Affordable housing still costly, says Penang BN

By Farah Wahida:

Majority of households in Penang cannot afford the 100plus-unit low-cost housing project proposed by the state government in Jalan SP Chelliah, claimed State BN chairman Teng Chang Yeow.

Even if the units are priced from RM200,000 to RM400,000, they are still too expensive for families earning less than RM5,000 each month, he said.

“The state government is being political and is not trying to solve the housing woes,” he added.

In addition, the state government is also constructing about 12,000 houses in Batu Kawan with prices ranging between RM72,500 and RM220,000 per unit.

Teng noted that home prices in Batu Kawan should be reduced as the “land cost is zero for the government”.

He explained that an average Penangite is on the lookout for houses priced between RM220,000 and RM300,000.

Najib promises 7 projects for Kelantan

By Farah Wahida:

The government will implement seven major projects in Kelantan, according to Prime Minister Datuk Seri Najib Tun Razak in a report by Bernama.
They include a new stadium, a highway stretching from Kota Baharu to Kuala Krai, the construction of the state’s largest mosque and a people’s housing project starting with 3,000 houses.

Other projects include an urban campus of Universiti Teknologi Mara (UiTM) that can accommodate 5,000 students, the roll out of the Rapid Kota Baharu public transport system and a solution to the water supply problems in Kelantan.

The seven projects would also be part of Barisan Nasional’s manifesto for the forthcoming general election.

“I am just announcing these seven projects, which are only part of the manifesto, now. I haven't mentioned the others.”

“I will announce more when I come again (to Kelantan). I am keeping it as political capital,” he said during the ‘Promises Kept’ programme at the Rural Transformation Centre (RTC) in Tunjung, Kota Bharu.

Market imbalance due to incentives given to GLCs

By Farah Wahida:

Before providing incentives to government-linked counterparts (GLCs), the government must first take into account the growth of private property developers linked to them.

Ho Chin Soon, Director at Ho Chin Soon Research Sdn Bhd, believes that “private property developers are more innovative and more responsive (to customer needs and market conditions) even though government-linked (property) companies (GLCs) may get certain incentives such as cheaper land. I still think that the private sector can be more dynamic.”

“But if the government continues to pour ‘lots of goodies’ for the GLCs, it may be a bit tough for the private property players (to compete),” he said at the sidelines of the Sixth Malaysian Property Summit 2013 recently.

For example, investors at the Tun Razak Exchange (TRX) development in Kuala Lumpur enjoyed 100 percent income tax exemption for 10 years as well as stamp duty exemption on loan and service agreements, reported The Sun Daily.

Aside from that, they also bagged a 70 percent income tax exemption for five years for eligible property developers, Industrial Building Allowance and Accelerated Capital Allowance.

Hence, the Real Estate and Housing Developers Association (Rehda) has earlier asked the government to assess how these incentives would impact the TRX, claiming that these would create an imbalance in the property market to the disadvantage of developers with land in KL.

“We view TRX with great concern because of the incentives for the project,” Datuk Eddy Chen, former Rehda President was earlier quoted.

Gov't cancels Dolomite project in Batu Caves

By Farah Wahida:

In a bid to protect the public’s interest and preserve the environment, the Selayang Municipal Council has axed the Dolomite Park Avenue Condominium project located near Batu Caves, reported The Sun Daily.
According to Selangor Chief Minister Tan Sri Abdul Khalid Ibrahim, the special committee tasked to investigate the controversial project called for the cancelation of its approval following the panel’s meeting last Tuesday.

“In that meeting the Country and Town Planning Department also gave a detailed briefing of the development and security status of the structure and building.”

“After hearing the submissions, I decided that the Selayang Municipal Council (MPS) should cancel the development order given to Dolomite Properties Sdn Bhd for the 26-storey Dolomite Park Avenue Condominium,” he said.

While the state government supports projects for the good of the people, some developments should be planned accordingly so as not to compromise public safety.

“I hope the decision will be accepted positively by all parties as it involves the safety of the public,” he added.

UK University's Iskandar campus eyes more students

By Farah Wahida:

The University of Southampton has successfully opened its first-ever international campus in Educity, Iskandar Malaysia in October last year.

“Our ambition is to have a similar status within Malaysia as being a premier university for engineering education and engineering research,” said Prof John McBride, Chief Executive Officer of USMC.

Aside from being listed among the world’s top 100 universities, University of Southampton is also regarded as one of the top two universities for engineering research and education in the UK.

The University of Southampton Malaysia Campus (USMC) eyes “to attract about 3,000 local and international students once our main campus is complete in the next eight years,” said McBride.

Since it opened in October 2012, the campus saw “22 students currently pursuing the Masters of Mechanical Engineering programme and we hope to increase the number to 150 by introducing the Electronic and Electrical Engineering (EEE) programme in September.”

Students would have to stay for two years in USMC before they can complete their studies at the UK main campus for another two years. McBride said graduates of the university were most sought-after by multi-national firms such as Google, Apple, Rolls Royce and Airbus.

UK University's Iskandar campus eyes more students

By Farah Wahida:

The University of Southampton has successfully opened its first-ever international campus in Educity, Iskandar Malaysia in October last year.

“Our ambition is to have a similar status within Malaysia as being a premier university for engineering education and engineering research,” said Prof John McBride, Chief Executive Officer of USMC.

Aside from being listed among the world’s top 100 universities, University of Southampton is also regarded as one of the top two universities for engineering research and education in the UK.

The University of Southampton Malaysia Campus (USMC) eyes “to attract about 3,000 local and international students once our main campus is complete in the next eight years,” said McBride.

Since it opened in October 2012, the campus saw “22 students currently pursuing the Masters of Mechanical Engineering programme and we hope to increase the number to 150 by introducing the Electronic and Electrical Engineering (EEE) programme in September.”

Students would have to stay for two years in USMC before they can complete their studies at the UK main campus for another two years. McBride said graduates of the university were most sought-after by multi-national firms such as Google, Apple, Rolls Royce and Airbus.

Malaysia can be real estate investment hub by 2020 - analyst

By Bernama
Wednesday, 23 January 2013 14:56



KUALA LUMPUR (Jan 23): Malaysia has the potential to transform itself into a real estate investment hub by 2020 with the completion of the mass rapid transit and the high speed railway linking Singapore.

Director of Ho Chin Soon Research Sdn Bhd, Ho Chin Soon, said while there are concerns over an oversupply situation, the free market will take care of itself.

“For example, there are some buildings that are still new and the rentals are too high. To attract rental, the landlords may need to introduce a rent-free period,” he said during the 6th Malaysian Property Summit 2013 on Jan 22.

“Infrastructure projects like the MRT system will determine market share. Infrastructure projects like highways will help townships in the outskirts,” he added.

Mega projects attracting attention include the Tun Razak Exchange, PJ Sentral, Warisan Merdeka and Bukit Bintang City Centre, he said.

“Government linked companies will take centre stage in future in terms of real estate development,” he said. – Bernama

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Property stocks to do better this year: UBS

By Farah Wahida:

Although they failed to meet expectations in 2012, some residential property stocks are expected to perform better this year, according to UBS Investment Research.

Among them the best is Mah Sing Bhd thanks to its good management and ambitious plan to expand within Malaysia. Due to its diverse product range, the company’s sales and earnings are expected to grow by 20 percent this year.

“Our new price target for Mah Sing’s stock is RM2.80 based on a 30 percent discount in realisable net asset value (RNAV) of RM3.99 and the company has a dividend policy of paying a minimum 40 percent of net profit resulting in a forecast yield of 6.2 percent for 2013,” said the research unit.

Meanwhile, UBS gave a ‘buy’ rating on SP Setia, whose shares are currently being traded at 14.3 times the expected FY2013 price-to-earnings ratio, with yield at 4.1 percent.

“The stock is currently traded at a 38 percent discount to our RNAV of RM5.14.”

“This discount more than fairly reflects the risks associated with the departure of Chief Executive Officer Tan Sri Liew Kee Sin, diversification of projects outside of Malaysia and upcoming product launches from its high-quality landbank should ensure that the company achieves its aggressive sales target for financial year 2013.”

Furthermore, the sales of luxury properties in Malaysia were slow, while those of low- to medium-cost units (RM500,000 to RM1 million) were resilient. In addition, demand for premium condominiums and premium landed properties were weaker, noted UBS.

Gov't disapproves RM75b Balik Pulau project

By Farah Wahida:

The state government has refused approve the proposed RM75billion mega development project in Balik Pulau as many Penangites expressed their disapproval over the project, reported The Malay Mail.
According to several Penangites, the massive scale plan of the project would have a great effect in Malaysia’s fragile ecosystem and would affect Balik Pulau’s surroundings.

“Thank goodness the project was not approved. You cannot build something like this. It will never work. The environment is too fragile for a project this big. I love the earth and would not like to see it destroyed,” said 28-year-old Fadila.

Another resident, 30-year-old C.S Ngui said the project would affect the environment, adding that the scale of the project would cost much for an offshore development.

“Unlike the Iskandar project in Johor where land was only rezoned, this is actually an island by itself with oil and gas industries. Where would the material come from? Would it be another Lynas?” he said.

The proposed 2,833ha offshore development would have featured residential areas, hotels and schools as well as oil and gas R&D labs, electrical and electronic industries, government office and an artificial beach.

Al-Cube Sdn Bhd proposed the project to the state government in October last year, on behalf of its Hong Kong and Malaysian investors.

Moreover, investors have pulled out of Penang following negative comments on the proposed development.

Carrefour outlets undergo RM100m makeover

By Farah Wahida:

Aeon Co Ltd is investing RM100 million to refurbish and rebrand 26 Carrefour outlets here, following its successful acquisition of Carrefour Malaysia for €250 million (RM1 billion) in October 2012, reported The Sun Daily.

According to Nagahisa Oyama, Vice President and CEO for ASEAN region at Aeon, RM50 million will be used to rebrand Carrefour to Aeon BIG (M) Sdn Bhd.

The rebranding and refurbishment exercise are currently ongoing, but the former is set to be completed by April, while the renovation is scheduled for completion by year-end.

So far, two hypermarkets — one in Kota Damansara, Selangor and the other in Jalan Ipoh, Kuala Lumpur — have been fully rebranded and refurbished, noted Oyama.

“We are currently integrating Aeon and the former Carrefour to look into synergising our resources.”

“After the rebranding exercise, we expect to open three to four Aeon Big stores every year to compete with the existing players in the Malaysian hypermarket industry.”

Moreover, Aeon, a Japanese supermarket operator, has no plans to close any of the Carrefour Malaysia outlets, noting that it employs 4,000 workers.

Mah Sing to launch Emaryl Condo Villa

By Farah Wahida:

Leveraging on the demand from Penangites and Singaporeans, Mah Sing Properties Sdn Bhd is set to unveil its Emaryl Condo Villa project in Batu Ferringhi in Penang this month, reported The Sun Daily.

The project features a resort-style living within a private gated village and is situated within Precinct 1 of the Ferringhi Residence, which is 15km away from Georgetown and less than one km from the Batu Ferringhi beach.

According to Teh Heng Chong, Chief Operating Officer of Mah Sing Properties, the condo villas are excellent for small families who want to escape the hustle and bustle of city life.

“It is ideal for small families, or foreigners who want to have a second home in Malaysia.”

Set to be completed in 2016, Emaryl Condo Villa comprises 20 five-storey blocks, with only 10 units in each building. The project will also feature six ‘articulated dreamscapes’ that enables residents to enjoy nature while doing activities with their families.

They include social gathering-space the Water Lounge, the Eco Street which consists of shady and green passageways linking the buildings, as well as the Flying Carpet, a bridge-like structure where residents can walk across several bodies of water. 

Phase II of Melaka river projects features wilds animals

By Farah Wahida:

To lure more tourists, the Phase II of the Melaka Beautification and Cleanliness Project will be developed based on a safari concept, according to Chief Minister Datuk Seri Mohd Ali Rustam.

The second phase will cost RM285 million and will incorporate rich wildlife in an area spanning six kilometres. They include colourful flora and several species of animals that will be propagated along the river.

“The first phase of the Melaka River beautification project has been drawing more than one million visitors yearly, which has also generated up to RM9 million in revenue. In the second phase, improvements are made by applying the safari concept, similar to that found along the Singapore River.”

He said this during the Water Treating Technology Workshop at Casa Del Rio yesterday.

Phase II was unveiled on 21 May 2012 and stretches from Taman Rempah/Hang Jebat bridge to Melaka Sentral. Other additions include walkways, water taxis, landscape beautification and river bank protective features.

Meanwhile, on the workshop, Mohd Ali noted that some experts called on the state government to use oil and gas (O&G) cleaning technology to enhance the cleanliness of Melaka River.

“The cleanliness of the river is now at level three and through this technology, we hope it can be improved to level two, that will enable the river to breed certain type of fish and be safe for recreational activities.”

Furthermore, the state government will apply to the Ministry of Energy, Green Technology and Water for a pilot project utilising the technology, which is estimated to cost between RM800,000 and RM1 million.

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Penang gov't not obliged to approve Mega project

By Farah Wahida:

A proposed RM75billion mixed project off the coast of Balik Pulau, Penang has not yet been approved since a project of this scale requires permission from the federal government, reportedThe Sun Daily.

According to Chief Minister Lim Guan Eng, the local authorities have no obligation to give the green light to the project even as the proposer had already engaged with non-governmental organisations (NGOs) and spent money on site visits.

“Even if the approval is granted by the federal government, we (the state government) reserve the right to give the approval,” he said in response to the report about a proposed 2,833ha project about 5.5km off Kuala Sungai Pinang.

Notably, a Malaysia-Hong Kong joint venture plans to build a mixed project featuring oil & gas facilities, hotels, schools, offices and residential units, all of which will be built on stilts in the next 10 years.

The scale of the proposed development surpasses that of the axed RM25billion Penang Global City Centre (PGCC) at a 104ha site near George Town.

MBSB to buy building in PJ as headquarters

By Ben Shane Lim of theedgeproperty.com
Thursday, 13 December 2012 14:17


KUALA LUMPUR: Malaysia Building Society Bhd (MBSB) has entered into a conditional sale and purchase agreement (SPA) with PJ Sentral Development Sdn Bhd to buy a 27- to 30-storey office building for RM239.24 million.

The “grade A” office building is part of the first phase of a proposed mixed development project named PJ Sentral Garden City which will contain MBSB’s flagship banking hall. The whole development will consist of five office towers and a 1.61ha central park.

“The proposed acquisition will create visibility for the group which is in turn expected to further strengthen and enhance the group’s corporate image, identity and presence,” the group said in its filing with Bursa Malaysia yesterday.

“It will also allow the group to consolidate and centralise its business units as well as business functions to achieve greater operating efficiency,” it added.

MBSB currently houses about 700 employees in its two office premises in Damansara Heights — in Menara MBSB which is owned by the group and Menara I&P 2 which is rented. The new building will not only house the group’s subsidiaries under one roof, but will also boast an electronic banking customer service area as well as a larger information technology data centre to cater to the group’s core banking platform.

Last month, the group began its move towards computerisation when it launched its new MBSB Integrated Core Banking System (MICoB).

The MICoB will be crucial to the group’s aspirations in obtaining a banking licence, said chief executive Datuk Ahmad Zaini Othman prior to the launch. Ahmad noted that next year would be a good year.

The developer, PJ Sentral Development, is 70% owned by Nusa Gapurna Development Sdn Bhd and 30% owned by PKNS Holdings Sdn Bhd. Nusa Gapurna in turn is a 60:40 joint venture between property developer Gapurna Sdn Bhd and the Employees Provident Fund. MBSB’s building will have 281,455 sq ft of net lettable area (NLA) as well as four basement carpark levels and one service floor. That works out to about RM850 psf based on the total NLA.

The group, which provides personal and property financing, will fork out RM71.77 million in internally generated funds to finance the project while the remaining RM167.47 million will be from bank borrowings.

This article first appeared in The Edge Financial Daily, on Dec 13, 2012.

Property market expected to stay level next year

By Mohd Kamarul Azhar of theedgeproperty.com
Friday, 14 December 2012 15:19


KUALA LUMPUR: The Malaysian property market next year is expected to remain subdued with little growth in prices, according to the Malaysian Institute of Estate Agents (MIEA).

"I think we all agree that next year, prices are not going to go up but we don't see prices coming down either," MIEA president Nixon Paul told reporters on Dec 12.

He said sales in the residential secondary market may be held back due to the difference in expectations between buyer and seller prices.

"Some buyers expect to buy at fire sale prices because of the misconception that there is an oversupply situation in the residential property market in Malaysia. On the other hand, a number of owners are holding on to their properties until they can sell at par or above market price," said Paul.

This situation is echoed by Reapfield Properties Group chief executive Gerard Kho. Based on the agency's experience this year, the volume growth in residential transactions has been slower at about 5%, compared with between 10% and 15% per annum in the previous years.

"In 2012, buyers have felt no urgency to purchase as asking prices are not close to the market value. When asking prices have been priced close to market value, the properties are transacted within a short period of time," said Kho.

The office market is forecast to remain healthy in 2013 with the recent shift towards green and MSC-status buildings set to continue, said YY Lau of YY Property Solutions.

"There is also a growing trend of companies moving into office spaces built in integrated developments which include hotels and shopping malls. Parking availability is also a very important factor," said Lau.

Despite the concern of an oversupply situation in Kuala Lumpur's central business district (CBD) which may well contribute to a slow rental market here next year, Lau said there is hardly any oversupply of office space in the city fringes and suburbs such as KL Sentral, Petaling Jaya, Shah Alam and Damansara.

She said rental rates for Grade A offices in the CBD area will decrease a little next year, especially for existing tenants, but rates for new tenants may still be higher. As at the third quarter this year, Lau revealed the average rental for CBD office spaces is at RM7.45 psf while the average for fringe areas is from RM4.57 psf.

For shophouses, principal realtor of GDS Properties Govin Bala said this segment is projected to do well in 2013 as prices are being driven upwards by end users and investors. With prices of shophouses rising, it has become increasingly difficult for the average businessman to buy a unit. This means more businessmen will be renting premises rather than owning them.

In the industrial property market, Hectares & Stratas managing partner Stephen Tew said there has been a strong demand for industrial property, especially in the Klang Valley and Penang, which is expected to continue into 2013. The demand could be due to a lack of supply as there have been no large planned industrial parks in the Klang Valley and Penang in recent times on a lack of space. The last industrial estates developed in Selangor were the Kota Kemuning and Berjaya Industrial Parks, launched 20 years ago.

This article first appeared in The Edge Financial Daily, on Dec 14, 2012.

Branded luxury homes trend emerges in KL

By Lam Jian Wyn of theedgeproperty.com
Friday, 04 January 2013 10:51


KUALA LUMPUR: More developers are partnering international luxury hospitality and lifestyle brands to give their new upmarket condo and serviced apartments in Kuala Lumpur city an edge, according to Knight Frank Malaysia.

“Hotel-like services such as concierge, security and room service provided by a luxury brand will help maximise the value of a development,” said the real estate consultancy in its second half (2H) 2012 Real Estate Highlights report covering Kuala Lumpur, Penang and Johor Baru.

One such noteworthy product is the Banyan Tree Signatures Kuala Lumpur in Jalan Conlay, where all 441 units were sold at an average price of RM2,000 psf.

Ritz-Carlton will be managing its first residences built by Berjaya Land Bhd in Jalan Sultan Ismail. Other brands making their debut here are Four Seasons, Harrods Hotel & Residences and W Hotel & Residences.

The 150-room and 353-unit W Hotel & Residences will come up on a 1.28-acre site in Jalan Ampang and has an indicative pricing of RM2,000 psf, with a launch date sometime in the first quarter (1Q) of 2013.

The hotel will be managed by Starwood Hotels & Resorts Worldwide Inc while the residences will be run by its developer Dijaya Corp Bhd.

Ireka Corp Bhd has also unveiled its RuMa Hotel & Residences in Jalan Kia Peng, which will feature a 263-room boutique hotel and 200 serviced residences, with the latter offering sizes ranging from 915 to 1,819 sq ft and priced from RM2,000 psf.
Introducing more luxurious and comprehensive services is just one of the ways developers add value to entice buyers in a slow market weighed down by large existing stock and low occupational demand for high-end condos/apartments, said the consultancy in the report.

Meanwhile, luxury apartment developments that are both completed and awaiting their Certificate of Completion and Compliance are St Mary Residences, Binjai 8, Verticas Residensi, towers 1A and 1B of Setia Sky Residences in KL City, Amarin Wickham in Ampang and Kiaramas Danai (Block A) in Mont’Kiara, bringing cumulative stock of high-end apartments in 1Q to 31,851 units.

A further 4,917 units of luxury high-rise homes will be added to existing supply in Kuala Lumpur city and Mont’Kiara this year including Crest @ Jalan Sultan Ismail, The Quadro Residence, Vipod Residences and 6 Capsquare in KL City, 9 Madge, Sastra U-Thant, phase one of One Kiara, 28 Mont’ Kiara, and block B of Kiaramas Danai.

During 2H2012 of last year, the rental market continued to face downward pressure with a slight decline in rents in selected locations. The high-end condo market at KLCC and Mont’Kiara saw a slight drop in asking prices
On the other end of the spectrum, the report noted that on the primary market, developers and buyers are moving towards the fringes of the city due to better access, thanks to the upcoming mass rapid transit line and other infrastructure projects, as well as the relatively more affordable prices.

Besides formulating better deals towards lower entry cost for buyers, developers are also coming up with smaller homes to meet the needs of first-time buyers who are sensitive to pricing, said the report.

In Penang, the Knight Frank report said the outlook for the luxury condo market is one of increasing caution as prices are high and the residential rental market appears to be weakening. “Although capital values are holding, a period of consolidation is likely to follow,” said the report.

Prices of older condos within the prime parts of Tanjung Bungah and Pulau Tikus have risen to RM650 psf from RM430 psf, while newer completed developments are priced at RM500 psf to RM800 psf.

Asking rents for older condos range from RM5,000 to RM8,500 per month, while rents for fully furnished new condos dropped from RM8,000 to RM13,000 previously to RM7,000 to RM12,000.

Some notable luxury condominium projects unveiled in 2H2012 include Eastern & Oriental Bhd’s Tower 1H of Andaman Quayside and The Landmark Penang in Tanjung Tokong that is jointly developed by Katana Developments and BSG Property. Andaman Quayside’s Tower 1H was launched in 3Q2012, achieving 40% sales so far with unit sizes ranging from 914 to 2,755 sq ft and prices from RM1,500 to RM1,700 psf. In comparison, earlier phases saw take-ups from 70% to 90%.

Meanwhile, The Landmark Penang achieved a 50% take-up prior to launching, with sizes from 2,622 to 7,266 sq ft and prices at about RM1,055 psf.

Over in Johor, the outlook for the luxury condo/serviced apartment market will be supported by the growth of Iskandar Malaysia while developers there anticipate a rising trend towards high-rise living from the younger generation and from Singaporeans.

Hap Seng to build Horizon Residences with GDV of RM355 mil

By Bernana
Friday, 11 January 2013 16:51


KUALA LUMPUR (Jan 11): Hap Seng Land Sdn Bhd, a wholly-owned subsidiary of publicly listed Hap Seng Consolidated Bhd, has unveiled its new project, The Horizon Residences Kuala Lumpur.

The project has a gross development value (GDV) of RM355 million. "To be fully completed in July 2015, The Horizon Residences is a 335-unit luxury residential development encompassing two 26-storey towers," said Datuk Edward Lee Ming Foo, Group Managing Director of Hap Seng Consolidated Bhd.

The Horizon Residences Kuala Lumpur is a stone's throw from the upcoming Tun Razak Exchange, a multi-billion ringgit world-class international financial district, while a planned Mass Rail Transit station is only 500 metres away. Lee said the location of the project provides an opportunity for investors to take advantage of significant potential value appreciation,
resulting from the infrastructure developments and investments taking place within its surrounding vicinity.

He said 40 per cent of the residential units had been sold even before the launch, with 30 per cent taken up by the locals and 10 per cent by foreigners.

"The foreigners are mainly from Asian countries like China, Taiwan, Korea and Singapore. Hap Seng is seeking the best contractor for the project, so that the residences built will be of high quality," he told reporters after unveiling The Horizon Residences Kuala Lumpur, here on Jan 11

Lee said those with a discerning taste and lifestyle for homes equipped with the very best in contemporary urban living, can also enjoy the facilities and amenities that have been incorporated in the Horizon Residences.

Designed to attain the Green Building Index certification once completed, The Horizon Residences Kuala Lumpur offers eight types of layout ranging from 549 sq ft to 4,316 sq ft

Prices start from RM700,285 and the show gallery for the project is on the ground floor of Menara Hap Seng in Jalan P.Ramlee here. "We have a few new projects on hand for this year and are looking for new land mainly in the Klang Valley and Sabah," Lee said.

Hap Seng Consolidated Bhd has a diversified business interest in plantations, property investments and development, credit financing, trading of fertilisers and the automotive sector. - Bernama

TM inks Mou with housing developer to provide high speed broadband

By Bernama
Thursday, 10 January 2013 17:45


SUNGAI PETANI (Jan 10): Telekom Malaysia Bhd (TM) has signed a memorandum of understanding (MoU) and a service agreement with Chinhinhome Sdn Bhd, to install its high-speed broadband service, UniFi, in housing projects to be undertaken by the company.

House buyers in projects undertaken by Chinhinhome will enjoy high-speed Internet, phone and Internet Protocol television (IPTV) using fiber optics.

Speaking after the signing ceremony on Jan 10, Kedah/Perlis TM Manager Noor Lela Baba said the MoU was the best way to create synergy between TM and dynamic housing developers in providing benefits to house buyers and residents in the state.

"This agreement is being inked at the right time given the keen interest expressed by house buyers and users. This is also in tandem with the government's aspiration to increase broadband penetration in the country.This is the third such collaboration that TM has entered into in the Kedah/Perlis area after Eupe Corp Bhd and Paramount Property Development Sdn Bhd," she told reporters, adding that TM hoped to emulate the effort with other housing developers in future.

Noor Lela said UniFi's service currently covered 94 areas and 1.32 million premises including economic and industrial zones in the Klang Valley, Cyberjaya, Putrajaya, Kulim Hi-Tech Park and Iskandar Malaysia.

"In Kedah, UniFi is available in housing estates and the industrial area of Kulim Hi-Tech Park, Sungai Petani, Ria Jaya and Bakar Arang. "Overall, UniFi has 490,000 customers, nationwide, and more than 1,700 in the state," he added - Bernama

Hong Kong developer launches maiden project in JB

By Bernama
Friday, 11 January 2013 16:47

JOHOR BARU (Jan 11): One of the largest property developers in Hong Kong, New World Development Co Ltd, has joined hands with a local partner to launch its maiden real estate project in Malaysia.

The company, which commands a 15 per cent market share in the highly competitive property market in Hong Kong, picked Luen Yum Development (M) Sdn Bhd as its partner in launching the "New World Garden" project in Plentong, Johor.

The project, offering 96 units of high-end bungalows and semi-detached luvury villas on 4.86 ha. of land, has a Gross Development Value (GDV) of RM240 million.

Slated for completion in April 2014, it is undertaken by Taipan Eagle Sdn Bhd, a joint venture company set up by New World Development and Luen Yum Development.

Michael Tam, director of Luen Yum Development, said the 92 units of semi-detached villas and four exclusive bungalows are priced from RM2.4 million to RM4 million each.

"We are targeting a mix of buyers, locals and foreigners, Singaporeans and other nationalities," he told the media at the New World Garden's launch here on Jan 11.

Construction of the luxury houses, he said, is more than 50 per cent complete. According to Tam, besides the booming Johor Baharu property market, Taipan Eagle, the local arm of New World Development, is also looking to expand its footprint into other markets in Malaysia.

Besides Hong Kong, New World Development, which is owned by Chow Tai Fook Enterprise Ltd and listed in the Hong Kong bourse, also has property projects in major cities in China such as Beijing, Shanghai, Guangzhou and Wuhan.

Meanwhile, executive director of New World Development Chen Guanzhan said the company, with its wide experience in property development in Hong Kong and China, is looking for opportunities in other parts of Malaysia. - Bernama

Hong Kong developer launches maiden project in JB

By Bernama
Friday, 11 January 2013 16:47

JOHOR BARU (Jan 11): One of the largest property developers in Hong Kong, New World Development Co Ltd, has joined hands with a local partner to launch its maiden real estate project in Malaysia.

The company, which commands a 15 per cent market share in the highly competitive property market in Hong Kong, picked Luen Yum Development (M) Sdn Bhd as its partner in launching the "New World Garden" project in Plentong, Johor.

The project, offering 96 units of high-end bungalows and semi-detached luvury villas on 4.86 ha. of land, has a Gross Development Value (GDV) of RM240 million.

Slated for completion in April 2014, it is undertaken by Taipan Eagle Sdn Bhd, a joint venture company set up by New World Development and Luen Yum Development.

Michael Tam, director of Luen Yum Development, said the 92 units of semi-detached villas and four exclusive bungalows are priced from RM2.4 million to RM4 million each.

"We are targeting a mix of buyers, locals and foreigners, Singaporeans and other nationalities," he told the media at the New World Garden's launch here on Jan 11.

Construction of the luxury houses, he said, is more than 50 per cent complete. According to Tam, besides the booming Johor Baharu property market, Taipan Eagle, the local arm of New World Development, is also looking to expand its footprint into other markets in Malaysia.

Besides Hong Kong, New World Development, which is owned by Chow Tai Fook Enterprise Ltd and listed in the Hong Kong bourse, also has property projects in major cities in China such as Beijing, Shanghai, Guangzhou and Wuhan.

Meanwhile, executive director of New World Development Chen Guanzhan said the company, with its wide experience in property development in Hong Kong and China, is looking for opportunities in other parts of Malaysia. - Bernama

Property developers turn to fund raising for projects

By Farah Wahida:

SP Setia Bhd, UEM Land Holdings Bhd and Mah Sing Group Bhd, among other Malaysian property developers have embarked on a fund raising exercise in order to fund their respective projects, according to RHB Research Institute Sdn Bhd.

“But the fundraising would not be in the immediate term and we are comfortable with their purposes,” it added.

The research house also named other developers that would need financing in the medium term — IJM Land Bhd, Sunway and Eastern & Oriental Bhd.

“We also feel more comfortable given the financing purposes of these three companies,” it said.

It noted that IJM Land would use the proceeds primarily to “fund its The Light Phase 2 commercial project in Penang”, while Sunway will use it to fund the development of its property investment assets in the next three to four years, with Sunway Pinnacle, Sunway Pyramid 3 and Sunway Velocity Mall as the main property assets.

E&O, on the other hand, will use the money for the reclamation and development of Seri Tanjung Pinang 2.

The correction for the property sector ahead of the election will be less drastic considering that the 2008 selldown could be partially caused by the initial outbreak of the subprime crisis in the US, explained RHB Research.

“We expect the physical property market to recover this year, supported by our analysis on population growth cycle and our gross domestic product growth forecast of 5.4 percent for 2013, as well as the influx of liquidity,” it said.

The research house noted that foreign buying could also provide the needed boost in the overall market, as Singapore and Hong Kong continue to roll out measures to curb foreign purchases.

Bright 2013 for property market

By Farah Wahida:

Spurred by the solid banking system and catalytic projects under the Economic Transformation Programme (ETP) and in the economic corridors, the property market will grow further in 2013, said TA Securities.

“Catalytic projects such as the Klang Valley MRT and public-private partnership developments like the PJ Garden Sentral in Petaling Jaya, Rubber Research Institute land in Sungai Buloh and Bandar Malaysia in Sungai Besi are envisaged to continue to excite the property market,” noted Thiam Chiann Wen, Research Analyst with TA Securities.

In TA Securities’ 2013 Annual Strategy: 2013 Outlook – Ride the Volatility report, it said, “We reiterate our view that the multibillion-ringgit MRT project will be a long-term driver for housing demand and property prices in the Klang Valley, particularly in Kajang and Sungai Buloh”

For instance, Johor has enjoyed an influx of investments into Iskandar Malaysia (IM), amounting to RM20.4 billion for the 11 months of 2012. This increased the total cumulative committed investments into the region and translated to high economic activity and jobs.

Currently, Iskandar is also enjoying boosted housing demand, said Thiam Chiann Wen.

Meanwhile, the Bank Negara Malaysia’s newly-introduced responsible financing guidelines have affected property growth, reflecting 48 percent decline in mortgage approval rates for the period up to October 2012.

Nevertheless, the total number of mortgage applications at the same period increased 3.4 percent year-on-year, which could mean that buyers remain optimistic amid stricter lending guidelines.

Transaction costs are very high in the Philippines

How high are realtors’ and lawyers’ fees in the Philippines? What about other property purchase costs?

TRANSACTION COSTS
		Who Pays?
Legal Fees	5.00% - 10.00%	buyer
Local Transfer Tax	0.50% - 0.75%	buyer
Deed of Sale	0.225% - 0.50%	buyer
Capital Gains Tax	6.00%	seller
Real Estate Agent´s Fee	3.00% - 5.00%	seller
Document Stamp Tax	1.50%	seller
Costs paid by buyer	5.73% - 11.25%
Costs paid by seller	10.50% - 12.50%
ROUNDTRIP TRANSACTION COSTS	16.23% - 23.75%
See Footnotes Source: Global Property Guide

How difficult is the property purchase process in the Philippines?

Foreigners cannot own land, but can own condominium units or apartments in high-rise buildings as long as the foreign proportion does not exceed 40%. They can also buy a house but not the land on which it is built. Leases on land up to 50 years, renewable for another 25 years, are available.

If a foreigner is keen on acquiring land, there are several options. One, if married to a Filipino citizen, is to have the ownership of the land under the Filipino’s name. However, in the event of death or separation, the land cannot be transferred to the foreigner. Another option is to acquire land through a corporation. Corporations can only be, at the maximum, 40% foreign-owned.

The maximum area that may be acquired for residential purposes is 1,000 square meters of urban land or one hectare of rural land.

When buying new property, it is important to look for properties backed by established developers and licensed real estate agents/ brokers, especially in cases of off-plan or pre-selling (the property is at the planning stages and non-existent during the time of the sale).

In general, property can be acquired by simple agreement. After deciding what property to buy as well as inspecting the premises and documents, the buyer usually signs a binding notarized Deed of Sale. Employing the services of a reputable sales agent is convenient because they not only provide vital information regarding the transaction and property, but also assist the buyer in getting mortgage loans.

Buying condominiums

A down payment of 10%-30% is usually required. Ownership of condominium units is evidenced by the Condominium Certificate of Title (CCT) but the transfer of title is usually not executed until the property is fully paid. Foreigners can only own up to 40% of a condominium project.

Holders of Special Resident Retiree’s Visa (SRRV), a non-immigrant resident visa, can get additional benefits aside from being allowed to buy a condo unit or lease a parcel of land or a house and lot. The SRRV holders can reside in the Philippines permanently, with multiple-entry privileges and zero travel taxes. Other benefits and information about the SRRVisa is available on the Philippine Retirement Authority Website.

Buying land

The process of buying land in the Philippines is cumbersome and tedious. Aside from the fact that foreigners are not allowed to buy land, the system of land registration and classification should make any investor think twice. The farther you are from the capital the more caution one must take.

However, serious land problems also exist in the NCR. There are 11 laws directly related to land registration and nine others indirectly related to land disposition and administration. Aside from the Department of Environment and Natural Resources and the Bureau of Lands, there are several agencies that have direct and indirect control over land. The courts also have the authority to award land ownership.

Legal Procedures in transfer of title (land and apartments)

1. Owner and Buyer agree on sale of a piece of land. Through a lawyer, a Deed of Absolute Sale (DOAS) is created and notarized.
2. A Land Tax Declaration is secured from the Bureau of Internal Revenue (BIR) and submitted to the city or municipal Assessor’s office.
3. Buyer pays real estate tax to the City Treasurer’s Office.
4. The Assessors office assesses the market value of the property.
5. Transfer taxes are paid by the buyer to the Assessors Office.
6. Capital Gains Tax and Documentary Stamp tax are paid to BIR.
7. The Registry of Deeds (RD) cancels old title and issues a new one in the name of the buyer.
8. The buyer, now the new owner, obtains a photocopy of the new title and requests tax declaration from the Assessors office.

Ownership is evidenced by the Transfer Certificate of Title (TCT) in the case of single houses and raw land, and The Land Registration Act requires the owners of property to register titles with the Registry of Deeds. The titles must be registered in the same province as the property. However, the records are inaccurate in such that overlapping might exist. There is a proliferation of fake and double titles. The completion of survey of all the lands in the country, mandated by the 1903 Public Land Law, is nowhere in sight.

The whole process of registering property may take around 33 days to complete eight procedures.

Value Added Tax

According to RA 9337, the following sales of property are VAT-Exempt

1. Sale of real properties not primarily held for sale to customers or held for lease in the ordinary course of trade or business;
2. Sale of real properties utilized for low-cost housing as defined by R.A. No. 7279, otherwise known as the “Urban Development Housing Act of 1992” and other related laws, such as R.A. No. 7835 and R.A. No. 8763 wherein the price ceiling per unit is P750,000.00 or as may from time to time be determined by the Housing and Urban Development Coordinating Council (HUDCC) and the National Economic Development Authority (NEDA);
3. Sale of real properties utilized for socialized housing as defined under R.A. No. 8763, wherein the price ceiling per unit is P225,000.00 or as may from time to time be determined by the HUDCC and the NEDA and other related laws;
4. Residential lot valued at one million five hundred thousand pesos (P1,500,000) and below, house and lot, and other residential dwellings valued at two million five hundred thousand pesos (P2,500,000) and below: provided, that not later than January 31, 2009 and every three (3) years thereafter, the amounts herein stated shall be adjusted to their present values using the Consumer Price Index, as published by the National Statistics Office (NSO).
   

Deed of Sale
Registration Fees	PHP 4,398 (US$88) + PHP 45 (US$0.90) for every PHP 20,000 (US$400) in excess of PHP1,700,000 (US$33,900)
Notarial Fees	PHP200 (US$4) per title or document
Registration Fees		PHP	US$
	Property value	12,500,000	250,000
	Value in excess of 1,700,000	10,800,000	215,000
	PHP45 for every 20,000	24,300	485
	Plus fixed amount	4,398	88
	Plus notarial fees	200	4
	Total Fees	28,898	577
	as % of property value	0.231%	0.231%

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Footnotes to Transaction Costs Table

The round trip transaction costs include all costs of buying and then re-selling a property – lawyers’ fees, notaries’ fees, registration fees, taxes, agents’ fees, etc.

Currency:
Philippines uses the Philippine Peso. The exchange rate was US$1 = PHP52.742 as of July 6, 2006.

Local Transfer Tax:
Imposed by Municipal or City governments. 0.5% to 0.75% of the contract price, zonal value or fair market value, which ever is higher.

Legal Fees:
Negotiable; generally at PHP20,000 and up. In some instances, legal fees can reach up to 10% of property value.

Capital Gains Tax:
The capital gains tax on sale of real property is levied at 6% of gross selling price or fair market value, whichever is higher. What is referred to as Capital Gains Tax is actually a local transaction tax, which is usually based on zonal values. Who actually pays the transaction costs is also dependent on the agreement between the buyer and the seller. In some instances, either the buyer or seller pays all the taxes and fees but the cost is debited or charged to the sale price.

Real Estate Agent´s Fee:
The Agent / Broker will usually do the registration process without any additional payments aside from the commission (3 -5%.)

Documentary Stamp Tax:
PHP15 (US$0.30) per PHP1,000 (US$20) of consideration or 1.5%.