Tune-ing in to properties

PIONEER PROJECT: An artist’s impression of Harbour Place

TUNE Group, famous for popularising the budget business model, is going into properties.

Its first project is a shopping complex and office building in Klang, a town known for its ports that are the nation's trading gateway.

Tune Group will hold all its property business under Tune Properties, following a restructuring exercise that will be completed within a year.

"The Harbour Place in Klang will be our first project under Tune Properties. From there, we will expand into other types of properties," Datuk Kamarudin Meranun told Business Times in a phone interview recently.

Kamarudin and Datuk Tony Fernandes are the founders of Tune Group, which now owns Asia's biggest budget airline, low-cost hotel operator Tune Hotels, and financial services provider Tune Money, to name a few.

Kamarudin hinted that Tune Properties might have a more diverse portfolio.

The group will hire Tan Eng Wah, the former director of Tan & Tan Development Bhd, to run Tune Properties.

Tan has more than 25 years of experience in the property business, encompassing hotels, shopping complexes and even hospitals.

Strategically located along the main Klang highway connecting Klang town and Port Klang, Harbour Place will be positioned as a suburban shopping complex to serve the mushrooming Klang neighbourhoods.

It is targeted to open by the third or fourth quarter of this year.

Kamarudin currently holds 63 per cent of Chestar Properties Sdn Bhd, the owner, developer and operator of the project.

The entire project, which comprises a shopping mall and an office suite tower, has a gross development value of RM420 million.

Kamarudin said the whole idea would be in line with the philosophy of Tune Group, which is to offer affordable products and services to an underserved market.

He said Harbour Place is a classic example of such a venture.

"You find that there are hardly any quality shopping malls in Klang, while Kuala Lumpur is almost bursting with such complexes," Kamarudin said.

Other private initiatives under the Tune brand are Tune Talk, Tune Entertainment, Tune Games and Tune Media.

By New Straits Times (by Presenna Nambiar)

Residential property sector turns the corner

The number of unsold houses in Malaysia fell for the first time since 2002, reflecting a buoyant property market, a deputy minister said.

"The overhang value stood at RM3.82 billion. Compared to last year, the overhang volume dropped by 6.9 per cent, while the value reduced by 8.8 per cent," Deputy Finance Minister Datuk Kong Cho Ha said.

He was speaking at the launch of the 2007 property market report in Kuala Lumpur yesterday.

Last year, total property transactions rose nine per cent to 309,455 while the value of these deals jumped by a quarter to RM77.14 billion.

The market was dominated by the residential sub-sector, making up 65 per cent of the deal volume and 47 per cent of the total value.

This was followed by property deals in the agriculture sector, which made up almost a fifth of transactions.

Commercial property deals made up nine per cent of the market, development land at 4.5 per cent and industrial property at 2.6 per cent.

Sales of new houses were better as overall take-up rate was 45.1 per cent.

"Houses priced below RM200,000 were well-received by the market, accounting for 65 per cent of the units sold. Terraced houses remained popular among buyers, as evident from its 51.7 per cent contributions to the total new launches," he said.

Kong also noted that prices of residential properties were sustained at a healthy level, with the Malaysian All Houses Prices Index rising by 4.8 per cent to 124 points last year.

Correspondingly, he said, the price of the "average" house rose by 2.2 per cent to RM173,998 in 2007. Kuala Lumpur had the highest price in the country at RM393,211 followed by Selangor at RM253,225.

As various government measures were introduced in 2007 under the Budget 2008 announcement, Kong said the actual effectiveness of these measures could be evaluated this year.

The government had scrapped the real property gains tax and allowed monthly withdrawals from the Employees Provident Fund, among others.

By New Straits Times (by Kamarul Yunus)

Ivory Properties to launch high-rise projects

PENANG: Ivory Properties Group plans to launch more than 1,000 high-rise properties with an estimated gross sales value of about RM450mil on the island over the next two years.

General manager Chok Keng Vui told StarBiz the high-end condominiums would be in Batu Ferringhi and Mount Erskine.

Chok Keng Vui

“The Batu Ferringhi project, Island Resort, will comprise 410 condominiums with built-up areas measuring from 1,100 sq ft and selling prices starting from RM350,000.

“The project in Mount Erskine, called the Peak, will comprise more than 600 condominiums with built-up areas from 1,100 sq ft and priced from RM290,000,” he said.

Chok said the Island Resort was targeted at house buyers who wanted to get away from urban life and enjoy the serenity of the seaside.

“The Peak, close to Tanjung Tokong town, is for those who want to stay close to shopping complexes, supermarkets and hawker centres,” he added.

Ivory Properties is now developing RM1.137bil worth of property projects on the island, including the RM1bil Times Square mixed development project in Jalan Datuk Keramat and the RM137mil Moonlight Bay villa project in Batu Ferringhi.

Since 2003, Ivory Properties has completed and sold high-rise and landed residential, and commercial properties with an estimated gross sales value of about RM500mil in Penang.

Ivory Properties was founded in 1999 by Datuk Low Eng Hock, whose first project was Tanjung Park Condominiums in Tanjung Tokong.

In 2005, the company launched the RM1bil Times Square project.

Due to its unique “urban village concept”, this project was featured in the Autumn 2005 special edition of the Architecture China magazine, one of the top professional design magazines in the Asian property industry.

Low, 45, is a graduate in engineering from Canada’s Concordia University.

By The Star (by David Tan)

Emkay buying land in Cyberjaya

CYBERJAYA: The Emkay group of companies will spend RM142.9mil to buy land for its second phase of commercial property development in Cyberjaya.

Group chairman Tan Sri Mustapha Kamal Abu Bakar said group had identified various areas to put up buildings for the information technology (IT) industry.

“To date, in the first phase of our development here, we have bought RM72.3mil worth of land that has resulted in gross development value of RM725mil,” he told reporters after delivering mock keys to its NeoCyber buyers and a press briefing on its MKN Embassy Techzone building yesterday.

The event was witnessed by Second Finance Minister Tan Sri Nor Mohamed Yakcop.

Its first phase development has four main commercial property projects - the NeoCyber, MKN Embassy Techzone, the Mustapha Kamal building and the Lucky Cottage.

Emkay's buildings are on a build-then-lease-or-sell basis in response to foreign and local investors' needs.

Mustapha Kamal said the initial phase of NeoCyber, comprising shop lots, had been 100% taken up and the second phase was 90% sold.

“We will start the NeoCyber third and fourth phases early next year and hope to wrap up the project by 2010.

“For the MKN Embassy Techzone building, we are in the midst of installing some IT fittings as required by a potential buyer,” he said.

He added that the deal with the buyer would be announced soon.

In its business focus in developing IT buildings, Mustapha Kamal said the company had faith in the future of Cyberjaya.

“We develop buildings as per customer specification to be rented out; later we plan to go into real estate investment trusts,” he said.

Meanwhile, Nor Mohamed said the Government would spend RM40bil in subsidies this year.

“Of the total, fuel subsidy accounts for RM18bil as compared with RM7bil to RM8bil last year,” he said.

By The Star (by Sharidan M.Ali)

Napic bullish about property market outlook for this year

PETALING JAYA: The National Property Information Centre (Napic) is bullish on the property market outlook for 2008, underpinned by government initiatives and a steady economy.

“The Government had proposed various measures in Budget 2008 aimed at sustaining the country’s economic growth, in particular, the property industry,” Napic said in its Property Market Report 2007.

The exemption of real property gains tax, and the 50% stamp duty exemption for the purchase of one house of not more than RM250,000, was a promising start.

“This would reduce the cost of purchasing a house by up to RM2,000 and overall costs of acquisition of houses,” it said.

The Government’s efforts in assisting the low-income group, such as implementation of low and medium-cost housing programmes, will also help drive property transactions.

A sum of RM381mil is said to be already allocated for the implementation of low-cost housing programmes.

Realising that housing loan repayment is a major financial commitment for most, the Government is allowing EPF contributors to make monthly withdrawals to ease the financial burden.

With regards to those without fixed income, the Government has also established a fund to provide guarantees to banks providing loans to this group.

According to Napic, the private sector’s role in expediting the transfer of property is also a contributory factor.

“The participation of the private sector in Pemudah (special task force to facilitate business) and the implementation of the certificate of completion and compliance is expected to have positive impact on the local property industry,” it said.

The healthy economic outlook for the country, it said, was also expected to contribute positively to the property market in 2008.

“The Malaysian economy is poised to remain robust in 2008 with real gross domestic product expected to register a 6% to 6.5% growth.

“The optimistic consumer and business confidence in the fourth quarter of 2007 suggests that the Malaysian economy would continue its growth momentum in the future,” it added.

Napic also said the Malaysian property market was buoyant in 2007.

The overall market strengthened with increases in both transaction volume and value, improved sales performance for newly launched housing units and reduced numbers of property overhang.

The market recorded 309,455 transactions valued at RM77.14bil in 2007 compared with 283,897 and RM61.6bil respectively in 2006, registering a transaction volume growth of 9% and value surging 25.2%.

The residential segment was the most dominant segment, making up 64.5% of total volume and 47.3% in transaction value.

By The Star

Singapore favours subway rail link to Johor

SINGAPORE: Singapore said yesterday it welcomed a suggestion by Malaysia to connect the city-state’s subway system to Johor.

“The link should not be a difficult one and it will bring immediate advantages to both sides,” Singapore Foreign Minister George Yeo told local reporters, according to transcripts released by his ministry.

Malaysian Foreign Minister Datuk Rais Yatim had earlier asked Singapore Prime Minister Lee Hsien Loong to consider connecting the city-state’s urban rail network to the Iskandar Malaysia special economic zone.

To be developed over 20 years, Malaysia hopes the 2,200 sq km (850 sq mile) zone in Johor would be able to generate jobs and investments in projects catering to companies and individuals in wealthy but land-scarce Singapore.

The two countries are separated by a narrow strip of water and connected by two bridges.

Singapore’s subway network is managed by SMRT Corp and ComfortDelGro, both of which are government-linked companies.

By Reuters

Rehda aims for RM100mil sales at MAPEX 2008

JOHOR BARU: The Real Estate and Housing Developers Association (Rehda) Johor hopes to register sales of RM100mil from the state-level Malaysia Property Expo (Mapex) 2008, which will be held here next week.

Branch chairman Steven Shum said the association recorded sales of RM150mil at last November’s four-day property expo in which 40 developers took part.

“To be able to make RM100mil this time around is good, considering the uncertainties in the global economic scenario,” he told StarBiz.

Shum said developers taking part in the upcoming event were not expecting to make big profits; in fact most of them were looking to break even and clear existing stocks.

He said the main objective of the last event was to create more awareness among potential house buyers of the best time to buy houses.

Shum said the actual price increase in building materials had not been factored into the selling prices of properties showcased in Mapex 2008, thus buyers would be paying reasonable prices. He said Johor currently had a property overhang of more than 8,000 residential and commercial properties worth RM1bil, which Rehda hoped to cut by half this year.

By The Star (by Zazali Musa)

Matta to host Asian tourism expo in KL next month

The Malaysian Association of Tour and Travel Agents (Matta) is hosting the Asian International Tourism Expo 2008 (AITE) from May 22 to 25.

The four-day event will be held at the Putra World Trade Centre in Kuala Lumpur. Malaysian Chinese Tourism Association and Malaysia India Tour & Travel Association are also jointly hosting the event this year.

"AITE 2008 is set to be a proprietary Malaysian trade show that is at par with other regional trade shows. We hope more local tourism players will take part in the event," AITE 2008 Travex committee chairman Rozzana Rahmat said in a statement.

AITE 2008 will showcase a variety of inbound travel products ranging from flights, accommodation and activities within Malaysia and Asia.

About 30 per cent of the exhibitors are from international markets. The trade show is open to public on its last day on May 25 where exhibitors can sell directly to consumers.

By New Straits Times