3 Storey Shop at Taman Mawar

Publika, Solaris Dutamas

Publika the country’s first creative retail centre, integrating arts and culture with urban shopping and dining will see Ben's
Independent Grocer (BIG) supermarket as its anchor tenant.

Publika is part of the 17.1-acre Solaris Dutamas in Kuala Lumpur, an integrated commercial and residential development that consists of office suites, a Grade A office tower and serviced apartments. It has more than 4,000 parking bays.

"BIG supermarket will occupy 49,000 sq ft and the opening of the supermarket is expected to benefit an on-site population of residents, office tenants and daytime crowd of about 21,000 as well as the residential catchment of 330,000 people within a 10-minute drive," said Anne Tong, assistant GM for branding and community development for developer Sunrise Bhd.

Besides grocery shopping, the supermarket will also organise in-house activities and cooking classes for shoppers.

Publika has a gross floor area of 800,000 sq ft, and a net lettable area of 320,000 sq ft located within the RM1.5 billion Solaris Dutamas. It was
officially opened on mid-2011, and was the first shopping gallery to have BIG as anchor tenant. Among its other tenants are British India, Caring Pharmacy, Rakuzen and Monocle. There is also a 26,000 sq ft Shanghai-inspired food village - Food Culture.

Sunrise has set aside about a third of the net lettable space of Publika for the promotion of arts and cultural activities. The art and cultural theme to the project is MAP, or Making Art Public, offering public spaces for activities such as art exhibitions, performances, lectures, seminars and workshops throughout the year.

The various projects in Solaris Dutamas have been fully sold except for Publika, which is retained for recurring income.

Greater Kuala Lumpur property outlook bright

In Greater Kuala Lumpur, the residential and commercial property markets are expected to see healthy growth, while the region’s industrial property markets will likely lag behind in terms of new supply this year, says property consultant CBRE Group.

In its latest MarketView report, CBRE said new residential project launches, albeit coming up at a slower pace than last year, were expected to increase the total existing supply of residential properties at about 1.79 million units in Greater KL, which encompasses Kuala Lumpur, Selangor and Putrajaya.

“Anecdotal evidence shows that some developers have been putting on hold some projects since the beginning of the year.

“But this may somehow lead to an increase in demand in the near future and further drive activity once launches resume,” it added.

CBRE said it expected to see greater interest in both the primary and secondary residential property markets, especially for units in good locations, in 2014. It, however, noted that a recent survey had shown that most Malaysians (68%) were not willing to spend more than RM500,000 for a property.

Meanwhile, in the commercial property space, CBRE said that Greater KL should see 6.1 million sq ft of new office space and 3.6 million sq ft of retail space added to the market by end-2014.

The office space additions would be supported by the completion of significant projects such as IB Tower and Menara Hap Seng 2, while new retail space would come from the 12 malls scheduled for completion this year such as IOI City Mall, Atria Shopping Gallery and Encorp Strand Mall.

On the hospitality front, an additional 401 rooms from new hotels such as Allson Capital Hotel and Holiday Villa were expected to add to the existing stock of 27,162 rooms in Greater KL, while 1,040 serviced apartments would be added to the existing stock of 6,196 units by the end of 2014, thanks to the completion of three new developments, including The One @ Bukit Ceylon and Fraser Residence.

The industrial property segment, on the other hand, was expected to continue seeing negligible growth in new supply, a trend observed since 2011.

As for the rental market in Greater KL, CBRE said office space and industrial properties would likely see improvement in rates, while rates for retail and residential spaces would likely remain muted this year.

In the first quarter of 2014, the average rental rates per sq ft for office space stood at RM7.64, up slightly from RM7.61 in the preceding quarter, while that for industrial space stood at RM1.62.

“Anecdotal evidence shows an increased interest for warehouse facilities that may possibly incur price increases in Greater KL,” CBRE noted.

In the first quarter of 2014, prime rents for retail space remained unchanged since the second quarter of 2013 at RM55 per sq ft and RM31 per sq ft in KL suburban areas.

Average monthly rentals in the KL city centre were RM3.96 per sq ft, while the monthly rents in Bangsar and Mont’Kiara stood at RM3.27 per sq ft and RM2.93 per sq ft during the first quarter of the year.

Homebuyer due diligence

A commercial transaction normally commences with due diligence being conducted prior to much consideration being put into the written agreement. This measure has two effects – it prevents the parties from sealing a detrimental deal and also time wastage over unfruitful discussions.

Essentially, this is an important process to ensure the parties get what they exactly bargained for. The same is applicable in the purchase of new residential properties from developers.

While there have been incidents of abandoned housing projects all over Malaysia that impacted the homebuyers who spent their hard-earned money but did not get their dream home in return, generally the housing authorities had been successful in protecting the interest of house buyers.

Many of these projects were abandoned by illegal developers who did not possess any valid licences to commence the development in the first place.

The Urban Wellbeing, Housing and Local Government Ministry’s website showed there were 82 developers without licence and 116 developers who have abandoned their projects as of June 30, 2014.

The question that remains is how could the homebuying public be so ignorant that they are incapable of doing the basic due diligence when making the biggest life-long investment of buying a dream home.

Under the Housing Development (Control and Licensing) Act 1966 (HDA), any developer who constructs and sells more than four units of housing accommodation comes under the purview of the HDA.

Section 18 of the HDA states that any housing developer who carries out housing development without having been duly licensed shall be guilty of an offence and shall, on conviction, be liable to a fine which shall not be less than RM250,000 but not exceeding RM500,000 or jailed not more than five years or both.

Thus, it is compulsory for a developer, prior to developing a housing project, to fulfill the following:

·Obtain the necessary approvals from the relevant authorities such as development order and building plan;
·Apply a developer licence from the Controller of Housing whereby the Controller has the discretion to grant with or without further conditions or to refuse granting the licence;
·Deposit a sum of not less than RM200,000 with the Controller for the grant of the licence which is refundable upon the completion and expiry of the defect liability period of the project (there is an amendment to adjust the deposit sum in line with the gross development cost in 2013 but it has yet to come into force); and
·Apply for a sales and advertisement permit to start selling the units of the development.

Thus, a licensed developer would pass the first stage, with checks by the relevant authorities. A unlicensed development would mean these authorities are out of the picture and that development had not been discovered for breach yet.

As such, the next level of due diligence will be significant: the homebuyer himself.

With the advancement in wireless technology today, we “google” for everything for which we need clarification and information. The same applies for home purchasing. You will be amazed over the amount of information available online: ranging from the developer’s own website, property reviews to forums started by other homebuyers on the same development.

While it is not advisable to believe everything from the world wide web, it serves as a good starting point to know better the product you are buying before signing the sales and purchase agreement.

A minor website checklist is as follow:

·Google
·Developer’s website
·News websites
·Ministry of Urban Wellbeing, Housing and Local Government
·Real Estate and Housing Developers’ Association (Rehda) and
·National House Buyers Association.

In addition to that, you may personally pay a visit to the development itself and make your own observation. If possible, asking around for details would also build up the confidence in buying the right home.

Normally, at the entrance, there will be a white signboard feeding you details of the construction such as the details of the development, landowner, developer, contractor and completion date.

Your lawyer or banker also serve as another filter of due diligence. Before you sign any agreement, it is advisable to ask them on any doubt that you are suspicious about and to be comfortable with what you sign.

Even if you have questions on the credibility of the lawyers, the Bar Council has a website for you to do the checks or even its friendly help desk in its office.

The above due diligence process does not guarantee a 100% smooth property transaction but it minimises the risk of buying a project which could be abandoned. Besides conducting a detailed research, the purchase of a house from reputable developers may diminish your homebuying risk further.

And for any of you who think you might be a victim of unlicensed developer, it is time to call your lawyer and banker for clarification.

Owning a house is a lifetime commitment; its protection starts with you.

Moody’s: Malaysia housing market may be peaking

Moody’s Investors Service expects an uptick in non-performing loans (NPLs), particularly in the household segment, in the South-East Asian banking system.

Moody’s assistant vice president and analyst Simon Chen said on Thursday that in Asean, the Malaysian and Thai banking systems were the most exposed to increased asset-quality pressure in the household segment when rates rise.

“This is primarily because the ability of households in these countries to service their debt in a rising interest-rate environment will be negatively affected by consumers’ high leverage at a time when the housing market in Malaysia may be peaking and Thailand faces elevated political risk,” he said in reference to Moody’s just-released report “Rising household leverage poses risks to Asean banks as the economic cycle shifts”.

Moody’s said the long positive credit cycle that has benefited banks in Asean might be on the verge of peaking. These would pose challenges for the lenders as pockets of asset-quality risk emerge due to tighter global monetary conditions.

“Our central scenario is that banking systems in Asean will be broadly resilient to the financial impact of a shift in interest rates, but we expect an uptick in NPLs, particularly in the household segment,” said Chen.

Moody’s report showed household debt has risen significantly in Asean in the past several years, with growth in bank loans to households outpacing loan growth to other borrowers.

Household leverage as a percentage of GDP was at historically high levels in Malaysia (A3 positive) (87% at end-2013) and Thailand (Baa1 stable) (82% at end-2013), and close to its five-year high in Singapore (Aaa stable) (75% at end-2013).

Although household debt has also risen significantly in Indonesia (Baa3 stable) and the Philippines (Baa3 positive), the growth in these countries was from a low base.

However, the report pointed out Asean bank asset-quality risk from residential property price corrections was mitigated by legal frameworks that support bank creditors.

Unlike in the US, banks in Asean have legal recourse to the borrowers on their debt obligations, beyond the underlying property assets mortgaged to the banks.

This feature provides greater creditor protection to banks, removes the incentive for borrowers to default on their mortgage obligations, and alleviates risks that housing NPLs will spike when property prices fall significantly.

Additionally, Moody’s report notes that Asean banks have responded to regulatory measures aimed at curbing further increases in excessive household leverage.

Banks in Thailand, Malaysia, and Singapore had tightened their underwriting standards on household loans, which was positive for banks’ asset quality over the longer term.

The banks also have strong buffers to withstand asset-quality shocks in the household segment, Moody’s said.

Bandar Puteri Bangi (2)

The town of Bangi in Selangor will soon see a new development that is set to be a major commercial hub and vibrant residential township in the southern corridor of the Klang Valley.

Bandar Puteri Bangi, an integrated mixed development by IOI Properties Group Bhd, sits on 370 acres of prime freehold land near the state border between Bandar Baru Bangi and Nilai, Negri Sembilan, with direct access from the North-South Expressway.

“We are committed to creating the ultimate township living experience with an emphasis on sustainability and individuality,” said IOI Properties Group Bhd chief executive officer Lee Yeow Seng

“A 148-acre site – approximately 40% of the land – will be earmarked for the development of a vibrant commercial hub that will offer outdoor dining, street cafes, quaint boutiques and flashy showrooms,” said Lee.

He added that another 40% of the 370 acres will be developed as residential precincts consisting of both landed and high-rise property while the remaining 20% will be allocated for landscaping, parkland and public amenities.

At a gross development value of approximately RM4bil, the entire site will be transformed into a fully integrated modern township over the next eight to ten years.

The lifestyle concept for Bandar Puteri Bangi is evident in its plans for a green and stylish boulevard landscape concept on a network of streets collectively called the ‘Streets of Dreams’.

These streets follow unique themes such as “California Street”, “Tropical Street” and “Art Street”, and they reconnect the urban population with the natural landscape through a system of parks, paths and open public spaces.

“Residents can also reconnect with nature at our large green space, the ecoOasis Parkland, or relax and wind down with the arenaOasis Clubhouse at their doorstep,” Lee added.

Its strategic location in the southern corridor also enjoys a wide range of amenities in the existing neighbouring townships, which include universities, shopping destinations, hospitals, hotels, popular recreational spots and public transportation.

According to property director Teh Chin Guan, the first phase of shop-office blocks are set to be launched as early as next month while the first phase of landed superlink houses will be launched in November.

With the market price of link houses in a neighbouring township set at about RM600,000, Teh says that their much larger superlink homes, with built-up areas starting from 2,700 sq ft, will likely sell for no less.

“We also have our first phase of serviced apartments in the works – about 669 units, expected to launch early next year,” he added.

Other types of residential property in Bandar Puteri Bangi to be launched in future phases include terrace houses, townhouses, affordable apartments and condominiums.

Malaysia’s residential property sector enters cooling phase

The residential property segment, a sub-sector of the overall property market, appears to have entered “a cooling phase” in the first two quarters with sales expected to stay “moderate” for the coming third quarter, according to the Malaysian Institute of Economic Research (Mier).

“The macro-prudential measures implemented by Bank Negara to cool down the property market since 2010 look likely to have played a role here,” Mier said.

Mier based its conclusion after doing a residential property survey designed to be an indicator of economic activity in the property sector.

Its Residential Property Index fell for the second quarter to 109.9 points, slipping 1.3 points from the first quarter, and 28.3 points from a year ago.

The survey also showed that total unsold new residential properties have accumulated faster than sales in recent months.

More than a quarter of house builders reported bigger stocks in hand, which is at a three-year high.

The Mier report said that given the built-up in total unsold new units, those surveyed have decided to keep creeping prices at bay by maintaining them at current levels.

But in the months ahead, prices “are likely to escalate again” more than half of those surveyed said while the remainder said they will “neither raise nor slash theirs (their prices) for now.”

Fewer of them increased prices in the second quarter compared with the first and some even offered price cuts, the survey found.

Moving forward, about half of those surveyed expect sales for the current third quarter to remain the same while more than a third of those surveyed foresee higher sales as “home buyers bought ahead of the Goods and Services Tax” which will come into effect next April.

Property prices are envisaged to rise due to higher input costs after that.

Double-storey houses continued to be the most popular while none of those surveyed seem to have sold any bungalows during this same period.

The survey concluded that affordability issues may continue to haunt the market if property prices outpaced income growth and interest rates edged up.

“Housing demand may eventually lose ground,” Mier said.

Bandar Puteri Bangi

IOI Properties will soon unveil its Bandar Puteri Bangi Township, a 370-acre freehold integrated project with a gross development value of RM4 billion.

Out of its total area, 40 percent will be allocated for residential precincts, a similar number for the commercial hub, which consists of a hypermarket, three- to four-storey shophouses, as well as retail and lifestyle units. The remaining 20 percent will be set aside for parklands, public amenities and landscaped areas.

Its 167 acre commercial hub is also touted as one of the biggest business centres within Klang Valley’s Southern corridor, which covers Nilai, Bangi, Kajang and Semenyih.

To be built over the next ten years, the town also feature three themed streets. Inspired by the Sunset Boulevard in the US, the tree-lined California Street allows residents to enjoy a ‘surfer-like’ lifestyle. Here, teenagers and professionals can ‘surf’ the lane with bikes or skates.

Commuter will also enjoy travelling through Tropical Street in an open-top or convertible car thanks to the giant natural umbrellas formed by huge rain trees, while Art Street is dotted with sculptures and other quirky masterpieces.

Moreover, the township’s ecoOasis Parkland is a perfect place to unwind or hold a picnic, while the lakeside arenaOasis Clubhouse comes with an outdoor amphitheatre with terrace-style seating.

With direct access to the North-South Highway via Putera Mahkota Interchange, Bandar Puteri Bangi is surrounded by many amenities. Apart from its proximity to a KTM commuter station, the township is also close to many educational institutions like UKM, KUIS and Uniten.

The Nilai Medical Centre, An-Nur Specialist Hospital and KPJ Kajang Specialist hospital are also nearby, likewise for shopping centres such as Bangi Gateway and the Nilai 3 Wholesale Centre. The Bangi Golf Resort and Palm Garden Golf Club are within easy reach as well.

According to the company’s press release: “The spectrum of properties to be launched soon will include gated & guarded terrace houses, townhouses, serviced apartments, condominiums, shop-offices and low-cost apartments.”

Interested buyers may register at www.ioiproperties.com.my/puteribangi or call 03-8947-8899.

Escalating land cost in KL and PJ driving developers south of Klang Valley

More developers are choosing to relocate their developments towards the south of the Klang Valley due to escalating land prices in and around Petaling Jaya and Kuala Lumpur.

“Escalating land prices within Greater KL have reduced the supply of affordable landed properties, which remain in demand,” said AllianceDBS Research in a report yesterday.

“The mass rapid transit (MRT) connectivity at Kajang (ready by 2017) and the ready infrastructure with several highways have made Kajang/Semenyih the natural choice for developers to expand township developments.”

The research house said this was supported by the availability of large tracts of land and these districts recording among the strongest population growth in Selangor.

“The close proximity to KLCC and the Putrajaya federal administrative centre will ensure KL South continues to thrive.”

AllianceDBS Research noted, however, that Greater KL and the Klang Valley remain the core of the Government’s Economic Transformation Programme.

“The Government wants to grow the Greater KL population to 10 million by 2020 from an estimated seven million currently. This means the Greater KL population has to grow by 5.2% per annum on average, much higher than the national average of 1.4%.

“If the goal materialises, then this would translate into stronger demand for housing of 80,000 units per annum in Greater KL alone vis-à-vis 78,000 units completed for the whole country in 2013.”

AllianceDBS Research said the housing demand in Greater KL is likely to remain healthy going forward, adding, however, that buyers would be picky because of the steep pricing, no thanks to a slew of cost-push factors, including inflationary pressure, subsidy rationalisation and the implementation of minimum wages.

“Faced with the risk of margin compression, property developers will naturally look to landbank in areas where land cost is relatively low and there is ready infrastructure and a growing population.”

SYF Resources inks deals for RM160m Cheras property project

SYF Resources Bhd is teaming up with two landowners to develop 8.09 acres of freehold land in Sungai Long, Cheras into a residential project with a gross development value (GDV) of RM160mil.

It said on Monday its unit SYF Development Sdn Bhd had signed joint venture agreements with Luxmark View Sdn Bhd and Sheeco Properties Sdn Bhd to develop the land.

SYF added SYF Development would carry out a residential project comprising of condominiums and Rumah Selangorku on the site.

It added Luxmar would be entitled to RM16.2mil and Sheeco RM14.88 million for the land.

"The total landowners' entitlement of RM31.08mi has been arrived at on a negotiated basis and taking into account the expected gross development value of a minimum of RM160mil," it said.

"Such entitlement will be paid progressively from the collection of sales proceeds arising from the future development of the land," it said.

SYF Resources said the JV agreements were subject to a condition precedent of a minimum allowed density of 60 units per acre when the building plans are approved.