ Razif said.

Razif said feedback also showed that many buyers, including foreigners, were attracted to properties in Nusajaya.

Work on infrastructure and several development projects in Nusajaya are on schedule and are expected to be completed in the next two to five years.

They include the RM1.4bil Coastal Highway linking Johor Baru city centre to Nusajaya, Asia’s first Legoland Theme Park, Indoor Theme Park @ Puteri Harbour, Marlborough College, Newcastle University Medical Faculty and Pinewood Studios.

By The Star

SunwayMas ventures into Sri Lanka

SunwayMas Sdn Bhd (SunwayMas), the wholly-owned property development arm of Sunway Holdings Berhad (Sunway Holdings), signed a Joint Venture Agreement (JVA) with Dasa Group on September 24 to jointly develop a parcel of prime land in Sri Lanka’s capital city of Colombo. With the signing of this JVA, SunwayMas becomes the first Malaysian property developer to undertake a development project of such scale and nature in Colombo, Sri Lanka.

Under this JVA, SunwayMas and Dasa Group will jointly undertake the development of a 34-storey building comprising about 70 commercial units and 180 residential units on prime freehold land in the premium mixed-use zone of Bambalapitiya in District Colombo 4. The proposed development has a gross development value of USD80 million (equivalent to approximately RM 250 million). The project will sit on a 1.14 acre land that is located 5km away from the central business district of Colombo.

The JV comes on the heels of the Memorandum of Understanding signed between SunwayMas and Dasa Group in June 2010. Under the JVA, the proposed structure is for SunwayMas to hold 65% of the shares and the Dasa Group 35%.

The JVA was signed by Sunway Holdings managing director Yau Kok Seng and Dasa Group of Companies chairman and founder S. D. Gunadasa. Yau said, "Today is a historic occasion as this is the first-of-its-kind venture by a Malaysian property developer into Sri Lanka. This is the beginning of an era of mutual economic co-operation and benefit between our two nations. Today, we have contributed towards a new paradigm - that of the opening up of the Sri Lankan economy to foreign investment and expertise, thus allows us to contribute to Sri Lanka’s nation building.”

Yau added, “Sunway Holdings has built a strong reputation in Malaysia for quality property offerings and pioneer development concepts. After today, Sri Lanka would be the third foreign country, apart from Singapore and China, where Sunway Holdings will have its property development foot print in.”

This brings Sunway Holdings’ land bank to a total of more than 430 acres with potential Gross Development Value of approximately RM2.6 billion, which will be developed over the next 3 years. The Group currently has RM450 million in unbilled property sales and is expected to launch about RM500 million worth of property projects in Malaysia and Singapore in the next few months.

S. D. Gunadasa, Chairman & Founder, Dasa Group of Companies, said at the ceremony, "This JV marks an important milestone for the Dasa Group’s first venture in mixed development in Sri Lanka. We look forward to more collaborations with Sunway Holdings for our future expansions.”

“While the Sri Lankan property market gears itself for robust growth in the next 5 years, international collaborations with premier property players such as the Sunway Holdings will contribute immensely to raise the standards in the industry as well as to create new benchmarks”, he concluded.

By The Star

Mines 2 aims to rake in RM15m rental from new shopping mall

MINES 2 Sdn Bhd, the owner of Mines 2, is aiming to rake in rentals of RM15 million a year from its new shopping mall that will start operations on October 15.

Its chairman Tan Sri Lee Kim Yew said with the "street mall" concept, Mines 2 offers unique shopping atmosphere with colourful light-emitting diode (LED) lights.

"We are the first shopping mall in the country to use 100 per cent LED in our operations," he said.

The RM150 million 11-storey commercial building has 400 shops and kiosks.

The company aims to secure 90 per cent tenancy rate by June next year.

Lee was speaking to reporters after the signing ceremony between Mines 2 Sdn Bhd and Frontken Corp Bhd, a service provider of surface metamor-phosis engineering to set up the Frontken LED lighting technology in the mall, recently.

Also present was Frontken's executive chairman and managing director Willie Wong.

"We aim to attract 10 to 12 per cent more visitors from the Mines Shopping Fair to shop here (Mines 2)," Lee said, noting that the Mines Shopping Fair has one million visitors a month.

Frontken's new LED lighting technology adapts to the green environmental initiatives, reduces energy cost and offers brighter and higher efficiency.

Lee said LED lights save energy, promote sustainability, reduce environmental impact and improve the quality of the light.

"We have made an investment of RM5 million to use LED technology here and hope to recoup the investment in less than five years," he said.

Lee said with Frontken's LED technology, Mines2 is expected to reduce utility expenses by up to 40 per cent from the lighting and air-conditioning loads.

He added that in the future, Mines 2 will continue to cooperate with Frontken to build a car park equipped with LED lights with 2,000 capacity.

By Business Times

Sunway Holdings still rated a ‘buy’

ECM Libra Investment Research is maintaining a "buy" call on Sunway Holdings Bhd in anticipation of strong earnings growth and more landbank acquisitions in the pipeline.

In a research note here today, ECM Libra said, it has raised Sunway's estimates for financial year 2011 and 2012 by 0.7 per cent to 7.5 per cent respectively, as the company remains the top "buy" for the construction sector.

"This is premised on a strong earnings growth of 67.6 per cent in financial year 2010 and undemanding forward price to earnings (P/E) valuation of 7.8 times, more landbank acquisitions in the pipeline as well as strength in securing overseas construction contracts," it said.

ECM Libra's target price, which based on 10 times price to earning on mid financial year earnings per share (EPS), remains unchanged at RM2.61 as the impact on financial year earnings is negligible.

Last Friday, Sunway Holdings entered into a joint venture (JV) agreement with Dasa Tourist Complex Pvt Ltd to undertake a mixed development project in Colombo, Sri Lanka.

The project is on a piece of 0.46 hectares (1.14 acres) freehold land with an expected gross development value (GDV) of RM250 million.

The development is for a 34-storey building comprising 180 residential and 70 commercial development units.

Sharing the same view, OSK Research is also maintaining a "buy" call on Sunway Holdings with a target price of RM2.52.

By Bernama

Saturday, September 25, 2010

Sunway to launch RM1.1bil project in Singapore

KUALA LUMPUR: Sunway Holdings Bhd will launch its third property project with a gross development value (GDV) of RM1.1bil in Singapore next week, said managing director Yau Kok Seng.


"The Sri Lanka project has the potential to generate total salea b le area of at least 380,000 sq ft" YAU KOK SENG

Yau said the 1.92ha project, called Vacanza @ East, would be located at Jalan Senang, District 14, a freehold land strategically sited near Pan Island Expressway.

“We expect good response for the project,” he said after signing a joint-venture (JV) agreement with the Dasa Group of Sri Lanka here yesterday.

He said profit margin in Singapore was usually 12%.

The project will comprise eight blocks of 12-storey buildings, which will have 500 units.

Sunway will also launch another project with a GDV of S$370mil in the second half of 2011 in Singapore. It will comprise 17 blocks of five-storey residential development.

The JV agreement signed yesterday was between Sunway unit SunwayMas Sdn Bhd and Dasa Group for a RM250mil mixed development project in Bambalapitiya, Colombo.

A JV company will be formed in Sri Lanka, with SunwayMas having a 65% stake and remainder taken up by Dasa Group.

SunwayMas would fund its investment in the JV company through bank borrowings and internal funds.

Yau said it hoped to launch the Sri Lanka project, which is expected to generate 20% profit margin, by the second quarter of 2011.

He said the development entailed a 34-storey building comprising 70 commercial and 180 residential units on prime freehold land and mixed-use zone.

It will be completed in 2014 and enjoy five years tax holiday then onwards.

“The project, sitting on a 0.461ha, is located a mere 5km from the Central Business District of Colombo. It has the potential to generate total saleable area of at least 380,000 sq ft,” he said.

Yau said residential properties in the Sri Lanka project would be priced from US$200 per sq ft while commercial units from US$350 per sq ft.

With the latest foray, Sunway’s land bank amounts to 174ha, with a potential gross development value of RM2.6bil over the next three years.

By Bernama

Sunway plans RM250m Sri Lanka project

Sunway Holdings Bhd will launch its RM250 million flagship commercial and residential project in Colombo, Sri Lanka, by the second quarter of next year.

It will be the company's sixth overseas project. Sunway has four ongoing projects in Singapore and one in China.

Sunway managing director Yau Kok Seng said it expects to get the approvals for the development, comprising a 34-storey tower with 70 commercial units and 180 high-end residences, in four months.

Construction will start immediately and the project is targeted to be completed by mid-2014, he told reporters after the signing of a joint-venture agreement with Sri Lanka's Dasa Group in Bandar Sunway, Selangor, yesterday.

Sunway is developing the project through wholly-owned unit, SunwayMas Sdn Bhd, in a 65:35 joint venture with Dasa Group, which is involved in real estate, tourism and fabrics.

SunwayMas will undertake the development on 0.5ha of freehold land owned by Dasa Group.

Yau said that Sunway was targeting more than 20 per cent net profit for the project.

On the home front, Sunway's profit margin ranges from 15 to 30 per cent, while that from its projects in Singapore is 12 per cent on average.

Yau said the residences in its Colombo project will be sold at more than US$200 (RM620) per sq ft, while the commercial units will be priced from US$350 (RM1,085) per sq ft.

"We are targeting locals and foreigners. We hope to sell up to 80 per cent of the project within the first year of its launch," he said.

Yau added that Sunway will look at further collaboration with Dasa Group as well as other developers in Sri Lanka as it embarks on being a long-term player.

The Sri Lankan government is giving incentives, such as a five-year tax holiday, use of duty-free imported and locally sourced building materials, and repatriation of funds invested, to woo foreign developers.

Yau said the project will also act as a springboard for Sunway's other businesses, including civil engineering and construction, building materials, trading and manufacturing, and quarrying.

"There are a lot of projects to build ports, bridges, roads and highways, and airport expansion in Sri Lanka. We are testing the market now through this project and will slowly tap other areas," he said.

By Business Times

Making Greater KL the nation’s heartbeat

Datuk Seri Idris Jala is not an urban planner – he is the master urban planner. As he presented his ideas on moving the country into high-income territory, he has fixed his focus on the city.

His rationale: Greater Kuala Lumpur (KL) will be the largest contributor at the gross national income level, both today and in 2020. A decade from today, Greater KL will contribute more than seven times over the next target urban centre of Johor Baru and 2.5 times over the largest industry sector, namely oil, gas and energy.



His aspiration – to improve the city’s livability. His tool – urbanisation. His rationale – the city will provide the engine of growth for the entire country. That means, the next 10 years will be crucial. A decade is a short time, actually, to do all that he has laid down.

Jala’s emphasis on livability is based on improving the public transport system, stability, healthcare, edcuation, infrastructure, culture and environment. The Economist had earlier ranked KL 79 out of 130 cities in terms of livability.

Property analyst and map maker Ho Chin Soon says: “Cities generally generate a huge portion of a country’s wealth. Paris produces 30% of France’s wealth, Tokyo 20% to 25% of Japan’s, and the Klang Valley 30%. How it is to be done is another question.”

Jala’s plan is for Greater KL to have a population of 10 million, compared with the current 6.4 million.

He has written about the growth of Petaling Jaya, Subang Jaya and others parts of KL.

Ho says there are two sensitive areas at stake here. There will be more as the journey for transformation goes along. The first involves public transport.

“Although we have some form of public transport before and the money to make it a reality, we did not proceed to ensure the survival of our car industry. That is why our public transport ridership is a mere 10% compared with Hong Kong’s 90%, and Singapore’s 80% to 85%.”

Ho says the Mass Rail Transit (MRT) system is more than just connectivity. Studies done have shown that if there is an MRT under an apartment block or mall, their rental improves by a quarter or a fifth, at least.

An integrated transport system with the MRT as its main spine will help to raise property prices and connects the pockets of new development that the Government has announced in the last few months with the existing established areas, Ho adds. These includes the redevelopment of the 380-acre Kampung Baru, the 80-acre Islamic financial hub at the Dataran Perdana in the Imbi area, the mixed development on 460 acres at the Sg Besi old airport, the Matrade piece of land in Jalan Duta, and the redevelopment of the 22-acre former Pudu Prison site among others.

The objective is to more than double the commercial content of KL.

“This will take some time for the market to absorb,” he cautions.

The other sensitive area is the redevelopment of Kampung Baru and other Malay reserve land. In order to do that, Ho says there must be changes to the laws governing Malay land rights.

“There must be a repeal of all Malay Reservation Land Enactments. All federal and state land must be sold via public auction so that the various states and the Federal Government can realise the true value of its land,” he said. Currently, the land belongs to the state.

Livability and aesthetics

The cleaning up of the river, the greening and beautification of KL and the call for new developments to have 30% of open space are part of the attempts to improve the city’s livability.

The revitalisation of the Klang River through its beautification and redevelopment of its banks also involves the cleaning up of the river to reduce polution. A joint development council will be fundamental in driving the development of the river. Other elements include the renewal of old areas within Greater KL.

Already, an UDA Holdings Bhd source says the government agency has put in a few proposals for the redevelopment of some old shop houses in some areas and to work with local authorities in their renewal programmes.

“From now onwards, developments will not viewed from an agency perspective, but from the country’s perspective and how it adds to the Greater KL plan and the city’s livability,” it says. The private sector has also proposed to work with UDA on some projects, all of which will help to enlarge UDA’s land bank, it added.

“Our projects will be market driven,” the source says, adding that UDA will be playing a big role in this transformation, both in terms of property development and public transport.

“We will be returning to our original objective of building cities.”

The agency has put in a request to be considered as one of the operators for Bandar Tasik Selatan transport hub. It currently manages and operates Puduraya Terminal, which is currently undergoing a RM52mil renovation.

In the area of property development, its most immediate project is the redevelopment of the 22-acre former Pudu Prison site. Located between Permodalan Nasional Bhd’s 100-storey project near Merdeka Stadium and Dataran Perdana’s Islamic financial centre in Jalan Sultan Ismail behind Berjaya Times Square, the former Pudu Prison site will form the axis, or centre of development, in that vicinity.

Another UDA project is the office and service apartment project on four acres next to Sheraton Imperial Hotel in Jalan Sultan Ismail. This area, where most of the hotels are located, and Jalan Bukit Bintang, where the malls are situated, will be given emphasis because they will generate tourist dollars.

There will be a need for more interaction between UDA and the local authorities, says the source.

To give cohesion to KL’s transformation, Greater KL will comprise 10 local authorities consisting of City Hall and the town councils of Kajang, Selayang, Ampang Jaya, Subang Jaya, Shah Alam, Klang, Petaling Jaya, Putrajaya and Sepang. Today, these operate within their designated zones.

By The Star