SP Setia bullish on condo project

From left: SP Setia Bhd deputy president Datuk Voon Tin Yow, Tan Sri Liew Kee Sin and executive director Chang Khim Wah with a model of the Setia Sky Residences.

SINGAPORE: SP Setia Bhd sees positive response to its Setia Sky Residences condominium in Kuala Lumpur that will be launched next month, said group managing director Tan Sri Liew Kee Sin.

The project, which has a gross development value of RM800mil, is the property developer’s first high-rise project in the Kuala Lumpur city centre.

“We are confident that it will attract not only well-heeled Malaysians but also wealthy foreigners who want to call Kuala Lumpur their home,’’ Liew said after opening a sales office at the Harbourfront Tower One here.

Setia Sky Residences is located along Jalan Tun Razak on a 2.43ha site and will comprise four 39-storey tower blocks, with each block containing 211 condos.

“The first two towers will be launched next month at an average selling price of RM680 per sq ft and both towers are expected to be completed in 2012,’’ he said.

On the opening of the Singapore office, Liew said the move was aimed at enhancing the company’s service to Singaporean buyers while attracting new ones.

SP Setia had attracted 800 buyers from Singapore who had bought RM300mil worth of properties from the group, mainly for its projects in Johor Baru, he said.

It planned to undertake a development in Singapore in the future via a joint venture with a reputable Singapore-based company, he added.

The Singapore office is SP Setia’s second abroad after the one in Ho Chin Minh City, Vietnam. The developer also plans to open offices in Beijing and Dubai this year.

Liew also said SP Setia had to date recorded about RM500mil sales for its 5/95 home loan package launched in January.

By The Star (by Zazali Musa)

Properties continue to attract investors

SINGAPORE: The global economic crisis has not slowed down the property development sector, particularly in Malaysia's southern region.

SP Setia Bhd Group president and chief executive officer Tan Sri Liew Kee Sin said people still had the means to invest in property.



"In these trying times, selling (property) is not easy to do. But the good thing about the current situation is that people have money. In 1997 and 1998, people had no money.

"As far as the Malaysian market is concerned, the banks are flush with money. None of the banks are in trouble," said Tan, after launching SP Setia's Singapore sales office at Harbourfront Tower One here.

Tan said SP Setia had taken advantage of this situation by offering the "5/95 Home Loan Package" where buyers pay a five per cent downpayment and service the remaining 95 per cent through a bank loan.

Maybank, CIMB, Public Bank and EON Bank are involved in this three-month offer which ends April 19.

Tan, who admitted that Johor Baru continued to be an attractive area for property sales, said SP Setia recorded almost RM500 million in sales since the "5/95" offer was launched.

The offer is also open to buyers from Singapore.

SP Setia has property developments in Klang Valley, Johor Baru and Penang. The group has also teamed up with a Vietnamese conglomerate, Becamex IDC Corp for a development project near Ho Chi Minh City.

Tan said that the group was further expanding its products to Singaporeans with the opening of its first sales office at the Harbourfront, which is located in the heart of the republic's busiest trade district.

Currently its Singaporean clientele stands at 800 with accumulated property sales of RM300 million.

Singaporeans make up five per cent of the SP Setia property buyers, and Tan said the group aimed to increase it up to 10 per cent.

By Business Times (by Ahmad Fairuz Othman)

Property sector may still be in for the worst

The worst is yet to come for the property sector as the country continues to feel the impact of the global economic crisis, according to HWANGDBS Vickers Research Sdn Bhd's roundtable.

The discussion with three property brokers to assess conditions in the sector and its outlook found the high-end residential market at the Kuala Lumpur City Centre (KLCC) and Mont'Kiara as well as retail and hotel segments, especially those with poor branding, to be the most vulnerable.

The panel included Hall Chadwick Asia Sdn Bhd chairman Kumar Tharmalingam and Regroup Associates' executive chairman Christopher Boyd and managing director Allan Soo.

"Office rental/occupancy rate should continue to hold up, with demand support coming from government-linked companies (GLCs). The KLCC commercial segment would be the most resilient due to its captive demand," HWANGDBS Vickers analyst Yee Mei Hui said in a report.

She noted that asking prices for the high-end residential segment in the KLCC and Mont'Kiara areas had fallen 20-30 per cent year-on-year.

Given the large incoming supply over the next two to three years and the high foreign ownership, prices were likely to fall further, Yee said.

However, the fourth quarter of 2008 saw growth. The average rental for prime office space in Kuala Lumpur breached RM7 per sq ft, while the vacancy rate dropped to 7 per cent.

As to the retail sector, Yee projects a 10-20 per cent rental downside this year amid rising vacancies.

"The average rental for prime retail malls started declining marginally in the fourth quarter of 2008. We understand that newer malls are struggling to breach 60 per cent occupancy and a few tenants are looking to pull out from recently-opened malls. Some have been offered rebates, such as at The Gardens Mall at Mid Valley City," she said.

Yee also expects hotels with poor branding to be the worst hit by the slowdown.

"The average room rate (ARR) has fallen by 20 per cent, while occupancy rate has remained steady at around 70 per cent. Most affected were hotels with ARR less than RM200 per room per night, partly due to slower public spending.

"Niche budget hotels, like Tune Hotel, however, have been relatively resilient.

"The Mandarin Oriental Hotel Kuala Lumpur saw ARR grow 5 per cent to RM630 per room per night, while the occupancy rate eased slightly to 65-70 per cent last year from 74 per cent in 2007."

Among the strategies highlighted at the roundtable for property developers to weather the crisis and emerge stronger were to hold income-producing, fully-tenanted properties and sell underperforming assets.

Developers were also advised to accumulate strategic landbank, focus on branding, reassess their business models and identify new opportunities.

Yee reiterated her cautious view on the Malaysian property sector and named KLCC Property Holdings Bhd as her top stock pick owing to its locked-in rental income from blue-chip tenants on long-term leases.

By Business Times

Cyberview targets 47 companies this year

CYBERJAYA: Cyberview Sdn Bhd, the landowner of Cyberjaya and the entity leading the entire development of Cyberjaya, is targeting 47 companies to set up operations there this year.


Redza Rafiq

Managing director Redza Rafiq said he anticipated most of the companies to be local entities.

“Only a handful of companies in Cyberjaya are multinational corporations (MNCs),” he said after the signing of a memorandum of understanding with Advanced Micro Devices Global Services (M) Sdn Bhd, a unit of AMD Inc.

Operating in Cyberjaya currently are 500 companies, including 35 MNCs. The rest are small and medium enterprises.

Redza said Cyberview’s role in the development of the creative multimedia and digital content industry corresponded with the mandate given by the Government to actively lead the entire development of Cyberjaya.

“There are many components to the development of Cyberjaya and one segment that we have been asked to nurture is the creative multimedia industry,” he said.

The Multimedia Development Corp (MDeC), which is the custodian of the MSC Malaysia Initiative, set up the Malaysian Animation Creative Content Centre (MAC3) in 2007 to spur the development of creative content.

Redza said AMD would partner Cyberview in nurturing the creative multimedia industry in Cyberjaya and the parties would work with MdeC to develop the Malaysian cybergames operations and research (MyCore) and the knowledge-worker development programmes.

“MyCore is part of MdeC’s MAC3 initiative and it focuses on the development of professional gamers and game developers by providing a local gaming centre,” he said.

He said AMD would take over a four-storey enterprise building in the Knowledge Workers Development Institute Complex and occupy about 68,000 sq ft.

The first phase of the complex, which cost RM48mil, was expected to be completed by the second half of this year, he said.

Meanwhile, AMD senior vice-president, finance and corporate controller, Devinder Kumar, said despite the challenging economic environment, the company expected to increase its headcount over the next two years to 500 from 230 currently.

“We have been expanding over the last couple of years and we would like to continue the expansion, especially in Cyberjaya, with the right government incentives,” he said.

He said the company also planned to set up an information technology data centre in Cyberjaya which would be to ready in the second half of this year.

AMD, a technology company headquartered in Sunnyvale, California, has established its presence in Penang in 1972 under AMD Export Sdn Bhd.

It launched its global services initiative in Malaysia through Advanced Micro Devices Global Services, which was awarded MSC Malaysia Status in 2008.

By The Star

Glomac to hold property showcase

PROPERTY developer Glomac Bhd is organising an event to showcase its properties, which will end on April 30.

Dubbed “Glomac 360° Showcase”, it will showcase the company’s various properties, including its township developments in Selangor, Bandar Saujana Utama and Saujana Rawang, as well as Sri Saujana in Johor.

Glomac said in a statement that during the showcase, each development will provide promotional benefits, such as up to 100 per cent loan, zero-per cent interest during construction and savings of up to RM100,000.

By Business Times

Selangor Properties Q1 profit drops 96pc

SELANGOR Properties Bhd said its first quarter net profit plunged by 96 per cent due to a foreign exchange loss, the fall in value of investments and the lack of an exceptional gain.

It made a profit of RM23.6 million for the first quarter to January 31 2008 from the sale of Wisma Damansara.

Its net profit for the quarter to January 31 2009 fell to RM1.75 million from RM43.16 million previously.

Revenue for the period under review was RM41.73 million compared with RM40.99 million in the previous corresponding period.

By Business Times

Magna buys school land

Magna Prima plans to build commercial and residential properties worth RM1.3 billion on the land on which the Lai Meng Primary School and Lai Meng Kindergarten sits.

Magna Prima Bhd appears to have struck gold as it is buying a piece of prime land in Jalan Ampang, Kuala Lumpur, a stone's throw from the Petronas Twin Towers.

It will spend RM148.2 million to buy the land on which the 44-year-old Lai Meng Primary School and Lai Meng Kindergarten currently sits.

In its place, the company plans to build commercial and residential properties worth some RM1.3 billion, Magna Prima told Bursa Malaysia in a statement.

This would probably be the third time that a school in the city centre is giving way for redevelopment. In 2000, the Bukit Bintang Girls School was moved to make way for the Pavilion Kuala Lumpur, a shopping mall.

Eastern & Oriental Bhd and the Lion Group relocated St. Mary's School in Jalan Tengah/Jalan P. Ramlee to Selayang and work on the new project has started.

"The proposed acquisition also creates an opportunity for the group to venture into the high-end property market, seeing that land within the KLCC area available for development is scarce," Magna Prima said in its statement.

Magna Prima will buy the existing land of 10,587.5 sq m from the Lai Meng Girls School Association.

The purchase price, which is a quarter less than its market value, will be paid in cash and funded with internal funds, bank loans or through a joint venture with partners.

As part of the deal, Magna Prima will give another piece of land double the size of the existing property for the relocation of Lai Meng. The new land is in Bukit Jalil.

Magna Prima will design, arrange and organise the construction of the new school. However, it is unclear which party will bear the construction cost.

Its project in Jalan Ampang will only start when the new school is completed.

The development has an estimated gross floor area of 1.2 million sq ft and an estimated gross development value of up to RM1.3 billion.

The project, due to start in 2012, is scheduled for completion in 2015.

Shares of Magna Prima were not traded yesterday. The counter's last closing price was RM2.10.

By Business Times

Magna Prima buys land for RM148mil

KUALA LUMPUR: Magna Prima Bhd’s wholly-owned subsidiary, Twinicon (M) Sdn Bhd has entered into an agreement with the Lai Meng Girls’ School Association for the proposed acquisition of land for RM148.151mil.

The proposed acquisition involved a total of 10,587.5 sq m, the company said in its filing with Bursa Malaysia.

It said with the intention to undertake an integrated commercial and/or residential development project, the proposed acquisition was expected to contribute positively to the group’s earnings in the future. — Bernama

The proposed acquisition was expected to be completed by 2015, it added.

By The Star

Singapore to spend up to S$20b on infrastructure this year

SINGAPORE: Singapore, expected to be emerging Asia's worst hit economy this year, plans to spend between S$18 billion and S$20 billion (S$1 = RM2.41) on infrastructure projects in 2009, a government minister said yesterday.

In 2010 and 2011, the government would continue to invest another S$15 to S$17 billion each year in building and infrastructure projects, Grace Fu Hai Yien, Senior Minister of state for National Development, told a seminar on Asia infrastructure.

Fu said the 2009 spending included construction of a new cruise liner terminal, new roads and parks, and the upgrading of schools, sports facilities and public housing estates.

"Here in Singapore, we are taking the opportunity of this downturn to build our own 'highways' to prepare for the next phase of Asia-centric growth. And upgrading of our infrastructure is a key part of this growth strategy," Fu said.

"Our financial resources allow us to undertake the projects at the appropriate time despite the negative economic outlook." Fu did not say how these projects would be funded.

In January Singapore for the first time tapped government reserves to pay for part of a S$20.5 billion budget stimulus package, which included S$4.4 billion on infrastructure, education and health, as well as other measures to help firms.

Singapore's economy could shrink by 4.9 per cent this year, its worst year ever, hit by a downturn in trade, a Reuters poll of economists showed earlier this month. Some economists have since revised estimates downwards, with Goldman Sachs expecting an 8 per cent contraction.

Lee Kuan Yew, Singapore's most powerful politician, was quoted as saying on Friday its export-dependent economy would take at least three years to recover from the recession.

By Reuters