Expo centre a start for Naza in iconic projects

An artist's impression of the Matrade Centre in Kuala Lumpur.

PETALING JAYA: Naza TTDI Sdn Bhd is expanding its property business and building its brand image by venturing into more iconic projects in Kuala Lumpur and other parts of the country.

The construction of Malaysian External Trade Development Corp (Matrade) Centre building, located off Jalan Duta, will pave the way for such projects by the company.

The Naza group, well known for its automotive business, has a number of prominent projects including the KLCC Platinum Park and other residential and commercial developments in Ampang, Shah Alam, Kajang and Taman Tun Dr Ismail.

Last November, Naza TTDI signed a privatisation agreement with the Government and Syarikat Tanah dan Harta Sdn Bhd to build the Matrade Centre in exchange for 62.45 acres of prime land in Mukim Batu, off Jalan Duta, Kuala Lumpur.

The exhibition building will have a gross floor area of one million sq ft.

According to a company spokesman, construction of the Matrade Centre is expected to begin in the second quarter next year with completion scheduled for 2014.

He said the centre, with three floors to house 12 exhibition halls, would be linked to the existing Menara Matrade building.

Phase one of the project will comprise a 90,000-sq-m expo centre on 13.1 acres that is set to be the largest exhibition and convention centre in the country.

It will consist of the main exhibition centre, multi-purpose hall, auditorium, meeting rooms and display arena. There will also be a hotel, shopping mall and office tower.

On Tuesday, Kumpulan Jetson Bhd and TTDI KL Metropolis Bhd, a wholly-owned subsidiary of Naza TTDI Sdn Bhd, entered into a shareholders agreement to facilitate a joint-venture arrangement to plan, design and construct the Matrade Centre.

Kumpulan Jetson said in a note to Bursa Malaysia that a special-purpose vehicle – TTDI Jetson Sdn Bhd – would be set up, with Kumpulan Jetson and TTDI KL taking up 49% and 51% stakes respectively.

Besides the Matrade Centre, it will also develop the 62.45 acres which will be transferred from the Government to TTDI Metropolis in exchange for building the expo centre.

The mixed development, provisionally known as Naza KL Metropolis Development, will be developed over 15 to 20 years and will have a gross development value of RM15bil.

Based on a preliminary projection, the total project costs for the Matrade Centre is RM628mil.

It is understood that the company is talking to potential investors in the hotel and retail sectors.

By The Star (by Angie Ng) (Posted on 24th December 2009)

Mah Sing stamps mark in global arena

PETALING JAYA: Mah Sing Group Bhd’s RM2.2bil property project in Wujin District, China’s Jiangsu province, will mark the company’s foray as a serious player in the global market, said managing director-cum-group chief executive Tan Sri Leong Hoy Kum.

He said Mah Sing was keen on China because its property market was expected to do well as it had the right structure with population-led demand.

“With increasing consumer sophistication in the country (China), it gives opportunities for expatriate developers like Mah Sing to expand there,” he said in a statement.

In a filing with Bursa Malaysia on Dec 2, Mah Sing said its subsidiary, Mah Sing International (HK) Ltd, had jointly with Danlong Realty (Beijing) Ltd entered into a letter of intent with the Wujin District People’s Government, Changzhou City.

This was to develop the project, which would have a total gross development value (GDV) of RM2.2bil.

In the same announcement, the company said Mah Sing International and Danlong intended to establish a joint-venture (JV) company.

On the local front, Leong said Mah Sing had had a very good year so far, and its success could be attributed to the pre-emptive measures in terms of project planning, pre-construction, cost and cash management as well as marketing strategies.

“We have a healthy balance sheet with only 0.18 times net gearing as at Sept 30 due to our strong financials and branding.

“Mah Sing was able to introduce innovative marketing concepts like Easy Home Ownership programme which helped us exceed our sales target by 1.4 times.

“We achieved RM615mil for the nine-month period against our full-year sales target of RM453mil,” he noted.

Leong said the local property market was expected to gain momentum as the country had the third-highest savings rate in the region.

With this liquidity, coupled with low returns on fixed deposit rates, property remained an attractive investment, he said.

“Malaysia’s financing environment is still conducive with attractive interest rates and financing packages.

“The new scheme allows further drawdowns from Employees Provident Fund’s Account 2 to finance first-home buyers and will further increase affordability.”

Leong said the domestic outlook was turning brighter as more consumers were willing to buy big-ticket items like properties.

“All these factors should result in improved property demand in the coming months in anticipation of asset reflation as our properties are still among the cheapest in the region.

“We believe this will lead to a strong demand recovery in mid-tier to high-end landed properties,” he said.

An analyst with Maybank Research said Mah Sing’s entry into China was a strategy to growing its earnings base beyond Malaysia.

“Its maiden project in China is a baby step but a long-term positive move to growing its base and becoming a global player in the industry,” he said.

The analyst said the JV was targeting to develop residential and commercial properties in two phases, with an estimated total costs of US$620mil, starting in 2011.

Assuming a 20% pre-tax margin and 25% China corporate tax rate, the project could deliver RM395mil in net profits, with Mah Sing International getting RM202mil based on its 51% equity stake.

“We estimate this amount to be recognised over five to six years and that the project could add RM34mil to RM40mil in yearly profits,” he said.

Locally, the analyst said Mah Sing’s 3.4-acre land in Penang was slated for high-end residential development with a GDV of RM280mil.

The research house’s earnings forecast for Mah Sing remains unchanged, with a “buy” call on the stock and a target price of RM2.35.

By The Star (by Danny Yap) (Posted on 24th December 2009)

Sunway in S$420m Singapore project

SUNWAY Holdings Bhd expects its 30:70 joint property development project in Singapore with Hoi Hup Realty Pte Ltd to generate an estimated gross development value of S$420 million (RM1,030 million).

The project features eight blocks of 12-storey residential flats (totalling about 500 units) with a clubhouse, multi-tiered basement car park, roof terrace and swimming pool.

This is Sunway's first private property development in Singapore after previous state-backed projects at Boon Keng and Toa Payoh.

By Business Times

PNB confirms Kenanga building deal

PERMODALAN Nasional Bhd (PNB) has confirmed that it has bought the 22-storey Kenanga International Building in Kuala Lumpur from Injaz AsiaEquity Property.

PNB president and group chief executive Tan Sri Hamad Kama Piah Che Othman confirmed the purchase but did not reveal the amount spent.

"I cannot remember how much the purchase price was and I don't want to be quoted wrongly on this," he told reporters after announcing the income distribution for Amanah Saham Nasional in Kuala Lumpur yesterday.

Business Times had reported that the Kenanga International Building on Jalan Sultan Ismail, Kuala Lumpur, was bought for an estimated RM250 million.
The 22-storey commercial building with a three-and-a-half-storey annexed podium block was bought from Injaz AsiaEquity Property Bhd, which was jointly set up by Middle East Injaz Mena Investment Co and Singapore-based Asia-Equity Partners Inc.

Hamad Kama didn't elaborate on the reasons for the purchase.

Meanwhile, he said PNB is also considering listing its property arm at the right time.

PNB had merged three of its companies - Pelangi Bhd, Petaling Garden Bhd and Island & Peninsular - into one big property developer.

On the proposed 100-storey skyscraper to be built at the Stadium Merdeka site, Hamad Kama said a study is under way and is at a very advanced stage.

"The site is owned by one of our subsidiaries, Merdeka Ventures, and we are looking into it. We plan to have a board meeting soon to discuss this in detail before making an announcement on the matter which will be quite soon," he added.

Hamad Kama said although there were numerous people criticising the project, what was important to PNB was whether it could get good returns.

PNB manages a total of 102 billion units in trusts funds.

By Business Times (by June Ramlee)

CEO: PNB skyscraper study in advanced stages

KUALA LUMPUR: Permodalan Nasional Bhd’s (PNB) study of a proposal for a multi-storey building here is in “advanced stages,” according to president and group chief executive Tan Sri Hamad Kama Piah Che Othman.

However, he neither confirmed nor denied that the building would be a 100-storey skycraper.

Tun Ahmad Sarji Abdul Hamid (left) and Tan Sri Hamad Kama Piah Che Othman announcing the income distribution.

“Whatever assets we have, we need to do a proper study to ensure that the returns we achieve will be beneficial for our shareholders. The study (for the building) is in advanced stages.

“I’m not saying it will be 100 storeys, but we are going to develop something,” he told reporters after announcing the income distribution for its Amanah Saham Nasional (ASN) fund yesterday.

Hamad Kama Piah declined to comment on whether the evaluation was being undertaken by local or foreign consultants. The building is expected to be developed near Stadium Merdeka and Stadium Negara.

On the reason for the proposed development, he said: “We want to improve our returns. If you just rely on equity and the stock market – there are too many ups and downs. Through this diversification, it helps to improve our returns.”

On another note, Hamad Kama Piah confirmed that PNB had purchased the 22-storey Kenanga International Building in Kuala Lumpur from Injaz AsiaEquity Property but declined to verify that the purchase cost the company RM250mil.

He also said PNB was looking at the possibility of listing its property assets, namely Island & Peninsular Bhd, Pelangi Bhd and Petaling Garden Bhd. “It will depend on whether it would benefit our shareholders and if the timing is right.”

Asked on the progress of PNB’s 10 billion-unit Amanah Saham 1Malaysia (AS1M) fund, he said 2.96 billion units had been subscribed by 235,032 investors since its launch on July 31.

Subscription of the AS1M units is subject to an allocation of 50% for bumiputras, 30% for Chinese, 15% for Indians and the remainder for other minority groups.

Hamad Kama Piah said about 82% and nearly 20% of the Chinese and Indian quotas respectively had been filled, adding that there was “still a lot to go” for the bumiputra allocation.

He said PNB might extend the period for subscribing to the AS1M share trust units, which has a Dec 31 deadline.

Asked whether PNB expected the 10 billion units to be fully subscribed, Hamad Kama Piah said “it would take time,” adding that the company was currently conducting nationwide promotions to create more awareness of the AS1M fund to the public.

Meanwhile, PNB announced an income distribution of 5.2 sen per unit for its ASN fund for the financial year ending Dec 31, 2009.

The income distribution will involve a total payment of RM81.52mil versus RM79.9mil last year.

PNB chairman Tun Ahmad Sarji Abdul Hamid said based on the net asset value of ASN of 75.86 sen per unit on Dec 22, 2009, the yield derived from the income distribution of 5.2 sen per unit was 7.36%.

The price return for ASN for the same period is 25.75%.

“Therefore, based on the rise of the net asset value of ASN from RM0.5619 per unit on Dec 31, 2008 to 75.86 sen per unit on Dec 22, 2009, the total return recorded by ASN is 35.01%,” Ahmad Sarji said.

Up until Tuesday, ASN recorded a gross income of RM87.91mil. Of the amount, the profit from the sale of shares contributed RM55.46mil (63.09%) followed by dividend income that contributed RM23.75mil (27.02%), while RM8.70mil (9.89%) was derived from short-term investment instruments.

The income distribution of ASN is calculated based on the units held on Dec 31, 2009, which is the last day of the ASN financial year. The payment will benefit 1.19 million unit holders which currently hold more than 1.57 billion units of ASN.

By The Star (by Eugene Mahalingam)

Mall set to open its doors

Work in progress: Construction workers using heavy machinery to complete the stretch from Jalan Harapan to the shopping mall.

Traffic in Petaling Jaya is set to worsen when another shopping mall opens its doors soon unless the council speeds up work on the missing links and other alternative roads.

During a check yesterday, construction workers were busy completing the exterior of the mall while bulldozers and excavators continued to use a short stretch of the road which connects the mall to Jalan Harapan (Jalan 17/47).

The stretch had been tarred and some workers were busy working on the pavements. However, the stretch links it to an unnamed road behind two blocks of low-cost flats and shoplots.

The advertisments placed by the developer states that the five-level SStwo Mall is positioned to be a lifestyle neighbourhood centre and would be open by early next year.

A representative from developer IJM when contacted said their task was only to complete the part that connected Jalan Harapan and the mall’s parking entrance and exit point.

He also said the mall would not aggravate the traffic situation in the area as it had another entrance and exit point in Jalan 2/72.

Meanwhile, Petaling Jaya city councillor for the area Mak Khuin Weng said the MBPJ had approved the budget for work in Jalan Harapan as well as chosen a consultant for the remaining road work in the area which included a link from Jalan Harapan to the Sprint Highway.

He said the council was facing some technical problems and needed approval from the state government.

“Once we have appointed the consultant formally, we will give them to a month to prepare the relevant information and plans for the area.

“The residents will then be called by MBPJ for a meeting with the consultant,” said Mak.

At the council’s full board meeting yesterday, MBPJ mayor Datuk Mohamad Roslan Sakiman said a temporary measure to ease traffic from the Rothman’s roundabout was to introduce a traffic light system.

He also said a flyover had been proposed to be built over the Rothman’s roundabout but that this would have be discussed first with the residents at the Special Area Plan hearing for Section 13.

By The Star (by Christina Low) (Posted on 24th December 2009)

Property curbs fear as mainland firms pay record prices for sites

Record prices being paid for development sites on the mainland have heightened concerns that Beijing will introduce new measures to cool the property market.

A high-end residential site in Shanghai's Xin Jiang Wan Cheng district was sold to China State construction Engineering Corp yesterday for 3.72 billion yuan (HK$4.22 billion), or 32,484 yuan per square metre, the highest unit price for a mainland plot.

The price is 9 per cent higher than the previous record of 29,859 yuan per square metre that state-owned Beijing Dalong Estates paid for a site in the capital last month.

The purchase follows Tuesday's record 25.5 billion yuan paid for a single plot — a Guangzhou Asian Games City development site — by a consortium comprising Guangzhou R&F properties, Agile Property Holdings and Country Garden Holdings at another public auction.

Shanghai-listed China State Construction outbid eight developers to win the site. The price is 117 per cent higher than the opening bid of 1.72 billion yuan.

Xin Jiang Wan Cheng is a new luxury residential area in Shanghai. Prices of the most recent project in the area being developed by China Resources Land range between 45,000 yuan and 50,000 yuan per square metre.

Clement Luk, a deputy general manager at Centaline China in Shanghai, said China State Construction would have to achieve an average price of at least 55,000 yuan per square metre to generate a reasonable profit.

However, he said Beijing would not be happy with the record-breaking land prices, adding they could force the central government to issue more measures to cool the property market.

The sentiment was shared by Huang Tao, a project manager at Centaline China's Guangzhou office, following the price paid for the Asian Games City site.

However, he added that this was not the only challenge facing the three-member Guangzhou consortium. "This is the first time for them to develop a project together. They need time to adapt to each other," he said.

The market originally expected a consortium comprising state-owned developers China Vanke and Poly Real Estate Group to win the site as they had put together an opening bid of 16.5 billion yuan.

However, a property analyst said the aggressive bidding by R&F Properties surprised the state-owned developers. "We were one of the consultants of Poly Real Estate. We suggested the developer not submit a bid higher than 20 billion yuan," he said.

"It was easier for the privately owned developer to raise the upper limit of the bid as the process for the state-owned developers to do so is longer. They could not raise the limit just by making a call."

John So, an analyst at ICBC International Research, expects property sales volume to drop next year as Beijing tightens the mortgage market. "We won't see strong growth in property prices next year as new supply will increase substantially," he said.

By South China Morning Post (Posted on 24th December 2009)

Mayor wants link to open by next month

PETALING JAYA mayor Datuk Mohamad Roslan Sakiman wants the developer to open the road linking Ara Damansara and Tropicana by the end of January.

The link is still closed despite an order last month from the Selangor Mentri Besar Tan Sri Abdul Khalid Ibrahim to open it to ease traffic congestion at the much debated Jalan Tanjung.

Under an injunction, the road was to remain closed pending the completion of the Tropicana Tunnel, following strong objections from Tropicana residents.

Roslan confirmed that the injunction had been lifted and all legal matters were supposed to have been solved.

But the problem is, the road is in a bad condition and the developer needs four months to complete the repair work.

Road plan submitted by the developer had been approved and the company was also to meet nearby developers to discuss other matters.

“How do you expect the residents to wait for four months for the road to be opened?”

“The festive season is here and the relevant parties have to expedite it as it is a crucial situation we are facing here,” he said during a press conference after the Petaling Jaya City Council’s full board meeting yesterday.

This, and other road issues, made the council’s engineering department the target of criticism from councillors during the meeting.

The councillors expressed regret that the department tasked to monitor the contractors had actually gave in to their excuses for the delay in progress.

They highlighted the situation at the Lembah Subang tunnel connecting Ara Damansara and Taman Megah Mas, which would be closed until Jan 4 for upgrading work.

“There had been many delays, and the work is only 20% complete now.

“Can the contractor be sure that the tunnel be reopened before school starts?” asked councillor Tiew Way Keng.

By The Star (by Yip Yoke Teng) (Posted on 24th December 2009)