Confidence returns to Malaysia property mart

The thinkproperty.my Property Outlook Index has risen sharply during June 2009.

At the beginning of the month the index stood at +12 per cent, by the end of the month the index stood at +37 per cent, resulting in the index standing at the highest level it has been since the index began in May 2008.

The index has been on an increasing trend since early March 2009.

Said Asim Qureshi, the CEO and co-founder of thinkproperty.my: “The data confirms that confidence has truly returned back into the Malaysian property market. The results of this survey suggest that we will see higher prices over the next few months, which will in turn likely lead to further confidence. Now is an excellent time to buy.”

Fixed deposits continued their decline in popularly, falling over the course of the month, from 15% of people favouring them to 11%, the lowest level since the survey began.

Equities gained, rising from 25% to 28%. Property remained firmly as the most favoured investment, with 61% preferring property over the other two investment classes, a rise of just 1% of the previous month.

“Fixed deposits will have a tough time competing with both property and equities over the next few months. The KLSE Composite Index is performing well, and property looks attractive. With interest rates remaining low, we expect fixed deposits to be firmly out of favour for a while,“ said Qureshi.

The survey asked participants their opinion on the outlook for the Malaysian property market over the next 12 months.

The index takes the number of participants that believe prices would rise, subtracts the number of participants that believe prices would fall, and then divides this figure by the total number of participants, and calculates this on a rolling 30-day basis.

“The data confirms that confidence has truly returned back into the Malaysian property market," said Qureshi.

"The results of this survey suggest that we will see higher prices over the next few months, which will in turn likely lead to further confidence.

Now is an excellent time to buy. Interest rates are low, banks are becoming increasingly aggressive, and of course, market confidence is returning.

It’s always difficult calling the bottom of the market, but in my view we are now passed the bottom.”

The Favoured Investment Evolution Chart below was compiled by asking participants which investment they believe would be the best investment to make at present (without stating a time frame).

The height of each of the shaded regions shows the percentage of participants that thought the respective investment type was the best investment, calculated on a 30-day rolling basis.

Fixed deposits continued their decline in popularly, falling over the course of the month, from 15% to 11%, the lowest level since the survey began. Equities gained, rising from 25% to 28%.

Property remained firmly as the most favoured investment, with 61% preferring property over the other two investment classes, a rise of just 1% of the previous month.

Qureshi highlighted “Fixed deposits will have a tough time competing with both property and equities over the next few months.

The KLSE Composite Index is performing well, and property looks attractive. With interest rates remaining low, we expect fixed deposits to be firmly out of favour for a while.“

The Favoured Property Type Evolution Chart has been calculated in a similar way to the Favoured Investment Evolution Chart. Participants were asked which property type they believed would appreciate the most over the next 12 months.

The chart shows that condominiums have come back in favour with the percentage of people favouring them rising from 15% to 22% over the month.

Another noticeable change was the decline in agricultural land from 18% favouring it at the beginning of June, but it falling to 11% by the end of the month, possibly due to the defensive nature of agricultural land in terms of investment profile.

By Business Times

Mahabuilders to revive Pandan City Business Centre project

JOHOR BARU: Property developer Mahabuilders Sdn Bhd plans to revive the abandoned Pandan City Business Centre here into a thriving commercial and educational centre.

Managing director Mustapha Hassan said it was currently talking with several educational-related institutions to set up branch campuses, colleges or learning centres.

He said Universiti Malaysia Perlis would be opening its southern region matriculation centre in January with the initial intake of 120 students.

“We also want to attract private medical service providers and banks here,’’ Mustaphatold a press briefing on Thursday.

He said the project by Kretam Holdings Bhd was left abandoned for almost seven years before Mahabuilders took over in 2007 after paying RM20mil to the bank.

The business centre is located along the Tebrau Highway and easily accessible from the city centre and via Jalan Tampoi and Pasir Gudang Highway.

Mustapha said there were 338 shop-offices in four blocks of four-storey commercial buildings with lifts and 1,000 basement parking lots available for tenants.

He said the company was open to any business proposal including turning Pandan City into a one-stop textile and garments wholesale centre like the one in Jalan Kenanga, Kuala Lumpur.

“Accessibility to the centre will also improve when the flyover from the Tebrau Highway and the exit point from the North-South Expressway (NSE) are completed in a year or two,” said Mustapha.

He said the company also wanted to attract domestic and foreign visitors driving to Singapore via the NSE to stay at its Pandan City Hotel, located just a few kilometres from the Sultan Iskandar Customs, Immigration and Quarantine Complex.

By The Star (by Zazali Musa)

New police station to serve i-City

TENANTS and visitors to Malaysia’s premier digital city in Section 7, Shah Alam, will be conducting their business with an added sense of security.

The Shah Alam police is planning a new police station at the western boundary of i-City, which will enable them to respond to calls within a minute and offer 24-hour patrol.

Strategic alliance: Selangor Police Chief Deputy Commissioner of Police Datuk Khalid Abu Bakar (front row, third from left) and IBerhad deputy executive chairman Datuk Lim Kim Hong (in suit).

Other safety services, such as ambulance and fire brigade, will respond within 15 minutes of any call from i-City.

In the interim, the security measures planned by the police include linking the current CCTV surveillance in i-City to the Shah Alam police station.

Apart from having patrols from i-City, the police also plans to train i-City in-house security staff.

In today’s competitive environ-ment, a safe and secure zone is an additional competitive edge for i-City, and the strategic alliance with the Polis DiRaja Malaysia (PDRM) is an important feature in ensuring i-City can compete to attract international investors to Malaysia.

The digital city is designed to be managed as one large complex with a controlled tenant mix.

There is CCTV surveillance as well as patrolling guards.

The Concierge in i-City serves both as a meeting point and a one-stop centre.

From a master planning perspective, i-City is bordered on three sides by either a river or housing.

Only the western border is open, but there is a 30.5m-wide (100ft-wide) buffer between this boundary and the main MBSA road.

The site is accessed by a main boulevard with only two entry points, so although it is not a gated community, the development easy security controls.

The project caters for two communities — the knowledge workers and the tourists.

In line with this, there are two major components in the development, i.e. the managed offices and the tourism components.

The office component comprises the MSC cybercentre offices, office towers, data centres and the related infrastructure, while the tourism component comprises the shopping mall, citywalk and media hub.

However, both the knowledge workers and tourists will have many similar requirements.

First, there is a need for i-City to operate round the clock seven days a week as many of the operations have international linkages.

Furthermore, as a tourism destination, i-City has to operate all year round and till late into the night.

Secondly, both the offices and tourism components cater for the international community, for which cosmopolitan outlets and other entertainment facilities like cinemas are integral to their lifestyle.

Then, there is the atmosphere of the place.

Thus within i-City, both the workforce and visitors would want a safe and comfortable environment, both in terms of personal safety and the security of their assets.

And, even more importantly, for i-City Data Centre Park, the operations not only require restricted access but have also to be secured against info-security risks.

The development’s infrastructure is based on the Cisco Connected Real Estate solutions. Cisco is the leading network services in the world from both the technology and data security perspectives.

By The Star

130 abandoned projects yet to be revived

A TOTAL of 130 out of 151 abandoned housing projects identified by the Selangor Task Force for Abandoned Projects have yet to be revived.

Selangor housing, building management and squatters committee chairman Iskandar Abdul Samad said only eight of them involving 2,710 units of various types were revived and completed.

“But it does not mean the remaining projects cannot be revived. We are studying the matter and looking at the best way to solve the problem,” he said.

The task force was chaired by Hulu Klang state assemblyman Saari Sungip with five consultant firms. The five consultant firms were Rimbun Capital Sdn Bhd, RSS-PMC Sdn Bhd, SSF Corporation Sdn Bhd, Crimson Landscape Sdn Bhd and SMY Capital Sdn Bhd.

The recovered projects include the mixed-development project in Taman Prima Selayang in Gombak involving a total of 110 commercial units, 600 apartments in Bandar Pinggiran Subang and 700 houses in Taman Puncak Jalil.

Iskandar added that one of the reasons some of the projects could not be revived was because no developer or contractors could be found to salvage the abandoned projects.

Some of them found the abandoned projects not viable.

“These are deficit projects, which have suffered lost.

“Most of these projects have been abandoned between 10 and 15 years and the original estimated cost of the project cannot cover the current construction cost,” he said.

Iskandar also added that some of the projects did not get the planning or development approval from the local authority or have broken some of the rules.

“There are also projects that were constructed on agricultural land and the developer did not change the land status for the development.

“Changing the land status will involve additional cost for the new developer,” he said.

He said the task force was in the process of tabulating the real cost involved for each project before taking the next step of reviving them.

“We have blacklisted 115 developers who were involved in the abandoned projects and the list is in our website and the public can find out who they are.

“We are also planning to include the names of the affected company directors in the list for possible legal action against them,” he said.

Meanwhile, in the Bukit Botak issue, Iskandar said the special committee set up to handle the case had started their investigation and was expected to be completed by Aug 18.

“The investigation was to make sure that the rightful person will have fair share of the land ownership.

“Those who are eligible need not worry about it,” he said.

By The Star

Sunway City working on assets for RM4b REIT

SUNWAY City (SunCity) Bhd plans to construct new buildings over the next few years, that will later be injected into its RM4 billion real estate investment trust (REIT).

"We are working on pipeline investment assets to include into the REIT later when they mature in earnings and have the right tenant mix," SunCity executive director Datuk Jeffrey Ng Tiong Lip told Business Times in an interview.

Ng said while existing REITs have to look for new assets to grow, SunCity has good assets in place.

This alone, he said, was a good selling point for SunCity and also a strategy to grow the REIT.
As at March 31 2009, SunCity's total asset value stood at RM5.2 billion.

It currently owns five hotels, two shopping malls, university colleges, theme parks and commercial towers, and a medical centre.

Reports indicate SunCity may also inject Sunway Pyramid Mall, Sunway Resort Hotel, Sunway Pyramid Hotel, Menara Sunway, Sunway University college and Monash University campus in Bandar Sunway, Selangor, Sunway Carnival Mall in Penang and Tambun Hypermarket in Ipoh, Perak into the REIT.

These properties currently command an average of 6-7 per cent yield per annum.

Other properties which may be included are Wisma Denmark in Kuala Lumpur, Sunway Medical Centre, KL South shopping mall in Cheras, and four new office towers in Bandar Sunway.

"We cannot speculate which assets will go into the REIT. The board will have to decide based on whatever that is being proposed," Ng said.

On whether the REIT will be launched by the end of this year or in 2010, Ng said SunCity will be prepared to launch the REIT when the market conditions improve, so as to best serve shareholders' interest.

SunCity is still weighing its option of whether to list on Bursa Malaysia or via reverse takeovers in Singapore or Australia.

By Business Times (by Sharen Kaur)

Land & General back on property scene

PETALING JAYA: Land & General Bhd (L&G), one of the oldest property developers in the country is back on the property scene after almost a two-year hiatus. Its managing director Low Gay Teck tells The Edge that the developer has "successfully cleaned up its balance sheet and is now debt-free".

L&G made its name for itself from the development of the 1,200-acre freehold Bandar Sri Damansara township in Selangor that was first introduced some two decades ago. Bandar Sri Damansara is situated on both sides of Jalan Sungei Buloh, near the junction with Damansara-Puchong highway.

However, like many other developers in town, the developer was badly hit by the 1997/98 regional financial crisis. The developer's Bandar Sungai Buaya and Lembah Beringin projects at the fringes of Selangor failed to flourish and its two subsidiaries undertaking these two developments went under liquidation.

In 2007, Malaysia Land Properties Sdn Bhd (Mayland) helmed by Hong Kong property magnate Tan Sri David Chiu became a new key stakeholder in L&G. Mayland is well known for its serviced apartment developments in Sri Hartamas in Kuala Lumpur.

However, despite the emergence of a new stakeholder, L&G has kept a low profile and there were no new major property launches until now.

Low, the former managing director of the Mayland Group, says L&G is now ready to put Bandar Sri Damansara “back on the map as a sought after address again".

The catalyst for their ambitions will be 8trium, its maiden retail-cum-commercial development on a 2.65-acre site in Bandar Sri Damansara. Also coming up will be a massive 43-acre condominium development within the township next year.

With only these two parcels left for development, there is a need to grow L&G's landbank.

“It is time to move forward. We are keen to find more prime and sellable areas and the focus will be on niche developments. We are also open to joint venture partnerships with landowners as well,” Low adds.

By The EDGE Malaysia