GuocoLand Malaysia to launch RM1.7b projects

Projects in Selangor may be completed in 2016 or 2017

(RAWANG, Selangor) Property developer GuocoLand (Malaysia) Bhd plans to roll out several high-end projects in stages at Emerald Rawang in Selangor with a total gross development value (GDV) of RM1.7 billion (S$695 million).

‘Going forward, the RM1.7 billion GDV will have a bigger impact in terms of contribution. The projects are expected to be completed in 2016 or 2017,’ executive director Chan Chee Meng told reporters during a media tour here yesterday.

Emerald Rawang is a joint-venture project between GuocoLand Malaysia and Hong Bee Land Sdn Bhd, with the former as the project manager. GuocoLand Malaysia is a member of the Hong Leong group.

The Emerald Rawang township comprises Emerald East and Emerald West.

Emerald Rawang sits on about 400ha of freehold land, comprising a mixed-use development ranging from link, cluster and semi-D homes to high-end bungalows.

To date, a total of 1,300 homes have been built with sales of RM375 million, Mr Chan said, adding the company has targeted another RM100 million sales by year-end on expectation of good demand for the semi-D homes.

‘We plan to launch four more phases this year because it is timely due to the recovery of the market and buyers are upgrading to more established projects,’ he said.

Mr Chan said several phases are planned for Emerald East with a GDV of RM268 million, with the launches expected in 2010 and 2011.

On Emerald West, he said the projects will be much bigger, with GDV of RM1.51 billion comprising semi-D, double-storey link and commercial properties.

Emerald West, on a 276ha site, will have facilities such as a jogging track, nine-hole golf course, Chinese primary school and commercial square, Mr Chan said.

Another township, called Emerald Hills, will be located on a 160ha site with more high-end projects to meet the growing demand, he said.

He also said that joint-venture partner Hong Bee Land is expected to finalise a venture with Jusco by year-end in order to set up a shopping complex near the township.

At the media tour, GuocoLand Malaysia unveiled its new sales gallery, which was set up to centralise sales activities, enhance communication with customers and showcase progress of the development.

‘The show gallery is a platform for customers to receive all the latest updates on the township and promotions as well as to hold discussions with our personnel on home-ownership matters,’ Mr Chan said. — Bernama

Source: Business Times, 4 Aug 2009

Drawing property investors

Carrying out police reforms will show that M’sia is serious about tackling crime

MALAYSIA aims to sell RM20 billion (S$8.2 billion) in domestic real estate to foreigners over the next decade, three times more than the current average of RM600 million or 2 per cent of the RM30 billion annually transacted in the residential market.

It hopes a newly incorporated public-private initiative Malaysia Property Inc (MPI) can successfully brand the country as ‘as an international property investment destination.’

Indeed, selling an average RM2 billion a year to foreign buyers ought not to be too onerous given that the local currency is increasingly buying less against major foreign currencies. MPI has also commended recent moves to liberalise the property sector, which makes it easier for foreigners to purchase commercial real estate.

Those who invest cite many reasons for doing so: the warm and mild climate, centrally located geographically, wide English speaking population, general political stability, excellent food, and reasonably good quality build.

But although Malaysian properties sell at only a fraction of those in the region – especially Singapore and Hong Kong against which they are commonly compared – the MPI acknowledges crime and poor public transport are major turn-offs to investors, one widespread, the other sorely lacking.

Syndicates’ prey
Because it is more insidious, crime is the more immediate problem. According to news reports, the total reported cases of crime last year was 211,648 or a 35.5 per cent increase over 2004′s of 156,648.

Crime had begun to rear its ugly head in the late 1990s – in 1997 total crimes reported was 121,176 cases – but because fighting crime was never a priority, it has emboldened criminals and made it necessary to be vigilant, even at airports, restaurants, and hotels, given the many syndicates preying on the unwary.

Whether the country has become known for the ‘easy pickings’ there have been reports of syndicates flying in for a week or two to loot before flying out again.

The proliferation of ‘gated’ communities – questionably illegal because residents have decided to close entry points to public roads with drums and bars – reflects the insecurity. In the extreme, some consider themselves prisoners in their own homes.

Prime Minister Najib Razak last week set the home ministry the target of reducing crime by a fifth by the end of next year as part of its key performance index.

Only in recent times has he conceded crime to be a major problem. Many found his comments last year that crime in the country was actually lower than in Japan and Hong Kong and that it was only public ‘perception’ that it was on the rise, incredulous and out of touch.

To upgrade the police force, the government has provided RM8 billion under the current five-year Malaysia plan to 2010, triple the amount in the previous plan. The whopping increase, notwithstanding, 97 per cent of 6,678 respondents in a recent poll by the Home Ministry said they do not fee safe because of the high crime rate.

The National House Buyers Association has projected communities will be increasingly gated and guarded until residents feel more secure.

Or as a concerned citizen observed in a letter to the editor of a local newspaper: ‘The ever increasing number of gated residential communities points clearly to two conclusions: The public do not feel safe from crime, and the public has given up on the police for protection.’

The government ought to seriously consider instituting the police reforms suggested by the Royal Commission set up in 2005 as this would not only help restore public trust in the police but also inspire confidence that Malaysia is serious about tackling crime.

That would arguably be a more effective selling aid than planned international road-shows.

Source: Business Times, 3 Aug 2009

KL’s policy shift set to benefit property sector

MALAYSIA’S decision to scrap a key approval process for most property transactions is expected to jump-start the sector and benefit commercial and international-class properties the most, property analysts say.

Regroup Associates managing director Allan Soo expects that the sector would be more opened up since larger funds would find Malaysia more attractive following last week’s announcement that the Foreign Investment Committee (FIC) would no longer process property transactions, except where it involves a dilution of bumiputra or government interests. Even then, the approval is required only if the property costs more than RM20 million (S$8.13 million).

‘The most important impact is that the big funds can come in without needing to find bumiputra partners to take up a 30 per cent stake,’ Mr Soo said.

Previously, owing to rules under the affirmative-action New Economic Policy, a foreign firm proposing to buy commercial property would invariably be asked to set up an entity, which had to be 30 per cent held by bumiputras.

On the odd occasion, the 12-man FIC would use its discretion and make an exception, one such example being the Four Seasons Resort Langkawi – sold by Malaysia Airlines to a company controlled by Saudi Arabia’s Prince Al-Waleed bin Talal in 2007 for RM435 million.

The FIC’s powers have now been pared, and guidelines on the 30 per cent bumiputra quota covering the acquisition of equity stakes, mergers and takeovers have been repealed. The government concedes that, by so doing, it had removed a major ‘irritant’ to investors.

Property players say this would definitely improve the perception of investibility and save time. Quill Group general manager Ng Chee Kheong said that FIC approvals took three to four weeks, but sometimes up to six weeks. Quill has a joint venture with Singapore’s CapitaLand in an office Reit that is listed on the Malaysian stock exchange.

But FIC approval is still needed where transactions involve bumiputra or government-owned properties that exceed RM20 million.

Minister in the Prime Minister’s Department Nor Mohamed Yakcop assured that the government would be ‘reasonable and flexible’ in considering applications. He said this last week when asked if the additional restriction would create a ‘two-tier system’ and lead to a bias against bumiputra and government-owned properties given the additional process.

In at least two states – Johor and Kedah – property consultants aver that many bumiputras themselves prefer buying real estate which does not attract any restrictions.

‘Anything that has any sort of restriction will fetch less,’ Quill’s Mr Ng said, adding that his experience in Kedah revealed that bumiputras preferred buying non-bumi lots.

His view is echoed by Tanah Sutera Development general manager Steven Shum who has urged a review of the practice. He maintains that because properties endorsed as ‘bumiputra title’ in Johor have to be re-sold to other bumiputras – unless the state allows otherwise – many bumiputras do not like buying bumiputra units, the developer discount offered on such units notwithstanding.

But commercial properties might not attract the same problems. Regroup’s Mr Soo observed that most buildings in Kuala Lumpur do not have bumiputra interests. Moreover, buying decisions are made on the basis of location and the quality of the building – whether it is a class-A building and let to good tenants. ‘If you put the Maxis building on sale, everyone would bid for it,’ he commented.

Located in the prime Kuala Lumpur city centre area, Menara Maxis is 67 per cent owned by a subsidiary of Tanjong plc – the listed power and gaming company controlled by tycoon Ananda Krishnan. But the 49-storey prime building is also 33 per cent owned by KLCC Property, which is in turn 53 per cent held by national oil company Petronas.

Petronas’a property arm also has interests in other prestigious buildings in the area: Petronas Twin Towers (51 per cent) Suria KLCC (60 per cent), Mandarin Oriental (75 per cent), Menara ExxonMobil (100 per cent) and Dayabumi (100 per cent). Dayabumi is located slightly further out.
As the ‘largest commercial property owner in the super prime KLCC area’, KLCC Property stands to be the prime beneficiary of last week’s policy changes, said HwangDBS-Vickers analyst Yee Mei Hui.

Source: Business Times, 14 July 2009

KL, Penang markets looking good

Many property consultants believe branded developments or designer buildings are what discerning investors increasingly desire

ALWAYS a favourite, landed real estate is receiving more interest in the current property lull. According to property agents, there has been a slight pick-up in the past two months, mainly in primary sales and landed properties located in popular suburbs. Zerin Properties’ chief executive Previn Singhe described April and May as ‘surprising months with very strong interest in landed properties’, centred mainly in the Klang Valley as prospective purchasers act on the premise that prices are unlikely to slip because of the limited supply.

In some places, demand continues to outstrip supply, he said, citing Bangsar, Bukit Damansara, Damansara Heights, Taman Tun Dr Ismail, Seputeh, Taman Desa and Jalan Ipoh where prices – which had held steady – have started to inch up as investors turn to property as a hedge against inflation.

‘If you want to buy for owner occupation, any time is a good time. If it’s for investment, you need to be looking now,’ advised CH Williams Talhar & Wong managing director Goh Tian Sui.

Mr Singhe lists those on the property hunt: the first timers attracted by low interest rates; investors in the 30-55 age group who are acquiring for their children; professional investors looking at Kuala Lumpur landed real estate for capital appreciation or condominiums for rental yields; and non-resident Malaysians.

There are also foreigners who have started to look at condos in the Kuala Lumpur City Centre and Mont Kiara areas since the price of some units have dropped by 20 per cent. Location-wise, Penang is another hot-spot, popular with Penangites and other northerners, as well as KL-ites looking to retire there.

Across the South China Sea, Kota Kinabalu real estate has received a boost from the oil and gas boom, as well as tourism which has led to numerous Koreans and Europeans succumbing to its charms, Mr Singhe said.

In the south of the peninsula, Johor’s Iskandar Malaysia remains a major point of interest. Central to Iskandar is the Nusajaya area with its strategic location across the Straits of Johor. Nusajaya’s jewel is the 687-acre Puteri Harbour with its planned integrated waterfront and marina development.

The precinct is to be gradually developed and because of its geography, has attracted the attention of a number of foreign builders which are keen to be involved. One of them is Limitless Holdings, a unit of Dubai World, which plans to jointly develop luxury residences with Nusajaya’s master developer, UEM Land.

Another planned joint venture between UEM Land and the Middle East’s Damac Properties was scrapped recently after Damac – which was to buy 43.5 acres in the enclave for nearly RM400 million (S$164.9 million) – did not fulfil conditions for the sale to proceed.

Still, most believe Puteri Harbour’s location, quality of build, management, and security will prove a big attraction to investors – especially foreign ones – just as they have in places slightly further afield such as Leisure Farm, Horizon Hills and Ledang East in Nusajaya.

Mr Singhe is of the view that the better quality products in Iskandar have allowed Johoreans to ‘upgrade’. Indeed, many property consultants believe branded developments or designer buildings are what discerning investors increasingly desire and could make a difference in a project’s ‘sell-ability’.

KGV-Lambert (M) executive director Samuel Tan agrees that the higher-end developments in Iskandar have drawn the most interest in Johor. The rest of the market has been softer.

‘People think that Nusajaya is Iskandar Malaysia,’ he observed wryly, pointing out that it is only a fraction of the special economic zone which is three times the size of Singapore. He highlighted new developments in brownfield areas as well as mature ones in the Tebrau Corridor, Skudai and Pasir Gudang which have been under-promoted but which might be worth a second look. ‘There are more opportunities in the secondary market because the primary market development costs have gone up.’

For those considering the lower- to mid-range of the market, bad debts have created a ‘sub-market’ of auctioned properties in Johor, he revealed, with auctions held weekly. Each auction offers 20-50 properties and they go for about 30 per cent less than their market value.

Despite the global financial crisis, Iskandar investors remain committed, the biggest to date being Middle Eastern firms which plan to develop the area called Medini, located near the Second Link.

Still, property developers caution that the pace of construction could be slowed. On the bright side, the state government has already moved into the new administrative buildings in Kota Iskandar, and overall infrastructure works are continuing.

Mr Singhe believes the 2003-04 pattern of funds sniffing for deals which resulted in a property boom in 2006-07 is being repeated now based on the number of funds that are making inquiries. Accordingly, he expects a property upswing to materialise in 2011-12.

The Quill Group of Companies, which designs and constructs purpose-built offices, confirms growing interest in Malaysia. Its property director, Ng Chee Kheong, said that multinationals were showing keen interest in the area of shared services, particularly in the Klang Valley and Penang.

Of late, Malaysia has started to speed up its liberalisation of many sectors of the economy to attract more investments. Should it succeed, the expatriate market ought to increase which would in turn stimulate demand for rented properties and help arrest some of the decline in yields.

Because of the downturn, a number of developments had been put on hold, including one by Singapore’s Kwek Leng Beng who was to have launched a 42-storey luxury condominium last year in the Kuala Lumpur golden triangle.

A prospective buyer expressed disappointment at the delay as he had been looking forward to purchasing a unit in the Carlos Ott-designed building which is to be constructed next to the tycoon’s Millennium Hotel.

Kuala Lumpur high-end condo prices have dipped to an average of RM1,000 per sq ft although the more prestigious ones still command a premium. Because of the weak ringgit, prices remain very affordable, especially for foreigners.

Ferrari team’s ex-boss Jean Todt, who is engaged to well-known actress Michelle Yeoh, recently revealed he had acquired a unit in OneKL, which sits opposite the iconic Petronas Twin Towers.

Source: Business Times, Property Supplement, 9 July 2009

KL, Penang markets looking good

Many property consultants believe branded developments or designer buildings are what discerning investors increasingly desire

ALWAYS a favourite, landed real estate is receiving more interest in the current property lull. According to property agents, there has been a slight pick-up in the past two months, mainly in primary sales and landed properties located in popular suburbs. Zerin Properties’ chief executive Previn Singhe described April and May as ‘surprising months with very strong interest in landed properties’, centred mainly in the Klang Valley as prospective purchasers act on the premise that prices are unlikely to slip because of the limited supply.

In some places, demand continues to outstrip supply, he said, citing Bangsar, Bukit Damansara, Damansara Heights, Taman Tun Dr Ismail, Seputeh, Taman Desa and Jalan Ipoh where prices – which had held steady – have started to inch up as investors turn to property as a hedge against inflation.

‘If you want to buy for owner occupation, any time is a good time. If it’s for investment, you need to be looking now,’ advised CH Williams Talhar & Wong managing director Goh Tian Sui.

Mr Singhe lists those on the property hunt: the first timers attracted by low interest rates; investors in the 30-55 age group who are acquiring for their children; professional investors looking at Kuala Lumpur landed real estate for capital appreciation or condominiums for rental yields; and non-resident Malaysians.

There are also foreigners who have started to look at condos in the Kuala Lumpur City Centre and Mont Kiara areas since the price of some units have dropped by 20 per cent. Location-wise, Penang is another hot-spot, popular with Penangites and other northerners, as well as KL-ites looking to retire there.

Across the South China Sea, Kota Kinabalu real estate has received a boost from the oil and gas boom, as well as tourism which has led to numerous Koreans and Europeans succumbing to its charms, Mr Singhe said.

In the south of the peninsula, Johor’s Iskandar Malaysia remains a major point of interest. Central to Iskandar is the Nusajaya area with its strategic location across the Straits of Johor. Nusajaya’s jewel is the 687-acre Puteri Harbour with its planned integrated waterfront and marina development.

The precinct is to be gradually developed and because of its geography, has attracted the attention of a number of foreign builders which are keen to be involved. One of them is Limitless Holdings, a unit of Dubai World, which plans to jointly develop luxury residences with Nusajaya’s master developer, UEM Land.

Another planned joint venture between UEM Land and the Middle East’s Damac Properties was scrapped recently after Damac – which was to buy 43.5 acres in the enclave for nearly RM400 million (S$164.9 million) – did not fulfil conditions for the sale to proceed.

Still, most believe Puteri Harbour’s location, quality of build, management, and security will prove a big attraction to investors – especially foreign ones – just as they have in places slightly further afield such as Leisure Farm, Horizon Hills and Ledang East in Nusajaya.

Mr Singhe is of the view that the better quality products in Iskandar have allowed Johoreans to ‘upgrade’. Indeed, many property consultants believe branded developments or designer buildings are what discerning investors increasingly desire and could make a difference in a project’s ‘sell-ability’.

KGV-Lambert (M) executive director Samuel Tan agrees that the higher-end developments in Iskandar have drawn the most interest in Johor. The rest of the market has been softer.

‘People think that Nusajaya is Iskandar Malaysia,’ he observed wryly, pointing out that it is only a fraction of the special economic zone which is three times the size of Singapore. He highlighted new developments in brownfield areas as well as mature ones in the Tebrau Corridor, Skudai and Pasir Gudang which have been under-promoted but which might be worth a second look. ‘There are more opportunities in the secondary market because the primary market development costs have gone up.’

For those considering the lower- to mid-range of the market, bad debts have created a ‘sub-market’ of auctioned properties in Johor, he revealed, with auctions held weekly. Each auction offers 20-50 properties and they go for about 30 per cent less than their market value.

Despite the global financial crisis, Iskandar investors remain committed, the biggest to date being Middle Eastern firms which plan to develop the area called Medini, located near the Second Link.

Still, property developers caution that the pace of construction could be slowed. On the bright side, the state government has already moved into the new administrative buildings in Kota Iskandar, and overall infrastructure works are continuing.

Mr Singhe believes the 2003-04 pattern of funds sniffing for deals which resulted in a property boom in 2006-07 is being repeated now based on the number of funds that are making inquiries. Accordingly, he expects a property upswing to materialise in 2011-12.

The Quill Group of Companies, which designs and constructs purpose-built offices, confirms growing interest in Malaysia. Its property director, Ng Chee Kheong, said that multinationals were showing keen interest in the area of shared services, particularly in the Klang Valley and Penang.

Of late, Malaysia has started to speed up its liberalisation of many sectors of the economy to attract more investments. Should it succeed, the expatriate market ought to increase which would in turn stimulate demand for rented properties and help arrest some of the decline in yields.

Because of the downturn, a number of developments had been put on hold, including one by Singapore’s Kwek Leng Beng who was to have launched a 42-storey luxury condominium last year in the Kuala Lumpur golden triangle.

A prospective buyer expressed disappointment at the delay as he had been looking forward to purchasing a unit in the Carlos Ott-designed building which is to be constructed next to the tycoon’s Millennium Hotel.

Kuala Lumpur high-end condo prices have dipped to an average of RM1,000 per sq ft although the more prestigious ones still command a premium. Because of the weak ringgit, prices remain very affordable, especially for foreigners.

Ferrari team’s ex-boss Jean Todt, who is engaged to well-known actress Michelle Yeoh, recently revealed he had acquired a unit in OneKL, which sits opposite the iconic Petronas Twin Towers.

Source: Business Times, Property Supplement, 9 July 2009

UEM Land says property sales picking up

(KUALA LUMPUR) Malaysia’s UEM Land has seen property sales picking up after a lacklustre first quarter but its goal to grow sales by 20 per cent this year remains challenging, its head said yesterday.

‘It’s challenging. I will not lead you elsewhere. It’s tough but we have not given up,’ UEM Land managing director Wan Abdullah Wan Ibrahim told Reuters in an interview.

He said that UEM Land is finalising a plan to raise RM354 million (S$146 million) via bank borrowings and is working on a phase two financing programme.

He declined to provide details or disclose the amount that the company plans to raise, saying that it is looking at various instruments. He added that UEM Land is in ‘serious discussions’ with four companies for development projects in Iskandar Malaysia, a government-sponsored economic zone in the southern Johor state near Singapore.

Mr Wan Abdullah’s remarks came as Dubai-based Damac Properties last week confirmed that it had cancelled a RM396 million land deal with UEM Land in Iskandar.

Khazanah Nasional, the investment arm of the government, controls 77 per cent of UEM Land. — Reuters

Source: Business Times, 23 June 2009

M’sian property prices may be recovering: survey

Outlook index rises to -36% in April from its early-March low of -58%

DESPITE a property overhang and a slump in some upmarket areas, secondary-market prices for many projects in Malaysia have not fallen below launch prices, property consultants say.

And an Internet survey suggests prices may be stabilising – or even recovering.

From its early-March low of minus 58 per cent, the thinkproperty.my Property Outlook Index rose last month to minus 36 per cent.

The improvement – for a second straight month – could signal stabilisation or even recovery, says the website’s chief executive and co-founder Asim Qureshi.

Adding to the feeling that the worst may be over, investors are starting to opt for shares and property over defensive fixed deposits, he says.

According to Mr Asim, the recent pick-up in the stock market, data indicating economic recovery in the United States and China and expectations that government stimulus packages will spur activity are some of the reasons Malaysians are now more positive about property.

But sentiment could change quickly.

While the stock market has improved about 20 per cent since the start of the year, the government has conceded that the economy is in a technical recession and expects a contraction of as much as 5 per cent this year before 3 per cent to 4 per cent expansion next year.

Even so, the latest thinkproperty data is the most favourable the website has seen since it began an ongoing survey in May 2008, which has since elicited more than 1,700 responses.

Zerin Properties chief executive Previndran Singhe believes low interest rates and innovative deals – such as 5 per cent downpayments and balance on delivery, with the developer bearing all other fees and interest payments during construction – have helped spur buyer interest.

‘It’s true that transactions have slowed,’ he says. ‘But there has certainly not been a crash.’

Because liquidity is not an issue, developers selling the right product at the right price – throwing in rebates, for example – have not had to agonise too much despite the economic uncertainty. For instance, a gated development of 49 courtyard homes by Tan & Tan at Sungai Buloh just outside Kuala Lumpur, priced from RM560,000 to RM800,000 (S$232,420 to S$331,960), was reportedly sold out on the first weekend, netting the developer RM37 million.

Major selling points would have included the units being landed – albeit leasehold – and that they are already completed.

Another Internet survey, meanwhile, has revealed that despite interest in property, some people consider current prices out of their reach.

According to a survey by iproperty.com, 27 per cent feel the time is right for bargain hunting; 39 per cent may buy but are waiting for prices to fall; 8 per cent are contemplating a purchase; and 21 per cent are keen but could not afford it. Twelve per cent said when they finally found a suitable
property, many others were vying for it.

Zerin’s Mr Singhe is quick to quash any notion of super bargains, especially in popular locations.
He expects prices to hold because there is liquidity, and reckons there will be an upturn in 2011-2012. ‘People still need to invest,’ he says.

And except for a 20-25 per cent drop in condo prices in the KLCC area and an 18-20 per cent at Mont Kiara, secondary transactions have not dipped below launch prices.

But he agrees that most young Malaysians – those in their 20s, especially – will find the property hunt tough going, given that incomes have generally remained stagnant over the years while property prices have risen 5-7 per cent a year.

The high-rise segment is expected to remain weak throughout this year and possibly well into next year, according to Regroup managing director Allan Soo.

But he is hopeful that a pick-up in Singapore’s property market will a spillover effect in Malaysia.

Source: Business Times, 2 June 2009

M’sian Resources plans RM1.8b office projects

(KUALA LUMPUR) Malaysian Resources Corp, developer of the nation’s biggest transport hub, will build two office projects valued at RM1.8 billion (S$746 million), gauging that property markets will revive as the global recession eases.

Malaysia’s biggest office supplier expects to sign up a foreign oil company to anchor the RM1 billion tower at the 348 Sentral project in Kuala Lumpur by taking up as much as 60 per cent of the building’s office space, Malaysian Resources managing director Shahril Ridza Ridzuan said in an interview. The project also includes serviced apartments.

‘The global recession is not going to last forever,’ Mr Shahril said on May 22. ‘It’s a good time to start building now. Materials prices are at a fairly low ebb of the cycle.’

The company, whose shares surged 91 per cent since Jan 1, plans to return to profit this year and expects to expand its order book by 50 per cent to RM3 billion as a government stimulus package spurs domestic demand.

The two office projects in Kuala Lumpur Sentral, an urban centre built around Malaysia’s largest bus and rail hub, will generate an average of RM600 million a year from 2010, based on the project’s total expected revenue.

Shares of Malaysian Resources, controlled by the country’s biggest pension fund, rose 5.4 per cent to a 12-month high of RM1.36 at 12.14pm. The company is the third-biggest climber on the Kuala Lumpur Construction Index this year and has outpaced the benchmark Composite Index’s 20 per cent gain.

The 348 Sentral development covers 1.1 million square feet of office space. The second project, worth RM800 million, is about half the size. Kuala Lumpur Sentral is already home to the Hilton and Le Meridien hotels. A St Regis hotel is also planned for the area.

‘Once we have our office deals signed up, then that seals our pipeline for the next three years in terms of revenue and profits,’ Mr Shahril said. ‘When you are willing to take the view that we’re going to come out of this, a three-year time frame is well within striking distance of putting your office on the market.’

Loans approved for buying Malaysian residential property surged 49 per cent in March from a month earlier, the second monthly gain, according to central bank data, adding to signs the industry may be rebounding.

‘The worst is over’ for the company, said Norfauzi Nasron, an analyst at OSK Research Sdn. While there are some ‘concerns about incoming office supply, the Kuala Lumpur Sentral development is very strategic’.

Malaysia Resources expects to win RM1 billion of new orders this year, with 30 per cent of that coming from projects to clean up the country’s rivers, Mr Shahril said. The company won two building contracts valued at RM239 million over the past two months, its first construction jobs secured this year, increasing its order book to RM2 billion, Mr Shahril said.

One of the projects includes upgrading road networks in Kuala Lumpur Sentral, funded through the government’s stimulus package, he said. The government has unveiled RM67 billion of planned spending to help revive economic growth.

‘We’ve definitely turned a corner from the fourth quarter last year,’ he said. ‘The rest of the quarter will show business strength.’

The construction division is leading the turnaround for Malaysian Resources, after surging building material prices and the economic slowdown pushed the company to losses in 2008.

On May 6, RHB Research Institute Sdn raised its profit forecast for Malaysian Resources by 34 per cent for 2010 and 36 per cent for 2011 to reflect higher construction earnings.

Malaysian Resources reported a RM39.3 million loss in the fourth quarter of last year as sales slid and building materials including steel surged. — Bloomberg

Source: Business Times, 26 May 2009

Iskandar M’sia eyeing S’pore outfits

Its developers plan to make pitch at Cityscape Asia exhibition here

SINGAPOREAN companies have yet to make big property investments in Malaysia’s Iskandar region, but the developers in charge of planning the area are hoping that this will change soon.

Malaysian developers UEM Land and Iskandar Investment Berhad are both participating in this year’s Cityscape Asia exhibition and conference in Singapore, and are aiming to attract more property investments into Iskandar Malaysia, which is located in southern Malaysia.
UEM Land, the master developer of Nusajaya, a key development project within the Iskandar Malaysia, has seen many buyers from Singapore pick up units in its residential projects in the Iskandar region.

Wan Abdullah Wan Ibrahim, managing director of UEM Land, says that for the company’s East Ledang and Horizon Hills projects within Iskandar, foreigners make up 65 per cent and 55 per cent of buyers respectively. And some 90 per cent of all foreign buyers come from Singapore.

The company plans to start selling homes in Puteri Harbour – an upmarket waterfront and marina area within Iskandar – this year, and is hopeful that take-up will be strong.

However, when it comes to Singaporean developers’ willingness to invest in Iskandar, the response has not been as keen.

For the land that UEM is in charge of, some RM600 million (S$247 million) of foreign investment has been secured, says Mr Wan Abdullah. However, none of it was from Singaporean companies. Companies from the Middle East have been most keen in investing in Iskandar.

By contrast, interest in Iskandar’s Southern Logistics & Industrial Clusters (SiLC) – an advanced technology community – has been stronger. Singapore-based investors make up 40 per cent of investors at SiLC, and include companies such as Jurong Technologies Industrial Corp and Yongnam Holdings.

UEM is now hoping to partner Singaporean developers to build homes and develop retail and hospitality properties within Iskandar.

Iskandar Investment Berhad, which is in charge of other parts of Iskandar, also hopes to attract more investors from Singapore.

‘For Singapore investors, we believe that Iskandar Malaysia plays a complementary role,’ said Arlida Ariff, chief executive. ‘It will enable and provide them with the facilities to build and expand their organisations further.’

The response from Singaporean investors has been favourable, she said, and added that discussions are ongoing.

Iskandar Malaysia has nearly met its overall foreign direct investment target of US$13 billion for the phase ending in 2010. To date, Iskandar Malaysia has altogether drawn more than US$11 billion, or 92 per cent of its targeted investment amount.

Source: Business Times, 21 May 2009

S’pore buyers get free rides to view UEM properties

SINGAPORE residents already make up a substantial chunk of property buyers in the Nusajaya urban development zone of south-west Johor, but now they are being ferried in for free to further boost their numbers.

Master developer UEM Land (UEML) is chartering buses to ferry interested individuals to its property sites in the area.

Said UEML managing director Wan Abdullah Wan Ibrahim: ‘We actually charter buses to a collection point in Singapore and ferry these people to our property…so buyers will know what they are buying and the kind of infrastructure that we provide.’

In the past two months, UEML has held four events – two ‘Super Sundays’ for their hillside property Nusa Idaman and the other two for East Ledang, a residential enclave which will boast 31 themed garden spaces.

For the first Super Sunday event in March, UEML ran advertisements in Singapore on the free buses running between Jurong Point and Nusa Idaman.

Said UEML general manager for strategic marketing Zamry Ibrahim: ‘We gave out cash vouchers as well for shopping. (The) response was overwhelming…about 220 Singaporeans came for the event and we collected 15 sales worth RM4.2 million (S$1.7 million).’

The second Super Sunday was held in April. This time, the company brought 175 Singaporeans in four buses and collected 20 sales worth RM6 million. A Super Sunday finale is planned for May 24.
Mr Ibrahim added that, ‘going by the success of these events’, UEML plans to organise more free tours covering more Nusajaya developments.

The Singapore market is of major importance to Johor developers. According to UEML, during East Ledang’s phase one launch in February last year, which saw 139 units launched, it enjoyed a take-up rate of 75 per cent, with 65 per cent of the buyers being foreigners. Of these, 90 per cent were from Singapore.

Preparations are now under way for the launch of phase two.

Other developments in Nusajaya include Puteri Harbour, a waterfront and marina development that spans 278.4ha and offers a view of the Johor Strait. Additionally, Iskandar Investment is looking to build East Asia’s first Legoland Park there in partnership with Merlin Entertainments.

The park’s slated public opening in 2013 could be brought forward. Ms Arlida Ariff, chief executive of Iskandar Investment, yesterday told The Straits Times that, with the stimulus package, the government had told them to ‘open earlier, so now it’s April 2012′.

Source: Straits Times, 21 May 2009