SunCity faces challenge in selling high-end units

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

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

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

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

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

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

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

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

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

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?

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?

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.

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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

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

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

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

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

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

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