Become a successful real estate investor

Hardworkers: Participants of the financial workshop working on their assignments

In Malaysia, there are plenty of opportunities for everyone to accumulate wealth and become financially free. Poor financial planning coupled with wrong investments have made many people poor wealth accumulators.

Most people acquire their financial knowledge once they start working or through trial and error.

This traditional method of learning would cost them thousands of ringgit and it would set them back a few years financially.

When it comes to putting money to work, it requires a different mindset and new set of skills that is best learned from the experts.

For example, many people have made wrong property investments that have cost them thousands of ringgit and a few years of their life is required to undo the damage. It is easy to get into properties but very difficult and costly to get out.

“You must get it right, not only the first time, but every time in property purchases — whether you are buying as investment or your own home,” advises Milan Doshi, independent financial trainer and best-selling author of How You Can Become A Multi-Millionaire Real Estate Investor.

Malaysia is one of the few countries where the majority can easily invest in one property every three to five years. Whereas, in countries like Singapore or Hong Kong, it is considered a major achievement to buy a second property for investment purposes.

Malaysia has a huge advantage as the prices of properties are amongst the lowest in world.

One can easily buy a medium-cost apartment that gives rental returns of seven to nine percent per annum for as low as RM70,000.

All you need to do is come up with a low down payment of only 10 percent.

“By using creative financing techniques, many of our graduates have bought properties with little or zero down payment and positive cash flow. It is really easy to earn long term compounded returns from both rental yields and capital appreciation of 10 to 12 percent p.a,” adds Milan.

Properties also provide an excellent long-term investment vehicle to fund your children’s education and retirement needs while providing a steady and predictable passive rental income that will help you to gain financial independence and ultimately, financial freedom.

In Malaysia, there are two main ways of becoming wealthy besides running your own business: investing in properties and stocks. Properties are long term in nature, whereas the stock market is in respect, short term.

Hence, one needs to learn how to do both and practise tactical asset allocation between these two powerful investment vehicles.

Milan has been conducting various financial programmes on personal money management, property and stock market investments since 1998. Participants will learn all aspects of smart money management, discover their unique investment profile as well as property and stock market investments.

This include ways of cutting short their mortgage payments in half, how to leverage property loans for stock market investments and how to make 20 to 30 percent p.a. returns from the stock market with minimal risks.

Participants will also learn the art of tenant and property management, how to look for motivated sellers and master powerful negotiation skills.

Money is made in properties at the point of purchase and not when you sell. Participants are assured of unbiased advice, as they do not sell any financial products or services.

They will learn practical lessons through a combination of lectures, games and real life case studies.

There will be a three-hour financial workshop on “How you can become a Multi-Millionaire Property & Stock Investor, right here in Malaysia” on May 10 and 17 (Saturdays).

* For more information, call 019-2277 645 or visit www.milandoshi.com/workshops.htm to sign up (limited seats).

By The Star

Metro plans RM1.5bil Kajang 2

KAJANG: Metro Kajang Holdings Bhd will embark on a RM1.5bil high-end gated and guarded development on its newly acquired 272-acre freehold land here.

To be launched next March, the project will be developed over eight years. It will have 3,500 bungalows, semi-detached houses and three-storey super link homes, apartments, commercial units and private schools.

Metro Kajang has announced to Bursa Malaysia on Monday the acquisition of 96% undivided share in 12 parcels of land in Hulu Langat by subsidiary Srijang Kemajuan Sdn Bhd for RM77.9mil cash.

Another wholly-owned subsidiary Intra Tegas (M) Sdn Bhd holds the remaining 4% undivided share of the land that was bought for about RM2mil more than five years ago.

The land, 2.5km from Kajang town centre and easily accessible via the SILK Highway and Jalan Reko, is bordered by matured housing estates and is partly planted with rubber trees.

Executive chairman Datuk Alex Chen Kooi Chiew told StarBiz Metro Kajang had been eyeing the land for more than 10 years.

However, it was only now that the company was able to complete the entire deal with the parcel owners, he said.

“This land is probably the biggest single piece so near to the town centre. We feel it is worthwhile to buy no matter the amount of efforts and hardship we have to endure as long as it benefits our shareholders,” he added.

Chen said the development would be tentatively called Kajang 2 but the name might later be changed. It would have a gross development value of RM1.5bil.

“We want to develop it into an integrated and self-contained township. Our first launch would be semi-detached houses, bungalows and super link homes,” he said.

On the recent acquisition of 15,942ha land in Kalimantan for RM24mil in January, Chen said based on its survey, the land was suitable for oil palm planting and harvesting.

“We have completed planting on 1,800ha. The plantation is intended to provide long-term earnings for Metro Kajang,” he added.

By The Star (by S.C.Cheah)

PKNS offers over a 1,000 units at rock-bottom prices

Big promotions: Md Nasir showing a poster for the sale of properties.

OVER 1,000 properties are up for grabs at rock-bottom prices in various parts of Selangor, including the state capital Shah Alam and the prime property hot-spot Kota Damansara.

The Selangor State Development Corporation (PKNS) has announced that the Jualan Hartanah Mampu Milik PKNS 2008 (PKNS Affordable Properties Sale 2008) will take place from this Friday to May 18.

A total of 1,173 residential units, 53 bungalows, 25 shoplots and 206 industrial land lots are on offer at bargain prices.

On top of the discounted prices, buyers will also get incentives for each property bought.

A 10% discount will be given to buyers of factory buildings in Rawang and Air Manis, Sabak Bernam.

All other buyers will be given free air-conditioners, LCD television sets and electrical appliance vouchers, depending on the price of the properties.

According to PKNS deputy general manger (administration and development) Md Nasir Md Arshad, the sale is intended to give the public an opportunity to own their dream homes at an affordable price.

“PKNS properties are always priced at 7% to 10% less than other properties on the market,” Nasir said.

This time around, the sale will encompass properties in Shah Alam, Kota Damansara, Antara Gapi, Kota Puteri, Bernam Jaya, Bandar Baru Bangi, Kuala Selangor and Bandar Sultan Suleiman in Port Klang.

Almost all these projects have been completed.

“PKNS is also offering a payment facility where buyers only need to pay a RM500 down payment before commencing on a loan scheme being offered to qualified buyers,” Nasir said.

“The facility is a confidence boost for buyers of PKNS properties.

“The buyers can also pick strategic locations, including the upmarket hot spots like the new eight-storey apartment block in Section 10 at Kota Damansara, which is priced from RM180,000 onwards,” he said.

The new apartment block is equipped with a swimming pool, a badminton court and sports area.

It is strategically located in the vicinity of Petaling Jaya and is linked to highways, including the Damansara-Puchong Highway and MRR 2.

In Shah Alam, PKNS is offering 167 apartments at RM145,000 each in Section 24, a strategically located residential area with many nearby facilities like schools, clinics, 24-hour restaurants, car workshops and the Giant, Mydin and Ole Ole supermarkets.

“The lowest priced apartment is RM59,000 for the five-storey apartment in Bandar Sultan Suleiman,” Nasir said.

He said PKNS decided to hold another special sale this year as the response to the previous one was overwhelming with buyers snapping up all the properties because of the competitive prices, strategic locations and other attractive facilities.

“We have started using the tagline ‘Living with PKNS’ that is representative of the buyers’ confidence in our properties.

“It represents 150,000 PKNS property owners who have bought and continue to grow with our new properties,” Nasir said.

The properties sale will be held at the PKNS Complex in Shah Alam as well as at all PKNS sales gallery in the state.

By The Star (by Debbie Chan)

Asian Finance Bank plans US$500m property fund

ASIAN Finance Bank, one of three foreign Islamic lenders in Malaysia, plans to set up an Islamic property fund of up to US$500 million in 2009 to tap what it considers an undervalued market.

The bank, owned by Qatar Islamic Bank, RUSD Investment Bank Inc of Saudi Arabia and Global Investment House of Kuwait, also plans to set up a fully-fledged Islamic bank in Indonesia by 2010 as part of its effort to build in-roads into Asia.

Faisal Alshowaikh, chief executive of Asian Finance Bank, said in an interview the property market was relatively subdued following the global credit crisis, but he saw potential for a property fund in Malaysia.

“Right now the property market has suffered from sub-prime, so it is not something I would pursue aggressively,” he said, referring to defaults on low-end mortgages in the United States that have rattled markets worldwide.

“But this is something we have in our minds to set up. When you look at Indochina and other countries like Korea, Singapore, Hong Kong, I think the property market is very much undervalued in Malaysia.”

The global Islamic finance market is one of the fastest growing in the world. Islamic assets are growing at an annual pace of 20 per cent and are set to hit US$2 trillion in 2010 from the current US$900 billion, largely thanks to a flood of petrodollars, Ernst & Young said in February.

Asian Finance Bank has a representative office in Indonesia, a country analysts say has the potential to become a major player in global Islamic finance because around 85 per cent of its population is Muslim.

“It is a big market for Islamic banking which needs to be aggressively explored,”Alshowaikh said on the sidelines of an Islamic banking conference in Jakarta.

“We have plans to make this representative office into a fully-fledged Islamic bank in Indonesia. In this part of the world, with a population at 229 million — and a relatively small percentage of the market here is Islamic — I believe we can do more on the retail side and do more on wealth management.”

Indonesia’s Islamic finance market lags neighbouring countries Malaysia and Singapore because of tax and accounting framework issues.

But analysts expect syariah financing to take off after Indonesia’s parliament passed a long-awaited syariah finance law last month.

Indonesia’s central bank says the Islamic banking industry in the world’s most populous Muslim nation is set to meet its target of a 10-15 per cent share of national banking assets by 2015 from less than 5 per cent now.

Asian Finance Bank was incorporated in Malaysia in 2005 and aims to develop a regional banking network providing a wide range of services.

The chief executive said it would like to establish representative offices in Singapore, Brunei, China, South Korea, Vietnam, Myanmar, Laos and Cambodia, to expand its Asian presence.

The bank’s website says Qatar Islamic Bank is its biggest investor with a 70 per cent share in the company. RUSD Investment Bank Inc has 20 per cent and Global Investment House has 10 per cent.

By Reuters

Malaysian properties catch eye of Qatar fund

DUBAI: Qatar Investment Authority, the Persian Gulf country's US$60 billion (RM3.15) sovereign wealth fund, plans to invest in real-estate projects in Asian cities and said it's considering buying distressed US property assets.

"We are focusing on prime cities in India, China, Singapore, South Korea, Vietnam and Malaysia, cities around the world where there is strong GDP (gross domestic product) growth and fundamental unmet demand for high quality real estate," Navid Chamdia, head of real estate at Qatar Investment, said in an interview at a wealth funds conference in Abu Dhabi late on Monday.

"About 40 per cent of our real-estate investments will be in Asia."

The Qatar Investment Authority has been investing in property in the past 2 1/2 years to diversity its holdings. The investments, either in developing new property or renovating existing buildings, will be made mainly through joint ventures with local partners, and they will have a long-term holding period of at least seven to 10 years, Chamdia said.

With a population of less than one million, Qatar owns the world's third-biggest natural-gas reserves and 1.3 per cent of global crude-oil reserves. The emirate's sovereign wealth fund manages US$60 billion for the state, Citigroup analysts including Carsten Stendevad estimated in an October report. It holds stakes in the London Stock Exchange and Credit Suisse Group.

Qatar Investment Authority last week bought a 27 per cent stake in a Vietnamese property fund, Dragon Capital, which will buy into offices and serviced apartments in Ho Chi Min City. It may also look to invest in individual projects with the fund.

The Qatari fund in February bought a 15 per cent stake in an Indian office complex being built at the Bandra Kurla complex in Mumbai by the Chatterjee Group and US firm Starwood Capital. It also owns 49 per cent of one of the largest shopping malls in Malaysia, Pavilion Kuala Lumpur.

The fund is evaluating buying commercial properties in the US that are financially distressed.

"We anticipate several opportunities in the US for mezzanine financing, and individual distressed assets," Chamdia said. "We are looking at a number of these opportunities with several partners."

State-managed funds in countries including Kuwait, Abu Dhabi and South Korea have ballooned to US$3.2 trillion in assets.

By Bloomberg

UEM Land plans REITs, may invest overseas

UEM Land, the development unit of Malaysia’s third-biggest construction company, plans to start real estate investment trusts and new projects as it prepares for a listing this year.

State-controlled UEM Land, whose Nusajaya commercial and residential project is Malaysia’s largest, may also invest overseas from 2010 to emulate CapitaLand Ltd, Southeast Asia’s largest property company, managing director Wan Abdullah Wan Ibrahim said yesterday.

“We aspire to be something of that size and that diversified,” Wan Abdullah said in an interview in Kuala Lumpur, referring to Singapore-based CapitaLand. “We even have initiatives like REITs on the table. We cannot rely on just Nusajaya to be our bread and butter.”

UEM Land, controlled by UEM World, is due to start trading in Kuala Lumpur by September in a reorganisation to attract investors to the group’s real estate unit. The company wants to cut its reliance on Nusajaya, a 24,000-acre (9,712-hectare) government-backed development that provides almost all the company’s income.

Malaysia’s ruling coalition, in power since independence in 1957, suffered its worst election result in March. Some analysts raised concern the weakened government may slow state-backed projects.

“Investors still fear for some reason that projects may not be deployed as strongly as they would have been,” said Vincent Khoo, head of research at Aseambankers Malaysia in Kuala Lumpur. “There’s enough uncertainty on this project.”

By Bloomberg

Lacklustre showing by three REITs

PETALING JAYA: The improved financial performance by two real estate investment trusts (REITs) - Axis REIT and AmFirst REIT - failed to excite investors as the local bourse turned sluggish in line with the weak regional markets yesterday.

An analyst with a local brokerage said sentiment remained largely cautious mainly due to the slower economic growth in the US, and recent weakness in regional markets.

Axis REIT, which reported a 44.6% increase in net profit to RM9mil for the three months ended March 31, saw its share price closing near a three-month high of RM1.80 yesterday.

The strong earnings also prompted the company to declare an interim income distribution of 0.75 sen per unit.

Despite the sterling results, however, the counter failed to attract investor interest as there only 100 shares were traded in the day.

However, AmFirst REIT came under mild profit taking to close four sen lower at 90 sen. A total 270,100 units were traded at prices ranging from 89.5 sen to 90.5 sen.

For the financial year ended March 31 (FY08), AmFirst REIT recorded net profit of RM31.3mil on revenue of RM57.8mil, compared with RM8.3mil and RM13.9mil respectively in FY07.

Analysts said AmFirst REIT’s results outperformed its forecast in its listing prospectus.

Meanwhile, Hektar REIT also announced its first quarter results on Monday, reporting a lower net profit of RM8.7mil against RM11.2mil in the previous corresponding quarter while revenue fell to RM18.8mil from RM23.6mil.

It closed one sen down to RM1.39 on total volume of 11,200 shares.

Despite the weaker set of earnings, Hektar REIT expected its earnings to be enhanced by its acquisition of an integrated retail development in Muar, Johor, for RM117.5mil in February.

On the performance of Axis REIT, Aseambankers Equity Research said its first-quarter results were in line with market consensus but came in above the brokerage’s expectations. It added that the results reflected the full quarter’s contribution from properties acquired in the fourth quarter last year.

“For the rest of 2008, we anticipate an even better performance with three more acquisitions pending completion, namely Delfi Cocoa factory in Pasir Gudang, Johor, worth RM12.5mil, and two factories occupied by Celestica (AMS) in Senai worth RM27mil in total,” Aseambanker said in the report.

Due to Axis REIT's strong results, Aseambankers raised the REIT's financial year ending Dec 31 (FY08) and FY09 distribution income estimates by 13.1% and 8.3% respectively.

The revision includes a maiden contribution from the Celestica factories effective Oct 1, amounting to RM1.2mil in incremental yearly profits for unit holders.

As for Hektar REIT, analysts said further scrutiny revealed that its outlook was not as bleak as its results portrayed as the group was involved in a few acquisitions during the quarter.

By The Star (by Leong Hung Yee)