Wednesday, April 30, 2014
Greenland looks for a slice of RM4.4bil river rehabilitation project in KL
Fresh from selling land worth RM600mil to China’s Greenland Group, Iskandar Waterfront Holdings Sdn Bhd’s (IWH) Tan Sri Lim Kang Hoo is believed to be eyeing another tie-up with Greenland – this time for the RM4.4bil River of Life (RoL) project in Kuala Lumpur.
Sources familiar with the matter said that Greenland, one of China’s top five property developers by sales, is in preliminary talks with Lim to explore ways it can play a role in the RoL project.
The Shanghai-based firm could be planning a “city within a city” à la Shanghai’s iconic The Bund along the bank of the Klang and Gombak rivers that flow through Kuala Lumpur, sources say.
Lim’s construction outfit Ekovest Bhd has a 60% stake in the joint-venture company that was appointed the project delivery partner (PDP) of RoL in 2011 by the Government. Malaysian Resources Corp Bhd (MRCB) holds the remaining 40%.
A spokesperson for Ekovest declined to comment when contacted.
RoL – an anchor project of the Economic Transformation Programme for Greater Kuala Lumpur that aims to breathe new life into the long-polluted Klang and Gombak rivers – is spearheaded by a multiagency task force under the purview of the Federal Territories Ministry.
The project calls for a massive cleanup and redevelopment of an 110km stretch of river by 2017. In return, the contractors given the mandate get plots of land along the river for development.
Greenland had two weeks ago agreed to buy 13.96 acres from IWH in the coastal Danga Bay area south of Johor for properties with an estimated gross development value (GDV) of RM2.2bil, marking its maiden foray to Malaysia.
It is understood that the state-owned enterprise may seal another purchase from IWH soon for two parcels measuring some 20 acres on the eastern side of Johor near the Permas Jaya township.
The deal is yet to be finalised as the land is held under IWH’s 47.16% associate Tebrau Teguh Bhd, another listed entity in Lim’s stable, and will have to undergo the usual due diligence processes.
“Greenland ultimately plans to acquire up to 150 acres in Johor with a GDV exceeding RM10bil. The land alone is expected to cost RM3.8bil,” says a property executive.
That would make Greenland the biggest China-based landowner in Iskandar Malaysia. Guangzhou R&F Properties, which last year bought 116 acres in Tanjung Puteri from the Sultan of Johor for RM4.5bil, is a close second.
Lim owns 60% of IWH via Credence Resources Sdn Bhd, and Kumpulan Prasarana Rakyat Johor, a state-backed vehicle, 40%.
Shares of Tebrau Teguh are up some 14% since early-April to RM1.37 on Friday. Ekovest, however, has drifted downwards after hitting a peak in December. The counter closed Friday at RM2.62.
A deal between Greenland and Lim on RoL, should it materialise, is unlikely to have any implications for MRCB.
MRCB officials told Starbiz that the company has no intention of selling down its interest in RoL currently, and neither was it on the lookout for buyers.
Unlike the Duke highway, in which MRCB used to own a 30% stake, the RoL is a division we want to keep, an executive says. “We will honour our commitment to the Government as PDP.”
Even so, the executive concede that RoL cold be a target of various parties given its large construction orderbook.
MRCB had in January hived off its interest in highway concessionaire Duta-Ulu Kelang Expressway to Ekovest for RM230mil in cash in a bid to pare down its debt and dispose of non-core assets.
Although RoL is still sorting our land valuation issues, its first phase kicked off in March involving a 10.7km stretch of the river dubbed Precinct 7. Ekovest-MRCB JV Sdn Bhd is the contractor appointed to carry out the project.
Work on the other four phases, comprising 10 precincts, is expected to begin in September.
A slew of developers from China have expanded abroad aggressively in recent years, but Greenland could well be the most ambitious of the lot.
Greenland, a Fortune 500 company, has interests in real estate, coal mining, finance and automobiles. Known as a builder of skyscrapers, three of its towers rank among the 10 tallest in the world.
It is targeting a spot in the Fortune 200 and revenue of 500 billion yuan by 2015.
In January, it had launched a US$480mil project in Sydney, its first in Australia, as part of a US$1bil push Down Under. The Greenland Centre in Sydney’s central business district will comprise a high-end boutique hotel and residential tower.
The group had acquired land in downtown Los Angeles, its first in the United States, last July for US$1bil from a teacher’s pension fund, with plans for a hotel, offices, serviced residences and luxury homes.
Across the pond, Greenland is investing £1.2bil in two London developments, one in the southwest and the other in the Canary Wharf financial district.
Foreign news reports suggest that Greenland also has its eye on France, Canada, Singapore and Thailand.
Four other major Chinese property firms are in talks with IWH for mixed-use developments featuring waterfront properties.
IWH is the master developer of 1,620ha of waterfront land in the eastern and western side of the Johor Causeway, with Danga Bay, located in Zone A of Iskandar Malaysia, as its centrepiece.
It has inked 17 deals to-date with local and foreign partners to develop properties worth RM127bil in GDV, bolstering its plan to transform the coastline of Johor bordering Singapore into a waterfront metropolis.
Sources familiar with the matter said that Greenland, one of China’s top five property developers by sales, is in preliminary talks with Lim to explore ways it can play a role in the RoL project.
The Shanghai-based firm could be planning a “city within a city” à la Shanghai’s iconic The Bund along the bank of the Klang and Gombak rivers that flow through Kuala Lumpur, sources say.
Lim’s construction outfit Ekovest Bhd has a 60% stake in the joint-venture company that was appointed the project delivery partner (PDP) of RoL in 2011 by the Government. Malaysian Resources Corp Bhd (MRCB) holds the remaining 40%.
A spokesperson for Ekovest declined to comment when contacted.
RoL – an anchor project of the Economic Transformation Programme for Greater Kuala Lumpur that aims to breathe new life into the long-polluted Klang and Gombak rivers – is spearheaded by a multiagency task force under the purview of the Federal Territories Ministry.
The project calls for a massive cleanup and redevelopment of an 110km stretch of river by 2017. In return, the contractors given the mandate get plots of land along the river for development.
Greenland had two weeks ago agreed to buy 13.96 acres from IWH in the coastal Danga Bay area south of Johor for properties with an estimated gross development value (GDV) of RM2.2bil, marking its maiden foray to Malaysia.
It is understood that the state-owned enterprise may seal another purchase from IWH soon for two parcels measuring some 20 acres on the eastern side of Johor near the Permas Jaya township.
The deal is yet to be finalised as the land is held under IWH’s 47.16% associate Tebrau Teguh Bhd, another listed entity in Lim’s stable, and will have to undergo the usual due diligence processes.
“Greenland ultimately plans to acquire up to 150 acres in Johor with a GDV exceeding RM10bil. The land alone is expected to cost RM3.8bil,” says a property executive.
That would make Greenland the biggest China-based landowner in Iskandar Malaysia. Guangzhou R&F Properties, which last year bought 116 acres in Tanjung Puteri from the Sultan of Johor for RM4.5bil, is a close second.
Lim owns 60% of IWH via Credence Resources Sdn Bhd, and Kumpulan Prasarana Rakyat Johor, a state-backed vehicle, 40%.
Shares of Tebrau Teguh are up some 14% since early-April to RM1.37 on Friday. Ekovest, however, has drifted downwards after hitting a peak in December. The counter closed Friday at RM2.62.
A deal between Greenland and Lim on RoL, should it materialise, is unlikely to have any implications for MRCB.
MRCB officials told Starbiz that the company has no intention of selling down its interest in RoL currently, and neither was it on the lookout for buyers.
Unlike the Duke highway, in which MRCB used to own a 30% stake, the RoL is a division we want to keep, an executive says. “We will honour our commitment to the Government as PDP.”
Even so, the executive concede that RoL cold be a target of various parties given its large construction orderbook.
MRCB had in January hived off its interest in highway concessionaire Duta-Ulu Kelang Expressway to Ekovest for RM230mil in cash in a bid to pare down its debt and dispose of non-core assets.
Although RoL is still sorting our land valuation issues, its first phase kicked off in March involving a 10.7km stretch of the river dubbed Precinct 7. Ekovest-MRCB JV Sdn Bhd is the contractor appointed to carry out the project.
Work on the other four phases, comprising 10 precincts, is expected to begin in September.
A slew of developers from China have expanded abroad aggressively in recent years, but Greenland could well be the most ambitious of the lot.
Greenland, a Fortune 500 company, has interests in real estate, coal mining, finance and automobiles. Known as a builder of skyscrapers, three of its towers rank among the 10 tallest in the world.
It is targeting a spot in the Fortune 200 and revenue of 500 billion yuan by 2015.
In January, it had launched a US$480mil project in Sydney, its first in Australia, as part of a US$1bil push Down Under. The Greenland Centre in Sydney’s central business district will comprise a high-end boutique hotel and residential tower.
The group had acquired land in downtown Los Angeles, its first in the United States, last July for US$1bil from a teacher’s pension fund, with plans for a hotel, offices, serviced residences and luxury homes.
Across the pond, Greenland is investing £1.2bil in two London developments, one in the southwest and the other in the Canary Wharf financial district.
Foreign news reports suggest that Greenland also has its eye on France, Canada, Singapore and Thailand.
Four other major Chinese property firms are in talks with IWH for mixed-use developments featuring waterfront properties.
IWH is the master developer of 1,620ha of waterfront land in the eastern and western side of the Johor Causeway, with Danga Bay, located in Zone A of Iskandar Malaysia, as its centrepiece.
It has inked 17 deals to-date with local and foreign partners to develop properties worth RM127bil in GDV, bolstering its plan to transform the coastline of Johor bordering Singapore into a waterfront metropolis.
Tuesday, April 29, 2014
New attraction for Cyberjaya
DPulze Ventures Sdn Bhd signed a memorandum of understanding with 11 of its biggest tenants in the DPulze Shopping Centre in Cyberjaya recently.
These tenants comprise well-known retailers and brands such as TGV, Jaya Grocer, FOS, Celebrity Fitness, MPH, Yamaha, U Bowl, Song Box, Molly Fantasy, Tune Hotels and Regus.
The shopping centre is in its final stages of construction and 80% tenanted.
Other retailers in the mall include Ace Hardware, Kitchen Shop by Katrin BJ, Akemi Uchi, Royal Sporting House, Adidas, Plan B by the Big Group, City Chain, The Coffee Bean & Tea Leaf, The Loaf, Rakuzen, Sushi Zanmai, Ole Ole Bali, Homst and Thai Odyssey.
“DPulze is a neighbourhood mall, smaller in size than a regional mall, but conveniently located and has a variety of retail outlets, from entertainment to a supermarket which caters to the needs of the surrounding community,” explained DPulze Ventures Sdn Bhd chairman Kan Ah Chun.
As the first retail commercial project by DPulze Ventures Sdn Bhd, careful attention was paid to the product mix when planning the RM500mil development.
“We were very conservative in our financial approach,” said Kan at the signing ceremony.
Complementing the retail outlets is The Tune DPulze Cyberjaya, the only limited-service hotel in the Cyberjaya, Putrajaya, Dengkil and Sepang areas.
The 200-room hotel is set to begin operations in a matter of weeks. Regus Serviced Offices, which comprise more than 120 workstations will be opened within the next two months while a Citadines serviced residences with 230 rooms managed by The Ascott Ltd will open its doors within the next five months.
Kan said, “We do not rush from project to project. When we take on something new, we look into every detail with great attention, such as the location, dynamics and layout. They must all be good. We are always very careful.”
Situated directly opposite the main transportation terminal in Cyberjaya and facing Persiaran Multimedia, Cyberjaya’s busy main road, the shopping centre’s close proximity to major MNCs and universtities in the area provides the mall with ready catchment and population.
“Reports have shown that we serve a population of 450,000 with total untapped retail expenditure of RM3.97bil.
“The population in Cyberjaya is expected to increase exponentially when another 11,000 residence units are completed within the next two years and there are another RM14bil worth of developments over the next six years.
“That is good news for Dpulze, and Dpulze is good news for them,” said Kan.
Also present to witness the MoU signing ceremony was Cyberview Sdn Bhd managing director Faris Yahaya.
Faris said he was certain the mall would bring benefits to Cyberjaya.
“The shopping centre will enhance the city’s ecosystem and will further enrich the city’s lifestyle, with distinguished retail brands that offer an array of selections,” he said.
Mandated by the Government to spearhead the development of the city, Cyberview’s focus for this year is to transform and elevate Cyberjaya into a global technology hub while continuing to promote entrepreneurship, innovation and creativity.
DPulze Shopping Centre is expected to open in August, making it the first of its kind to open in Cyberjaya with several others to follow in the next two to four years.
These tenants comprise well-known retailers and brands such as TGV, Jaya Grocer, FOS, Celebrity Fitness, MPH, Yamaha, U Bowl, Song Box, Molly Fantasy, Tune Hotels and Regus.
The shopping centre is in its final stages of construction and 80% tenanted.
Other retailers in the mall include Ace Hardware, Kitchen Shop by Katrin BJ, Akemi Uchi, Royal Sporting House, Adidas, Plan B by the Big Group, City Chain, The Coffee Bean & Tea Leaf, The Loaf, Rakuzen, Sushi Zanmai, Ole Ole Bali, Homst and Thai Odyssey.
“DPulze is a neighbourhood mall, smaller in size than a regional mall, but conveniently located and has a variety of retail outlets, from entertainment to a supermarket which caters to the needs of the surrounding community,” explained DPulze Ventures Sdn Bhd chairman Kan Ah Chun.
As the first retail commercial project by DPulze Ventures Sdn Bhd, careful attention was paid to the product mix when planning the RM500mil development.
“We were very conservative in our financial approach,” said Kan at the signing ceremony.
Complementing the retail outlets is The Tune DPulze Cyberjaya, the only limited-service hotel in the Cyberjaya, Putrajaya, Dengkil and Sepang areas.
The 200-room hotel is set to begin operations in a matter of weeks. Regus Serviced Offices, which comprise more than 120 workstations will be opened within the next two months while a Citadines serviced residences with 230 rooms managed by The Ascott Ltd will open its doors within the next five months.
Kan said, “We do not rush from project to project. When we take on something new, we look into every detail with great attention, such as the location, dynamics and layout. They must all be good. We are always very careful.”
Situated directly opposite the main transportation terminal in Cyberjaya and facing Persiaran Multimedia, Cyberjaya’s busy main road, the shopping centre’s close proximity to major MNCs and universtities in the area provides the mall with ready catchment and population.
“Reports have shown that we serve a population of 450,000 with total untapped retail expenditure of RM3.97bil.
“The population in Cyberjaya is expected to increase exponentially when another 11,000 residence units are completed within the next two years and there are another RM14bil worth of developments over the next six years.
“That is good news for Dpulze, and Dpulze is good news for them,” said Kan.
Also present to witness the MoU signing ceremony was Cyberview Sdn Bhd managing director Faris Yahaya.
Faris said he was certain the mall would bring benefits to Cyberjaya.
“The shopping centre will enhance the city’s ecosystem and will further enrich the city’s lifestyle, with distinguished retail brands that offer an array of selections,” he said.
Mandated by the Government to spearhead the development of the city, Cyberview’s focus for this year is to transform and elevate Cyberjaya into a global technology hub while continuing to promote entrepreneurship, innovation and creativity.
DPulze Shopping Centre is expected to open in August, making it the first of its kind to open in Cyberjaya with several others to follow in the next two to four years.
Monday, April 28, 2014
Eco World to launch RM1bil corporate exercise
Eco World Development Group Bhd, the property developer controlled by former executives of S P Setia Bhd, is planning to launch a new asset acquisition and fund-raising exercise worth about RM1bil, sources said.
Trading in the shares of Eco World was suspended yesterday after the counter hit a record high. The company said the suspension was to make way for “a material announcement”.
Sources said Eco World would acquire RM400mil worth of land for shares.
It would also propose a rights issue to raise RM400mil cash to be used for working capital purposes.
Shares in Eco World had risen 48% since the start of January to RM5.40 yesterday, boosting its market value to RM1.37bil.
Eco World had paid RM1.40 a share for the majority stake in Focal Aims Holdings Bhd, which owns a 1,000ha township in Kota Masai near Johor Baru.
The company later changed its name to reflect the identity of its new controlling shareholder.
There has been speculation about Tan Sri Liew Kee Sin joining his son, Tian Xiong, at Eco World. Tian Xiong owns majority shares in Eco World.
The outgoing chief of S P Setia, however, has so far kept mum on the subject.
Reports have indicated that the elder Liew had already sold his entire stake in S P Setia ahead of his departure on April 30 from the company he founded.
While Eco World is a relative newcomer to the local property scene, the people behind the company are some of the respected figures in the industry.
Eco World is helmed by Datuk Chang Khim Wah (pic), one of Liew’s top lieutenants at S P Setia.
Interestingly, some observers have noted that the eco-branding of projects by Eco World was first made successful by S P Setia.
Earlier this month, Eco World showcased nine projects located in the Klang Valley, Penang and Johor.
The EcoCity project in Kuala Lumpur, has a gross development value of RM1bil, while the company’s biggest township – EcoMajestic – is a 1,000acre development in Semenyih.
Chang told StarBiz last week that the company would start the project at the remaining 404.5ha of undeveloped land in Kota Masai by September this year.
Despite having so many projects in the pipeline, Eco World is still busy adding to its landbank.
Last month, the company acquired 128ha, part of the Canal City project in Selangor, from Tropicana Corp Bhd for RM470.6mil.
Trading in the shares of Eco World was suspended yesterday after the counter hit a record high. The company said the suspension was to make way for “a material announcement”.
Sources said Eco World would acquire RM400mil worth of land for shares.
It would also propose a rights issue to raise RM400mil cash to be used for working capital purposes.
Shares in Eco World had risen 48% since the start of January to RM5.40 yesterday, boosting its market value to RM1.37bil.
Eco World had paid RM1.40 a share for the majority stake in Focal Aims Holdings Bhd, which owns a 1,000ha township in Kota Masai near Johor Baru.
The company later changed its name to reflect the identity of its new controlling shareholder.
There has been speculation about Tan Sri Liew Kee Sin joining his son, Tian Xiong, at Eco World. Tian Xiong owns majority shares in Eco World.
The outgoing chief of S P Setia, however, has so far kept mum on the subject.
Reports have indicated that the elder Liew had already sold his entire stake in S P Setia ahead of his departure on April 30 from the company he founded.
While Eco World is a relative newcomer to the local property scene, the people behind the company are some of the respected figures in the industry.
Eco World is helmed by Datuk Chang Khim Wah (pic), one of Liew’s top lieutenants at S P Setia.
Interestingly, some observers have noted that the eco-branding of projects by Eco World was first made successful by S P Setia.
Earlier this month, Eco World showcased nine projects located in the Klang Valley, Penang and Johor.
The EcoCity project in Kuala Lumpur, has a gross development value of RM1bil, while the company’s biggest township – EcoMajestic – is a 1,000acre development in Semenyih.
Chang told StarBiz last week that the company would start the project at the remaining 404.5ha of undeveloped land in Kota Masai by September this year.
Despite having so many projects in the pipeline, Eco World is still busy adding to its landbank.
Last month, the company acquired 128ha, part of the Canal City project in Selangor, from Tropicana Corp Bhd for RM470.6mil.
Sunday, April 27, 2014
'Old soldier' says he will rise and shine again
On April 15, outgoing S P Setia Bhd president and CEO Tan Sri Liew Kee Sin bade farewell to an audience of 1,000 at Istana Budaya in Kuala Lumpur.
It was the opening night for the broadway musical Jersey Boys in Kuala Lumpur. It was also S P Setia’s corporate night. The two-and-a-half-hour show told the story of the formation, success and eventual break-up of the 1960s rock n’ roll group The Four Seasons, with each of the four members sharing their perspective.
Liew in his opening speech gave his perspective of the road ahead for him. His last day at S P Setia is April 30.
He told the audience that the company he started in the 1990s with Datuk Voon Tin Yow had a small capital.
“At its height, S P Setia’s market cap reached nearly RM9bil (about RM7bil today). It has 4,782 acres of undeveloped land worth RM102bil, and unbilled sales of more than RM9bil,” Liew said. He said if he had told anyone that he would one day be selling residential units in London with an average price of £2,300 per sq ft, no one would believe him, but that was exactly what was happening today.
On May 1, Liew, as chairman of Battersea Project Holdings Co Ltd (BPHC) will be launching Phase 2 of Battersea Power Station. The project is a 40:40:20 joint venture with Sime Darby group and S P Setia taking an equal stake each and the Employees Provident Fund the remainder.
“I have served my country and I now leave this company in capable hands,” he said.
Next chapter
He then singled out Voon, the chief operating officer who takes over as acting president and CEO from May 1 to April 20, 2015.
“I am leaving it all to you. Can (do) or not?” he asked Voon. Voon gestured in the affirmative.
As usual, there is much drama surrounding Liew. Those few minutes could have been a teary-eyed event but that’s not Liew. Instead, he hinted at the path he has set for himself. He said American military leader General Douglas MacArthur too served his country.
“At the American Congress, he ended his speech with a line that has become well-known today. He said old soldiers never die, they just fade away. But this old soldier (pointing to himself) is going to rise up.”
How the next chapter unfolds for the entrepreneur – the youngest son of a lorry driver and rubber tapper – is anyone’s guess.
At about RM7bil, S P Setia has one of the largest market cap in the property sector. Since the PNB takeover moves in September 2011 until yesterday, S P Setia shares touched a high of RM4.01 on April 2, 2012 and a low of RM2.74 on Feb 6, 2014. On Friday, its share price closed six sen higher at RM3.05.
Moment has arrived
Earlier this week, Liew sold his last 2.76% block of S P Setia shares amounting to 67.79 million at RM3.95 apiece, a price agreed upon after the hostile takeover by government-linked company Permodalan Nasional Bhd (PNB).
The agreement was that he will remain until March 2015. There have been hints that he may leave early. That moment has arrived.
Liew seems to have paced himself well for the departure. When the first phase of Battersea Power Station was unveiled in Kuala Lumpur early last year, StarBiz asked if he was buying any vehicle to replace the one he will be losing. His son’s name Tian Xiong, then 22, has popped up as a director in a little-known company.
“I am training my son (who was with him then) to be a developer,” he said.
Several months later, Tian Xiong emerged as a director of Eco World Development Sdn Bhd together with former S P Setia directors Tan Sri Abdul Rashid Abdul Manaf and Datuk Eddie Leong Kok Wah. Within a short span of less than a year, the unlisted Eco World has amassed more than 3,000 acres in Penang, the Klang Valley and Johor with a gross development value (GDV) of more than RM30bil. This exercise has also resulted in quite a bit of debt, probably to the tune of about RM2bil, a source reckons.
Yesterday, listed-vehicle Eco World Development Group Bhd (EcoWorld) announced a proposed corporate exercise to acquire the development rights of eight projects from the unlisted vehicle, increasing the listed vehicle’s land bank from 1,326 to 4,433 acres with a GDV of RM43.5bil.
Sources say Liew will become an EcoWorld director in early May but he will leave the running of the show to president and CEO Datuk Chang Khim Wah. Liew will remain as chairman of Battersea Project Holdings Co Ltd (BPHC) until September 2015 and oversee the Qinzhou Industrial Park project in China. The £8bil (RM43.92bil) Battersea project is slated for completion in 2022. All three partners in the Battersea project – Sime Darby, Sime and EPF, will have a turn at heading BPHC.
Sources say Sime Darby has informed Liew that it is willing to give up its turn and would like him to stay on as chairman until 2018. By any measure, Liew has been the main driver from the start.
On the domestic front, there has been speculation that Liew aspires to create “a bigger S P Setia”, hence the aggressive land accumulation. However, this may be a tough act to follow.
Another theory is that he wants to close a chapter and move to the next.
Tian Xiong, now 23, may be his motivating factor. Liew may just want to built a legacy and train Tian Xiong. Those who know him say two things consume him today – work and his children.
In order to do that, Liew will need more than money and land, important though they may be. A team player from the start, he has succeeded in building a loyal following, be it staff, customers or financiers.
Says a young employee: “There were times when I wanted to leave. But after Tan Sri spoke to all of us, I changed my mind. He has this ability to motivate you to strive harder.”
Learning curve
Says a senior employee: “He gives you back your self-respect.”
Liew, it seems, holds 20 meetings talking to different levels, every six months. A source says of EcoWorld’s 350 staff, 250 are former S P Setia employees. S P Setia has about 1,800.
Post-Liew, Voon will be acting president and CEO “until PNB finds a replacement”. S P Setia’s CFO and executive vice president Datuk Teow Leong Seng has also tendered his resignation. His last day will be July 31.
Non-independent, non-executive director Tan Sri Lee Lam Thye has also resigned.
Sources say with so many crossing over, the EcoWorld group will build on the same S P Setia template to shorten its learning curve. Liew, 56, took 24 years to build S P Setia to what it is today. EcoWorld need not go through the same growing pains. The benefit of experience and knowledge of building a company will be transplanted into EcoWorld. That, together with Liew’s reputation as the number one property man in town, should ensure that deals are easier to get done at EcoWorld then it would have been for any other fledgling company.
EcoWorld will follow three well-trodden paths – growth, transparency and governance. It aims to have RM2bil sales this year and RM3bil next year. The company recently launched the RM1bil EcoSky project situated on a 9.6-acre freehold site along Jalan Ipoh in Taman Wahyu, Kuala Lumpur. In Johor, it launched its maiden project, EcoBotanic@Nusajaya, last year and is planning the launch of two township projects – EcoSpring and EcoSummer located in the Tebrau growth corridor – in Johor in May.
Both projects, on a 242.80ha site with a combined GDV of RM5bil, will keep the company busy.
What EcoWorld gets once Liew joins the board will be his foresight. It’s almost like he has the innate ability to sniff trends and see the big picture. It is said that Liew gets a feel of a market, especially abroad, by immersing himself into an area he is thinking of expanding to.
Much of that has come from experience, and his sense of timing the market has largely been a success.
Track record
The biggest attribute he has, according to those close to him, is his marketing and communicating skills.
“He is able to read what the public wants and truly understands marketing and branding. It’s not about fancy fonts but execution.”
That, and delivering housing products few can match, has seen a legion of loyal buyers follow the company’s every launch. There is hope within EcoWorld that this will continue once Liew comes on board.
That trust also extends to the financiers. Bankers seem to accord Liew the respect given his track record and, so far, that has worked out for EcoWorld which has had no issues in raising funds for the many projects it is embarking on.
The feeling is that bankers will give him at least a couple of years to deliver and he will likely do so because he has sold plenty of houses in the past and EcoWorld is focused on the bread-and-butter segment where there is plenty of demand.
“The man (Liew) has not slowed down and he has never been so busy,” says a source.
Liew may continue to take the big picture perspective and leave the day-to-day routine to his trusted lieutenants.
That will free him up for a lot more strategising.
In between jetting to London to oversee the Battersea project, EcoWorld too is scouting for projects abroad, much in the vein S P Setia is doing today.
At yesterday’s press conference, EcoWorld president/CEO Datuk Chang Khim Wah did not dispute about EcoWorld venturing abroad. “We like to be in countries we know, at the right time and right place,” he says.
Says a property consultant who declined to be quoted: “If you look at S P Setia, it grew after the Asian Financial Crisis in 1997/98 when other developers, who had focused on the high-end residential sector, were suffering.
S P Setia provided the bread-and-butter housing that people were able to afford. It downsized its units in both Johor and Setia Alam, and instead of double-storey, built single-storey in Johor. This reduced revenue but there were sales.
“The company was agile and the market helped him. That is basically the story of S P Setia. He hanged on to a formula and made it better. If you consider EcoWorld’s offerings today, they are also in the bread-and-butter housing, but because prices have moved up, their prices too have move in tandem with today’s prices.
Small upstart
“S P Setia balanced itself with different products. EcoWorld has EcoSky, a condominium project in Taman Wahyu.
It also has townships in Johor. S P Setia went international and regional in order to balance sales if the domestic market suffers. EcoWorld may do the same, a source says.
The next poser for EcoWorld would be the many lieutenants and generals in a small upstart, aggressive though it may be. Chang’s forte is in Johor.
EcoWorld, says a source, will not remain in Johor. It has already amassed land in the Klang Valley and Penang.
In time to come, it may have more than one CEO. And if it truly takes the path of S P Setia by going international, it will need a trusted loyalist to head the international market.
“Having tasted success overseas in S P Setia, EcoWorld will not want to remain under the coconut shell,” says a source.
Liew does not seem to be slowing down but seems to have a second wind and chance in building a legacy. And he hinted at the opening night of Jersey Boys: “This old soldier is going to rise up”
Eco World outlines ambitious plans
Eco World Development Group Bhd (EcoWorld Bhd), formerly Focal Aims Holdings Bhd, has proposed a RM1.7bil corporate exercise to pave the way for it to be a “formidable” property developer with a presence in the Klang Valley, Penang and Johor, with a sales target of RM5bil for this year and next.
The exercise will also result in the upstart enlarging its land bank from 1,326 to 4,433 acres and its gross development value (GDV) ballooning from RM13.5bil to RM43.5bil. It will also acquire a development team with proven expertise and capabilities, namely Eco World Project Management Sdn Bhd, and Eco Macalister Development Sdn Bhd which owns an investment property asset in Penang.
EcoWorld president and CEO Datuk Chang Khim Wah told a press conference yesterday in Shah Alam that the company had proposed to acquire the development rights of up to eight projects from subsidiaries of Eco World Development Sdn Bhd with a combined GDV of RM30bil involving 3,106.8 acres.
The 11 projects, including the additional eight as a result of this exercise, will enable the company to launch four new projects in quick succession shortly to boost future revenue. The company would be kept busy for the next eight to 10 years, Chang said.
Less than a year old, the EcoWorld group has launched two projects, namely EcoSky in the Klang Valley and EcoBotanic in Iskandar Malaysia. It had achieved RM1.13bil in sales for both as at March 31, 2014.
The related party transactions involve a proposed subscription of shares in EcoWorld by shareholders of Eco World Development Sdn Bhd to partially fund the acquisitions. A rights issue of about RM788mil with warrants and a private placement up to 20% of the paid-up capital (about RM600mil) have been proposed to fund the acquisitions and as working capital.
On whether Tan Sri Liew Kee Sin, outgoing president and CEO of S P Setia Bhd, will be coming on board anytime, Chang said: “You have to ask the man yourself.”
The presence of Liew’s first-born son, Tian Xiong, 23, a director in EcoWorld, has fanned much speculation.
On the company entering the scene with the property sector facing a slowdown, Chang said there would always be challenges.
He said the group’s forte would be township development with predominantly landed properties.
There would be demand if priced correctly and in the right location, he added. On the possibility of the company going overseas, Chang said.
“We like to be in the countries we know, at the right time and place,” he added.
The exercise will also result in the upstart enlarging its land bank from 1,326 to 4,433 acres and its gross development value (GDV) ballooning from RM13.5bil to RM43.5bil. It will also acquire a development team with proven expertise and capabilities, namely Eco World Project Management Sdn Bhd, and Eco Macalister Development Sdn Bhd which owns an investment property asset in Penang.
EcoWorld president and CEO Datuk Chang Khim Wah told a press conference yesterday in Shah Alam that the company had proposed to acquire the development rights of up to eight projects from subsidiaries of Eco World Development Sdn Bhd with a combined GDV of RM30bil involving 3,106.8 acres.
The 11 projects, including the additional eight as a result of this exercise, will enable the company to launch four new projects in quick succession shortly to boost future revenue. The company would be kept busy for the next eight to 10 years, Chang said.
Less than a year old, the EcoWorld group has launched two projects, namely EcoSky in the Klang Valley and EcoBotanic in Iskandar Malaysia. It had achieved RM1.13bil in sales for both as at March 31, 2014.
The related party transactions involve a proposed subscription of shares in EcoWorld by shareholders of Eco World Development Sdn Bhd to partially fund the acquisitions. A rights issue of about RM788mil with warrants and a private placement up to 20% of the paid-up capital (about RM600mil) have been proposed to fund the acquisitions and as working capital.
On whether Tan Sri Liew Kee Sin, outgoing president and CEO of S P Setia Bhd, will be coming on board anytime, Chang said: “You have to ask the man yourself.”
The presence of Liew’s first-born son, Tian Xiong, 23, a director in EcoWorld, has fanned much speculation.
On the company entering the scene with the property sector facing a slowdown, Chang said there would always be challenges.
He said the group’s forte would be township development with predominantly landed properties.
There would be demand if priced correctly and in the right location, he added. On the possibility of the company going overseas, Chang said.
“We like to be in the countries we know, at the right time and place,” he added.
S P Setia's moment of truth post-Liew
For a company that is in a pink of health, the lacklustre share price of S P Setia Bhd is perplexing but is being attributed to the departure of its president and CEO, Tan Sri Liew Kee Sin.
With Liew, who has been credited with building S P Setia into the most profitable property company in Malaysia, leaving at the end of the month, the one glaring gap in the company perceived by the market is the vacuum in leadership.
“I rarely get asked about S P Setia by fund managers these days, and – on the other hand – there are a lot of queries about Eco World Development Group Bhd and Mah Sing Group Bhd,” says one analyst who tracks the stock and the property sector.
“The market is worried about execution within the company once Liew leaves.”
Liew’s departure from S P Setia has long been priced into the stock and it had showed in the share price performance against the both the FTSE Bursa Malaysia KLCI and the property index over the past couple of years.
The under performance of S P Setia’s stock against the property index began in October 2012, some months after the takeover attempt by Permodalan Nasional Bhd (PNB).
In May last year, it started to lag behind the FBM KLCI. S P Setia’s share price performance was in step with the FBM KLCI and the property index for much of the time prior to that.
To date, the stock is 26% below the performance of the property index and about 24% below that of the FBM KLCI.
Realistically, that should not even be the case.
S P Setia has projects worth RM70bil in gross development value and RM2.6bil in cash. Coupled with unbilled sales of about RM10bil, the company’s cash generation and margins appear to be in a leadership position in comparison with the general property sector.
“The company is in the peak of strength and it can forecast what its profit is going to be for the next four years,” says a source close to the company.
“S P Setia has never been stronger.”
Liew’s departure from S P Setia has long been foretold and the group has appointed Datuk Voon Tin Yow in his place. As acting president and CEO, Voon has the tools to drive S P Setia forward as he was part of the team together with Liew that built S P Setia to where it is today.
Those who know Voon say he is as capable as Liew in running the show, albeit both of them have their different strengths.
Liew always credited his team when asked how he did the job at S P Setia.
For much of the part, SP Setia still has the people in the company that are more than capable of delivering the results expected by shareholders.
Lucrative projects
Although some 250 people have left the company for Eco World, S P Setia has not allowed itself to be hallowed. In fact, recruitment has been as furious as it has ever been to plug the gaps left by departures. Staff count still remains at 1,800 despite staff leaving for other companies, in particular Eco World.
As key personnel hopped over to Eco World, S P Setia has recruited people who have the calibre required by the company.
Although S P Setia has trouble filling in for people who have left in Johor, it has managed to replace people who have left in the Klang Valley and Penang.
That is important as it sits on large swathes of land and lucrative projects to deliver and build, and the company has key projects in those areas.
Voon will have the luxury of experienced layers of able lieutenants – from senior to mid-management – to help him run the company.
“There is no unit that is depleted. Voon and Datuk Khow Chap Jen are still there,” says a source.
“But there will be a period of adjustment that will take place after Liew leaves.”
The key thing, though, is whether Voon and his team will be allowed to do the job they see fit.
“Voon has been meeting with the top people at PNB and that will probably be to see how the transition takes off. Furthermore, I do expect him to be briefed on what they expect him to do,” says the source.
The question now is what will PNB do with S P Setia once Liew leaves? It’s common knowledge that both parties never saw eye to eye after PNB had to relinquish managerial control after taking over the majority of equity in S P Setia.
But after waiting for three years, and now seeing the value of their investment in S P Setia drop through the decline of its share price from the offer price of RM3.95 a share compared with its closing price of RM3.05 yesterday, it’s PNB’s turn to dictate things.
Turning S P Setia into a government-linked company (GLC) might not gel with the way things have been done at S P Setia. Pressure to conform with all things a GLC is will surely come but for those who have chosen to stick with S P Setia, the clash of corporate cultures will be discomforting.
“The best thing for PNB to do is actually allow Voon and his team the freedom to thrive in. The question is will they?” asks the source.
The best scenario will be for PNB to leave Voon to run the company but set out the key performance indicators that it wants achieved.
“They don’t have to run a company directly. This is a specialised industry and they should reward people for getting the job done,” says the source.
With Liew, who has been credited with building S P Setia into the most profitable property company in Malaysia, leaving at the end of the month, the one glaring gap in the company perceived by the market is the vacuum in leadership.
“I rarely get asked about S P Setia by fund managers these days, and – on the other hand – there are a lot of queries about Eco World Development Group Bhd and Mah Sing Group Bhd,” says one analyst who tracks the stock and the property sector.
“The market is worried about execution within the company once Liew leaves.”
Liew’s departure from S P Setia has long been priced into the stock and it had showed in the share price performance against the both the FTSE Bursa Malaysia KLCI and the property index over the past couple of years.
The under performance of S P Setia’s stock against the property index began in October 2012, some months after the takeover attempt by Permodalan Nasional Bhd (PNB).
In May last year, it started to lag behind the FBM KLCI. S P Setia’s share price performance was in step with the FBM KLCI and the property index for much of the time prior to that.
To date, the stock is 26% below the performance of the property index and about 24% below that of the FBM KLCI.
Realistically, that should not even be the case.
S P Setia has projects worth RM70bil in gross development value and RM2.6bil in cash. Coupled with unbilled sales of about RM10bil, the company’s cash generation and margins appear to be in a leadership position in comparison with the general property sector.
“The company is in the peak of strength and it can forecast what its profit is going to be for the next four years,” says a source close to the company.
“S P Setia has never been stronger.”
Liew’s departure from S P Setia has long been foretold and the group has appointed Datuk Voon Tin Yow in his place. As acting president and CEO, Voon has the tools to drive S P Setia forward as he was part of the team together with Liew that built S P Setia to where it is today.
Those who know Voon say he is as capable as Liew in running the show, albeit both of them have their different strengths.
Liew always credited his team when asked how he did the job at S P Setia.
For much of the part, SP Setia still has the people in the company that are more than capable of delivering the results expected by shareholders.
Lucrative projects
Although some 250 people have left the company for Eco World, S P Setia has not allowed itself to be hallowed. In fact, recruitment has been as furious as it has ever been to plug the gaps left by departures. Staff count still remains at 1,800 despite staff leaving for other companies, in particular Eco World.
As key personnel hopped over to Eco World, S P Setia has recruited people who have the calibre required by the company.
Although S P Setia has trouble filling in for people who have left in Johor, it has managed to replace people who have left in the Klang Valley and Penang.
That is important as it sits on large swathes of land and lucrative projects to deliver and build, and the company has key projects in those areas.
Voon will have the luxury of experienced layers of able lieutenants – from senior to mid-management – to help him run the company.
“There is no unit that is depleted. Voon and Datuk Khow Chap Jen are still there,” says a source.
“But there will be a period of adjustment that will take place after Liew leaves.”
The key thing, though, is whether Voon and his team will be allowed to do the job they see fit.
“Voon has been meeting with the top people at PNB and that will probably be to see how the transition takes off. Furthermore, I do expect him to be briefed on what they expect him to do,” says the source.
The question now is what will PNB do with S P Setia once Liew leaves? It’s common knowledge that both parties never saw eye to eye after PNB had to relinquish managerial control after taking over the majority of equity in S P Setia.
But after waiting for three years, and now seeing the value of their investment in S P Setia drop through the decline of its share price from the offer price of RM3.95 a share compared with its closing price of RM3.05 yesterday, it’s PNB’s turn to dictate things.
Turning S P Setia into a government-linked company (GLC) might not gel with the way things have been done at S P Setia. Pressure to conform with all things a GLC is will surely come but for those who have chosen to stick with S P Setia, the clash of corporate cultures will be discomforting.
“The best thing for PNB to do is actually allow Voon and his team the freedom to thrive in. The question is will they?” asks the source.
The best scenario will be for PNB to leave Voon to run the company but set out the key performance indicators that it wants achieved.
“They don’t have to run a company directly. This is a specialised industry and they should reward people for getting the job done,” says the source.
EcoWorld outlines ambitious plans
EcoWorld Development Group Bhd (EcoWorld Bhd), formerly Focal Aims Holdings Bhd, has proposed a RM1.7bil corporate exercise to pave the way for it to be a “formidable” property developer with a presence in the Klang Valley, Penang and Johor, with a sales target of RM5bil for this year and next.
The exercise will also result in the upstart enlarging its land bank from 1,326 to 4,433 acres and its gross development value (GDV) ballooning from RM13.5bil to RM43.5bil. It will also acquire a development team with proven expertise and capabilities, namely Eco World Project Management Sdn Bhd, and Eco Macalister Development Sdn Bhd which owns an investment property asset in Penang.
EcoWorld president and CEO Datuk Chang Khim Wah told a press conference yesterday in Shah Alam that the company had proposed to acquire the development rights of up to eight projects from subsidiaries of Eco World Development Sdn Bhd with a combined GDV of RM30bil involving 3,106.8 acres.
The 11 projects, including the additional eight as a result of this exercise, will enable the company to launch four new projects in quick succession shortly to boost future revenue. The company would be kept busy for the next eight to 10 years, Chang said.
Less than a year old, the EcoWorld group has launched two projects, namely EcoSky in the Klang Valley and EcoBotanic in Iskandar Malaysia. It had achieved RM1.13bil in sales for both as at March 31, 2014.
The related party transactions involve a proposed subscription of shares in EcoWorld by shareholders of Eco World Development Sdn Bhd to partially fund the acquisitions. A rights issue of about RM788mil with warrants and a private placement up to 20% of the paid-up capital (about RM600mil) have been proposed to fund the acquisitions and as working capital.
On whether Tan Sri Liew Kee Sin, outgoing president and CEO of S P Setia Bhd, will be coming on board anytime, Chang said: “You have to ask the man yourself.”
The presence of Liew’s first-born son, Tian Xiong, 23, a director in EcoWorld, has fanned much speculation.
On the company entering the scene with the property sector facing a slowdown, Chang said there would always be challenges.
He said the group’s forte would be township development with predominantly landed properties.
There would be demand if priced correctly and in the right location, he added. On the possibility of the company going overseas, Chang said.
“We like to be in the countries we know, at the right time and place,” he added.
How property is priced by the market
Why does a property sell at RM1.6mil when almost everyone living there can at best afford only RM800,000 or sell at RM800-RM1,000 per sq ft when up to a short while ago the maximum was only RM350 per sq ft?
Can 350 new properties in a scheme sell at the same price as one single latest transaction of an existing property in the vicinity? Can 10 developers sell 350 new properties each based on the abovesaid one single latest transaction?
Let’s take a look over the last 30 years at how properties had been priced in the market. Subang Jaya would make a good starting point.
In 1980 when I first started working, I noted that the latest phase of the new single and double-storey terrace houses in Subang Jaya were priced at between RM90,000 and RM140,000 per unit respectively, up from their previous pricing of between RM60,000 and RM90,000 in 1979. The 1980 pricing echoed the newly revised housing loan amounts of Division 2 and Division 1 government officers. All the launched units were quickly sold with the new and huge demand. In the subsequent phases, the pricing followed the momentum of the earlier fully sold sale prices with additional premiums for time, newer design and specifications and variations in the floor and land areas.
Then in the 1990s in the condominium city of Mont’Kiara, I noted the new condominiums were priced based on the price range of the existing two-storey terrace houses in Sri Hartamas/Desa Hartamas which were no longer being built due to land shortage and high land prices. The new condominiums provided an ideal alternative for the affluent younger Malaysians who were seeking a lifestyle change. The prices were also influenced by foreign buyers who preferred a new property with security and property management services at prices and rents which they could afford.
When the number and type of foreign buyers and tenants increased, the developer started to build larger units which were priced based on the price range of semi-detached and detached houses in the neighbourhood. This was well accepted by the market as it was based on actual demand for new, secure and well managed properties by foreigners especially since there were two international schools in the vicinity.
I also noted that in pricing the newly-launched terrace houses in the mid-1990s in Bandar Utama, the prices were 10% to 20% lower than the last transacted prices of existing comparable houses in the same neighbourhood such as TTDI, Damansara Jaya and Damansara Utama. Here the rationale was that the price of the newly-launched house should reflect a discount compared to an existing property, to take into consideration the 2-year waiting period during which interest has to be paid to the bank and rents have to be paid to stay in the current accommodation. It is interesting to note that this rationale is no longer followed by developers and their marketing gurus who now price the newly-launched schemes at higher prices than the highest sale price of an equivalent existing house. The basis being, “why not” when everybody wants to invest in properties and loans are easy and cheap.
Pricing trend
Another pricing trend noted was the continuous rise in the prices of shopoffices in Bangsar and Desa Hartamas, etc. Here the price rise was directly influenced by the rentals paid for the ground floor retail units which were in high demand by food and beverage outlets. This trend continues in all the new smaller shopping complexes as well, where the food and brewerage (F&B) outlets form the largest composition of tenants. The reason they can pay higher rents is because there are a large number of people/small entrepreneurs who find this sector the easiest to enter or invest in, as the payback period is only a short 3 years and there are no barriers to entry.
The other occupiers of the shopoffices and small shopping complexes have no choice but to cough up the same rent as the F&B outlets, as they set the “tone” for the rent in that particular row of shops. As the rents rise, so will the prices as they are directly related.
Similarly, properties in areas which can be converted to a different use where new demand is being created such as showrooms, bridal studios, etc can afford a higher rent. Prices rise due to the higher rents paid. Then by way of the much misused comparison method of valuation, other properties in the vicinity also rise in price, irrespective of their current use, rent and turnover.
I note that in highly popular areas where supply of a particular type of preferred property is limited, like in Damansara Heights/Bangsar etc, the number of transactions per year is very limited as no one really wants to sell since there are no other similar alternatives to move into. Then when out of the blue, a unit here is advertised for sale (usually because the owner is migrating or just wants to test the market) a “special purchaser” will come along and easily pay 20% to 30% above the last transacted price to secure the unit. This is repeated in the next sale when the second “special purchaser” pays another 20% to 30% above the last special purchaser price.
After two such transactions, the price paid by the “special purchaser” becomes the market price and extends to all other properties which are considered comparable, such that the price is now beyond the capacity of the people who have always lived or traded in that vicinity.
The price here is based more on the price which someone living or trading elsewhere is prepared to pay. This is what is happening in Singapore, London, etc. where foreign purchasers set the price. In Malaysia this is happening in Iskandar, KLCC and Penang.
Prices are also directly influenced in the following manner. Say a typical terrace house in a locality measuring 20’ by 60’ and 20 to 30 years old, is fetching prices in the range of RM350,000 per unit. A new scheme comes up in the area where the new unit measures 24’ x 80” and is of modern quality. Here the two properties are not comparable in terms of size and quality. The new unit is priced at say twice the price of the older smaller unit (based on cost, floor area and land area) and sets a new price benchmark for that locality. Then in a matter of time, all the existing properties in the vicinity (particularly all those that have been renovated) try to adopt a similar selling price per sq ft as the new property, using the location, location, location theory, never mind that upon purchasing the older property, the new buyer has to spend a hefty sum to make it livable to modern standards.
Then there is the effect of the policies of the lending institutions on the price. The policies of the lending institution in respect of loan tenure, interest rates and the loan to value ratio directly influence the pricing of a property. During a period of high confidence, sellers can quote high prices just to test the market, but as long as the purchase of the property can be financed, the buyer is prepared to pay the higher asking price as the loan is spread over 20 to 35 years and almost 90% to 100% of the purchase price can be financed.
And all it takes is for one property to be sold and financed at the newly tested price and the new price level will then be tested even higher with the next lending institution. This is particularly true for new types of properties which the buyer and lending institution cannot compare with an existing property.
The above real examples clearly indicate how properties have been priced by the market. It is noted that despite property being a long-term investment and outlay, the market’s pricing mechanism is very short term and dynamic particularly when moving upwards. The prices being set by the market in the short term may not always equate with sustainable market values. It is a strong probability that if one blindly follows the pricing set by the market during a very short-term dynamic cycle, life can become one of endless and needless debt.
No surprises in property report
Property experts say the findings of the Property Market Report 2013, released last week by the National Property Information Centre, came as no surprise, with the various cooling measures having their intended effect of curbing speculation and excessive price growth.
Less certain is whether demand will recover in earnest during the second half of this year, in what some expect to be a “pre-GST boom”.
CEO-Agency of property consultancy PPC International Sdn Bhd Siva Shanker tells StarBizWeek that he sees buyers making a beeline to snap up property in the two quarters prior to April 2015, when the GST takes effect at an initial rate of 6%.
Shanker, who is also president of the Malaysian Institute of Estate Agents, does not believe Malaysia will follow the example of Australia, where prices soared and then tumbled pre- and post-GST back in 2000.
“In Malaysia, what goes up does not come down. I think our property prices will rise ahead of GST and find their level there,” he says.
According to the Property Market Report 2013, volumes shrank 10.9% to 381,130 transactions but their value rose a marginal 6.7% to RM152.37bil from RM142.84bil in 2012, indicating that prices gained strength despite a raft of measures designed to rein in speculation, including a ban on interest-bearing schemes and a higher real property gains tax.
“Most people say 2014 and 2015 will be tough years for the property market. A slowdown usually lasts for two years.
“But looking at the report, my view is that 2013 and 2014 are the slowdown years. I expect the market to normalise in 2015 and make a full recovery in 2016 and 2017,” Shanker remarks.
“This year’s volumes will probably be flat, but prices are not likely to go down.”
As in the past, the report showed that the residential market dominated close to two-thirds of all transactions.
Approvals for housing loans, however, fell sharply compared with an expansion the year before. Total loans disbursed for the purchase of residential properties rose to RM74.4bil from RM64.1bil.
The report says construction activity stayed solid, backed by high-rise and high-end properties in the Klang Valley, Penang and Johor. The shop and industrial segments also saw higher starts and building plan approvals in 2013.
The occupancy rate for retail and office space remained firm, buoyed by a moderate increase in new supply, as well as fewer starts and new planned supply.
But the market showed evidence of softening across the board. All sectors posted reductions in transaction activity, led by commercial and industrial properties.
Most states fared worse save for Johor and Perlis, which recorded high single-digit improvements.
Five states experienced double-digit contraction in activity, with Putrajaya, KL and Kelantan topping the list.
According to the report, residential properties saw improved sales of new launches and more housing starts and completions, which helped pare down the number of “overhang” properties.
The all house price index jumped to 192.9 points against 172.8 points the year before. Average prices rose 10% to RM266,304 from RM241,591.
In terms of volume, most states posted a downturn except for Johor, which expanded 16.6%.
In value terms, all major states saw growth except for Kuala Lumpur, which declined by 9.7%. Johor was most improved with 63.2% growth, while Selangor recorded 2.8% growth and Pulau Pinang, zero growth.
Houses priced between RM250,000 and RM500,000 were the most popular, capturing 27.3% of all transactions, while demand for those in the low-cost RM100,000-RM200,000 category weakened.
Terraced houses made up the largest share of residential transactions, with Selangor, Johor and Perak contributing to more than half of the market share, followed by condominium and apartment units, most of them being transactions in Selangor and Kuala Lumpur.
The number of new launches fell last year after three straight years of growth to 48,290 units from 57,162 units in 2012, even as their take-up receded to 45.1% against 47.7%.
Kuala Lumpur, Selangor and Perak topped the list of new launches, commanding 57.4% of the national total.
From a price standpoint, the Kuala Lumpur market continued to be resilient. The report reveals that single-storey terraced homes at Bukit Bandaraya and Lucky Garden, both in Bangsar, saw 25.3% and 11.4% growth, respectively, pushing the value of a unit to upwards of RM1mil.
Spurred by the MRT factor, homes in Taman Bukit Anggerik and Salak South Garden posted 17.2% and 17.8% growth, while double-storey terraced units in Kepong’s Desa Park City ranged between RM1.31mil and RM2.48mil.
The report highlights that select condominiums in Kuala Lumpur, such as Bangsar Puteri, OBD Garden Tower and Casa Vista experienced growth of over 20%.
A downtrend was seen in Mont’Kiara Damai and Tijani 2, however, as prices tumbled by 5.7% and 12.4%, respectively.
Home prices also stayed firm in Selangor, but Johor’s landed residential segment jumped by double-digits in certain areas, particularly Johor Baru.
Condominium pricing in Johor Baru remained competitive, with the highest transacted price being RM500,000 per unit in Taman Pelangi. On average, units were priced between RM150,000 and RM350,000.
Up north in Pulau Pinang, residential properties were stable as the limited number of terraced houses on the island boosted demand for the Timur Laut and Barat Daya districts.
While Iskandar Malaysia was clearly a boon for Johor, CH Williams, Talhar & Wong managing director Foo Gee Jen says he is concerned if that performance is sustainable.
The veteran property consultant also expects a pre-GST rush for property.
“Buyers are concerned that prices will go up. If you are looking at a piece of property, now is the time to lock in your purchase,” he quips.
In Foo’s estimation, residential property could experience an 8%-10% jump in price after GST, and the landed segment a stronger 10%-15%.
“There is no oversupply in landed homes, but I can’t say the same for condominiums, especially the Soho (small office home office) or Sovo (small office versatile office) types.”
Kim Realty CEO Vincent Ng tells StarBizWeek that demand in the primary market remains firm and will likely continue apace unless interest rates go up.
“The primary market may gain traction in the second half as developers have been holding back on launches. Those with unsold stock will want to unload them before GST,” he points out.
“I don’t think prices will be cut drastically, but developers will make it attractive for buyers.”
Nonetheless, Ng acknowledges that the banks have tightened the screws on mortgages, leading to a mass of loan rejections.
“From what I understand, 30%-50% of the people who have put in deposits have had their loan applications denied for various reasons,” says Ng.
“The damage has already been done. More cooling measures will kill the market,” says another property agent.
PNB may merge its big property firms
Permodalan Nasional Bhd (PNB) is looking to merge three of its biggest property companies in a move to extract value from its portfolio of companies.
Sources say the fund is studying a move to amalgamate S P Setia Bhd, Island & Peninsular Sdn Bhd and the property businesses of Sime Darby Bhd to bring about efficiencies in its broader shareholding, and in the process create the largest property company in Malaysia.
With PNB set to assume managerial control of S P Setia, the thinking behind it, says a source, is to leverage on the strengths of each company.
In S P Setia, which PNB controls 65%, it has the country’s most profitable property company. But S P Setia is limited by the amount of land that it owns and generally acquires land and then prepares the site for its next project.
It has holding power today thanks to its strong balance sheet but it needs sell land as quickly as it purchases it to generate cashflow to sustain its operations. S P Setia has about 4,782 acres and 40 projects in five countries.
Sime Darby Property, which was merged with the property arm of Kumpulan Guthrie Bhd, by itself is the largest property developer in the country. According to its website, it has 19,000 arces and has identified another 18,800 acres for future development.
Sime Darby says the core businesses of its property division are property development, property investment and hospitality and leisure. Apart from Malaysia, it has successful projects in four countries, namely, Singapore, Vietnam, Australia and United Kingdom.
In Malaysia, Sime Darby has arguably the lowest cost of land because of the large plantations that it owns.
“That is a big benefit to Sime Darby but the property business is small relative to the overall business of Sime Darby,” says a source.
Island & Peninsular is a different entity than when it was listed and its form today is a creation of a merger between itself, Pelangi Sdn Bhd and Petaling Garden Sdn Bhd.
According to its website, Island & Peninsular has pending developments on 5,165 acres.
The property companies within the PNB stable are steeped in history. They as a collective have been a builder of some of the country’s largest townships. Places such as Subang Jaya, Bukit Jelutong, Ara Damansara, Putra Heights, Setia Alam and Bandar Kinrara in Puchong were created by those companies.
The thinking behind the merger is that by combining the assets and abilities of the different companies within PNB, the singular large company will be able to surpass some of the larger property companies on Bursa Malaysia which are UEM Sunrise Bhd and IOI Properties Group Bhd.
Plans to create a property giant has always been in the thinking within the corridors of PNB.
More than a decade ago, the idea was floated that property companies under the PNB stable should merge to create a giant in the industry.
Those plans never took off with much conviction until the creation of Synergy Drive which saw the merger of plantation and property companies that would later become the new Sime Darby.
But in recent years, following the takeover of S P Setia by PNB, property has increasingly been the focus of the fund.
Apart from owning stakes in property companies, PNB has commenced with the building of the 118 storey Warisan Merdeka Tower.
Award of the first contract for the tower has been doled out to Pintaras Jaya Bhd for the foundation works for the massive tower.
Saturday, April 26, 2014
2013產业报告 - 柔佛 （2）
双层排屋仍是柔州投资者首选，去年有1万384个单位转手，比前年增加逾40%，但交易总值比前年多了2倍，达32亿1103万令吉，显见价格的暴涨。
甫出炉的柔州《2013年產业市场报告》显示，双层及两层半排屋还是投资者的最爱，其中30万至40万令吉的款型房屋最受落，共有2237个单位转手，交易额达7亿9086万令吉，绝大部分交易单位落在新山。
值得注意的是，在新山方面，50万至100万令吉的房產，即使已近天价，但需求量相较前年大大提升，去年有1075个单位转手，前年则有148个单位。
其次受青睞的是单层或一层半房屋，有8701个单位易手，相较前年则是8287个单位，成长平稳。
最炙手可热的公寓单位，去年有2249个单位转手，相较前年仅是1755个单位，交易额也从前年的3亿7741万令吉，跃升至5亿6914令吉，所有交易单位几乎落在新山。
此外，外国投资者最爱的田字型房屋，交易数量也大大攀升。从前年的仅有164个单位，暴升至去年的575个单位，当中以价格50万令吉至100万令吉的单位最受欢迎。
对于政府严控买卖的廉价组屋、组屋及廉价屋，交易情况也相当乐观，但不管是转手数量或价格，看来都相当平稳，並未出现大起大跌现象。
总体来说，柔州去年有3万3651个住宅单位易手，比前年的2万8849个多出近20%，交易额方面从前年的56亿8750万令吉，暴增至92亿8277万令吉。
商业单位交易量5083
全柔的商业单位交易量去年达5083起，比起前年的4630起，增加453起，总交易额达112亿3425万令吉。
全柔10个县区当中，新山的商业单位交易十分蓬勃，在全柔拥有最多交易量，在去年有2562起交易成功，同时比起前年的1898起，激增664起。
峇株巴辖县商业单位交易量排在次位，去年达606起，不过比起前年的686起交易，交易量反而减少80起。
居鑾县商业单位交易量去年达369起，同样比起前年的483起的交易量，下跌114起。
城市屋价逾30万
边缘房屋逾19万
柔州各地的单层排屋价格节节上升，城市地区的单层排屋价格介于25万至30万令吉，城市边缘的房屋价格则介于14万至19万5000令吉。
其中，沿新山─士姑来路的乌达新镇一带的双层排屋价格，出现双位数增长，即达11.6%，或相等于26万令吉至27万令吉之间。
新山─地不佬路周边花园，包括柔佛再也花园、彩虹花园、世纪花园、森德综合镇及长春山庄的单层排屋房层，也上涨7.2%至9.5%。
古来再也太子城的单层排屋，也基于靠近工艺大学及士乃工业区，平均上涨15.2%至16%，平均售价16万5000令去至18万5000令吉。
哥打丁宜县的哥打再也花园的单层房屋价格也上升15.9%，或12万令吉至13万5000令吉。峇株巴辖县的布特里再也花园，其单层房屋价格上升13.3%，或25万至26万令吉。
美迪尼努沙再也房价猛涨
马来西亚依斯干达特区发展迅速，美迪尼成为外资投资的热门商业区，努沙再也一带的双层楼房价隨之猛涨。
其中武吉英达花园房价上涨幅度最高，达29.3%，双层排屋价格达46万至50万令吉；先锋园二房价也上升24.2%，或22万令吉至28万令吉。
房价上升位居第三高的是D乌达马花园（24%），紧接著是士姑来顺和花园（20%）、 翠景园（15%）。
至于通往努沙再也及依斯干达城的沿路花园，如柏伶花园、皇后花园及大学城的房价，平均涨幅6.6%至14.8%
实达英达花园的房价则涨15.2%至22.3%。
峇株巴辖县的双层排屋房价一样走高，尤其进步花园平均上升24.1%，或37万2000令吉。
高层住宅方面，其各种类房价涨幅高低不一，新山市超过10年屋龄的公寓价格保持，即1万5000令吉至16万5000令吉不等。
位于彩虹花园及Aloha Tower的高级公寓价格平稳，即最高房价不超过50万令吉。
边沿地区的公寓房价则平均上涨2.2%至16.2%。
热衷投资店屋
交易量达2374宗
据分析，投资者在柔州比较热衷投资购买双层或双层半店屋，去年的交易量高达2374起，比起前年的2203起，增加171宗。
上述双层店屋的交易额，去年达11亿2258万令吉，比前年的8亿1925万令吉，增加3亿333万令吉。
双层或双层半店屋当中，新山县的交易额最多，高达5亿8596万令吉，比起前年的3亿6961万令吉，增加2亿1635万令吉。
在空地单位，新山县去年的交易额在各县领先，达80亿3932万令吉，比前年的8亿2247万令吉，增加72亿1685万令吉。
100万豪宅交易量升258%
新山县100万令吉以上的天价豪华房產，交易量大大提升258.2%！
新山有多个房產单位，去年在100万令吉以上的天价成交，情况比起前年更热烈。
例如，双层或双层半房屋方面，去年有238个单位易手，相较前年仅是37个单位，交易值大大提升。
商业单位方面，由于去年还未实行外国买家购置资產片槛调高至100万令吉措施，50万令吉至100万令吉的商產最受投资者青睞，佔总商產交易额的26.2%，100万令吉以上的商產也广受欢迎，以佔总额的13.8%居次。
此外，住宅產业成为投资者的心头好，並不意外，但令人大跌眼镜的是，农业土地连续两年的交易量，竟超越商业单位，即去年为佔总数的19%，但较前年的23.6%下滑不少。商业单位波幅则不大，稳守近10%关口。
產业市场表现平稳
交易量比前年升7.1%
柔州在去年的產业市场表现趋向更加平稳，交易量达5万2773起，较前年的4万9296起，上升7.1%。
这项令人鼓舞的表现，使得柔州去年总交易的產业总值较前年激增52.7%，即从167亿7000万令吉，上升至256亿1000万令吉。
房屋的交易量依仍是州內產业市场最大贡献，即佔达58.5%，居次为交易量较前年明显下滑的农业领或（佔19%，或1万48次），至于商业、土地发展及工业领域则各別佔9.6%、5.3%及2.3%。
柔州去年共有4座建筑屋易手，包括新山The Zone免税区（包括商场、酒店及泊车场）、拿督赛慕菲迪路的“专业中心”（Pusat Professional）办公楼、新山Heritage酒店，以及峇株巴辖一家废置的戏院。
去年，位于素里里柏沙（Sedili Besar）农业地段易手，交易价总值1507万令吉，另外，昔加末及古来再也县，则有3块空地易手。
房屋租赁市场增16.7%
新山县去年的房屋租赁市场稍微增长8.3%至16.7%。
其中，单层排屋广受租户欢迎，取得8.3%至16.7%的成长率，或回酬率3.1%至4.9%。
马星花园和大学城的廉价单层排屋，各取得8.3%至7.1%的回酬率。
在新山区租赁市场方面，美乐花园、大丰花园、彩虹花园、百合花园及大马花园的单层排屋，每月租金介于650至850令吉；其中百合花园的租金涨幅最高，上升15.4%。
实达生態园的单层排屋租金最高，达每个月逾1000令吉。
隨著成本上涨，武吉英达花园、士姑来顺利花园及实达英达花园的祖赁价格，各上升16.7%、12.1%及9.1%。
甫出炉的柔州《2013年產业市场报告》显示，双层及两层半排屋还是投资者的最爱，其中30万至40万令吉的款型房屋最受落，共有2237个单位转手，交易额达7亿9086万令吉，绝大部分交易单位落在新山。
值得注意的是，在新山方面，50万至100万令吉的房產，即使已近天价，但需求量相较前年大大提升，去年有1075个单位转手，前年则有148个单位。
其次受青睞的是单层或一层半房屋，有8701个单位易手，相较前年则是8287个单位，成长平稳。
最炙手可热的公寓单位，去年有2249个单位转手，相较前年仅是1755个单位，交易额也从前年的3亿7741万令吉，跃升至5亿6914令吉，所有交易单位几乎落在新山。
此外，外国投资者最爱的田字型房屋，交易数量也大大攀升。从前年的仅有164个单位，暴升至去年的575个单位，当中以价格50万令吉至100万令吉的单位最受欢迎。
对于政府严控买卖的廉价组屋、组屋及廉价屋，交易情况也相当乐观，但不管是转手数量或价格，看来都相当平稳，並未出现大起大跌现象。
总体来说，柔州去年有3万3651个住宅单位易手，比前年的2万8849个多出近20%，交易额方面从前年的56亿8750万令吉，暴增至92亿8277万令吉。
商业单位交易量5083
全柔的商业单位交易量去年达5083起，比起前年的4630起，增加453起，总交易额达112亿3425万令吉。
全柔10个县区当中，新山的商业单位交易十分蓬勃，在全柔拥有最多交易量，在去年有2562起交易成功，同时比起前年的1898起，激增664起。
峇株巴辖县商业单位交易量排在次位，去年达606起，不过比起前年的686起交易，交易量反而减少80起。
居鑾县商业单位交易量去年达369起，同样比起前年的483起的交易量，下跌114起。
城市屋价逾30万
边缘房屋逾19万
柔州各地的单层排屋价格节节上升，城市地区的单层排屋价格介于25万至30万令吉，城市边缘的房屋价格则介于14万至19万5000令吉。
其中，沿新山─士姑来路的乌达新镇一带的双层排屋价格，出现双位数增长，即达11.6%，或相等于26万令吉至27万令吉之间。
新山─地不佬路周边花园，包括柔佛再也花园、彩虹花园、世纪花园、森德综合镇及长春山庄的单层排屋房层，也上涨7.2%至9.5%。
古来再也太子城的单层排屋，也基于靠近工艺大学及士乃工业区，平均上涨15.2%至16%，平均售价16万5000令去至18万5000令吉。
哥打丁宜县的哥打再也花园的单层房屋价格也上升15.9%，或12万令吉至13万5000令吉。峇株巴辖县的布特里再也花园，其单层房屋价格上升13.3%，或25万至26万令吉。
美迪尼努沙再也房价猛涨
马来西亚依斯干达特区发展迅速，美迪尼成为外资投资的热门商业区，努沙再也一带的双层楼房价隨之猛涨。
其中武吉英达花园房价上涨幅度最高，达29.3%，双层排屋价格达46万至50万令吉；先锋园二房价也上升24.2%，或22万令吉至28万令吉。
房价上升位居第三高的是D乌达马花园（24%），紧接著是士姑来顺和花园（20%）、 翠景园（15%）。
至于通往努沙再也及依斯干达城的沿路花园，如柏伶花园、皇后花园及大学城的房价，平均涨幅6.6%至14.8%
实达英达花园的房价则涨15.2%至22.3%。
峇株巴辖县的双层排屋房价一样走高，尤其进步花园平均上升24.1%，或37万2000令吉。
高层住宅方面，其各种类房价涨幅高低不一，新山市超过10年屋龄的公寓价格保持，即1万5000令吉至16万5000令吉不等。
位于彩虹花园及Aloha Tower的高级公寓价格平稳，即最高房价不超过50万令吉。
边沿地区的公寓房价则平均上涨2.2%至16.2%。
热衷投资店屋
交易量达2374宗
据分析，投资者在柔州比较热衷投资购买双层或双层半店屋，去年的交易量高达2374起，比起前年的2203起，增加171宗。
上述双层店屋的交易额，去年达11亿2258万令吉，比前年的8亿1925万令吉，增加3亿333万令吉。
双层或双层半店屋当中，新山县的交易额最多，高达5亿8596万令吉，比起前年的3亿6961万令吉，增加2亿1635万令吉。
在空地单位，新山县去年的交易额在各县领先，达80亿3932万令吉，比前年的8亿2247万令吉，增加72亿1685万令吉。
100万豪宅交易量升258%
新山县100万令吉以上的天价豪华房產，交易量大大提升258.2%！
新山有多个房產单位，去年在100万令吉以上的天价成交，情况比起前年更热烈。
例如，双层或双层半房屋方面，去年有238个单位易手，相较前年仅是37个单位，交易值大大提升。
商业单位方面，由于去年还未实行外国买家购置资產片槛调高至100万令吉措施，50万令吉至100万令吉的商產最受投资者青睞，佔总商產交易额的26.2%，100万令吉以上的商產也广受欢迎，以佔总额的13.8%居次。
此外，住宅產业成为投资者的心头好，並不意外，但令人大跌眼镜的是，农业土地连续两年的交易量，竟超越商业单位，即去年为佔总数的19%，但较前年的23.6%下滑不少。商业单位波幅则不大，稳守近10%关口。
產业市场表现平稳
交易量比前年升7.1%
柔州在去年的產业市场表现趋向更加平稳，交易量达5万2773起，较前年的4万9296起，上升7.1%。
这项令人鼓舞的表现，使得柔州去年总交易的產业总值较前年激增52.7%，即从167亿7000万令吉，上升至256亿1000万令吉。
房屋的交易量依仍是州內產业市场最大贡献，即佔达58.5%，居次为交易量较前年明显下滑的农业领或（佔19%，或1万48次），至于商业、土地发展及工业领域则各別佔9.6%、5.3%及2.3%。
柔州去年共有4座建筑屋易手，包括新山The Zone免税区（包括商场、酒店及泊车场）、拿督赛慕菲迪路的“专业中心”（Pusat Professional）办公楼、新山Heritage酒店，以及峇株巴辖一家废置的戏院。
去年，位于素里里柏沙（Sedili Besar）农业地段易手，交易价总值1507万令吉，另外，昔加末及古来再也县，则有3块空地易手。
房屋租赁市场增16.7%
新山县去年的房屋租赁市场稍微增长8.3%至16.7%。
其中，单层排屋广受租户欢迎，取得8.3%至16.7%的成长率，或回酬率3.1%至4.9%。
马星花园和大学城的廉价单层排屋，各取得8.3%至7.1%的回酬率。
在新山区租赁市场方面，美乐花园、大丰花园、彩虹花园、百合花园及大马花园的单层排屋，每月租金介于650至850令吉；其中百合花园的租金涨幅最高，上升15.4%。
实达生態园的单层排屋租金最高，达每个月逾1000令吉。
隨著成本上涨，武吉英达花园、士姑来顺利花园及实达英达花园的祖赁价格，各上升16.7%、12.1%及9.1%。
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