Petaling Jaya PJ Office Blog

SunCity faces challenge in selling high-end units

2009-09-07T16:46:00.001-07:00

PROPERTY developer Sunway City Bhd (SunCity) (6289)faces a great challenge to sell a massive stock of RM1.2 billion houses, particularly the high-end projects in Mont Kiara and Bandar Sunway where sales have been slow, AmResearch says.

The group is aiming for RM330 million in residential sales this year but has so far achieved only RM130 million, the broker said.

The take-up rate for Bayrock South Quay in Bandar Sunway, which has 77 bungalows priced between RM4 million and RM7 million per unit, has stalled at 35 per cent since the soft launch in April last year.

Only about two-fifths of the Vivaldi project in Mont Kiara were sold, where there are 234 units priced at RM850 per sq ft.
"We understand from its management that the group is unlikely to bring prices down to speed up inventory liquidation," AmResearch said in a report yesterday to initiate coverage on the company.

Instead, SunCity plans to lure potential buyers with more attractive financial scheme for selected projects, such as no-interest payment during construction and no payment for up to 24 months, the report said.

AmResearch rates the shares of SunCity as a "hold", with a fair value of RM3.45. The stock appears "fairly valued" after its price more than doubled in March this year, the broker said.

SunCity fell 1.8 per cent to close at RM3.20 yesterday. The stock has risen 83 per cent this year, beating a 36 per cent rise in the FTSE Bursa Malaysia KLCI so far.

The primary catalyst for the shares continues to centre on SunCity's potential to cash out from its large portfolio of investment properties worth an estimated RM3 billion to RM4 billion via the set up of an real estate investment trust (REIT).

"We, however, are skeptical that the group can successfully launch a REIT given our concern over pricing and quality of assets to be injected," AmResearch said.

Aside from Sunway Pyramid shopping mall and Wisma Denmark, other assets that the group plans to sell into the property trust are not really suitable for a REIT, it pointed out.

Sunway Group had planned to float a REIT which holds its key assets that include office towers, retail malls, a hospital and university hostel by as early as 2007. The plan has been delayed so far, mainly due to unfavourable market conditions.

Source: BT Times 8 Sept 2009

Launch for Green Developer Bluwater's RM3b Sri Kembangan project

2009-09-07T00:56:00.000-07:00

BOUTIQUE property developer Bluwater Developments Bhd will launch the first phase of its RM3 billion residential project in Seri Kembangan, Selangor, in June, offering 18 bungalow lots worth a combined RM25 million, or RM150 per sq ft, for sale.

The bungalow lots, dubbed "Bluhaven", are part of the upscale Bluwater Estate, which sprawls over 100ha and will be developed over eight years by phases.

And depending on market demand, it will launch a few lakeside villas, priced from RM800,000 to about RM1 million each, in the second half of this year.

Bluwater Developments is a unit of Clearwater Group, controlled by Dian Lee Cheng Ling, eldest daughter of property tycoon Tan Sri Lee Kim Yew.
Dian Lee, who is Bluwater Developments managing director, said she believes in Bluwater Estate's product offering, which is planned and designed by award-winning architect Sim Boon Yang of Eco-id Architects.

In addition to bungalow lots and villas, the estate will have semi-detached homes and condominiums. Some 1,000 households will live there after its completion.

The company is targeting to sell the properties to buyers in Europe and Asia Pacific, including Malaysia.

"The market sentiment has weakened due to turmoil. There are, however, astute investors who continue to look for good quality and priced properties thus, we do see sales in our projects, albeit at a slower pace," Dian Lee told Business Times in Seri Kembangan recently, after inking a deal with GD Baby Programme (S) Pte Ltd for rights to distribute Glenn Doman learning tools in Malaysia.

She believes there is possibility of some form of recovery in the second half of 2009 as trillions of dollars are being pumped into global economies in the form of fiscal stimulus.

"There is a chance that recovery would be sooner. The stock market will probably lead the recovery, followed by the property markets," she added.

Glenn Doman Baby Malaysia Sdn Bhd, the lifestyle arm of Clearwater, will provide the learning kits and programmes for normal and brain injured babies and toddlers up to age six.

Source: BTTimes June 2009

MRCB's Integrated Development At KL Sentral To Be Completed By 2012

2009-09-07T00:53:00.000-07:00

Malaysian Resources Corporation Bhd (MRCB)'s new integrated development project at Kuala Lumpur Sentral (KL Sentral) is already 10 percent underway and expected to be completed by 2012, group managing director Shahril Ridza Ridzuan said Tuesday.

The project includes a retail mall, three office towers and a hotel.

Shahril said the retail mall called Nu Sentral is expected to attract a decent rental revenue as it would be catering for medium to high end retailers but declined to reveal posibble tenants.

"We expect a decent commercial return from the mall which we are developing with Pelaburan Hartanah Bhd (PHB)," he told reporters after the launch of Nu Sentral by Prime Minister Datuk Seri Najib Razak here.

The hotel, he added, is expected to be launched next year.

Nu Sentral and the office towers development is a joint investment between MRCB and PHB, a subsidiary of Yayasan Amanah Hartanah Bumiputera.

Shahril said Nu Sentral would be managed by Nu Sentral Sdn Bhd, a joint venture development by MRCB and PHB with 51:49 equity stakes respectively.

MRCB and its partners invested more than RM3 billion in the integrated development project, of which the group itself put in about RM1 billion of the total sum.

Earlier at the launch, MRCB chairman Tan Sri Azlan Zainol said the next three years would see more developmental activities within KL Sentral as MRCB raced towards fulfilling its development masterplan's goal of completion in 2015/2016.

He said MRCB and its partners were also simultaneously building the new CIMB headquarters in front of the National Museum, the new Shell headquarters at 348 Sentral and would soon begin construction of KL Sentral Park, a green office campus development.

By next year, MRCB expects to start construction of a new office development, luxury hotel and new luxury condominiums in front of the museum, Azlan said.

"All these developments will bring the total gross floor area under construction at KL Sentral to more than six million square feet with a gross development value of RM7 billion," he said.

Source: Bernama August 2009

Selangor Dredging to go big in Singapore

2009-09-07T00:37:00.000-07:00

KUALA LUMPUR: Selangor Dredging Bhd (SDB) plans to launch more luxury condominiums in Singapore after its maiden project there, comprising 22 luxury condos at Wilkie Road, received good response and drew in sales worth RM163mil.

“We do have projects in the pipeline for Singapore,” managing director Teh Lip Kim said at the company AGM here.

Teh Lip Kim ... ‘Singapore has been identified by Selangor Dredging as a place of growth.’

“Singapore has been identified by SDB as a place of growth and there are potential development opportunities that suit our niche market.”

The former tin mining company recently acquired a piece of land in the Newton Circus area of Singapore and is in the works to build 110 luxury condos.

The project was expected to generate a revenue of RM450mil for the company, Teh said.

While there are no immediate plans to expand property development beyond Malaysia and Singapore, Teh did not rule out the idea, citing the recovery in regional propert markets.

On SDB’s controversial Damansara 21 project in Kuala Lumpur, chairman Eddy Chieng confirmed that the stop-work order issued by City Hall had not been lifted.

The hillside construction of 21 luxury bungalows at Damansara Heights drew protests from the public due to concerns over its enviromental impact on surrounding areas.

Chieng dismissed fears that the project might cause landslides, claiming that Damansara 21 was benchmarked against standards in Hong Kong, which has many hillside developments.

“We have fully complied with the Government’s recent guidelines regarding hillside developments, and we are just waiting for further approval,” he said.

SDB reported a net profit of RM17.24mil on turnover of RM164.07mil for the year ended March 31.

Source: The Star August 2009

Plan To Make It A Must For New Buildings To Meet GBI Criteria

2009-09-07T00:34:00.000-07:00

The government is expected to introduce a new policy under the Tenth Malaysia Plan (10MP) to require all new buildings to meet the criteria under the Green Building Index (GBI).

Public Works Department (PWD) director-general, Datuk Seri Dr Judin Abdul Karim, said the Economic Planning Unit in the Prime Minister's Department would decide on the criteria.

"Since the government has shown its desire to adopt the GBI under the 9th Malaysia Plan, I don't see any hesitation to introduce the policy under the 10MP," he said.

Judin was speaking to reporters after delivering a keynote address at the launch of Infrastructure Asia's Conference on Building Information Modelling and Sustainable Architecture here on Wednesday.

He said existing buildings were expected to be upgraded to meet the GBI requirements in stages as it was expensive to do it immediately.

On another development, he said the PWD has introduced a new project review process, 'Gerbang Nilai' to supervise infrastructure projects.

He said this would ensure that a project was really perfect and in accordance with the plan submitted.

"We want all the new projects to mature from each stage as many do not know their initial mistakes and realise it during the finishing stage," he said.

Source: Bernama 19 August 2009

PAM To Propose Incentives For Malaysian Green Developers

2009-09-07T00:33:00.000-07:00

The Malaysian Institute of Architects (PAM) will submit a proposal asking the government to provide incentives to developers who fulfilled the Green Building Index (GBI) criteria.

Its president Lee Chor Wah said PAM hoped that the proposal, to be submitted to the Finance Ministry on Friday, would be considered positively by the government as a form of appreciation to developers who built environmental-friendly buildings, which cost higher.

Lee said financial factors were among the issues hampering efforts to build green buildings, which cost 10 to 15 per cent higher than ordinary buildings.

"I think there will be announcement on the matter later," he told Bernama at the signing of a memorandum of understanding today between PAM and Universiti Putra Malaysia's Faculty of Design and Architecture to incorporate the PAM-developed GBI system into the faculty's curriculum.

Apart from developers, the PAM also hoped that the government could provide incentives to contractors, architects and engineers similar to what was being practised in Singapore.

He said that the incentives need not be in the form of cash.

It could be in the form of tax relief as well as rebates on equipment and stamp duties, he added.

Lee said that since its launching in May this year, only one building fulfilled the GBI criteria, namely the GEO building in Bangi.

There were also 40 GBI projects currently being evaluated by PAM, he said.

There are six categories for the GBI evaluation namely energy efficiency, interior air quality, site planning and management, material and resources, water usage efficiency and innovation.

Source: Bernama 28 August 2009

Bina Puri Secures RM36.6 Million Project In Kota Kinabalu

2009-09-07T00:27:00.000-07:00

Bina Puri Construction Sdn Bhd, a wholly-owned subsidiary of Bina Puri Holdings Bhd, has been awarded a RM36.6 million substructure project in Kota Kinabalu, Sabah.

The award from Sunsea Development Sdn Bhd is for the construction and completion of earthworks, piling works, pile caps, basement slab and basement retaining wall for a proposed commercial development in Kota Kinabalu, Sabah.

The substructure works are part of the Kota Kinabalu City Waterfront (KKCW) development and construction is expected to be completed within nine months, the holding company said in a statement Thursday.

KKCW which had its groundbreaking in February, is a mixed commercial development comprising four-levels of retail mall, residential designer suites and a five-star international hotel, all to be built on a 1.248 hectare of sea frontage land.

Source: Bernama 3 Sept 2009
The project is a joint venture between DBKK Holdings Sdn Bhd and Sunsea Development Sdn Bhd, a subsidiary company of Waterfront Urban Development Sdn Bhd, the statement added.

With the above award, Bina Puri group's current book order stands at RM2.32 billion, having managed to secure new projects of up to RM1.15 billion so far in 2009.

It will continue bidding for new projects, both locally and internationally and is confident of securing new projects before year-end.

Meanwhile, Bina Puri Construction's on-going projects in Sabah, include the construction and completion of "Dewan Kuliah Pusat Ke-2" and "Pusat Pasca Siswazah for Universiti Malaysia Sabah (UMS), Kota Kinabalu, Sabah and a housing development at Sayang Buang, Papar.

It had completed projects valued about RM1.5 billion in Sabah which includes, the 38-km of Kota Kinabalu Sulaman Coastal Road, Institute Latihan Perindustrian Sabah, Wisma PERKESO, Road from Jalan Sipitang to Tenom and Jesselton Condominium.

U.S. distressed real estate totals $97.4B in June 2009

2009-09-06T21:17:00.000-07:00

National distressed commercial real estate totaled $97.4 billion in early June, including foreclosures, lender-owned properties and those headed in that direction, according to a new report from Delta Associates.

Distressed commercial real estate volume has doubled every three months since December 2008 with retail properties representing the largest segment in June, at $29.7 billion.

Commercial mortgages had a 3.2 percent delinquency rate in the first quarter, up from 1.8 percent in the first quarter of 2008.

Delta says mortgage maturities will also peak at more than $300 billion per year in 2012 and 2013.

The Alexandria, Va.-based firm also reported that the 12-month trailing delinquent unpaid balance of commercial mortgage backed securities rose by $12.5 billion to $17.1 billion in February.

Source: Denver Business Journal June 2009

Brazil booms again on real estate stage

2009-09-06T21:11:00.001-07:00

Brazilian real estate is booming again after fizzling at the end of last year, as sales have rebounded in one of the best emerging markets, a New York-based real estate private equity investor said in an interview on Tuesday.

Launched two weeks ago, a 104-unit residential project directed at middle-income families in Sao Paulo's Vila Carrao area is the best example of that, Thomas Shapiro, president of GoldenTree InSite Partners, said at the Reuters Global Real Estate Summit.

"We sold every unit in four hours," Shapiro said, adding that the company has recently raised around $500 million to invest there.

Shapiro said the Brazilian real estate market took a dip in the fourth quarter but has now gone up "substantially."

Brazil has kept a low profile internationally in the past few months, he added. That was good for his company to identify good investment opportunities, as local listed real estate companies like Cyrella (CCPR3.SA: Quote, Profile, Research, Stock Buzz) and Gafisa (GFSA3.SA: Quote, Profile, Research, Stock Buzz) were suffering with the stock market debacle.

"Very few funds were raised for Brazil because they forgot the 'B' in BRIC," Shapiro said, adding that the bulk of the available money went to India and China. The "R" in BRIC stands for Russia.

"It was hard to find something with good fundamentals ... that was not outflown with capital," he said.

Shapiro said the fundamentals of the Brazilian economy looked better than expected for the year ahead and a stimulus package from the government has helped the real estate market heat up.

He also stated that the upper class in Brazil traditionally prefers to invest in hard assets when crises arrive, noting that Brazilians are not typical stock market investors.

He discarded signs of a real estate bubble forming in the South American country, like the one that hit countries like the U.S. and Spain.

"Brazil was never leveraged," he said, adding mortgages represent only 2 percent of gross domestic product.

"It (a bubble) could happen in the future, but I don't see it happening today," Shapiro said.

That's particularly true for the residential market, he said, in a country with an 8-million housing unit deficit. "Buyers of these units are not speculators," he said.

Source: Reuters June 2009

Dubai to Become World Capital of Towers

2009-09-06T21:09:00.000-07:00

Dubai is set to have more buildings with 100 floors or more than any other city in the world by 2015.

A new tower has been announced in Dubai that will secure the city’s reputation as a real-estate hot spot.

Once completed the Pentominium tower in the Dubai marina with 120 floors, will join four other 'super towers' - those with over 100 floors - in the city which is working hard to restore its image as a key financial center, despite the current global economic crisis.

The most famous among the other super towers is the Burj Dubai, which once completed, will have 168 floors.

While Burj Dubai is now the tallest building in the world, having surpassed the Taipei 101 in July 2007, an even grander project is currently being planned. While still only on the drawing board, the 200 floor Nakeel Tower is set to overtake any other building.

The only other city to boast more than one super tower is Chicago, home to the 108 floor Sears Tower and 100-storey John Hancock Centre. According to local papers Dubai currently has 390 completed high-rises with an additional 321 under construction and 551 planned. At least 9 of the buildings are taller than 984 feet compared to 6 in Chicago and Hong Kong.

Despite being surrounded by countries with vast oil reserves such as fellow Emirate Abu Dhabi or the world's number one oil producer Saudi Arabia, Dubai has relatively little oil and other natural resources. This led the government, under Sheikh Mohammed Al Maktoum, to engage in a diversification of the economy, turning a sleepy fishing village into a global financial and transportation hub in sixty years.

By offering generous terms to foreign companies, many set up offices in the city. The ensuing demand in both housing and office space fueled the construction industry, which in turn, became a vital part of the success story.

Initial estimations that the Emirate seemed resistant to the economic crisis, were countered when six months later the delayed impact of the crisis hit Dubai.

The ruler of Dubai, Sheikh Mohammed Al Maktoum, was recently quoted as describing the economic crisis as a "passing cloud".

Over the last year, local papers have been reporting falling rent prices due to decreasing demand, as many foreigners are leaving the region after losing their jobs. On the same day that the Pentominium tower was announced, the main English language newspaper in neighboring Abu Dhabi, The National, carried an article on the number of abandoned luxury cars that could be found all over the city after their owners had left the country.

Source: The Media Line 7 Sept 2009

World housing market showing signs of recovery?

2009-09-06T20:54:00.000-07:00

The world's housing markets are showing signs of recovery, with seven countries having emerged from the house price slump, according to Global Property Guide.

After experiencing declines in 2008, house prices in China, Portugal, Australia, New Zealand, France, Sweden and Hong Kong rebounded during the latest reported quarter, 2Q 2009.

In its survey of world-wide house price indices, issued on Aug 26, it said however, most countries suffered sharp house price falls during the year to end-Q2 2009, hence the general situation remains negative.

The Global Property Guide uses price-changes after inflation, giving a more realistic picture than the (more upbeat) nominal figures usually preferred by real estate agents.

In Shanghai, China, house prices rose 1.96% during the year to end-2Q09, with most of these gains entirely during 2Q when Shanghai's house prices rose 2.09%.

China's house prices started falling in 2Q08, but a strong increase in government spending revived the housing market and the economy. This saw the country recording a 7.1% growth in GDP in 1H09. Chinese property prices are widely expected to increase further.

Average house prices in the Algarve, Portugal, at €1,429 per square metre, were up by 2% in 2Q09. House prices in Portugal as a whole rose 1.01% in 2Q and were down only 0.43% on the year to end-2Q09, compared to minus 7.24% during the year to end-2Q08. New construction orders in Portugal increased 12.3% in 2Q09.

Global Property Guide said in Australia and New Zealand saw house price increases of 3.73% and 3.31% respectively in 2Q09. All regional capital cities in Australia registered quarterly house price increases, ranging from 2% to 5%. However, over the year to Q2 2009, there was a price decline of 2.80% in Australia.

In New Zealand, the annual change was still negative at minus 3.07% in the year to end-2Q09. But in July 2009, New Zealand had the first yearly house price increase since 2008.

After falling for the last five quarters, house prices in France were up by 3.31% during Q2 2009, thanks to government subsidies. In Sweden, house prices were up by 3.16% during Q2 2009. Hong Kong's house prices increased by an average of 8.9% during Q2 2009.

As for the US housing market, it was stronger, as reflected in the Case-Shiller house price index, which rose 0.35% in 2Q09, from a decline 6.46% in 1Q09.

Year-to-date in 2Q, house prices were down 13.96%, an improvement from 18.51% decline on-year to 1Q09.

The FHFA's purchase-only index was however down by 1.74% during 2Q09, somewhat worse than the 0.04% drop in 1Q09, so the signals in the US are mixed.

Year-to-date in 2Q, seasonally-adjusted prices fell 5.03%.This was a lesser fall than in the year to end-Q1 (down 9.16%) and than in the year to end 4Q08 (down 9.69%) (all figures inflation-adjusted).

However, the Global Property Guide said some countries avoided the crunch.

Israel's housing market has continued to sail through the global recession. The average price of houses rose 8.40% on-year to end-2Q09. But the quarterly increase in 2Q09 was down to 1.02%, a drop from 5.52% in 1Q09.

Switzerland saw an increase of 4.90% over the year to end-2Q09. However, house prices barely increased during 2Q09.

A key indicator of improvement is the market's momentum, that is the number of countries that did better this year, than during the previous year.

Nine countries improved their on-year performance to end 2Q09, compared with a year ago. In contrast during the year to end-1Q09, only six countries did better than the previous year.

But many countries are still suffering. The house price index for Dubai, UAE, fell 49.9% during the year to end-2Q09. But quarterly data indicates Dubai's downward house price spiral is moderating.

House prices fell 8.92% in Q2 2009, much less than the 42% drop in 1Q09.

Double digit year-on-year declines were also experienced in Bulgaria, Singapore, Iceland, UK, Japan, Denmark and South Africa. Most recent quarter declines in these countries range from 2% to 10%.

Source: The Edge 26 August 2009

Is commercial property really on brink of recovery in UK?

2009-09-06T20:48:00.000-07:00

As the great and good of the commercial property industry return from their holidays or, in the case of Helical Bar's Mike Slade, from collecting more sailing gongs, a new buzz phrase has gained credence among agents – "inflection point".

The phrase is designed to illustrate that after catastrophic falls in value over the last two years, increasing interest in offices and shops has brought the commercial property market to the brink of a recovery.

A year ago, the investment market collapsed following the demise of Lehman Brothers. With credit and confidence sucked from the market, values fell by 14.4pc in the final three months of 2008 alone and 45pc from the peak of July 2007.

Property shows potential, but work required

The collapse brought down some of Britain's most famous entrepreneurs, such as Simon Halabi and Paul Kemsley, as well as pension funds and banks. Perhaps its biggest victim was HBOS, whose over-exposure to the market forced the bank into the arms of Lloyds and remains a major burden on the enlarged group.

However, over the last few months, offensive fund-raisings from industry veterans, such as Nick Leslau, have increased expectations that property values are set for a recovery. A number of foreign investors have added to the demand, boosted by the weakened the pound. China has invested in Canary Wharf and South Korea's pension fund revealed on Friday that it wants to buy "landmark" London assets worth at least £150m.

According to IPD, the decline in values has slowed dramatically. The optimism has driven the strongest rally in property stocks for 34 years. Land Securities, for example, is up more than 80pc since March.

However, industry experts believe the situation is very fragile.

Demand for space from businesses is stuttering, banks are reducing their exposure to the sector and government stimulus packages, such as low interest rates, will not prop up the market forever.

"We believe a boost in property prices is coming and it does not look sustainable," says Harm Meijer, a property analyst at JP Morgan. "We believe it can only look sustainable if job growth will pick up, strongly, rents bounce, strongly, credit spreads drop, significantly further, government bond yields will not rise etc.

"We believe that the current stimuli at work are very powerful, but are unsustainable."

The rental market, as suggested by Meijer, is one of the major causes for concern.

Forecasts from BNP Paribas Real Estate last week predicted that office rents will fall 20.5pc this year and 14.4pc in 2010. Nomura last week agreed to move into new offices on the banks of the Thames in a deal in which they will not pay rent for six years. Such pressure on cash flow weakens property as an asset class.

The struggling occupier market, and the sheer scale of the falls in capital values, has therefore meant that investor interest has almost solely focused on prime property with quality tenants on long leases. This has led to some fascinating deals, including London & Stamford's acquisition of a stake in Meadowhall shopping centre and Hammerson's sales of Bishops Square.

But despite the billions set aside for UK property, there has not been a flood of deals, or the high-profile acquisitions, that many had begun to forecast.

According to Cushman & Wakefield (C&W) and PropertyData, UK property deals worth £3.1bn were completed in the second quarter of 2009. This was down from £3.99bn in the first quarter, 46pc down on a year earlier, and 82pc on 2007.

The problem for the vulture funds is that there is a lack of quality assets on the market. The banks are not unwinding their distressed assets as quickly as some had hoped and the largest property companies have boosted their balance sheet by raising equity, and therefore do not want to sell into a weak market. Leslau, one of the leading British investors, has described the situation as "market constipation".

All this has left the market at the "inflection point" it now finds itself. Investors have a crucial decision to make – are they confident enough to turn their sights to secondary properties such as shopping centres and offices in smaller towns and cities, a move which could reinforce a recovery in the market?

Decisions on new developments are another key part of the "inflection point" for the industry and one, because of its links to economic growth, which has wider implications. Commercial property's outlook has improved from six months ago but, given the sector's prominence on the loan-books of taxpayer-backed banks, where it goes from this key junction will have an impact on us all.

Source: The Telegraph 5 Sept 2009

The state of the property market in UK

2009-09-06T20:44:00.000-07:00

September, the start of the academic year and also the time when the study of the housing market starts afresh: idle summer surfing of property websites turns to serious contemplation of the opportunities available. Or not available, depending on how the banks are minded to treat loan applications this autumn. Read Bricks and Mortar’s revision notes on the state of the market now.

Buyers Anyone thinking of selling their home should be aware that today’s buyers are fearsomely well-informed about conditions in their local markets. This was one of the key findings from the agents that we quizzed this week on their outlook for the autumn. This new breed of buyer will have nothing to do with a seller who believes his home has been unaffected by the downturn. Proof of this can be seen in research carried out for Bricks and Mortar by the National Association of Estate Agents, which shows that in nine out of ten cases overpricing is the reason why a property will not sell. A badly-carried out DIY conversion is another thing the new buyers will not tolerate. They also dislike kitchens with too personal a decor. If you cannot trust yourself not to install a kitchen that expresses every facet of your personality, this is not the time to put your house on the market.

Loans Mortgage price war. Now there’s a phrase you probably thought never to hear again, given the banks’ stingy stance on lending since the beginning of the year. HSBC’s new 1.99 per cent offer was described by some as a declaration that there would be more competition in the home loans business. It should be seen rather as a statement about the kind of low-risk customer the banks are ever more eager to attract. To qualify for the HSBC deal, you need a deposit of 40 per cent. Only the borrowing elite need apply.

New-builds A city-centre apartment block is at the centre of controversy. But the row is not over the number of unsold units in the building, but its design. Some critics call One Park West in Liverpool a carbuncle; other consider it a tour de force. This spat is proof that attention is turning away from problems posed by the glut of new-build flats. In the panicky mood of autumn 2008, a debate over the aesthetics of developments would have seemed trivial. Half of the homes in One Park West have been sold, as we report on pages 8-9, some to investors, and some to retirees, swapping suburbia for high-rise urban living. The desire for an easy upkeep home is also a growing trend in the country house market, where mock-period mansions are no longer the object of such disdain. Authentically old manor houses tend to have kitchens for staff; the old-looking houses have kitchens that can be used as family rooms.

Tax For the homebuyers and buy-to-let investors acquiring new-build flats in Liverpool and other cities at discounted prices, the stamp duty holiday on properties between £125,000 and £175,000 is a bonus. The exemption ends on December 31. If the Chancellor believes that the continued recovery of the housing market is key to a wider revival, he should extend the stamp duty tax break in his Autumn Statement. But he needs every penny in revenue. Besides he would face embarrassing accusations that the incentive had benefited few first-time buyers.

London The price surveys indicate that London and the South East are leading the recovery; Hometrack data shows single-digit annual declines in almost all the capital’s boroughs. Central London seems to have cast off all memory of the baleful events of September 2008, such as the fall of Lehman. Prices in the best streets are close to their levels of September 2007. Investment bankers no longer fear for their jobs. Some also see a house in Chelsea as the best hedge against the rise in inflation, which could be one side-effect of the Bank of England’s quantitative easing (its stratagem to stimulate the economy). Central London’s surge is being driven by a lack of supply. But Prime-location.com says the exuberance will be tested when reluctant landlords opt to confront the picky new buyers.

Viewings The downturn made millions of homeowners disinclined or unable to move. Among some, staying put has bred a new appreciation of their home. Among others, there is a sense of deprivation. One of the joys of climbing up the ladder was the opportunity to take a peek at the lifestyles of other households. This month brings opportunities for those who miss the thrill of viewings. Heritage Open Days (September 10-13, heritageopendays.org.uk) gives you the chance to see 4,000 diverse buildings, including the Modernist High Cross House in Totnes, Devon. London’s Open House scheme (September 19-20 openhouse.org.uk/london) offers still more architect-ural highs.

Source: The Times 4 Sept 2009

Developer I&P taking cue from Klang Valley

2009-09-06T20:41:00.001-07:00

I&P Group Sdn Bhd plans to introduce the Klang Valley lifestyle to the Johor Baru property market via wholly-owned subsidiary Pelangi Sdn Bhd.

Group managing director Datuk Jamaludin Osman said it would be bringing in the new concept and new design for its future property launches in Johor Baru.

Datuk Jamaludin Osman (right) with a model of Tiara semidetached houses. With him are I&P southern region deputy general manager Abd Razak Mohd Yusof and group marketing and communications general manager Noor Lida Nazri

He said the company wanted to repeat the success story of its projects in Kuala Lumpur and Selangor, such as Seri Beringin Bukit Damansara and Temasya Glenmarie, for buyers in Johor Baru.

“We are looking at the niche category for residential properties priced above RM300,000 with larger built-up area and better design,” Jamaludin said at a briefing yesterday on its JB Mega Property Sales Carnival to be held at Pelangi Leisure on Aug 14-16.

He said the three-day event would showcase an existing stock of 300 residential and commercial properties valued at over RM100mil at prevailing market prices.

All the properties are located in its existing development schemes near hear in Taman Pelangi Indah, Taman Perling and Taman Rinting.

He said once the existing stocks were cleared, the company would roll out new launches under Pelangi as it still has 107.24ha left in the ongoing Taman Pelangi Indah and 364.21ha for the yet-to-be-launched Taman Pelangi Indah II.

To date, I&P Group has about 606.21ha land bank in Johor, including 134.76ha in Gelang Patah near the Port of Tanjung Pelepas.

“We are going for high-end properties in limited units for our future launches in Johor as we believe that this segment is growing,” Jamaludin said.

I&P Group, wholly-owned by the Permodalan Nasional Bhd, is the new entity following the successful merger of three properties companies – Island & Peninsular Sdn Bhd, Petaling Garden Sdn Bhd and Pelangi Sdn Bhd – in May.

Source: The Star 13 August 2009

Malaysian developers foray into boutique development

2009-09-06T20:39:00.000-07:00

THE concept of boutique developments is fast becoming an attraction in the property market nowadays.

Gamuda Land Sdn Bhd managing director Chow Chee Wah says usually, the design of a boutique development is for the middle to high-end housing, catering to a special targeted niche market that has a discerning taste and appreciation for resort lifestyle living.

“Gamuda Land has a few boutique developments, namely Valencia in Sungai Buloh, Jade Hills in Kajang and Madge Mansions in Kuala Lumpur. Both of these landed developments – Valencia and Jade Hills – are within the 300-acre range, while Madge Mansions, our high-end condominium is on 2.16 acres,” he says in an email.

Valencia residents enjoy a private 9-hole golf course and country club.

Chow defines Gamuda Land’s concept of a boutique development as one with a low density ratio and a host of other Oooomph! factors.

“It has to be very exclusive, very private with top security features in placed. Added to that is the ambience and this includes a host of criteria – quality products, safety and security, tranquil environment, well-equipped facilities, status and class, and a good return on investment, he says.

He says Gamuda Land first ventured into boutique developments in the year 2000 with Valencia.

“This luxurious project became the first boutique development in Malaysia with a private 9-hole residents’ golf course and country club. Valencia soon became a much sought after address because it offers the perfect combination of living in a landed property with condominium living facilities.

“It is a private, exclusive development within an environment equipped with the best resort facilities for a healthy and secure living lifestyle,” he says.

Facilities and ambience aside, Chow says a boutique development is also about location. It has to be a prime address that an owner will be proud of.

“It is about being a class above others,” he says.

“Gamuda Land decided to undertake this type of projects because we saw a growing demand and need for it. In urban areas, especially in the Klang Valley, the growing population of the affluent and elite group are looking for residences that meet their needs and desires for fine resort living.

“Valencia and Jade Hills testify to our success in this boutique home category. More than 60% of Valencia purchasers are repeat buyers. Thirty percent of Valencia’s residents today are expatriates, a large majority of them are Europeans. This means our boutique developments have become prime investments,” he says.

Because developers saw the popularity of boutique properties, they are now beginning to offer boutique commercial developments.

IRDK Land Sdn Bhd director Datuk Kevin Woo says such developments are not a trend but a need as the market evolves.

“The difference between boutique commercial developments and other commercial developments is the concept and setting of the development. It gels the business with lifestyle elements by providing and facilities,” he says.

The company is developing a boutique commercial development called Alam Avenue in Shah Alam, comprising 51 commercial units on three-storey intermediate shop offices and five-storey corner and end units.

“The ground floor will have a floor to ceiling height of 4.5 metres (15 feet). It will be generously fitted with high quality zinc aluminium roller shutters of 10 feet high to give maximum advertising and showroom presence.

These shops will have generous 17-feet verandas and walkways frontage to accommodate alfresco dining and cafes. They will be tiled luxuriously with homogenous floor tiles. Decorative light fittings will be installed at the walkways to enhance the ambience and to exude on easy flamboyant lifestyle where business and leisure meet in a quaint setting,” he says.

The gross development value of the project is about RM100mil. It is scheduled to be completed by December next year.

A green development is another concept introduce by developers. Sentral City (M) Sdn Bhd has gone one step further by incorporating a touch of Zen in its green concept development in Puchong Zen Residence@Asplenium condominium.

General manager Pang Swe Haw says the word Zen has been widely used in different industries like food and beverages but nobody has attempted to define the true meaning and essence of Zen.

“Zen is a living philosophy which centres around the simplicity and beauty of nature around us.

“In Zen Residence, we aim to create landscape and architecture settings that encourage the residence to take a longer and closer look at the environment around them and hope they will be able to develop a greater insight and appreciation of nature.

“So, we may not be the one who first use the word Zen, but we are the first to really explore and implement the Zen living concept,” says Pang.

With GDV of about RM96mil, Pang says Zen Residence has achieved close to 90% sales to date. The company will continue to explore this concept in their next project that is currently on the drawing board.

Source: The Star 29 August 2009

Property developer Bolton mulls over issuing RM250mil to RM300mil bonds

2009-09-06T20:37:00.000-07:00

Bolton Bhd is planning a bond issuance of RM250mil to RM300mil to fund the development of existing projects and acquisition of land bank, says executive chairman Datuk Mohamed Azman Yahya.

“We are seriously considering a bond issuance at this time of RM250mil to RM300mil at a standby line with a staggered draw down,” he told reporters after the company’s AGM yesterday.

“We have started evaluating the options,” Azman said, adding that the bond issuance would not be for refinancing purposes.

“Our gearing is only 27% today. The ability to gear up is there for Bolton.”

Azman said while the company’s focus this year would be to capitalise on its undeveloped land bank of 700 acres, it was still looking to increase its land bank in the Klang Valley and possibly, Penang.

He said the Penang property market was slow now as Penangites had been hit by the economic slowdown.

Azman said Bolton planned to launch three projects with total gross development value of RM450mil in its current financial year ending March 31, 2010 (FY10).

These projects, all located in Kuala Lumpur, are expected to enhance its sales till 2012.

Coming onstream in the fourth quarter are 100 apartments in Bukit Tunku and 207 serviced apartments at Jalan Bukit Ceylon.

In the first quarter of 2010, Bolton will launch fiftyonegurney, located at Jalan Persiaran Gurney.

Azman expects the company to maintain its sales and net profit for FY10, backed by new property launches and existing unbilled sales.

Source: The Star 13 August 2009

Malaysia's Mah Sing upbeat on Cyberjaya land

2009-09-06T20:36:00.000-07:00

Mah Sing Group Bhd’s purchase of 46.1ha freehold land in Cyberjaya for RM130.5mil cash will spearhead its expansion into the southern growth corridor.

According to Mah Sing group managing director cum group chief executive Tan Sri Leong Hoy Kum, the land will be developed into a medium to high-end gated and guarded residential – Garden Residence – comprising superlink homes, semi-detached homes and bungalows, with an estimated gross development value (GDV) of RM690mil.

From left: Tan Sri Leong Hoy Kum, Mah Sing chairman Tan Sri Yaacob Mat Zain and Setia Haruman Sdn Bhd COO Lao Chok Keang after the signing

The company told Bursa Malaysia it intended to fund the acquisition and the development cost of the land through internally generated funds and/or bank borrowings.

The company requested a whole day suspension for its share trading yesterday, pending this material announcement.

To be launched early next year, the Garden Residence will take three years to complete. It will also contribute to group earnings from the financial year ending Dec 31, 2010 (FY10).

At a press briefing yesterday, Leong said the Garden Residence would be developed in two phases. The first phase would be launched early next year, followed by the second phase, depending on the market response.

He said the mini-township project included a clubhouse and various facilities and amenities.

The first phase comprises 267 units superlink homes and 124 units semi-detached homes, amounting to about RM207mil to RM276mil or 30% to 40% of the total GDV of RM690mil.

The second phase comprises 284 units semi-detached homes and 70 bungalow units. “The project should start contributing to our earnings next year,” he said.

Leong said sentiment had improved and an upcycle in the property market was likely in the second half of 2010.

Mah Sing would consider purchasing additional commercial land in future as it intended to expand the township and plan for commercial components, should the need arise, he said.

Yesterday, Mah Sing through its subsidiary Myvilla Development Sdn Bhd, signed a sale and purchase agreement (SPA) yesterday with Cyberview Sdn Bhd (as a proprietor) and Setia Haruman Sdn Bhd (vendor) in Kuala Lumpur.

Leong said currently, residential properties in Cyberjaya comprised mainly medium range apartments and bungalow lots.

He believes there is a pent-up demand for gated and guarded landed properties with good concepts and themes that boost value.

Mah Sing’s expansion strategy is to acquire choice land bank in multiple prime locations in Klang Valley, Kuala Lumpur, Penang and Johor Baru for its Commercial, Legenda, Residence and Perdana series which targets different segments of the medium to high-end property market.

With the Garden Residence, Mah Sing now has 17 projects located in high growth regions and property hot spots, comprising 12 projects in the Klang Valley, the Central Region, four projects in Johor, (the southern region) and one project in Penang (northern region).

All developments have a remaining total GDV and unbilled sales of about RM4.4bil.

“We plan to continue the acquisition trail for large landbanks for potential mass housing projects in Malaysia, and explore overseas opportunities in China and Vietnam, which has high population growth,” Leong said.

Among its new launches in the Klang Valley for the third and fourth quarters this year are the StarParc Point commercial project, Kemuning Residence Shah Alam, Hijauan Residence, One Lagenda bungalows development and Aman Perdana residential.

For Penang and Johor, projects to be launched this year are Penang Island Residence@Southbay, Johor Baru Sri Pulai Perdana 2 and Johor Baru Sierra Perdana.

Source: The Star 13 August 2009

Looking for the perfect property buy in Malaysia

2009-09-06T20:34:00.000-07:00

IT has been a tough and challenging ride for Malaysians and people the world over this past one year or so.

Their confidence in the free market economy must have been shaken badly after so much wealth and asset value have been eroded by the global financial meltdown.

The leveI of confidence going forward will depend on how the people perceive their general well-being and whether there’s hope for the future, which depends among other things on their expectation on the health of the local and global economy.

It will be a herculean task to reinstate the same robustness to the economy to that of the pre-global crisis days and much work remains to be done in many parts of the world.

The same goes for Malaysia and hopefully all parties will get down to work expediently for the common goal of lifting the country’s chance of a sustainable economic recovery and growth.

The liberalised measures introduced by the Government, aimed at raising the country’s competitiveness and attract foreign direct investments to the country, will need the total commitment and cooperation of all to succeed.

Based on the strong sales registered by developers these past few months, one wonders whether there is a pent-up demand for residential properties, especially landed properties, as the supply pipeline has been put on hold or substantially scaled down when the crisis hits.

The question on whether property buyers will be flocking back into the market after the days of easy financing packages for house purchases are over remains to be seen.

There is still some hesitation among buyers on whether this is the best time to seal the deal as some are still waiting for better deals or offers to come along.

To be sure of striking the right chord with buyers, developers should literally put themselves in the buyers’ shoes and proactively seek their feedback on what type of property products are being sought after.

Housebuyers today are looking for more than a roof over their head. Expectations have certainly gone up many notches and they want more value from developers before committing to buy.

Besides the basic requirements of a good location, quality standards and developer’s reputation, buyers are also giving more priority to safety and conducive environment, well landscaped parks and surroundings, community facilities, good infrastructure and accessibility.

There is still much liquidity in the system and property is one of the time-tested investment tools with potential for capital appreciation and rental yields.

The prevailing low interest rates and slew of incentives offered by developers are helping to fan property buying interest.

After all, property in Malaysia has proven to be a good investment tool and hedge against inflation. Prices of most of the residential property, except for high-end condominiums in the Kuala Lumpur City Centre and Mont’Kiara areas, have held out quite well throughout the crisis period.

Developers will not go wrong if they target their products at the mass market segment as the country’s young population, where at least a third of the 26 million population are between 25 and 44 years, will need a fairly big number of houses each year.

Those with high-end projects may opt to wait out a little longer until market sentiment has recovered before putting out their projects for sale.

It will certainly help with the sales if developers take the proactive steps of making sure their housing units are designed practically and buyers will not need to do any further renovation before moving in.

Having the housing units fitted with some basic necessities such as air conditioners, wardrobes and kitchen cabinets will prove to be a big plus for buyers as it will save them substantial time and money to shop around by themselves.

Offering a few choices of colours, materials and designs will be a practical option for buyers.

By sourcing for these fittings for a whole project, developers will be able to enjoy economy of scale and lower average cost which can then be passed on to their buyers.

Source: The Star 15 August 2009

Malaysia's Selangor Dredging To Launch Three Projects Valued Up To RM500 Million

2009-09-06T20:33:00.000-07:00

Selangor Dredging Bhd, a company involved in property development, leasing and hotel operations, has three mixed development projects in the pipeline to be launched in its financial year ending March 31, 2010, with a total gross development value of between RM400 million and RM500 million.

Managing Director Teh Lip Kim said the projects, a 110 unit condominum near Newton Circus in Singapore and a condominium in SS 2, Petaling Jaya, and residential houses and apartments in Taman Melawati, Hulu Klang, both in phase two, would be launched early next year.

"The development near Newton Circus will be our second project in Singapore and our share of the GDV is about RM225 million.

"It is in the final stage of being launched probably end 2009 or in the first quarter of next year", she said, adding that the company was optimistic of its second project in the republic as the pick up rate had recovered.

Meanwhile, Selangor Dredging's maiden project in Singapore, a 22 unit apartment block in Mount Sophia was already 40 per cent sold.

She said 70 per cent of the 185 apartments to be built in SS2 was sold out, a tremendous endorsement for the company given the current market environment.

"We will conduct our projects prudently and be sensitive to the prevailing market scenario. At present, we are already seeing some improvement in the demand for properties.

"We have RM235 million in proceeds yet to accrue from the sale of remaining units in all these projects.

On another development, Teh said the company was in the midst of discussions with the authorities on resuming work on its luxurious housing project, dubbed "Damansara 21", which was halted following the tragic Bukit Antarabangsa landslide in December 2008.

"We still have a stop work order. The guideline for hillslope development is out and we have complied with it. We are still working very closely with the authorities as safety is our prime concern here.

"We have spent RM80 million on earth works so far. As the project is not launched, we are not adversely affected with the stop work," he elaborated.

The company also operates Hotel Maya Kuala Lumpur which suffered low occupancy since the outbreak of the H1N1 pandemic.

Group Chairman Eddy Chieng Ing said, " We get European, Australian, American and multinational clients, but many have cancelled bookings and stopped travelling since the pandemic.

"In the first quarter we registered a loss of RM280,000," he said.

Selangor Dredging recorded a net profit of RM17.2 million for the financial year ended March 31, 2009, down sharply from RM97.1 million chalked up in the same period in 2008.

Property development contributed 70 per cent of the group's revenue.

Source: Bernama 21 August 2009

Sunrise Has RM971 Mln In Unbilled Property Sales

2009-09-06T20:31:00.000-07:00

Property developer, Sunrise Bhd, has unbilled sales totalling RM971 million as at June 30, 2009, which will underpin earnings till 2011, says executive chairman Tong Kooi Ong.

It excludes sales of RM39.3 million recognised in July 2009 and another RM157.1 million sales pending sales and purchase agreement signing.

Most unbilled sales are from higher margin projects, he said.

"Profits from future billings will be recognised over the next two financial years and will sustain earnings in the near future," he told a briefing on the company's 2009 financial year results Friday.

Sunrise recorded RM205.8 million in pre-tax profit for the year ending June 30, 2009, up by two per cent from RM201.1 million in the previous year.

Turnover rose 17 per cent to RM803.9 million from RM685.8 million previously.

One-off gains from the sale of office, retail and car park space at Plaza Mont' Kiara and an Australian asset amounted to RM19.4 million in the financial year compared with RM46.6 million in the previous financial year.

He said profits for the year ended was boosted by progress billings for the group's ongoing developments, notably 10 Mont'Kiara and Solaris Dutamas, as well as sales of fully completed luxury bungalows at Mont'Kiara Residence.

Going forward, Tong said the property market seemed stronger than what it was a year ago.

"We don't see a property bubble in Malaysia. There are no major shocks and the global economy is showing signs of recovery and sentiment for properties has improved in recent months," he said.

Among the supportive factors for the property market are low unemployment, ample liquidity, approval for mortgage is resilient and low interest rates.

He however cautioned that there are various pockets of oversupply around the KLCC area.

The challenge forward is to manage cost and on-time delivery, he said, adding that Sunrise was re-inventing itself to stay ahead.

"We have a pipeline of projects ready to be launched, depending on market conditions, and we will continue to widen product mix and market reach, and build and price what the market demands," said Tong.

Besides projects within Mont'Kiara, Sunrise also has one project waiting to be launched in the heart of Richmond, Vancouver, Canada.

He said Sunrise is also in the midst of talks to acquire more land bank within the Klang Valley.

"There could be some purchases by end of the year," he said, but declined to reveal details, saying that talks are still at preliminary stage.

Source: Bernama 14 August 2009

Rehda cautions Malaysian developers not to overbuild

2009-09-06T20:29:00.000-07:00

Property developers should be cautious and not overbuild just because the property market appears to have bottomed out in the second quarter, said Real Estate and Housing Developers Association (Rehda) president Datuk Ng Seing Liong.

Developers were optimistic of a stronger uptake of properties in the second half of the year as the property market appeared to be recovering, he said.

“But they should remain cautious and not overbuild,” he told reporters at the 20th National Real Estate Convention themed Recalibrating the Fundamentals in the Malaysian Real Estate Market yesterday.

Ng noted that many developers were still worried about clearing their inventory and reducing property overhang.

Real Estate and Housing Developers Association president Ng Seing Liong the keynote speaker at the 20th Natinal Real Estate Convention in Kuala Lumpur yesterday.

“Their concerns include completing on-going projects in time, softening property prices and high marketing expenses,” he said.

At the end of the first quarter, the housing property market recorded 544,926 units of incoming supply against 669,554 units of planned supply, Rehda figures showed.

The number of completions and starts of residential projects increased in the first quarter, but new building plan approvals had dwindled, compared with the fourth quarter last year, according to Rehda.

“With the property market improving, developers need to be innovative, creative and focus on what the market demands. It’s good to see some developers embracing the green concept in the construction of buildings,” Ng said.

A Rehda survey in May on 105 developers from peninsular Malaysia showed that 32% respondents launched new projects in first half of the year while 68% did not.

The survey said 30% of the 105 developers experienced “static performance” in their launches, while 38% reported worsening sales with a majority stating that they had experienced a 30% or more reduction in sales.

Source: The Star 18 August 2009

Little gems in the outskirts - Malaysian Property

2009-09-06T20:27:00.002-07:00

Small-scale developers weather the crisis well.

VERY often, when one considers a property for investment, one tends to consider those in the city. And when one thinks of developers, there is a tendency to consider the big, established players for fear of projects being abandoned.

But what about the smaller players, some family-based business, in a little town far away from city life serving their community? Where are these companies heading? And how has the turmoil of the past year affected them? Or did it?

Before going further, a big company does not become big overnight. One does not become rich out of the blue. It takes years of savings and investing, wise decisions and many other factors.

From Skudai, Johor to holiday destinations like Langkawi in the north, from Peninsular Malaysia’s largest state to former tin state Perak, these small-scale developers share their views about the community they are building in, and for, and the effects of the global downturn. For three out of four of them, property development is their core business. Because they have years of experience in that community, they know the infrastructure and the market. On the whole, they have weathered the crisis well.

Some, like YNH Bhd, have decided to venture out into the Klang Valley. Others, like Hua Yang Bhd which started out in the Valley, is venturing out to the little areas. Yet others are contended to stay put.

Professionals working in the town centre can also consider Bandar Putra with its exclusive living and pretty surroundings.

To the city

In 2003, a little-known developer from Manjung, Perak, YNH came to Kuala Lumpur. Manjung is about 80km from Ipoh, and is located between the city and Lumut, the getaway point to Pangkor, and Sitiawan.

When it came to Kuala Lumpur, its choice of land was telling – Mont’Kiara and the Jalan Sultan Ismail vicinity. The family business was seeking its fortune in the city but it was not leaving behind its roots in Perak; it was, in fact, adding another pillar to its foundation.

Come the fourth quarter, YNH will be handing the keys to buyers in both projects, Fraser Place, next to Wisma Hong Leong, in the city and Cerian Kiara in Mont’Kiara.

(Because Fraser Place is a project with a commercial title, it is not governed by the Housing Developers Association’s mandatory three-year completion deadline.)

Formerly known as Yu Neh Huat Bhd, the company was incorporated in 1985 as a family business. The late Datuk Yu Neh Huat was a farmer and livestock keeper. The company began constructing its first project – 10 units of double-storey shop offices – in the late 1980s.

Its financial controller Chan Yan Meng says the company’s turning point came in 1995, with the Manjung Point township, a project of about 1,000 acres. It still has about 700 acres that are yet to be developed.

“Although we may have ventured out to Kuala Lumpur, Manjung Point will continue to be our reference point. Today, YNH is a trusted and one of the largest developers with a strong base here,” says Chan, who has been with the company since 1990. Its staff strength has grown from 30 in 1990 to 250 today.

Most of its customers are civil servants – mainly those at the naval base located there and teachers – and small holders.

With 45% of its revenue coming from there and the rest from its projects in Kuala Lumpur, the company has diversified its market with a foot in the city.

The glass bubble lift overlooking the pool in Century Suria condominium.

There are dozens of small-scale developers in and around the peninsula, Sabah and Sarawak. Many of them have humble beginnings and are contended to be where they are. In some ways, the economic downturn has not really affected them as much as the big boys.

Says an analyst who declined to be named: “Housing development is still very much location based. If a developer is from a small town, it has to consider the local economy and demographics in that area.

“In such a situation, there may be a tendency to expect sales to be poor because of the global economic woes but this need not be the case. Away from the city, these smaller developers have a captive market and they will still do relatively well. In terms of sales and earnings, it will be stable.

“YNH, for example, sells to civil servants, and makes an average RM40mil to RM50mil sales annually in what many would consider as remote areas. Likewise, Pasdec Holdings Bhd in Pahang.

“In Sabah, property sales are doing well in plantation areas because of the significant price of palm oil. So it really depends on locality. While some – Hunza Properties Bhd from Penang and YNH who have made their way into the city the last several years – there are many others who are contented doing what they are doing in these smaller towns.

“A big deterrent is the price of land in the Klang Valley, which is not representative of the whole country.”

Klang Valley-based Hua Yang is scouring for projects outside the Valley where land prices are cheaper.

The rural pull

Like YNH, Hua Yang is also a family-based business. Its Seri Kembangan mixed development is by far the largest project in its stable. Its chief operating officer Ho Wen Yan says it would like to focus on other markets in Perak, Johor and Seremban.

Says Ho: “Outside the Klang Valley, our focus is mass housing in integrated townships; in Seri Kembangan, it is high-rise residential units.”

He says the affordable mass market segment is the company’s core focus and contributes the bulk of Hua Yang’s revenue. In terms of customer demographics, most of them are first-time buyers comprising young couples who buy for occupation.

“In the city, the story is different. There is the investor group who buys to sell, or to rent. So the present lull is an opportunity to grow our presence.

“The bigger boys have gone into niche housing, resulting in a lack of affordable mass market housing in the RM90,000 to RM380,000 range. Our opportunity is to tap into this market,” Ho says.

The company plans to launch several developments in the next six to nine months in Seremban, Senawang and Johor Baru amounting to about nearly RM120mil. Its Sg Besi project, comprising residential, commercial and retail, has a GDV of RM550mil.

It is also pretty upbeat about its financials for 2010 with revenue of RM100mil in 2009, RM60mil in 2008 and RM63.5mil in 2007.

In Pahang, the largest state in Peninsular Malaysia, land is in abundance. This is Pasdec Holdings home turf. CEO Mohd Khairuddin Abdul Manan says the company is best known for medium-cost houses comprising mainly single-storey terrace and semi-detached homes, which contribute 60% to the group’s turnover.

Besides housing development and management, the group is also involved in construction, the manufacture of bricks and trading in building materials.

The group recorded improved sales of its residential properties from RM32mil in 2007 to RM64.8mil in 2008. The projected sales for 2009 is RM81.8mil. The group has 2,500 acres of land, 90% of which are in Pahang. Pasdec expects revenue and profit to be affected due to market condition.

Says Khairuddin: “Results for the first half of the year indicated a drop in our targeted turnover by 37%, we anticipate unfavourable results for the second half of the year. But we will look for ‘wow’ factors’, like public infrastructure and other amenities.

“We expect caution and perseverance for the residential market owing to the economic turmoil until the year-end.”

The total GDV of the company’s five flagships projects, which are located in Kuantan, Pahang is RM1.98bil.

Further north, Thong Sin Development Sdn Bhd has made Langkawi and Cameron Highlands its playing field. The company is best known for building apartments and serviced apartments, which contribute 70% to the company’s revenue. It has some double-storey and semi-detached units scattered about but overall, its forte is apartments.

Born and bred in Penang, and having been in the business for the past 30 years, its managing director K. C. Tan is familiar with the infrastructure and the market he is operating in.

“The global downturn did affect us, but not too much. Century Suria condominium in Langkawi saw a drastic drop in response from foreign purchasers as a result of the global woes. Since second quarter 2009, sales have picked up for all the projects and continue to look encouraging from local buyers. We have 17 acres in Kuah, Langkawi and 2.5 acres in Cameron Highlands and we expect things to be stable and encouraging in the coming months,” he says.

Source: The Star 29 August 2009

Hap Seng buys 50pct of Menara Citibank for RM303.5m

2009-09-06T20:17:00.000-07:00

Hap Seng Consolidated Bhd is buying a 50% stake in Menara Citibank for RM303.5 million from Singapore's CapitaLand Ltd and Amsteel Corporation Bhd.

Hap Seng said on Aug 7 it was acquiring CapitaLand's entire 30% stake in Inverfin Sdn Bhd -- owner and operator of the 50-storey building in Kuala Lumpur. It was also acquiring the entire 20% stake in Inverfin from Amsteel. Menara Citi Holding Co. Sdn Bhd owns the other 50% stake in Inverfin.

Hap Seng said it would fund the RM303.5 million purchase of Menara Citibank with RM200 million bank borrowings and the rest from own funds.

Inverfin is a special purpose entity and investment company for the sole purpose of owning and operating Menara Citibank.

Hap Seng Amsteel shares in Inverfin are charged to RHB Investment Bank Bhd. On Aug 30, 2007, Inverfin issued medium term notes of RM160 million to selected investors wherein Inverfin had charged Menara Citibank as security.

"The purchase price for the sale Shares (purchase price) is based on 50% of the net asset value of Inverfin as at June 30, 2009, after taking into account the agreed property value of Menara Citibank which is fixed at RM607.45," it said.

It added the proposed acquisition was consistent with Hap Seng's corporate business direction to expand the group’s property division both for development and investment holding.

The transacted prices of prime office buildings within the Golden Triangle and the Central Business District were in the range of RM800 to RM1,200 per sq.ft. of lettable area.

Hap Seng said the gross rental revenue based on the latest audited accounts of Inverfin for the financial year ended Dec 31, 2008 was about RM48.76 million, giving a gross yield of 8.03%. The operating profit was RM38.128 million, giving a net yield of 6.28%. The rental revenue and operating profit are expected to improve with the rent rollover for Year 2009 onwards.

"The attractive price coupled with the potential rental growth will offer an excellent capital appreciation potential and an immediate substantial rental income stream," it said.

The gross rental revenue based on the latest audited accounts of Inverfin for the financial year ended 31 December 2008 was approximately RM48.76 million, giving a gross yield of 8.03%. The operating profit was RM38.128 million, giving a net yield of 6.28%. The rental revenue and operating profit are expected to improve with the rent rollover for 2009 onwards.

At the signing ceremony, Hap Seng Group Group managing director Datuk Edward Lee Ming Foo said: “Menara Citibank is indeed a gem of a property. Its superior location in the Kuala Lumpur City Center offers unparalleled access to premier retail and commercial amenities. At the same time, the building is also surrounded by an extensive range of public transportation infrastructure.”

Lee said the demand for prestigious office space in the heart of the Golden Triangle has not waned despite the global economic downturn. “Based on our experience in the market, we expect demand to remain robust, if not improve, while supply is naturally kept limited in super-prime areas such as these.”

The 50-storey Menara Citibank is an office building that sits on a parcel of freehold land measuring approximately 12,700 square meter (sq.m). It has a net rentable area of approximately 68,000 sq m.

Source: The Edge 7 August 2009

Malaysian Property Sector Remain Stable - ECMLibra

2009-09-06T20:16:00.001-07:00

ECM Libra Investment Research has maintained its neutral recommendation on the property sector.

It said while the property sector has bottomed out and was recovering, conditions were not sufficient to re-rate it.

ECM Libra said its stock picks remained selective, preferring mid- to small-capitalised property developers where valuations were more compelling.

“Among the picks are Sunway City, for its resilient property investment earnings while there is potential upside from recovering property development earnings, and Sunrise due to its strong brand name and prime landbank,” it said in its research note today.

It said there was pick-up in commercial activities in August following the acquisition of a 50 per cent stake in Menara Citibank by Hap Seng Consolidated, as well as the sale of an eight-storey corporate block in Southgate commercial centre by Mah Sing to Koperasi Permodalan Felda Bhd.

ECM Libra said Glomac was also finalising the sale of a 30-storey corporate tower at its Glomac Damansara project to a government agency.

It said following a pick-up in property transactions in recent months, more developers were now planning new property launches.

“Among them are IJM Land, Mah Sing, Selangor Dredging, Dijaya Corp, GuocoLand, MRCB, Metro Kajang, TA Enterprise and TSR Capital,” it said.

Source: Reuters 1 Sept 2009

E&O plans to launch RM4bil property projects

2009-09-06T20:14:00.001-07:00

Property developer Eastern & Oriental Bhd (E&O), which is looking to raise RM200mil from a 1-for-2 rights issue slated to be completed before the year-end, is targeting to launch RM4bil worth of properties in two to three years.

Managing director Datuk Terry Tham said about RM2bil worth of projects would be launched in the Kuala Lumpur central business district and the balance in Penang.

He said most of E&O’s current projects had good take-up rates, despite the tough economic environment.

“On average about 80% of our property projects have been taken up,” he said after the company EGM yesterday.

He said E&O’s fund-raising exercise would help the company take advantage of the opportunities that might arise in the next economic upturn.

The fund raised would have a coupon of 8% per annum, and irredeemable convertible secured loan stocks (ICSLS) holders have the option to convert to E&O shares any time within the 10-year tenure to take advantage of any upside in the share price.

Also, the ICSLS are secured against the assets of the E&O group to mitigate the risk for holders in the event of a default.

“The money raised from the rights issue will be used to fund strategic acquisitions for expansion purposes,” Tham said, adding that it would also help lower E&O’s gearing from 0.79% to 0.16%. We will channel the bulk of funds raised specifically towards the development of ready-to-market and strong-branded E&O products in prime locations.”

Tham said E&O had another target: raising RM500mil within 18 months. “We have raised RM100mil from property sales and RM200mil could potentially be raised from the rights issue and the balance from internal funds and future property sales.”

He said it was important for E&O to strengthen its balance sheet before embarking on an expansion. Currently, E&O has cash reserves of about RM300mil.

Tham said in the past three months the property market, especially the high-end category, had shown early signs of recovery.

Source: The Star 22 August 2009

Targeting Malaysian buyers

2009-09-06T20:12:00.001-07:00

MALAYSIANS are generally quite a frugal lot and believe in saving for rainy days. That should explain why we have one of the highest savings rates in the world at 32% of gross national product.

There are in fact many rich Malaysians who are looking for quality properties to invest in. Malaysian buyers constitute one of the largest foreign buyers in Singapore; many do this with investment in mind or for having a holiday home.

That could be the reason why developers from overseas, including Australia and as far as Britain, are targeting Malaysian buyers and are showcasing their projects in Kuala Lumpur.

Berkeley Homes group, one of the largest developers in Britain, is a regular foreign developer with outings to Kuala Lumpur to woo our buyers.

Source: The Star 5 Sept 2009

Last month, its subsidiary, St George was in the city to promote Battersea Reach in the township of Battersea and Aquarius House, on St George Wharf in Vauxhall SW8, south of London.

Averaging £200,000 to £350,000 for a 800 sq ft apartment or around RM1,500 to RM2,600 per sq ft, these properties are not exactly cheap by Malaysian standards.

Although most of the buying activities are from parents who have children pursuing their education in Britain, there are also those who are frequent travellers and enjoy the lifestyle there.

Those still with spare cash to invest will be on the lookout for good property to buy in Malaysia and buying activities are expected to resume when there are clearer economic and market directions.

For now, the majority of buying activities are still by first-time home buyers and for medium-priced property, while buying for high-end property has been markedly decimated by the global financial crisis.

One of the reasons could be that many of the high net worth buyers are out on “bargain hunting expeditions” to pick up overseas properties that have eroded in prices.

It is about time developers come up with the right products to attract these high net worth buyers and some of the high-end products will likely make their way to the market next year.

The pro-active stance adopted by industry practitioners will ensure they have the right products to offer and they will go the extra mile to design and market them well.

In fact, the pace and quality of property development in the country will depend on other factors including the rate of population growth, people’s changing lifestyles and economic activities.

Although the residential property sector has been the main driver of the local property market in the past, commercial property has the potential to grow in importance, especially with the advent of real estate investment trust.

Malaysia has many promising services-related businesses that should be tapped and harnessed to generate a more positive impact on the real economy and real estate sector.

Among the sectors that easily come to mind are tourism, education, healthcare, retailing, food and beverage, and financial services.

These businesses will continue to grow in importance in the coming years and will contribute to more job creation and economic growth for the country.

Having a robust services sector will have a significant impact on the real estate sector, especially commercial real estates, which are still largely in the doldrums as a result of the global financial crisis.

Many cities around the world that have drawn big numbers of businessmen, investors and visitors to their shores mostly started out as successful business and financial hubs.

From Singapore and Hong Kong to London, Paris and New York, these global cities are renowned for their highly efficient and top-notch infrastructure as well as corporate and public governance.

All are international financial centres and have well developed services sectors and facilities.

With more concerted efforts to further develop Malaysia’s services sectors, hopefully more opportunities will emerge for the people in terms of business opportunities and employment.

Meanwhile, property industry players will also be able to partake in more quality developments for the enlarged sectors.

Eleven new hotels in Klang Valley by 2011

2009-09-06T20:10:00.000-07:00

New rooms not expected to cause oversupply in the Klang Valley

PETALING JAYA: The Klang Valley will see 11 new hotels by 2011 although some newly planned projects will be delayed due to the uncertain economic climate, property consultants said.

These hotels are mostly three- to five-star rated, comprising a mix of foreign and local brands.

Malathi Thevendran ... ‘New entries into the market should weigh the pros and cons first.’

Based on recent research, the hotel sector would have an additional 4,000 rooms upon the completion of these hotels, they said, without giving an estimated value of the projects involved.

CH Williams Talhar & Wong Sdn Bhd (WTW) managing director Goh Tian Sui said the new supply of hotel rooms in the next three to five years would not lead to an oversupply in the market as demand was still intact.

“More people will start travelling again when the global economy recovers. And later more foreign brand hotels will come in to expand their operations here,” he told StarBiz recently.

Goh said that coupled with more budget travel packages offered by airlines like AirAsia, more tourists would be visiting the country, thus boosting the domestic hotel business.

“Moreover, the average hotel room rate in Malaysia is the cheapest in the region,” he noted.

Although the hotel industry is currently doing not so well due to the Influenza A (H1N1) outbreak and global financial crisis, Goh sees a positive outlook for the hospitality industry.

Goh Tian Sui ... ‘The average hotel room rate in Malaysia is the cheapest in the region.’

There are currently 103 hotels (both foreign and local brands) with three- to five-star ratings in the Klang Valley, providing a total of 33,484 rooms.

According to WTW’s latest research, there will be an additional 297 rooms by year-end, 1,845 rooms in 2010, 992 rooms in 2011 and 553 rooms in 2012.

“Average occupancy rate in (upcoming) years will be around the current level of 60% to 70%, which is the historical average level,” Goh said.

Average room rates at present for hotels in Malaysia range between RM250 and RM600, according to Goh.

Zerin Properties chief executive officer Previndran Singhe said the company expected eight new 5-star hotels to be launched after 2011 in the Klang Valley, worth RM2bil to RM2.2bil.

Previn sees the Klang Valley needing more branded budget hotels in five years’ time.

Leo Kuscher ... ‘Hotel business is cyclical, so there will be demand.’

“Budget hotel is set to be the next growth market in Asia,” he said, adding that many investors were taking positions in the Malaysian hotel sector as they realised that the country’s tourism industry was underrated.

International real estate consultant Jones Lang Wootton executive director Malathi Thevendran said the Klang Valley, the main economic centre of Malaysia, had consistently recorded the highest number of hotel guests in the country, increasing to 20.5 million in 2008 from 16.7 million guests in 2004.

“Although the opening of more four- and five-star hotels may heighten competition in the local hotel scene, they (especially the new brands) will enhance the global awareness of Kuala Lumpur/Klang Valley in totality as an international destination for leisure, culture and meeting,” she said.

But she noted that developers of four- and five-star hotels were cautiously monitoring the market to avoid any oversupply in the long term.

“Hence any new entries into the market should weigh the pros and cons prior to making inroads into the local market,” she added.

Malathi concurs with Previndran that budget accommodation is always good investment as budget-conscious business travellers downgrade to cheaper accommodation during these challenging times.

“Overall, the mid- to long-term outlook of the Klang Valley hospitality industry remains positive as it has received strong government support to grow further,” she said.

The 5-star Royale Chulan Kuala Lumpur, soft-launched in April, expects to achieve 55% occupancy rate by year-end.

Its general manager Leo Kuscher told StarBiz that there appeared to be an oversupply of hotel rooms in the Klang Valley and the current market was very competitive, affecting hotel room yields.

“However, the hotel business is cyclical, so there will be demand,” he said.

Operated by Boustead Hotels & Resorts Sdn Bhd, The Royale hotel chain also has three 4-star hotels, namely The Royale Bintang Kuala Lumpur, The Royale Bintang Damansara and The Royale Bintang Resort & Spa Seremban.

The hotel operator plans to launch The Royale Bintang Penang and The Royale Bintang Suria-Damansara, with 300 rooms each, in the second quarter and end of 2010 respectively.

Meanwhile, TA Enterprise Bhd managing director and chief executive officer Datin Alicia Tiah said it was too soon to comment on its two hotel projects in Kuala Lumpur. TA said in an email reply that it had not started any hotel project in Malaysia.

“Construction of the new hotels will start next year and be ready only in four to five years,” the company told StarBiz.

Source: The Star 7 Sept 2009

Mitrajaya buys property for RM28m

2009-09-06T19:57:00.000-07:00

Mitrajaya buys property for RM28m

PETALING JAYA: Mitrajaya Holdings Bhd’s wholly-owned subsidiary, Mitrajaya Homes Sdn Bhd, has acquired a 99-year leasehold property in Petaling Jaya for RM28mil.

In a filing with Bursa Malaysia, the company said its subsidiary had entered into the sale and purchase agreement with Danaharta Urus Sdn Bhd for the acquisition.

It said the 405,108-sq-ft property’s existing use was for light industrial and was currently a vacant lot.

“The proposed future use would be for industrial and commercial development,” it said.

Mitrajaya Holdings said the acquisition would be satisfied fully in cash, to be financed by internal funds and borrowings.

“The acquisition will increase the group’s land bank for future development and it is estimated to be completed by the first quarter of 2010,” it added.

Source: The Star 4 Sept 2009

It's one of the great mysteries of the business world: How much is Donald Trump really worth?

2009-06-14T06:46:00.001-07:00

It's one of the great mysteries of the business world: How much is Donald Trump really worth?

The world famous real-estate developer and television personality has consistently said it's in the billions. A 2005 book citing anonymous sources said it was between $150 million and $250 million. Mr. Trump sued the writer for defamation. He alleged damage to his reputation that caused him to lose out on future deals in locales from Philadelphia to Kiev.

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Donald Trump discussed how he values his net worth in a deposition.

A hearing in that case will take place Monday in a state court in Camden, N.J. As part of the proceedings, the Donald, as he's known to fans and detractors alike, has provided under oath the secrets to how he values his wealth and treasure. In one case, he says, he does "mental projections."

"My net worth fluctuates, and it goes up and down with markets and with attitudes and with feelings, even my own feeling," he told lawyers in the December 2007 deposition.

The deposition, marked "Confidential," comes to light at a time when some of Mr. Trump's projects, including several condominium developments that bear his name, are struggling. Among the problems are anemic sales, lawsuits, sharp declines in value and troubles with creditors.

In a telephone interview Sunday, Mr. Trump disputed that these are tough times for him. "We have a lot of cash right now. We're starting to buy things," he said while taking a break from playing golf at a Trump course in Bedminster, N.J. He said he stood by the statements he made in the deposition.

In the deposition, given to lawyers representing the book's author, Timothy O'Brien, and its publisher, a unit of French-based Lagardere SCA, Mr. Trump described his public persona. "I'm not different from a politician running for office," he said.

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Scott Olson/Getty Images

A city of Chicago flag flies in front of the Trump International Hotel & Tower in the Chicago's business district.

In the deposition, Mr. Trump said that his 2007 estimate of his net worth -- over $4 billion -- is "a very conservative number, in my opinion." He also said $6 billion is a good number, counting his brand value. (In the interview Sunday, he said he was worth $5 billion, not counting brand value.)

Mr. Trump was asked whether he has ever exaggerated in statements about his properties. "I think everybody does," he said in the deposition. "Who wouldn't?"

A follow-up question: Does that mean he inflates the value of his properties in general, nonfinancial public statements? "Not beyond reason," he said in the testimony.

The deposition reveals he told his bankers and New Jersey casino authorities in 2004 and 2005 that he was worth approximately $3.6 billion. In 2005, Deutsche Bank evaluated his net worth as part of underwriting a $640 million construction loan it made to Mr. Trump's Chicago condo and hotel project. The bank said his worth was $788 million, according to information presented by the author's lawyers present during Mr. Trump's deposition.

In his testimony, Mr. Trump discounted that and other low-ball evaluations as "ridiculous." And he noted, "They [Deutsche Bank] still come up with numbers that are many times" what the book's author, Mr. O'Brien, reported. In his interview Sunday, he said Deutsche Bank looked at some of his assets, not all of them, and didn't do independent appraisals. A Deutsche Bank spokesman couldn't be reached.

Reuters

A Trump project on Hawaii's Waikiki Beach

Mr. Trump said Sunday that Mr. O'Brien, author of "TrumpNation: The Art of Being the Donald," will "wish he never heard of that God damn book" and predicted that "the publishing company will pay me hundreds of millions of dollars" as a result of the suit.

Mr. O'Brien, who is an editor at the New York Times, declined to comment through his attorney, citing the ongoing litigation.

In the deposition, Mr. Trump discussed how he determined the value of a residential development on old rail yards on Manhattan's west side. According to the deposition, when a newsletter reporter writing about the project's 2005 sale for $1.8 billion said Mr. Trump had a "small interest," Mr. Trump wrote him a note. "You're a real loser. Thanks for the nice story. Is 50% small?"

But Mr. Trump had a 30% limited-partnership interest in the project, according to legal documents. A group of Hong Kong investors were the owners. Asked about this during the deposition, Mr. Trump explained that, in his eyes, he owned half because he gets paid fees for managing the buildings and because he didn't have to put up cash in the deal. "In my own mind I've always felt that," he said. "That 30% is equated to 50%," he said. In his interview Sunday, Mr. Trump said he had owned the equivalent of "more than 50%."

Mr. Trump often licenses his name to other developers in return for a fee or a cut of the sales. During the deposition, Mr. O'Brien's lawyer, Andrew Ceresney, noted that Mr. Trump had claimed publicly that he had a major ownership in one such project.

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Associated Press

A project that Donald Trump is associated with in Las Vegas.

For example, in a November 2007 Wall Street Journal interview cited by Mr. Ceresney, Mr. Trump said he had sold out units at an eponymous condo-hotel project in Hawaii. "The building is largely owned by me," he said in the interview. But in the deposition, Mr. Ceresney produced the licensing agreement for the project. Mr. Trump wasn't a major equity holder in the project, it showed, a fact Mr. Trump didn't dispute.

"Because this is such a strong licensing agreement that I consider it to be a form of ownership," Mr. Trump said. "I'd rather have this than own the building," he said. Moments later he said: "I would say that it could be interpreted to be a form of ownership in the building."

In the deposition, Mr. Trump is asked about the Bedminster, N.J. golf course, which financial statements showed had a net loss of $4.6 million in 2005. Has he ever done a financial analysis of his investment there?

"Yes, I've done mental projections," he said, figuring he'd eventually make $120 million. He never put them down on paper. "You don't really have to," he said. Mr. Ceresney, asks: "Have you discounted in your mind for the risk that you won't sell [memberships] at the prices you are anticipating?"

"I think I will, but it's possible I won't. But I think I will," Mr. Trump said.

At one point during the deposition, Mr. Trump explained the importance of putting his projects in the best light possible. "Would you like me to say, oh, gee, the building is not doing well, blah, blah, blah, come by, the building -- nobody talks that way. Who would ever talk that way?"

Source: WSJ 18 May 2009

Redeveloping and conserving Penang’s heritage

2009-06-14T06:35:00.003-07:00

IT is long overdue for Penang to come out with holistic and well thought out plans and programmes for the redevelopment and rejuvenation of George Town’s inner city.

Proactive and concerted efforts by the state government, the private sector and Penang folks should be initiated soon for a workable blueprint in order for the state to regain its glory as the “Pearl of the Orient”.

In the drawing up of a blueprint for the redevelopment, it is important that all stakeholders, especially property owners and those living, working, and operating their businesses around the inner city perimeters, be consulted and their concerns duly addressed.

Many Penangites, especially those who are illiterate or don’t have the time to read up on current issues, are still in the dark over Penang’s world heritage status and what it means to them.

George Town was declared a World Heritage Site by the United Nations Educational, Scientific and Cultural Organisation (Unesco) on July 7, 2008.

It will do the people good if those involved in the planning of George Town’s growth and development take the initiative to organise roadshows and public education programmes to highlight the salient points and issues to the people, and at the same time get their feedback for the blueprint.

The state government should come out with a referendum and consult all the stakeholders, business guilds, clans, associations, and non-governmental organisations (NGOs) that are working towards conserving Penang’s heritage while ensuring it stays relevant in these modern times.

Although it is important to conserve Penang’s old world charm, rich heritage and culture in keeping with its status as a Unesco World Heritage Site, there should be avenues for the new and modern side of Penang to co-exist with the old to ensure the people’s changing lifestyle and livelihood will not be jeopardised.

As a Penang girl, I am certainly proud of the state’s rich Straits Settlement cum Baba Nyonya heritage and culture that dates back to so many generations of the early settlers from China, India, Indonesia and the Arab continents, among others.

Many Penangites who are now residing in other parts of the country (me included) and overseas always have pangs of nostalgia when recalling their younger days in good old Penang.

Besides the lure of the good Penang cuisines, there are many beautiful historical buildings that were built many centuries ago that are still around in various parts of the island, including the inner city, today.

But there are also many pre-war buildings that are left in very dilapidated conditions after their tenants left those buildings when rentals soared after the repeal of the Rent Control Act in 2000.

Many of these buildings have become hazardous and are unfit for occupancy after their owners failed to upkeep and maintain them.

The introduction of clear and transparent guidelines on what can and cannot be done in the redevelopment of these ageing buildings will revitalise and bring back life to the inner city.

Penang can take a leaf from many cities around the world including London, Sydney and Singapore that have successfully rejuvenated and redeveloped old parts of their cities while maintaining the rich heritage and history for the present and future generations to enjoy.

While many of the historical buildings should be conserved in their current original form such as the restoration of the Cheong Fatt Tze Mansion and Khoo Kongsi buildings, those that are too dilapidated should be redeveloped.

Retaining the original facades of these old buildings while allowing new extension annexes within the permissible heights to be built is one practical way of adding value to these buildings.

Buildings that are too old to be restored should make way for new ones that incorporate the elements of Penang’s “old world charm” in the building’s architecture and facade and are within the permissible heights to blend in with the whole environment.

Making known these practical solutions and guidelines that allow room for value adding and reasonable return on investment will encourage the private sector to partake in the inner city’s rejuvenation and inject a new glow and versatility into George Town.

Currently, some interested parties, including NGOs, are taking a very ad-hoc view of how to go about restoring buildings without looking at the big picture of rejuvenating George Town’s inner city.

Instead of opposing every proposed plans, they should offer value added and constructive ideas that are practical and workable.

It is heartening to note that even Unesco has expressed its empathy for Penang folks and has directed its two representatives, David Logan and Giovanni Boccardi, to appraise the situation on how the 18m height restriction for the four hotel projects approved for George Town’s inner city will affect the stakeholders and the people’s livelihood.

Boccardi, who is Paris-based World Heritage Centre chief of unit for East Asia and the Pacific, and Logan, International Council on Monuments and Sites member, were in Penang from April 26 to 30 to meet representatives of the developers of the hotel projects in the Unesco-listed heritage zone.

Their findings are set to be deliberated at the upcoming Unesco World Heritage Committee meeting in Seville, Spain, from June 22 to 30.

The four developers – Asian Global Business Group, Boustead Group, the Low Yat Group and Eastern & Oriental Group have been granted approvals from the Penang Island Municipal Council to build hotels in the heritage zone before it was placed on the Unesco World Heritage List.

With so much at stake, Unesco’s impending decision will put to rest the anxiety of these developers and hopefully, it will be a well thought out and win-win one for all stakeholders.

Meanwhile, instead of directing the four developers to confine the height of their hotels to 18m or five-storeys, the state government should also wait out for the final Unesco decision on the projects.

After all, commercial projects that are viable will generate huge spin-offs to Penang’s economy and create employment for its people.

·Deputy news editor Angie Ng believes that for George Town to thrive as a vibrant heritage city, it is imperative that quality commercial developments that are within the guidelines of its world heritage status and that add value to the city, be encouraged.

Source: The Star 13 June 2009

Kuala Lumpur's Jalan Imbi set to change

2009-06-14T06:30:00.003-07:00

The shops on Jalan Imbi, located in Kuala Lumpur's Golden Triangle, may soon pave way for new developments as land in the city centre becomes scarce. The Imbi stretch from the intersection of Jalan Bukit Bintang to Jalan Sultan Ismail started out with residential bungalows. From the 1950s, shops sprouted up as some of the homes were converted for commercial use.

Jalan Imbi has long been viewed as a possible extension of its more affluent cousin Jalan Bukit Bintang. Developers too have realised this and one developer, Asia Pacific Land Bhd (AP Land), is believed to have acquired over 25,000 sq ft since 2008 in their bid to accumulate landbank. According to AP Land, it is in the planning stages for future commercial developments on their Jln Imbi tracts.

Meanwhile, several existing shop owners too have been buying other shops here to expand their businesses or for investment purposes.

According to property transactions data provided by Burgess Rawson Sdn Bhd, the most recent transaction was recorded in January this year where a 2-storey pre-war shop was transacted for RM2 million. This unit sits on a site of over 1,700 sq ft. An owner is also believed to be asking RM10 million for his two-storey corner unit plus an adjoining lot.

Burgess Rawson's data also showed that the year 2007 saw a spike in the number of transactions on Jalan Imbi and some believe that to be caused by an announcement of the possible redevelopment of the Pasarakyat project nearby.

VPC Alliance (M) Sdn Bhd managing director James Wong told City & Country that land here is certainly valuable due to its strategic location.

"Although demand is high for the shops on Jalan Imbi, owners are not willing to let go as they realise the capital appreciation potential. As demand far exceeds supply, property values are bound to appreciate," he says. He also believes that the shops would eventually be amalgamated for redevelopment.

Principal of Ho Chin Soon Research Sdn Bhd, Ho Chin Soon, feels that future developments at Jalan Imbi would complement the businesses found nearby such as shopping centres and entertainment outlets. "However, the process of acquiring contiguous lots for redevelopment would be a long one, easily between five to 10 years," says Ho.

Source: the Edge Magazine 29 May 2009

Raffles KL to open doors in 2011

2009-06-14T06:22:00.004-07:00

The luxury hotel brand Raffles will have its first hotel in Malaysia - the Raffles Kuala Lumpur - which is expected to open its doors in 2011.

The Raffles Kuala Lumpur will be at Pavilion Kuala Lumpur, along Jalan Bukit Bintang. Featuring 200 rooms and suites, each with a minimum of 50 sq m (about 538 sq ft), it will offer the most spacious rooms in the city.

Raffles Hotels & Resorts' signed an agreement on May 28 with Harmoni Perkasa Sdn Bhd, a unit of Urusharta Cemerlang Sdn Bhd, which owns Pavilion Kuala Lumpur.

"The name Raffles is associated with exceptional standards of service, hospitality and cuisine. We look forward to working with Raffles Hotels and Resorts to bring a luxurious lifestyle experience to Kuala Lumpur," said Harmoni Perkasa chairman Tan Sri Zainol Mahmood.

Owned by Fairmont Raffles Hotel International, Raffles Hotels & Resorts is expected to expand from seven Raffles hotels now to 23 hotels worldwide by 2012.

Chris Cahill, COO of Fairmont Raffles Hotel International said the group had always wanted to extend the Raffles portfolio to Kuala Lumpur.

"Now we have an ideal strategic partner and an unrivalled location," he adds. The group also owns Fairmont and Swissotel brands of hotels and resorts.

Raffles Hotels & Resorts' public relations and communications manager Vivian Koh said Raffles Kuala Lumpur will offer six restaurants and bars including a specialty restaurant, an all-day dining restaurant, a lobby lounge, a lobby bar, a pool bar and a Cafe Stelle located at the Couture Pavilion precinct. The cafe which will be a showcase of Raffles' service prior to the opening of the hotel, opened its doors today.

The Raffles Amrita Spa, a signature component of Raffles hotels and resorts worldwide, will feature 10 treatment rooms and an extensive range of massage and wellness treatments.

Source: The Edge Magazine 29 May 2009

Mulpha’s Leisure Farm, Putrajaya Holdings win Cityscape awards

2009-06-14T05:22:00.002-07:00

SINGAPORE: Malaysian developers Leisure Farm Corporation Sdn Bhd and Putrajaya Holdings Sdn Bhd had won awards at the 2009 Cityscape Awards for Real Estate in Asia in Singapore on May 19.

Leisure Farm Corp, a unit of Mulpha International Bhd, won in the "Best Best Green Development (Built)" category with its Leisure Farm Resort project.

Leisure Farm is a residential and gated resort development spread over a total of 1,765 acres freehold land in Gelang Patah. This southern gateway to Johor from Singapore has a 36-hole golf course, clubhouse and equestrian facilities.

It has five precincts, comprising of villas with over 11 different architectural and interior design themes, built on bungalow lots measuring 3,000 sq ft to 18,000 sq ft.

This freehold property offers accessibility to Singapore, Johor Baru city and Sultan Ismail International Airport via the Second Link highway, JB Parkway and North-South Expressway.

Meanwhile, Putrajaya Holdings won the "Best Waterfront Development (Future)" category for its Putrajaya Waterfront Development.

The condominium project was designed by Studio Nicoletti Associati and Malaysian-based Hijjas Kasturi Associates. The main residential complex is conceived like a fleet of majestic Sail-Boats floating in the lagoon, with rib-like structural system forms the outer skin of the Sail-Boats

The buildings will be powered using alternative energy and they will emit about 50% less carbon dioxide than other residential projects.

There are 12 award categories in Cityscape Asia 2009, spanning from Corporate Social Responsibility, Green Development, Urban Design and Master Planning through to the best developments in Waterfront, Retail, Commercial, Residential, and Mixed Use Project (with a Built and Future award in each category).

This year, two new green awards were introduced. Singapore's upcoming Ocean Financial Centre by Keppel Land International Limited winning the "Best Green Development (Future)" award.

Singapore's luxury residential development, The Sail @ Marina Bay was also recognised as the "Best Waterfront Development (Built)", while CapitaLand's Muchuan Green Hope School was honoured with the "Best Corporate Social Responsibility Development".

For commercial/ retail development, Shanghai ICC was named the "Best Commercial/ Retail Development (Future)", while Elements by Hong Kong's MTR Corporation Limited won the "Best Commercial/ Retail Development (Built)".

India's Sis Danube and Golf Greens-Golf Condominiums and Mandeville Golf Villas walked away with "Best Residential Development (Built)" and "Best Residential Development (Future)" respectively.

Meanwhile The Central by Far East Organisation was awarded the "Best Mixed Used Development (Built)", while Aqua Pearl won the award for "Best Mixed Used Development (Future)".

Source: The Edge Magazine 27 May 2009

Penang Should Buck Up On Infrastructure: Lee Kuan Yew

2009-06-13T05:59:00.000-07:00

The Penang Government should buck up on its infrastructure as it is inferior, in comparison to those in Ipoh and Seremban.This is the view of Singapore's Minister Mentor Lee Kuan Yew, said Chief Minister Lim Guan Eng.

"That was the reflection of the graceful decline that Penang has undergone over the last 18 years, and we need to improve in order to make up for the previous neglect," noted Lim.

He was speaking to reporters after receiving Lee, Singapore's first prime minister and the Father of Modern Singapore, and his delegation at his office in Komtar here Saturday.The minister mentor is on an eight-day visit to Malaysia.Lee's last visit to the state, better known as the 'Pearl Of the Orient', was in 1989, when Tun Dr Lim Chong Eu was chief minister.Lim said the state government was willing to cooperate with the federal government to improve the city's infrastructure, especially communication and transportation.

He said Lee had also stated that there would be an increase in the number of flights from Singapore to Penang next year."There would be about 12 flights daily and 84 flights weekly for the Singapore-Penang route next year," added the chief minister.On Penang and Singapore, Lim said they shared a commonality in terms of establishing a clean and good government."We may have different thoughts, views and perception but we certainly share the same ideology, in terms of establishing a good government with competency, accountability and transparency," he said.

Source: Bernama 13 June 2009

SunCity prefers Malaysia for listing

2009-06-13T05:44:00.000-07:00

PETALING JAYA: Malaysia has become the preferred listing destination for Sunway City Bhd’s (SunCity) proposed real estate investment trust (REIT) although it is not ruling out other proposals for reverse takeovers in Singapore and Australia.

“The authorities in Malaysia are very proactive and doing their level best to get the more established companies to list in Malaysia,” SunCity executive director Datuk Jeffrey Ng told StarBiz yesterday.

Industry sources added that companies also had a more positive view following the revamp of main and second boards into a unified board, further improvement in processes and procedures as well as liberalisation of the 30% bumiputra quota in 27 service sub-sectors.

“Malaysia is definitely a preferred destination,” said Ng. “But we are not closing our doors to other opportunities.

If something very firm comes up, we will study it in the best interests of shareholders, one of which is GIC (Government of Singapore Investment Corp).’’ Early last year, SunCity was reported to be more keen on listing in Singapore where the tax regime is more attractive to REIT investors in relation to withholding tax.

However, the global financial crisis, which erupted in the later part of last year, has changed the scenario and investors turned risk averse.

In terms of mandate, this represents a fresh opportunity to select possibly new parties that can give the best terms. Under the old mandate, the global investment banks were Goldman Sachs and UBS while the local investment banks were CIMB Investment Bank and RHB Investment Bank.

“There could be new parties involving global and local investment banks,” said Ng. “Such a major fund-raising exercise will have to go into the global markets. At the end of the day, we will study what the most aggressive investment bankers have to offer.”

In the wake of early market recovery, SunCity is monitoring the indicators and will make every effort to get into the market as fast as possible. “We don’t want to miss out or be considered slow. We are watching the markets closely,” he said. “If there is a window of opportunity that fits our criteria, we will definitely implement (the listing).”

Among the factors involved are market timing and the need to balance yields in the REIT market and bond yields, which represent the cost of funds and is an indicator used in the calculation of REIT pricing. Investors would also weigh their options in the REIT and bond markets.

StarBiz recently reported that backed by assets valued at RM3.7bil, the proposed REIT listing is possibly the largest in the country. According to the report, about 75% of SunCity’s operating profit of RM175mil for the first half ended Dec 31, 2008, was from its property investment assets and SunCity was expected to receive total rental income of RM285mil this calendar year of which 70% would be from Sunway Pyramid Shopping Mall.

AmResearch managing director/regional head Benny Chew suggested that SunCity list its REIT at a point when property stocks were trading close to their net asset value.
“It will then be seen as a good alternative investment,’’ said Chew, who also expressed concern over the inclusion of diversified assets into the REIT as he considered suburban retail to be the main growth driver. “In general, they have to convince investors on their strategies to grow the fee income.’’

However, other analysts pointed out that SunCity’s proposed REIT would have assets with synergistic benefits in the integrated resort city, education, medical and office, retail, hotel and leisure theme park.

“Next year should be more exciting for the listing,” said a senior analyst with a foreign research house. “It will be cheaper as currently REIT yields are high on worries that rentals might weaken.”

ECM Libra Research acting research head Ching Weng Jin agreed it was time to dust the proposals previously kept on the shelf as market sentiment had changed compared with six months ago. “The properties are well-managed and rental yields are good. It is also more encouraging to list here in view of liberalisation of rules.”

Source: Star 11 June 2009

KYM soars on land sale pact

2009-06-13T05:37:00.000-07:00

KYM Holdings Bhd, a Malaysian property investor, soared in Kuala Lumpur trading after agreeing to sell land to Vale SA, the world’s biggest iron ore producer.The stock leapt 55 per cent to 79 sen at 12.30pm, set for the highest close in almost two years.Vale agreed to buy land in Perak, Malaysia, for RM101.9 million (US$29 million) and also has an option to buy additional plots in the north Malaysian state for RM93.7 million, KYM said in a statement yesterday after the market closed.

Source: Bloomberg 13 June 2009

Foreigners eye S'pore homes

2009-06-13T05:23:00.000-07:00

Most are regional buyers hunting for bargain-price units below $1m in resale market

Unlike the rising market in 2004 and 2005 when foreigners bought mostly new launches, buyers now are largely going for resale homes.

FOREIGN buyers are back to snap up homes here after bolting for the exits during the financial turmoil late last year.

The number of foreign private home purchases in April and May is already up on the first quarter but no one is claiming a significant turnaround is under way, although sales numbers hint at 'green shoots'.

The mix of buyers has also changed from the boom of 2007 and early last year. Then, Koreans, Americans, Russians, and people from the Middle East and elsewhere joined regional buyers to invest at the high end of the market, often with the aim of flipping the property to other investors.

Now buyers from Malaysia, Indonesia and China are dominating, and they are mostly picking up bargain-price units under $1 million for their own use or investment, according to property consultant Jones Lang LaSalle. Its analysis of non-landed private home caveats lodged in April and May found that foreigners bought 202 properties, up 15 per cent from the 175 bought in the first quarter and the 156 deals done in the last three months of last year.

They are taking advantage of bargains in the weak market and low interest rates, said Jones Lang LaSalle associate director of research Desmond Sim.

In the first five months this year, about 57 per cent of the foreign buyer caveats were in the $500,000 to $1 million price category. This is slightly more than for the same periods in 2004 and 2005.

Unlike the rising market in 2004 and 2005 when foreigners bought mostly new launches, buyers now are largely going for resale homes.

'During that period (2004-2005), Singapore prime residential prices were in the region of US$7,745 (S$11,200) per sq m compared to our 'cousin' Hong Kong at US$20,500 per sq m,' said Mr Sim.

Most foreign buyers then came from within Asia and saw cheaper homes here as good investments, he said. Many at the time made use of the deferred payment scheme to earn quick capital gains through flipping the units in the sub-sale market, he added.

Resale homes became popular in 2006 and 2007 as more foreigners - who came mainly as the banking and financial industries grew - chose to buy instead of paying sky-high rents.

Source: Straits Times 12 June 2009

Malaysia: Increase in stamp duty to hit property buyers

2009-06-10T09:04:00.000-07:00

KUALA LUMPUR: Those buying and renovating their properties will have to fork out more following an increase in stamp duties.

Master Builders Association Malaysia (MBAM) president Ng Kee Leen said the extra costs incurred would eventually be passed down to the end-consumers.

The amendment of the First Schedule of the Stamp Act 1949 came into effect on Jan 1 this year, where it stated that all “bonds, covenant, loan, services, equipment lease agreement of any kind whatsover” are chargeable with duty at the rate of RM5 for every RM1,000, or part thereof - which is effectively 0.5% of the contract value.

Prior to the amendment, the stamp duty chargeable on a normal service agreement without security was fixed at RM10.

“With the amendment, a RM10mil construction contract will now attract an ad valorem duty of RM50,000, while previously, it was only a nominal duty of RM10 per document regardless of the contract amount,” he said.

He called on the Government to revert to the previous system, and said he would raise this matter in a dialogue with the Finance Ministry on June 11.

“Regardless of whether the contracts are Government or private, the ultimate cost is passed back to the Government and the people,” he told a press conference.

Ng said that although the amendment came into effect in January, contractors were paying the nominal RM10 for the first three months of the year as the government agencies took some time to switch to the new system.

“But since then, many had no choice but to pay according to the new amount. This creates a cash flow problem for our members. If they don’t pay, then they cannot go ahead with their projects,” he said.

MBAM honorary tax adviser Yee Wing Peng said in addition to the increased stamping fee, members were already paying a Construction Industry Development Board (CIDB) levy of 0.125% on a construction contract, and 5% service tax on professional services such as project management, architectural, surveyance and engineering consultancy.

“The construction industry is multi-tiered, meaning there will be multiple levels of sub-contracting works.

The combined effect of stamping all agreements including sub-contracting and outsourcing at 0.5% of the contract value is exponential,” he said.

Source: The Star 5 June 2009

Total demolition of old Jaya supermart depends on MIPW

2009-06-10T08:31:00.000-07:00

Work to demolish the remaining structure of the former Jaya Supermarket building can only start after the authorities have been assured that the method to be employed meets Malaysian Institute of Public Works standards.

Selangor Menteri Besar Tan Sri Abdul Khalid Ibrahim said the method should also satisfy professional standards set by the Petaling Jaya City Council.

He said the state government had directed the MBPJ to get Jaya Section Fourteen Sdn Bhd, the owner of the building, and its consultants to provide details of the method of demolition.

He told a press conference after the weekly state executive council meeting here yesterday that the stop-work order would only be lifted if the criteria set by the state government were met.

Abdul Khalid said Petaling Jaya Mayor Datuk Mohamad Roslan Sakiman had briefed the meeting that the owner of the building had applied to have the stop-work order lifted.
The remaining structure includes a 19-metre structure that is threatening the safety of nearby homes..

"While the state is aware that the application is to ensure public safety, it cannot lift the order without proper planning,’ he said.

He said the state government hoped to make a decision as soon as possible so that evicted residents could return home.

He said the state government had been informed that all local councils in the state were checking their records to identify if the six companies involved in the Jaya Supermarket project had other development projects elsewhere in the state.

"Any ongoing projects involving any of these companies will be reassesed and monitored closely to ensure that all safety requirements are followed," he said.

The companies, blacklisted and banned from future projects in Selangor, are Jaya Section Fourteen Sdn Bhd, DP Architects Sdn Bhd, Meinhardht (M) Sdn Bhd. DLS Management, Pembinaan CW Yap Sdn Bhd and Jurutera Perunding Sdn Bhd.

The former Jaya Supermarket was about to be demolished when it collapsed on May 28, killing seven workers.

Source: New Straits Times 10 june 2009

Robert Kuok at top of Malaysia’s 40 richest

2009-06-03T07:30:00.000-07:00

By now it is no surprise that the rich around the world are getting poorer. Malaysia is no exception: Its 40 wealthiest are worth US$36 billion (RM126 billion), down from US$46 billion a year ago. That loss is largely in line with the 21 per cent drop in the Kuala Lumpur Composite Index and not too bad considering the fact that the ringgit has lost 10 per cent against the US dollar, the currency in which net worths are measured.

Malaysia's billionaires continue to dominate. The country's two richest people, Robert Kuok and Ananda Krishnan, both again No. 1 and No. 2, are worth a combined US$16 billion and account for 44 per cent of the top 40's wealth. They are also the two richest people in Southeast Asia. The country's nine billionaires are worth US$30 billion, or 84 per cent of the total, the biggest wealth disparity among any of Forbes Asia's other rich lists. Vincent Tan is the only Malaysian to have dropped out of the billionaire ranks in the past 12 months as share prices in his companies declined.

There are signs of recovery. The nation's stock market index has been climbing in the past two months. Kuok's fortune is up US$2 billion since March, when he appeared on the world's billionaires list. Five other billionaires have posted a combined US$800 million in gains since then. Kua Sian Kooi grabbed the last spot on the list as a result of a big rally in his insurance firm Kurnia Asia's stock, up 50 per cent since the start of April.

Three newcomers debut, thanks to the discovery of better or new information. They include software executive Goh Peng Ooi, IOI board member Chan Fong Ann and gaming tycoon Chen Lip Keong, who operates a casino in Cambodia and a tourism business in Malaysia.

Four people have returned to the ranks after an absence of a year or more. Among them are Syed Mohd Yusof Syed Nasir and Tan Teong Hean, who cashed out of Southern Bank several years ago and are now making new investments.

Among those who dropped off the list are several tycoons who barely missed the cut, including CIMB Bank's Nazir Razak and OSK finance group's Ong Leong Huat. Malaysian citizen Ong Beng Seng, who has lived in Singapore for decades, is wealthy enough to qualify but stands to be listed among that nation's 40 richest in September, largely due to the fact that he and his wife, Christina, who is a citizen of Singapore, share a number of holdings.

1 Robert Kuok US$9 billion diversified 85. Married, 8 children

Onetime rice, sugar trader heads multinational Kuok Group. Biggest source of wealth is stake in Wilmar International, palm oil outfit run by his nephew. Other big holdings are Hong Kong real estate group Kerry Properties, hotel operator Shangri-La Asia. Has an interest in South China Morning Post publisher. With Filipino tycoon Eduardo Cojuangco Jr's San Miguel, plans to spend up to US$1 billion to develop public land for farming to boost agricultural sector.

2 Ananda KrishnanUS$7 billion telecom 71. Married, 3 children

Runs Maxis Communications, Malaysia's largest cell phone service provider, with more than 10 million subscribers; took it private in June 2007 in US$12 billion deal, then sold 25 per cent to Saudi Telecom the same month. Last year sold Excel, the exhibition venue in London's Docklands, for reported US$230 million and bought 20 per cent stake in British regional newspaper chain Johnston Press, luckily a small holding, as stock has dropped more than 80 per cent since as it struggles with debt. Modern art collector, has homes in Kuala Lumpur, London and south of France; has a son who is a monk living in the forest.

3 Lee Shin Cheng US$3.2 billion palm oil 70. Married, 6 children

Former plantation field supervisor heads IOI Group, one of world's leading operators of palm oil plantations, refineries. Took its IOI Properties private in April. IOI's stock has doubled since November but still down a third since last year amid falling commodity prices.

4 Lee Kim Hua US$2.5 billion gaming 80. Widowed, 6 children

Widow of Lim Goh Tong, who transformed a jungle on outskirts of Kuala Lumpur into one of world's most successful casino resorts. Genting Group now run by her son Lim Kok Thay (No. 14) but inheritance held in trust to benefit Lee, her children and grandchildren.

5 Teh Hong Piow US$2.4 billion banking 79. Married, 4 children

Former bank clerk opened first bank in 1966. Now his Public Bank has 14,000 employees; branches throughout Malaysia, also in Cambodia, Laos, Sri Lanka, Hong Kong, China. Set up Public Islamic Bank as a subsidiary in November 2008. Donates to medical institutions and to the Malaysian Nature Society to fund planting of trees.

6 Quek Leng Chan US$2.3 billion diversified 68. Married, 3 children

Heads conglomerate Hong Leong GroupMalaysia, with interests in finance, entertainment, real estate. Bought 5 per cent stake in Mokhzani Mahathir's (No. 16) Kencana Petroleum and 3 per cent in Intercontinental Hotels Group last year. Family's GuocoLand is planning retail, residential, office projects in China. Inherited business from his father, one of 3 brothers to start a banking group in 1920s.

7 Yeoh Tiong Lay US$1.8 billion diversified 79. Married, 7 children

Founded YTL Corp, one of Malaysia's largest conglomerates, run by son Francis.

8 Syed Mokhtar Al Bukhary US$1.1 billion diversified 57. Married, 5 children

Former rice trader controls Malaysia Mining Corp. (MMC); has stakes in Malaysia's Johor Port, independent power producer Malakoff, natural gas distributor Gas Malaysia. Inking projects in Saudi Arabia, Jordan. Lost billionaire status earlier this year but back up top thanks to rebound of MMC stock. His Albukhary Foundation offers scholarships to students from poor countries to pursue college education in Malaysia.

9 Tiong Hiew King US$1 billion timber 74. Married, 4 children

Dubbed by some as Asia's Rupert Murdoch — his Chinese Media International has 5 newspapers, 30 magazines in Southeast Asia, Hong Kong, mainland China, Taiwan, North America. His Rimbunan Hijau, which means "forever green," has palm oil, timber assets. Big player in New Zealand, where he owns timber, property and fish farming companies; also in Papua New Guinea, where he has an English-language newspaper, hypermarkets and controversial logging operations.

10 Vincent Tan US$750 million diversified 57. Married, 11 children

Has run Berjaya, which means "success" in Malay, since 1984; interests in hotels, lotteries, real estate, finance. Operates 7-Eleven, Wendy's, Starbucks, Borders in Malaysia. Opened first Krispy Kreme store there in April. Also operates water and sewage treatment and sanitary landfills in Malaysia, Indonesia and China. Selling stake in moneylosing US eatery Roadhouse Grill; setting up a school in China.

11 Azman Hashim US$470 million finance 69. Married, 5 children

Longtime banking executive has been executive chairman of Amcorp since 1993. Malaysian financial services group. Opened Brunei operations in May. Chairman of the Malaysian Investment Banking Association. Loves scuba diving, painting and fast cars. A singer, has also recorded numerous albums.

12 William H.J. Cheng US$390 million retail 66. Married, 3 children

Runs the Lion Group, which has interests in plantations, steel, property. Though nicknamed "Steel King," biggest source of wealth is his indirect stake in Chinese retailer Parkson Retail, which he chairs. Also known as Cheng Heng Jem.

13 G. Gnanalingam US$260 million ports 64. Married, 3 children

Former tobacco and advertising executive cofounded, heads Westports Malaysia, one of nation's biggest ports. Private company valuation up because of better information from outside analysts; expects volume to contract for first time since it started as a container business in 1996. Has stake in transit hub KL Sentral.

14 Lim Kok Thay US$225 million gaming 57. Married, 3 children

Son of late Lim Goh Tong, has run Genting since 2003. Building gaming resort on Singapore's Sentosa Island, slated to open in 2010. His Star Cruises is working with Filipino tycoon Andrew Tan's Alliance Global to develop resort complex in Manila Bay.

15 Anthony Fernandes US$220 million airlines 45. Married, 2 children

Perennially optimistic travel tycoon on move during recession. His AirAsia, region's largest budget airline, adding flights to Bali, Taipei; secured debt financing for 15 new planes. Stock down just 2 per cent in past year. Its two-year-old long-haul discount airline AirAsia X began flying from Kuala Lumpur to London in March; Richard Branson is an investor.

16 Mokhzani Mahathir US$215 million oil services 48. Married, 5 children

Son of former PM Mahathir Mohamad runs petroleum company Kencana; former chairman switched roles and was redesignated chief executive in September. Investors include Quek Leng Chan (No. 6). Recently became chairman of fibre optic cable outfit Opcom Holdings, replacing his brother, its founder, who was named deputy international trade and industry minister. Also Malaysian Grand Prix chief, authorised Porsche dealer.

17 Lee Oi Hian US$210 million diversified 58. Married, 4 children

Chief executive of Kuala Lumpur Kepong, involved in plantation, property, retail. Bought palm oil business, Ladang Perbadanan-Fima last year; disposed of stake in Barry Callebaut Malaysia. Its Crabtree & Evelyn brand being hit by economic downturn. Also chairs Malaysia Palm Oil Council, chemicals company Batu Kawan; serves as director of British chemicals maker Yule Catto & Co Plc.

18 Chan Fong Ann US$209 million palm oil 78. Married

Joined board of Lee Shin Cheng's palm oil group, IOI 1985; remains a non-executive director and one of its biggest individual shareholders with a nearly 3 per cent stake.

19 Kamarudin Meranun US$205 million airlines 48. Married, 5 children

Deputy chief executive of AirAsia, which he cofounded with Anthony Fernandes (No. 15). Also close partner with Tony in several other businesses including AirAsia X, in which he owns a bigger stake; Tune Hotels, which has 5 locations and is opening 7 more; and Tune Money.

20 Chong Chook Yew US$200 million real estate 87. Widowed, 4 children

Columbia University grad has run family's Selangor Properties since 2000. Stock down just 5 per cent in past year, buoyed by successful housing project in Claremont, Australia.

21 Chen Lip Keong US$195 million gaming 61.

Founded NagaCorp in 1995, the year he obtained 70-year gaming licence in Cambodia; eventually built country's largest gaming resort, NagaWorld. Listed in Hong Kong in 2006. Serves as economic advisor to Cambodia's prime minister. Controlling shareholder and president of Malaysia tourism company, Karambunai. Trained medical doctor, headed Composite Technology Research, aerospace outfit owned by Malaysian government, for 7 years.

22 Lee Swee Eng US$190 million oil services 53. Married

Runs KNM Group, which provides services and equipment to oil and gas industry; stock dropped by more than half in past year. In September announced joint venture with France's Prosernat to form KPN Gas Technology. Fortune includes shares belonging to wife, Gan Siew Liat, head of human resources.

23 Jeffrey Cheah US$185 million real estate 64. Married, 3 children

Accountant started local tin mining outfit in 1974. Became Sunway Group, with interests in property, infrastructure, education, hotel and health care. Bulk of fortune held in property arm Sunway City, which is expanding in China and India.

24 Lim Wee Chai US$180 million rubber gloves 51. Married, 2 children

With his wife, spent US$180,000 in savings in 1991 to start a business trading rubber gloves. Later moved into manufacturing. Now his Top Glove is one of world's largest producers, with 850 customers in 180 countries; claims to have 24 per cent global market share. Apparently benefiting from ageing population, medical threats like swine flu. Shares up 12 per cent in past year, more than 50 per cent year-to-date; fortune down because of lower value of personal property.

25 Ahmayuddin Ahmad US$175 million port 52. Married, 4 children

Board member of both transit hub KL Sentral and Westports, the port he cofounded with G. Gnanalingam (No. 13) and which counts Li Ka-shing's Hutchison Whampoa as an investor.

26 Lee Hau Hian US$174 million diversified 55. Married, 1 child

Son of late rubber baron Lee Loy Seng is managing director of Batu Kawan and board member of KLK, which brother Lee Oi Hian runs. Batu Kawan's stock has rebounded 30 per cent since October low, but still down for past year.

27 Lau Cho Kun US$165 million diversified 73. Married

Largest shareholder in tilemaker Malaysian Mosaics, bought out its stake in Hap Seng, with interests in plantations, property, credit finance. Hap Seng's auto division operates Mercedes-Benz dealerships that supply Samling Group, run by his son-in-law, with logging trucks and transportation vehicles. Has no position at either company.

28 Vinod Sekhar US$150 million rubber 41. Married, 2 children

Late father invented process to devulcanise used tyres so they can be recycled. Vinod has been working to commercialise it. Timberland is first footwear manufacturer to incorporate Green Rubber, to be used in two of the company's fall 2009 collections. Reportedly being tested by several tyre companies. Minor investors include Mel Gibson, Forbes family members and Bruce Willis, who sued last year for return of funds after company didn't go public but later settled. Valuation down because of market conditions and few exit strategies for small tech outfits.

29 Liew Kee Sin US$140 million real estate 50. Married, 4 children

Former banker joined real estate firm SP Setia in 1996 as a director and is now group's managing director. With partners, developing US$620 million urban project in Vietnam.

30 Tiah Thee Kian US$135 million real estate 61. Married, 5 children

Cofounder of TA Enterprise, with property, financial interests. Owns Radisson in Sydney; announced purchase of the Westin Melbourne. Returned to board in 2007 after 5-year ban tied to conviction for reporting irregularities on Malaysia bourse. Wife Tan Kuay Fong filled as chairman during interim and remains chief executive.

31 Rozali Ismail US$130 million infrastructure 53.

Got start in law, then Islamic banking. Now executive chairman of water treatment and distribution company Puncak Niaga. Initially rejected Selangor government's offer to buy out some of its water concessions but is still negotiating. Shareholder in TRIplc Bhd. and WWE Holdings; trading in both suspended because of profitability issues.

32 Lin Yun Ling US$115 million infrastructure 54. Married, 2 children

Managing director of infrastructure group Gamuda, which has investments in such places as Indochina, South Asia and the Middle East. Sold part of his stake last year.

33 Yaw Teck Seng US$113 million forestry 71. Married

Founder of Samling Group, one of world's biggest forestry companies. Depressed plywood prices and lacklustre housing demand have led to falling profits. Stock dropped nearly two-thirds in past year; down three-fourths since its public offering two years ago. Son Yaw Chee Ming, who runs the firm, is worth US$85 million, just missing cut.

34 Goh Peng Ooi US$112 million software 53.

Electronics engineer worked at IBM Malaysia for 9 years. In 1989 founded Silverlake Axis, which provides banking and financial services software to companies across the globe. Educated in Tokyo.

35 Eleena Azlan Shah US$110 million infrastructure 49. Married, 2 children

Trained as a lawyer in Britain. Set up her own firm in Malaysia in 1987. Her wealth comes from her being the largest individual shareholder in infrastructure firm Gamuda.

36 David Law Tien Seng US$105 million mining

Cashed out his stake in Australian iron ore mining company Midwest when China's Sinosteel took company private in September. Apparently involved in philanthropy projects in Malaysia.

37 Syed Mohd Yusof Syed Nasir US$100 million banking 61. Married, 3 children

Former chairman of Southern Bank, sold out in one of nation's biggest deals of 2006. Since then has bought shares in pipemaker YLI, which have since dropped. Has had better luck with investment bank K&N Kenanga, whose shares are up 63 per cent. Partnering with Ong Beng Seng to develop first Four Seasons hotel in Kuala Lumpur.

38 Hamdan Mohamad US$98 million infrastructure 53. Married, 2 children

Australian-educated engineer controls infrastructure conglomerate Ranhill. Took its Ranhill Utilities private last year in a US$290 million deal; recently sold nearly 5 per cent of Ranhill to an undisclosed buyer. Avid polo player.

39 Tan Teong Hean US$95 million banking 65. Married, 3 children

Chief executive director of Southern Bank for 23 years until it was bought out in 2006. Former MasterCard board member now chairs Singaporean smart card outfit Cassis International. Also chairman of Southern Capital Management and member of the Board of Trustees of the Malaysian Institute of Economic Research.

40 Kua Sian Kooi US$90 million insurance 56. Married, 4 children

Executive chairman of insurance firm Kurnia Asia, which claims to have 6,500 agents, 3.5 million policyholders in Malaysia. Leading provider of car insurance, looking to diversify. Stock up 50 per cent since start of April.

Methodology

The list was compiled using shareholder and financial information provided by individuals themselves, stock exchanges, public documents and analysts. For people with publicly traded documents, net worths were calculated using stock prices and exchange rates from May 15. Privately held fortunes were calculated using database company BRIS and other sources to estimate what companies and assets would be worth if public.

Source: Forbes 3 June 2009

Housing the middle class in Penang

2009-06-03T07:23:00.000-07:00

WHEN opening a recent real estate seminar, Penang Chief Minister Lim Guan Eng expressed concern that young professionals and mid-level managers are finding it difficult to buy living quarters.

This was, of course, not a “Eureka” statement as many others have said it.

But it was important that he said it as the chief minister’s post is what the American media refers to as a “bully pulpit” that lets the occupant speak out and be listened to. It should set the agenda for state and local council leaders and civil servants to focus on this issue. Equally important, it should also tweak the consciousness of developers and their professional consultants.

It is useful to recall that in the early 1970s, college trained teachers, earning about RM400 a month and aided by government housing loans, were the main buyers of double-storey houses costing between RM25,000 and RM30,000 in Island Glades which has turned out to be a choice middle class housing area. Other buyers were mid-level management workers and professionals.

Today, young graduates earning from RM2,500 to RM3,500 a month in Penang Island do not think of landed properties anymore, even if their spouses earn similar salaries. Their combined income of RM5,000 to RM7,000 a month can only allow them to buy houses of RM300,000 to RM400,000, that is, if they have saved between RM30,000 and RM50,000 for down-payments or are lucky enough to have parents who can and are willing to contribute.

The double-storey terrace houses in Island Glades are selling from RM500,000 to RM700,000 each! Most new landed properties in the Northeast District of Penang Island are in three-storey format costing about RM800,000! Semi-detached variety costs more than a million ringgit.

Young middle-class house buyers have settled for apartments in high-rise buildings, unless they want to stay in Seberang Perai.

But living in the less attractive mainland part of Penang is a poor alternative as long as commuting between the two parts of the state is not seamless. The inefficient ferry services and the usually congested Penang Bridge do not help.

It is getting very difficult for Penangites to find apartments of about 120 sq m on the island selling for less than RM400,000. For some reasons, including development control standards and guidelines, developers have chosen to build large apartments with prices above RM600,000.

Those in choice areas, such as Gurney Drive, cost above a million ringgit.

Despite the good intentions of politicians, the power and resources of the state government and Penang Island Municipal Council (MPPP) are limited. They do not have large land banks to be active developers or the power to control prices.

Their main role in the housing industry is in regulating development. Under the best circumstance, they facilitate developers to build the type of houses needed by the people and at prices they can afford.

But the existing circumstances are not ideal. Politics and sectional interests can interfere with rational decision makings.

Making things more difficult, existing policies related to housing are not useful. For example, the housing policies in the Rancangan Struktur Negeri Pulau Pinang 2020 are largely “pie-in-the-sky” feel-good statements that are also applicable to Perak or Timbuktu.

Furthermore, many town planning and building standards and guidelines governing development control decisions were formulated decades ago.

An important agenda is to review the standards and guidelines to be in tune with the realities of the housing situations today and new development ideologies, such as sustainability. Height control is important to shape an attractive urban landscape.

More specifically they should facilitate and promote the building of housing units of 100 sq m to 120 sq m and selling for between RM300,000 and RM400,000.

Hopefully, developers can also be persuaded to abandon the practice of providing swimming pools, Jacuzzis, “libraries” and other facilities that require huge budgets to maintain. What is seriously needed is having ample parking space until the days when Penang has a public transport similar to that of European cities.

The task is urgent. The new members of the middle class, the back-bone of the labour force, are having problems housing their families. Under such circumstances, the clarion calls of Klang Valley and other metropolis can be and have been persuasive.

If the situations continue, making Penang the engine of growth will be adversely affected.

Besides, the island must not become just the favourite place of retirees and tourists.

Source: The Sun 2 June 2009

US: Where Homes Are Cheaper Than Cars: Bankruptcy Weighs Heavily on Real Estate

2009-06-02T07:27:00.000-07:00

Associated Press

Local real estate ads in Detroit, where houses can be had for less than the price of a used cars.

General Motors‘ trip through bankruptcy court delivers a new blow to Detroit’s long-suffering real estate market.

The struggling auto industry has made Michigan one of the epicenters of the foreclosure crisis dating to early 2005, well before the housing downturn hit overheated markets in Florida, California and the Southwest. Houses in some of the most distressed parts of Detroit sold for less than new cars.

Now, the closure of auto dealerships and the loss of white-collar jobs threatens a new round of pain in high-end suburban housing markets, as BusinessWeek examines.

The twin bankruptcies of GM and Chrysler also dampen prospects for Detroit’s commercial real estate industry. An effort to revive the city’s St. Regis Hotel stumbled earlier this year when the developer defaulted on a construction loan. And leaner companies could mean rising office vacancies, spurring debate over what Detroit should do now. A column in Crain’s Detroit Business argues that Quicken Loans could be one possible suitor for office space in the Renaissance Center.

The real estate impact of GM’s bankruptcy will also be felt beyond Motor City, as some 2,300 dealership closings by GM and Chrysler weigh on the already sagging retail real-estate market. The retail sector has been hit particularly hard rising vacancies during the recession; mall landlord General Growth Properties filed for bankruptcy earlier this year.

”This is single purpose real estate that has to change use now. So there will be a lot of that coming at one time,” AutoNation CEO Mike Jackson told Reuters last month. “And that’s going to take quite some time to work its way through the system.”

Source: Wall Street Journal 1 June 2009

PJD to unveil third phase of Harbour Place

2009-06-02T07:21:00.000-07:00

Company registers average sales of 90% from previous two phases

PJ Development Holdings Bhd (PJD) targets to launch the third phase of its Harbour Place project, the Ocean View Residences, in Penang with a gross development value of RM83mil by the middle of this month.

Chief operating officer Lim Lian Seng said the project, which consists of 386 condominium units with built-up areas of 938 and 1,100 sq ft, was located on a three-acre site near Penang Sentral transport hub.

Targeted at young working adults and scheduled for completion within three years, the building has incorporated distinct green elements such as eco-friendly landscaping and “sky garden”.

This is part of the group’s compliance with the Green Building Index endorsed by the Malaysian Institute of Architects.

Lim Lian Seng pointing to the proposed sky bridge linking Menara PJD to the Star LRT and KL monorail stations.

PJD has registered an average sales of 90% for phase one, Park View Residences, and phase two, Sea View Residences, of its 24-acre residential development.

Year-to-date, the group has registered some RM120mil sales from its one new and nine existing projects.

Among its existing projects are its flagship development – Swiss Garden Residences and Endah Promenade in Kuala Lumpur and Impian Meridien in Subang Jaya.

Meanwhile, PJD had invested some RM700,000 in a sky bridge to link its Menara PJD business tower to the STAR light railway transit and KL monorail stations, Lim said.

“We took over an abandoned serviced apartment project for about RM140mil last year and invested another RM100mil to convert it into a commercial building,” Lim said.

With an average rental rate of RM5 per sq ft, the group hoped to achieve 80% occupancy for Menara PJD in the first year of its opening in September, which would translate into a yield of at least 7% per annum, he said.

“We are in talks with various parties, including a major anchor tenant who has shown interest in leasing the whole building, and expect to close the deals within the next two months,” said Lim.

The 28-storey purpose-built business tower has 75 office suites with floor sizes from 1,335 to 29,353 sq ft. Of the 75 suites, 19 are corporate and the balance executive.

The former has more than 8,000 sq ft with attached bathroom and pantry while the latter will be from 1,367 to 8,000 sq ft. Menara PJD also consists of retail lots with built-up area of 646 to 12,487 sq ft.

Currently, PJD has some 1,500 acres undeveloped land bank in the Klang Valley, Kuantan, Johor and Penang.

For the third quarter ended March 31, PJD posted a net loss of RM1.77mil against a net profit RM9.29mil in the previous corresponding period.

Revenue dropped to RM133.35mil from RM159.15mil a year ago.

For the nine months to March 31, it recorded a 86.43% drop in net profit to RM11.47mil while revenue fell 10.61% to RM460.52mil.

Source: The Star 2 June 2009

Jaya Disaster: PJ's landmark and family favourite

2009-06-02T07:11:00.000-07:00

PETALING JAYA: Jaya Shopping Centre, more popularly known as Jaya Supermarket, was one of the city's earliest shopping malls.

The well-known "blue" landmark, strategically located at Section 14's bustling commercial centre, was established in 1974 as a lifestyle shopping centre.

It was one of Petaling Jaya's longest-standing icons, which became a popular shopping haunt and a cool place for teenagers to hang out in the mid-1980s and early 1990s.

In the early 1990s, the mall was embroiled in controversy when it flouted the law by extending its car park to 10-storeys, four-storeys higher than what was approved by the then Petaling Jaya Municipal Council Building Department.

The 12.6-sq-metre shopping centre had four-storey retail units, five-storey office units and a multi-level car park. The building was vacated to make way for a newer and modern shopping complex last year.

Until its closure, Jaya remained a neighbourhood shopping centre that housed the Cold Storage supermarket as its anchor tenant with a number of family restaurants such as Cable Car and Jaya Noodle House, pharmacies, bakeries and kiosks selling trinkets.

In August 2007, tenants were given six months to move out. Feb 6 last year was the last day that Jaya's tenants were allowed to trade.

Most of the shop owners and tenants were relocated to Jaya 33, just opposite it.

Redevelopment of Jaya involves the demolition of the existing structure and the construction of a new yet-to-be-named mall that offers bigger retail space.

Fourth body in Jaya mall disaster found

The body of the third victim, Muhammad Maskor, being removed from the rubble by search and rescue personnel yesterday.

PETALING JAYA: Police yesterday recovered a fourth body from the collapsed portion of the former Jaya Supermarket, amid fading hopes of finding the three other victims still trapped inside alive.

District police chief Assistant Commissioner Arjunaidi Mohamed said the search and rescue mission would nevertheless be conducted round the clock.

He said the search party located the third body, at the basement of the building at 3.30am, but retrieval attempts were made difficult by layers of concrete above it.

"We had to drill a hole in the concrete before the body was taken out at 2pm," he said yesterday.

The third victim was identifed as Muhammad Maskor, 31, while the fourth, retrieved at 4pm, was identified as Anwaruddin, 38.
The fourth victim was an excavator operator and his body was found beneath the machine he was operating when the collapse occurred.

The machine is among three others perched on top of the debris, while five were buried in the rubble.

Arjunaidi said 541 search and rescue personnel, including a Special Malaysia Disaster Assistance and Rescue Team were on duty at the disaster site, along with three sniffer dogs.

"We limit the use of heavy machinery at the site to avoid further collapse from the vibration it creates."

Arjunaidi, who is also the operation commander, said police believe that the remaining three workers are also trapped near the spot where the third and fourth bodies were found.

The building, which was about to be demolished, crumbled suddenly just as nine workers, all Indonesians, were unloading scaffoldings at the site at 4.45pm on Thursday.

Fifty workers were at the site in different sections when the incident occurred, but apart from the nine, the others were unhurt.

Two of the nine -- Sale, 48, and Suryano, 32 -- were injured and taken to the University Malaya Medical Centre for treatment.

The first body -- Al-Shuki Nahru, 31 -- was retrieved at 6.30pm on Thursday while the lower half of the body of an unidentified victim, was brought out at 10.20pm.

The Selangor government yesterday issued a stop-work order on the project site, to facilitate investigations by the Department of Occupati-onal Safety and Health and Public Works Institute of Malaysia

"The stop-work order is for seven days beginning from today (yesterday)," said Menteri Besar Tan Sri Abdul Khalid Ibrahim in a statement.

Source: New Straits Times 29 - 30 May 2009

Is a commercial real estate bust in the US inevitable?

2009-05-28T07:35:00.000-07:00

The government hopes to restore lending via cheap financing. Skeptics say programs aimed at restarting the market haven't worked yet.

Bank lending has slowed, but securities issuance has fallen off a cliff.

Malaysia's E&O posts loss on lower property contribution

2009-05-27T08:02:00.000-07:00

It seeks to raise RM500mil to fund new launches, reduce gearing

KUALA LUMPUR: Niche property developer Eastern & Oriental Bhd (E&O) has posted a RM44.6mil net loss for its fourth quarter ended March 31 compared with a net profit of RM9.27mil a year ago.

For the full year, the group saw a RM37.7mil net loss versus a RM128.9mil net profit in FY08, while revenue also fell to RM302.6mil against RM516.4mil previously.

A lower contribution from the property division, as well as provision for impairment loss on investments of RM10.24mil and loss of RM19.976mil on disposal of 50% stake and preference shares in associate Puncak Madu Sdn Bhd to Selangor Properties Bhd were the reasons for the lower full-year earnings, the group said in a statement. The property division accounted for more than 80% of total revenue in FY09.

While the company slipped into the red in FY09, it is looking at strengthening its balance sheet and reducing its gearing with a rights issue that is expected to raise RM200mil.

E&O executive director Eric Chan told StarBiz the severity and suddenness of the economic downturn in 2008 necessitated “pre-emptive balance sheet management strategies”.

E&O announced yesterday a renounceable rights issue of irredeemable convertible secured loan stocks (ICSLS) 2009/2019 on the basis of one new ICSLS for every two shares held. The nominal value 10-year ICSLS of 65 sen each come with a coupon of 8% per annum.

E&O has the option to call for conversion of the ICSLS into new E&O shares after two years of issuance and if its share price exceeds RM1.

E&O’s share price has been penalised since its merger with and delisting in July/August last year of E&O Property Development Bhd which left it with high gearing.

Chan said the rights issue was only part of a two-pronged approach to address the gearing concerns and funding needs.

In total, the group aims to raise RM500mil. In addition to the RM200mil from the ICSLS issue, E&O is raising another RM300mil from the disposal of non-strategic landbank.

“This programme started in January. To-date, we have raised just under RM100mil from our asset disposal including from the unwinding of the joint venture with Selangor Properties,” Chan said.

At present, E&O’s gearing is high at 0.8 times but the group’s loans are not due immediately having been extended to 2014.

According to Chan, with the RM200mil from the ICSLS scheme, E&O’s gearing falls to 0.46 times.

A further RM300mil from the disposal of non-strategic landbanks would bring gearing to a low 0.16 times.

Together with new property launches that would generate even more cashflow, gearing would be slashed to a negligible level in two to three years, said Chan.

Source: The Star 27 May 2009

Damansara Perdana to see new wave of development

2009-05-26T08:38:00.000-07:00

MK LAND Holdings Bhd (8893) is planning a new wave of development at its integrated Damansara Perdana township in Selangor and this includes the launch of more than RM5 billion worth of properties over the next decade.

While the company is targeting purpose-built buildings to enhance its margins, its focus for the next 10 years will be to develop Armanee Terrace Condominium and Rafflesia for RM3.5 billion, its chief operating officer for central region, Fatimah Wahab, said.

Launches at Damansara Perdana have been slow since 2007, as MK Land was consolidating its position to focus on other key aspects of its operations.

Since July 2008, a repositioning was carried out with the view to bring the company to a better strategic and financial position to meet the challenges ahead.
The township, which is 44 per cent developed, has accumulated sales in excess of RM2 billion since its launch in 1996.

Fatimah told Business Times that she is optimistic that the luxurious Armanee Terrace and Rafflesia projects, which are supported by a high-end integrated security system and surrounded by greenery, will be the main driving force for growth at Damansara Perdana.

The township has received encouraging response from home owners and investors due to its offerings and location, being in the prime area of the Damansara Perdana enclave amid a primary forest - best of the best location in Damansara Perdana, Fatimah said.

The Balinese-inspired Armanee Terrace features homes with sky gardens and broadband-ready features. It is the first high-rise development in Damansara Perdana with a garden in every unit.

Rafflesia is MK Land's first landed residential property at the township.

"We did a market survey on what people want and upon conclusion, learnt that they are looking for properties like Armanee Terrace and Rafflesia which has, among others, high returns on investment," Fatimah said.

She added that properties in Damansara Perdana would usually appreciate by 25-30 per cent upon completion, making them appealing to buyers.

Armanee Terrace will feature several condominiums in a horseshoe offering various designs of exclusive units.

The first block has been constructed and handed over to buyers in 2007, while the second block, comprising 518 units, is under construction and being offered for sale.

Fatimah said the last two or three blocks may end up as boutique developments or duplexes where it will offer less units but with bigger built-ups.

On Rafflesia, MK Land will offer a total of 460 units of triple-storey semi-detached modern homes.

It launched the first batch of 56 houses, priced from RM1.4 million each in 2007 with 60 per cent sold.

Fatimah said the company will launch 60 new units in July, each priced from RM1.8 million.

Source: Business Times 26 May 2009

YNH plans condo project atop Genting Highlands

2009-05-26T08:34:00.000-07:00

PETALING JAYA: A rare piece of land on Genting Highlands has been snapped up by YNH Property Bhd which will build holiday condominiums amid the rarefied air there.

It is believed most of the land on the highlands is owned by the Genting group.

YNH itself was surprised that there was land available and offered by a company. It completed the land purchase at the end of last year but did not announce it as the sum involved is not substantial relative to its equity.

YNH paid RM16mil for 95 acres which an official described as being on the same level as the casino. “If it’s on the Awana or Gohtong Jaya level, we wouldn’t have bought it,” a company official told StarBiz yesterday.

The Awana hotel and resort and Gohtong Jaya township are some distance below the peak of Genting Highlands and therefore, less cooling. The land that YNH bought is near the top where the temperature is around 15 to 16 degrees Celsius, he said.

Although the land YNH bought is sizeable, only 30% to 40% is suitable for development as the slope on the rest is too steep. “We’ll use the rest of the land for a golf course and jungle trekking,” the official said.

As for the development portion of the land, the official said the company estimated the gross development value (GDV) at up to RM2bil over 15 to 20 years.

It is working on a GDV of about RM50mil an acre, which it considers achievable as high-end condominium projects in the suburbs of Kuala Lumpur can have a GDV of about RM100mil an acre.

The official said the land had been converted from agricultural use to that of mixed property development. The company is preparing layout and building plans for approval from the Pahang state authorities, and hopes to launch sales next year.

Beside the cool weather, a feature that led YNH to buy the land is that there is good road infrastructure that was built by the Genting group. The land YNH bought will also be accessible by the main Genting road.

On YNH’s other projects, the official said the retail area of Kiara 163 had been sold for a total of RM200mil. Sales for the apartment units of this project in the Mont’ Kiara area of Kuala Lumpur have not been launched yet.

Meanwhile, it has also sold the retail units in the first phase of Menara YNH, near Shangri-La Hotel in Kuala Lumpur. The units in the retail podium were sold for RM300mil and the company expects to start construction of that in three months’ time.

Analysts, however, were disappointed at a recent briefing when they were informed of a further delay in the sale of one of the twin towers of Menara YNH to Kuwait Finance House. The sale and purchase agreement for that might not be signed till next year, they were told.

Source: The Star 26 May 2009

Malaysian Resources Plans 1.8 Billion-Ringgit Office Projects

2009-05-26T07:44:00.000-07:00

Malaysian Resources Corp., developer of the nation’s biggest transport hub, will build two office projects valued at 1.8 billion ringgit ($517 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 1 billion-ringgit tower at the 348 Sentral project in Kuala Lumpur by taking up as much as 60 percent of the building’s office space, Malaysian Resources Managing Director Shahril Ridza Ridzuan said. The project also includes serviced apartments.

“The global recession is not going to last forever,” Shahril said in a May 22 interview. “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 90 percent since Jan. 1, plans to return toprofit this year and expects to expand its order book by 50 percent to 3 billion ringgit as a government stimulus package spurs domestic demand. The two office projects in Kuala Lumpur Sentral, an urban center built around Malaysia’s largest bus and rail hub, will generate an average of 600 million ringgit a year from 2010, based on the project’s total expected revenue.

The 348 Sentral development covers 1.1 million square feet (102,000 square meters) of office space. The second office project, worth 800 million ringgit, is about half the size. The Kuala Lumpur Sentral development is already home to the Hilton and Le Meridien hotels. A St Regis hotel is also planned for the area.

Shares Surging

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

Shares of Malaysian Resources, controlled by the country’s biggest pension fund, are the fourth-biggest gainer on the Kuala Lumpur Construction Indexthis year. The stock has outpaced the benchmark Composite Index’s 20 percent gain.

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

Malaysia Resources expects to win 1 billion ringgit of new orders this year, with 30 percent of that coming from projects to clean up the country’s rivers, Shahril said. The company won two building contracts valued at 239 million ringgit over the past two months, its first construction jobs secured this year, increasing its order book to 2 billion ringgit, Shahril said.

New Projects

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 67 billion ringgit 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 percent for 2010 and 36 percent for 2011 to reflect higher construction earnings. Malaysian Resources reported a 39.3 million-ringgit loss in the fourth quarter of last year as sales slid and building materials including steel surged.

Source: Bloomberg 25 May 2009

Relaxed rules set to boost Malaysia My Second Home scheme

2009-05-26T07:38:00.000-07:00

The Government’s move in February to further liberalise the Malaysia My Second Home (MM2H) programme has been well received by foreigners and industry players, especially MM2H licence operators.

Currently, there are about 200 such operators nationwide.

Several amendments to the MM2H criteria were made by the authorities, including the lowering of entry age (below 50) as well as employment opportunities for foreigners in selective industries.

MM2H Agent Association president Kirby Lim said the programme had undergone significant improvement every year since it took over from the Silver Hair scheme, which began in 2002.

A file picture shows John Jones, a retired firefighter, and his wife Samantha who have moved to Malaysia under the Malaysia My Second Home programme. MM2H has so far attracted about 12,000 participants

“It shows that the Government, particularly the Tourism Ministry, is fully aware of the importance of MM2H as a key driver to economic growth, bringing in billions of ringgit, which is why it (MM2H) has been promoted heavily as a national agenda,” he told StarBiz.

Lim said while there might be some “hiccups” along the way, generally, most players or those who benefited from the programme were satisfied with the progress made.

“Of course, more can be done and there will always be issues that need to be ironed out, but we are making good progress and the association is in close contact with top officials from the Government, especially the Tourism Ministry,” he said.

Lim said the association would convey the concerns of the licence operators and MM2H participants to the relevant authorities.

It would also keep them abreast on the effectiveness of the policies in attracting foreigners under MM2H, and the changes needed to improve the logistics and marketing and promotions undertaken currently.

On the success of the MM2H so far, Lim said despite not being well marketed in its early years, the programme had been fairly successful.

Kirby Lim ... Despite not being well marketed in its early years, MM2H has been fairly successful

“However, the Government has recently been very aggressive in promoting it and under the stewardship of Tourism Minister Datuk Seri Ng Yen Yen, we believe the programme will gain significant momentum,” he said.

Currently, there are about 12,000 MM2H participants from countries such as China, South Korea, Britain, Bangladesh and certain parts of Europe and the Middle East.

Lim said the Tourism Ministry had recently embarked on a blitz to promote Malaysia, particularly in China and Japan, as a favoured destination to visit as well as to stay and retire (under the MM2H).

“We understand the Tourism Ministry is now looking to promote MM2H in other countries like Canada through exhibitions and other promotional activities,” he said.

Currently, Ng is in Britain to woo more tourists to Malaysian shores. She is targeting at least 10,000 Britons under MM2H. So far, 1,551 Britons have signed up for the programme.

On Malaysia’s advantage in attracting foreigners compared with other countries in the region, Lim said: “We are not trying to be arrogant but Malaysia offers foreigners quite a high standard of living at a relatively low cost, coupled with good infrastructure and a politically stable environment where English is widely spoken.”

Lim said foreigners also had the opportunity to own properties and would not be subjected to real estate property gains tax should they sell their assets.

“Moreover, the Malaysian hospitality is second to none as many foreigners have remarked that the locals are extremely warm and friendly,” he noted.

Lim is optimistic that the number of MM2H applicants will be higher this year.

“This is following the liberalisation of the entry level as well as the strong promotions made by the Tourism Ministry, Immigration and Home Affairs Ministry and other government departments,” he said.

Source: The Star 25 May 2009

New CEO at the helm for Kuala Lumpur Pavilion

2009-05-24T07:46:00.000-07:00

Kuala Lumpur Pavilion Sdn Bhd has appointed Joyce Yap as its chief executive officer for retail from May 1.

Yap joined the company which manages lifestyle mall Pavilion Kuala Lumpur in May 2002 as director of leasing and marketing after which she was promoted to acting chief executive officer for retail.

She has more than 20 years of retail, sales and marketing experience covering among others, the marketing, sales and management of properties ranging from residential to shopping centres.

Upon graduating in business studies in London, Yap stayed on and embarked on her career with the international trade division of the Gestetner Group in 1979. Since then, she has taken on senior sales & marketing and property management roles in large corporations such as Lion Properties Sdn Bhd, MBF Properties Sdn Bhd, General Corporation Berhad and Berjaya Ditan Sdn Bhd.

As a testament to her achievement and contribution, Yap was awarded Winner of Distinction of Distinguished Lifetime Contribution to Management of Shopping Centres in 2008.

She is also a founding member of the Council of Asean Shopping Centres, President of the Association for Shopping and High-rise Complex Malaysia (PPKM), vice president of FIABCI (International Real Estate Federation) Malaysia as well as a committee member of the Malaysian Association of Convention and Exhibitions, an active think tank committee of the Malaysian and Kuala Lumpur Tourism councils.

Source: The Edge Magazine 22 May 2009

S P Setia’s Setia Eco Gardens, Pavilion clinch Fiabci awards

2009-05-24T07:37:00.000-07:00

S P Setia Bhd’s Setia Eco Gardens project in Johor and Pavilion Kuala Lumpur have emerged winners in the Fiabci Prix d’Excellence Awards 2009 international property awards. Fiabci is the French acronym for the International Real Estate Federation.

S P Setia won in the Master Plan category while Pavilion KL won in the Retail category. Fiabci International announced the winning projects in a press release on May 21.

The awards presentation ceremony was to be held during the 60th Fiabci World Congress in Beijing. However, the entire Congress was called off three days before it was to due to begin on May 19 due to concerns over the spread of the A (H1N1) influenza.

This is S P Setia’s second win as it won in the same category in 2007 for its Setia Eco Park residential development in Shah Alam. The Group has been ranked the nation’s top property developer in The Edge Top Property Developers Awards for the past four years.

S P Setia president and CEO Tan Sri Liew Kee Sin attributed the win to the Group’s continous efforts in striving for excellence. “We are heartened that our efforts over the years to differentiate ourselves as the developer of choice have been rewarded with such a well-respected award in the property industry,” said Liew who is currently in Beijing together with about 100 other delegates who were already in Beijing when the Congress was called off including Lisa Kurrass, the new Fiabci World president.

“Setia Eco Gardens was developed in line with the Eco Concept due to the existing environment and the intention is to make the Eco concept available to both high-end customers (lavish eco villas priced from RM800,000) and the mass market (eco homes priced from RM200,000),” added Liew of the homes in the 948-acre township development.

Among the common features of the Eco homes and villas are energy conservation features such as rainwater harvesting, water recycling and solar panels.
The provision for green zones in the development master plan includes a 18.5-acre Eco park, a 16-acre rainforest, smaller landscaped parks as well as rivers, lakes and canals.

Meanwhile, Joyce Yap, CEO-Retail of Kuala Lumpur Pavilion Sdn Bhd said winning the award in the Retail category could mean that the lifestyle mall has led the country’s retail industry to new levels particularly in the growth of retail brands in Malaysia. It has a total of 450 tenants across 1.3 million sq ft net of retail space and has received about 48 million visitors since opening in 2007.

Residential project Lake Edge Puchong by YTL Land & Development Bhd was runner-up in the Master Plan category.Other runners-up from Malaysia was YTL's condominium project The Maple at Sentul Park which came in second runner-up in the Residential category while the 1 Sentral office building in KL Sentral by Malaysian Resources Corporation Bhd and G Hotel in Penang were first runners-up in the Office and Hotel categories respectively.

Orchard Scotts and Newton Suites from Singapore took the top two spots respectively in the Residential category while St Regis Singapore was the winner in the Hotel category.

Last year, Mulpha International Bhd's Pinggiran Bayou Village Homes which is part of its Leisure Farm Resort development in Johor was tops in the Residential category while four other Malaysian developers were runners-up in various categories.

This year’s awards saw several first-time winners from China, India and Russia. The two China projects that won were Huaming Model Town in the Rural & Suburban category and the Nanjing Riverbank Family affordable housing project which won a special award called the Beijing Congress Award. Russia’s tallest building the Federation Tower won in the Office category.

Source: The Edge Magazine 21 May 2009

Mubadala to invest $1.8bn in Malaysia property JV

2009-05-23T21:07:00.000-07:00

A luxury condominium is shown standing in front of Kuala Lumpur’s iconic Petronas Twin Towers in this April 28, 2009 file photo. Malaysia’s property market continues to attract investors such as Abu Dhabi’s Mubadala Development Co.

Mubadala Development Co, the investment arm of the Abu Dhabi government, will invest about $1.8 billion (Dh6.6 billion) in a property development project in Malaysia, a local newspaper reported on Saturday.

The project involves the construction of hotels and villas on a 1,200-hectare site in Terengganu state on the east coast of the Southeast Asian country, the Edge Weekly reported, citing Shahrol Azral Ibrahim Halmi, CEO of the Terengganu Investment Authority (TIA).

Mubadala will invest the amount over seven years while TIA will buy the land from the state government and inject it into the joint venture, said Shahrol.

TIA has been set up and labelled as Malaysia's first sovereign wealth fund and is modelled on similar concepts in the Gulf with the aim of investing oil revenues for the long term.

The Malaysian fund this week said it is to sell 5 billion ringgit ($1.43 billion) of bonds guaranteed by the federal government.

Shahrol of TIA said the fund aims to raise another 6 billion ringgit later this year by forward selling the oil royalty to be received by the oil-producing state over the next few years.

Mubadala, which manages over $10 billion in assets, is also developing a $600 million city in a planned economic zone in Malaysia's southern Johor state, near Singapore.

Source: Reuters 23 May 2009

Key investor factors in Dubai real estate

2009-05-22T06:51:00.000-07:00

Dubai's property sector has gone from boom to bust in less than nine months. Motionless cranes in desolate building sites are a stark reminder of the seaside emirate's dramatic property bust.

The following are issues investors are watching closely:

HOW LONG WILL DUBAI'S PROPERTY SLUMP LAST? Property prices in Dubai soared after the emirate opened its real estate sector to foreign investors in 2002, granting them freehold ownership rights at many developments.

But the bubble has burst, developers are cancelling or delaying projects and thousands of jobs are being cut.

Slumping demand would drag residential real estate prices down 50-60 percent this year from 2008 peaks, EFG-Hermes said in a research note this month. The market is unlikely to begin to recover before some time in 2011, it said.

GREATER CLARITY ON PROPERTY LEGISLATION ? The United Arab Emirates said earlier this month it would grant expatriate homeowners multiple-entry visit visas allowing them to stay six months at a time if they own properties worth at least 1 million dirhams ($272,000).

Property buyers have been waiting for legislation for years to clarify their residency rights.

But more clarity is needed as it remains unclear how expatriate buyers living in the emirate will be affected by the new resolution. It is also unclear whether the 1 million dirham tag is at the time of purchase or the current selling price.

Many units are now selling for less than 1 million dirhams, according to real estate brokers.

WHO IS GETTING GOVERNMENT CASH ?

Dubai sold $10 billion of bonds to the United Arab Emirates central bank in February to raise funds to support state-linked companies suffering from the crisis. But authorities have said they do not intend to reveal the recipients.

Nakheel, the state-owned developer of the emirate's palm-shaped islands, said it is receiving funds.

Emaar Properties EMAR.DU, the largest-listed developer, said it had no need for financial support.

Nasser al-Shaikh, former Dubai Department of Finance director-general, said key beneficiaries were real estate companies in which the Dubai government holds some ownership states.

Source: Reuters 20 May 2009

Donald Trump on His Business Operations

2009-05-22T06:42:00.000-07:00

Donald Trump described his business operations in a December 2007 deposition as part of his legal case against author Timothy L. O'Brien. Mr. O'Brien's book, "TrumpNation: The Art of Being the Donald," cited anonymous sources close to Mr. Trump that his net worth was around $250 million, not the many billions that Mr. Trump claims. Mr. Trump sued Mr. O'Brien and his publisher in Camden, N.J., state court claiming defamation and lost business.

Trump on Trump: Testimony Offers Glimpse of How He Values His Empire

Here are some additional details that emerged from the case:

Trump on Brand Value
The 62-year-old developer told Mr. O'Brien that he was worth $6 billion. But it emerged during the deposition that Mr. Trump had told his bankers and New Jersey Casino officials that he was worth around $3.6 billion. This all occurred around the same time period in 2004 and 2005.

Mr. Trump said the $3.6 billion figure that he told the banks didn't "include anything having to do with branding," he said in the deposition. "There are those that say the value of the brand is very, very valuable," he said. Asked if he keeps his net worth documents nearby, he said: "I do keep one actually on my desk, hidden." In an interview Sunday, Mr. Trump said his net worth is now above $5 billion, not including the brand value.

Trump on Being 'Sold-Out'
Mr. Trump told The Wall Street Journal in November 2007 that he sold all 1,282 units at his Las Vegas condo project that he owns with casino and hand-truck magnate Phil Ruffin. There were $1.3 billion in proceeds coming from that project, he told The Journal and other news outlets, including CNBC.

In the deposition one month later, he said he had deposits for around 900 units. Mr. O'Brien's lawyer, Andrew Ceresney, asked whether Mr. Trump was caught in a lie?

"That's not a lie," Mr. Trump said. He said that he was holding on to the rest of the units as an investment. "I'm a buyer also, essentially."

On Sales per Square Foot
At the condo and hotel project in Las Vegas, Mr. Trump had told reporters on several occasions that the project sold for $1,300 a square foot on average.

At the deposition, the lawyer, Mr. Ceresney, asks if that sales figure is true.

"For some units it is, yes. We got some -- we sold -- we got 1,300 -- I averaged on some units $1,300 a foot," Mr. Trump said.

Mr. Ceresney then asked: "Do you understand the concept of an average, Mr. Trump?

Mr. Trump's lawyer objected to the form of the question. Then Mr. Trump said: "Well, I'm saying on certain units I averaged $1,300 a foot."

Trump on Accounting
Asked if he understands the concept behind GAAP, or generally accepted accounting principles, the set of rules used by businesses, he said, "No. I'm not an accountant."

At one point a lawyer asked Mr. Trump: "Are you familiar with the concept of net present value?" Net present value is a key measure used in real estate to estimate the worth of an asset in today's dollars based on its future cash flow and the time-value of money.

"The concept of net present value to me would be the value of the land currently after debt," Mr. Trump said. He added, "Well, to me, the word 'net' is an interesting word. It's really -- the word 'value' is the important word. If you have an asset that you can do other things with but you don't choose to do them -- I haven't chosen to do that."

In an interview Sunday, Mr. Trump says that he stands by his answers and that he leaves financial reporting to his accounts.

On Trump Tower
One of Mr. Trump's most prominent buildings is Trump Tower, the black glass skyscraper he built in the 1980s on Fifth Avenue and 57th Street in Manhattan.

According to the deposition, in 2006 a Forbes magazine reporter calculated that Mr. Trump's portion of the tower was worth $288 million. To do that, the reporter estimated the building generated $17.5 million of cash flow a year. The deposition shows, according to Mr. Trump's internal financial statements presented by Mr. O'Brien's lawyer that the building had a net loss of $587,730 that year. And including depreciation, amortization and interest expenses, the financial statements showed the operating income was about $4 million.

Asked if he knows how to calculate operating income, he said: "I don't do that. I really don't." Mr. Trump said in the interview Sunday that he stands by his answers and that he leaves financial reporting to his accounts. With regard to Trump Tower, he says a recent lease he signed with luxury retailer Gucci is one of the most lucrative in the world.

In the deposition, he also pointed out in the discussion of Trump Tower's income statement that the statement didn't take into account that he occupies two and half floors there for his headquarters. "I pay no rent, which you have to put a value on too, I guess; right?" Referring to his three adult children -- Ivanka, Eric and Donald Jr. -- who work for him in Trump Tower : "Maybe I'll move my children into a less expensive location."

Trump on Using Email
Asked if he uses computers or personal electronic devices, Mr. Trump told Mr. O'Brien's lawyers he doesn't own a computer at work or at home. Nor does he have a BlackBerry. He relies on his staff to send emails. "I generally would write letters or make telephone calls," he said. "Sometimes I'll just write a note to somebody. I don't do the email thing."

Source: Wall Street Journal 18 May 2009

IOI bullish on RM1bil development project in Iskandar

2009-05-22T06:36:00.001-07:00

JOHOR BARU: IOI Properties Bhd is banking on the strategic location of its newly launched Taman Kempas Utama within Iskandar Malaysia as the project’s main selling point.

Senior general manager (property division) Simon Heng said the project’s location in the Kempas-Tebrau growth corridor augur well for the company.

The Kempas-Tebrau corridor is currently the hottest spot for property development in south Johor with more than 10 ongoing projects.

Heng said the project was also easily accessible from the North-South Expressway after the Skudai toll plaza, Jalan Kempas Lama and Jalan Senai-Seelong.

Simon Heng (left) with senior manager, marketing and sales department Kelvin Tang at the Taman Kempas Utama showhouses. “We are looking at RM1bil in gross development value and the project will keep us busy for the next 10 years,’’ Heng told StarBiz.

“We are looking at RM1bil in gross development value and the project will keep us busy for the next 10 years,’’ he told StarBiz.

Located on 101.17ha, Taman Kempas Utama will have about 2,000 residential and commercial units, while 20.2ha has been allocated for light industrial buildings.

Heng said Tesco Stores (M) Sdn Bhd, the operator of Tesco hypermarkets in Malaysia, would also set up the township’s first standalone hypermarket on 4.04ha next year.

The project is the company’s second mixed property development project in Johor after its 2,023.42ha flagship project, IOI Bandar Putra Kulai.

Besides upgraders and existing house owners in the vicinity, the project is also aimed at Malaysian professionals working in Singapore, Singaporeans, and pensioners and expatriates based in the republic.

“Demand for high-end houses is still positive in Iskandar Malaysia despite the current economic situation as there are still buyers out there with money,’’ said Heng.

He said the commitment shown by stakeholders of Iskandar to ensure that the development of the economic growth corridor continued despite the slowdown would also benefit the property sector.

Under the Ninth Malaysia Plan (9MP), the Government has allocated RM6.83bil for infrastructure projects in Iskandar and all the projects will be completed between 2011 and 2015.

Projects approved under the 9MP include road improvement packages, drainage works, river cleaning and public housing.

These projects are in five flagship development zones in Iskandar – Johor Baru City Centre, Nusajaya, Eastern Gate Development, Western Gate Development and Senai-Kulai.

Heng said the continuous inflow of local and foreign investments and the creation of some 800,000 jobs over the next 15 years in Iskandar would boost demand for houses there.

He said the company planned to expand its IOI Mall shopping centre in Bandar Putra Kulai next year to cater for the growing number of shoppers.

The RM50mil shopping centre, spanning 55,742 sq m, opened in 2001 with 80 tenants and was the only standalone shopping centre in the Kulai-Senai area, he said.

Heng said the new wing, to be known as IOI Mall II, would be built on a 4.04ha site beside the existing shopping centre and would have 100 tenants.

Source: The Star 22 may 2009

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IOI bullish on RM1bil development project in Iskandar

JOHOR BARU: IOI Properties Bhd is banking on the strategic location of its newly launched Taman Kempas Utama within Iskandar Malaysia as the project’s main selling point.