Saturday, July 31, 2010

Property market to stay vibrant


MALAYSIA'S property market is due to stay vibrant in 2010 due to low borrowing costs, easier foreign ownership rules and a new home purchase scheme by the nation's biggest pension fund.

Last year, there was a 0.7 per cent drop in the total number of property transactions but the number of unsold properties fell by 13 per cent for residential units.

"This shows that the property market in Malaysia is more resilient and stable, especially in demand locations such as in the Klang Valley," said Housing and Local Government Minister Datuk Wira Chor Chee Heung.

He spoke at the opening of a three-day property fair organised by iProperty.com in Kuala Lumpur yesterday.


The total number of property transactions dropped 0.7 per cent to 337,859 in 2009 from 340,240 in 2008. The bulk of it came from the housing market, making up 63 per cent of the total deals and 52 per cent in terms of value.

"The total number of launches reduced only slightly from 48,830 units to 45,909 units in 2009, possibly due to some cautiousness among some developers. Selangor and Johor remains the leading states with 8,430 units and 7,099 units respectively," he said.

Speaking to reporters later, Chor lauded the Employees Provident Fund's (EPF) latest move, which would boost the local housing industry.

From August 1, EPF will launch a flexible withdrawal scheme for higher-end houses.

The scheme is open to contributors who have not made withdrawals under the existing scheme to buy a house or reduce their housing loans.

According to the EPF, the main difference of the new scheme is that it is designed to give qualifying members, who initially were not eligible for a higher loan, a better chance to boost their loan eligibility.

Thursday, July 29, 2010

MRCB to raise RM400m for KL Sentral Park Read more: MRCB to raise RM400m for KL Sentral Park http://www.btimes.com.my/Current_News/BTIMES/articles/du


MRCB Sentral Properties Sdn Bhd, a unit of Malaysian Resources Corp Bhd (MRCB) (1651), will raise RM400 million of debt to finance the development of its latest project called KL Sentral Park.

The commercial paper/medium term notes (CP/MTN) programme is arranged by Affin Investment Bank Bhd.

"The financing, which is being guaranteed by Danajamin Nasional Bhd, is for a period of seven years," said MRCB chief executive officer Mohamed Razeek Hussain.

KL Sentral Park comprises five blocks of office buildings, high-end retail shops, business centres and green spaces with a net lettable area of 518,000sq ft. So far, 18 per cent of the project has been completed.
Speaking to reporters after the signing ceremony between MRCB, Affin Investment and Danajamin in Kuala Lumpur yesterday, Mohamed Razeek said construction started in the fourth of quarter of 2009.

"The project is scheduled to be completed next year," he said.

MRCB had executed a 15-year lease agreement with SME Corp and recently obtained a commitment to lease for 15 years by SBM (Malaysia) Sdn Bhd.

"Collectively, this translates to occupancy reaching 60 per cent of KL Sentral Park's net lettable area," he said.

Also present were Affin Investment managing director Maimoonah Mohamed Hussain, Danajamin chief executive officer Ahmad Zulqarnain Onn, Malaysian Trustees Bhd director Ng Hon Soon and MRCB senior vice-president of property Wong Dor Loke.

Meanwhile, Maimoonah said the domestic bond market has been dull since the subprime crisis started.

"Therefore, the guarantee provided by Danajamin to MRCB is instrumental to re-ignite interest by providing quality issuance to the market," she said.

Maimoonah said the CP/MTN programme is accorded the highest rating of MARC1 and "AAA" with the guarantee wrap from Danajamin.

This provides the most competitive pricing which lowers the company's interest costs further.

The financing for MRCB is Affin's second for the group in the last two years, the first being the RM499 million syndicated loan.


Wednesday, July 28, 2010

IJM's The Light to contain world-class appeal

A PERFORMING arts centre to rival Australia's Sydney Opera House, waterfront retail promenade and an international standard marina are among the attractions property developer IJM Land Bhd will unveil when it launches the second phase of its flagship waterfront "The Light" development in Penang at the end of the year.

Its managing director Datuk Soam Heng Choon yesterday said the proposed iconic arts centre, known as "The Pearl" is expected to boost a seating capacity of 2,000 and set to be sprawled over 0.8ha.

The proposed marina, meanwhile, is expected to offer club facilities with more than 200 berths.

"Also to be found in the second phase of this commercial development would be an information technology precinct for Multimedia Super Corridor-status companies and incubator firms," he said during a media launch of the company's "The Light Collection 1" in Penang.

The Light Collection 1 project, which carries a development value of RM203 million, was soft-launched in May, and Soam said half of non-Bumiputera units which are sprawled on 2.8ha have been sold so far.

Present at the launching ceremony were IJM Land general manager (north) Toh Chin Leong and one of the company's consultant architect, Eric Tham.

The Light Collection 1 is the first of four in The Light Collection series which offers 24 units of four-storey water villas and 152 condominiums in four eight-storey blocks.

While the condominiums have built-ups of 1,371 to 1,582 sq ft, the water villas, which are touted to be the first of its kind in the country, are set to boost a built-up area of 3,132 sq ft.

The units are priced from RM823,600 to RM3.18 million.

With a gross development value of RM5.5 billion, The Light is a 60.8-ha freehold waterfront development which will be built over the next 12 to 15 years.

Soam said IJM Land intends to make The Light one of the best waterfront places to live in Malaysia.

"Living by the water," he noted, "represents the highest level of luxury for many home owners."

The entire The Light development is undertaken by IJM Land's subsidiary, Jelutong Development Sdn Bhd.

The project, which will be carried out in three phases, is being touted as the biggest and best integrated residential, shopping, dining, recreational and commercial waterfront living in the northern region.

Read more: IJM's The Light to contain world-class appeal http://www.btimes.com.my/Current_News/BTIMES/articles/opera2/Article/#ixzz0uz5SVgKX

Monday, July 26, 2010

Funding boost for highways

The fund, announced under the 10MP in June, was meant to attract at least RM200 billion worth of private sector investments over 2011-2015.

"RM5 billion we're putting aside for land acquisition. Acquiring land is also part of the facilitation," said Datuk Dr Ali Hamsa, director general of the Public-Private Partnership Unit (3PU).

Some of these highways are extensions to existing highways like the North-South Expressway (NSE) while some will be completely new ones. One will connect Paroi to Senawang in Negri Sembilan and onwards to KL International Airport, which will be more than 50km.

Another major new highway is called the central spine, a new highway spanning the length of Peninsular Malaysia. But unlike the NSE or the East Coast Highway, it will run in the centre of the Peninsula from Kota Baru in Kelantan, down to Simpang Pelangai in Negri Sembilan.But Ali stressed that the central spine highway is still in the "thinking" stage. This means that the project would only happen if it is worthwhile doing.

"This is just some thinking, early thinking. All highways will depend on viability," he told Business Times in an interview last week.

The seven new highways are estimated to be worth some RM20 billion.

The new highways will also be done on a privatised basis, which means that companies will build the roads and operate it over a period of time.

3PU is a new unit set up under the Prime Minister's Department and it would handle privatisation projects, Private Finance Initiative projects, as well as monitor the five economic corridors.

It would also manage the RM20 billion Facilitation Fund.

The fund will be given as grants to companies with projects in strategic sectors like infrastructure, education, tourism and health.

Companies that are interested will be able to find out more about how to apply and what sort of projects qualify once the Cabinet approves the guidelines.

"Now the guidelines are ready but we have to take it to Cabinet for approval in September," he said.

Wednesday, July 21, 2010

Khazanah places out TM shares for RM581m

The government's investment arm Khazanah Nasional Bhd has placed out 5 per cent of Telekom Malaysia Bhd (TM)'s stock in a deal valued at RM581.3 million.

The deal, executed yesterday, is believed to be the second largest share placement exercise in Malaysia so far this year.

Maybank Investment Bank and Nomura Singapore were the joint placement agents for Khazanah.

Some 178.9 million of TM shares were placed out to local and foreign institutional investors at a fixed price of RM3.25 each, sources said.


The price represented a 2.7 per cent discount to TM's closing price of RM3.34 in the stock market yesterday.

"There was overwhelming demand from both domestic and foreign institutional investors. The transaction was covered very quickly," a source told Business Times.

TM's share price has gained about 9.2 per cent so far this year, peaking at RM3.54 in mid-May.

With the sale, Khazanah's 42 per cent stake in TM has now been reduced to 37 per cent.

Khazanah has been been making an effort to sell down its holdings in government-linked companies in a bid to boost their free float and draw foreign funds back into the stock market.

It last year placed out shares in airport operator Malaysia Airports Holdings Bhd and power utility Tenaga Nasional Bhd.

Last week, the world's biggest cement-maker Lafarge SA sold 11.2 per cent in Lafarge Malayan Cement Bhd for RM594 million in the largest share placement deal in Malaysia this year. That deal was arranged by The Royal Bank of Scotland.

Friday, July 16, 2010

Bina Puri-UEMC JV lands RM997.23m LCCT job

KUALA LUMPUR: BINA PURI HOLDINGS BHD []'s joint venture with UEM CONSTRUCTION [] Sdn Bhd (UEMC), a UEM Group Bhd subsidiary, has been appointed the main contractor for the construction of KL International Airport (KLIA) New Permanent LCCT complex at the KLIA.

The total contract value is RM997.23 million.

In a filing to Bursa Malaysia Securities on Friday, July 16, Bina Puri said its group managing director Senator Tan Sri Tee Hock Seng had accepted the letter of award in the name of UEMC-Bina Puri JV from Malaysia Airports Holdings Bhd.

Bina Puri's acceptance of the award confirms a report by The Edge on July 5 that the JV beat the likes of heavyweights MALAYSIAN RESOURCES CORP [] Bhd and Sunway Construction Sdn Bhd to the job.

Bina Puri said with the award, the group's current order book stood at RM2.7 billion as at to date.

The total value of contracts it had secured in 2010 was RM1.51 billion, adding that the LCCT project was expected to be completed within 20 months, it said.

"The contract is expected to contribute positively to the earnings of Bina Puri Group for the financial year ending Dec 31, 2010," it said.

Sunday, July 11, 2010

Banks to revise deposit rates, BLR


KUALA LUMPUR: Several banks will be increasing rates on lending and deposit from Monday after Bank Negara raised its key policy rate for the third time this year.

Malayan Banking Bhd (Maybank) will revise upwards deposit and base lending rates (BLR), effective July 13, in line with the increase in the overnight policy rate (OPR) by 25 basis points.

Maybank said it would raise deposit rates by up to 25 basis points while the BLR would be increased by 25 basis points to 6.3% per year. The base financing rate (BFR) of Maybank Islamic Bhd will similarly be revised upwards by 25 basis points to 6.3%.

CIMB Bank and CIMB Islamic Bank announced yesterday that they would increase their BLR and base financing rate BFR by the same quantum.

Meanwhile, Bank Islam Malaysia Bhd would raised its base financing rate (BFR) by 25 basis points to 6.30% per annum effective July 13.

Saturday, July 10, 2010

Mah Sing buys lands in Selangor

MAH SING Group Bhd (8583) has bought three parcels of land in Puchong, Sg Buloh and Bukit Jelutong in Selangor to build residential, commercial and industrial properties worth RM1.1 billion.

The first parcel of land, opposite the Kinrara Golf Club in Puchong, is to develop residential properties.

Mah Sing said in a statement yesterday that the project, dubbed Kinrara Residence, has an estimated gross development value (GDV) of RM730 million.

The second parcel, which is adjacent to the Rubber Research Institute land in Sg Buloh is for a commercial project, known as Star Avenue, worth RM280 million.
In Bukit Jelutong, Mah Sing will build i-Parc 3, an industrial project worth RM82 million, which is a continuation of its i-Parc brand.

Mah Sing said the 3 parcels of land will reinforce its strength as one of the few local developers to offer a complete range of properties in its stable, namely residential, commercial and industrial.

With the new land acquired, Mah Sing has projects with remaining GDV and unbilled sales of about RM7.5 billion in the Klang Valley, Penang Island and Johor Baru.

Some 59 per cent of the projects are residential properties. Commercial and industrial make up 36 per cent and 5 per cent respectively.

Mah Sing said the landbanks will keep it busy for some 6 years.

This year alone Mah Sing has acquired new projects worth RM1.9 billion for building works stretching to 2011 and beyond.

"We are pleased that our performance has been acknowledged with our most recent award, the inaugural The Edge Billion Ringgit Club awards where we were named recipent for Highest Compound Returns to Shareholders over 3 years," it said.

Thursday, July 8, 2010

Overnight Policy Rate Up 0.25%

KUALA LUMPUR: Bank Negara raised the Overnight Policy Rate (OPR) by 25 basis points to 2.75% at the Monetary Policy Committee (MPC) meeting on Thursday, July 8.

"The floor and ceiling rates of the corridor for the OPR are correspondingly raised to 2.50% and 3% respectively," it said.

The central bank said the MPC considered the new level of the OPR to be appropriate and consistent with the current assessment of the growth and inflation prospects.

It also said the stance of monetary policy continues to remain accommodative and supportive of economic growth.

On the domestic economy, it said recent trends in industrial production, financing activity, labour market conditions and external trade indicate that economic activity has remained robust in the second quarter.

"Going forward, while external developments may result in some moderation in the pace of growth, the domestic economy is expected to remain strong with continued improvements in private consumption and investment, and augmented by public investment spending," it said.

Domestic inflation recorded modest increases in April and May, mostly on account of supply factors.

Bank Negara said prices were expected to rise at a gradual pace in the coming months, in line with the continued improvement in domestic economic conditions, and taking into account possible adjustments in administered prices.

"Overall, inflation is, however, expected to remain moderate going into 2011," it said.


Written by Joseph Chin

Wednesday, July 7, 2010

Budget 2011: Govt to wrap up talks with focus groups end-July

KUALA LUMPUR: The government will wrap up its discussions with 10 focus groups by end-July as it prepares the Budget 2011 proposals to drive private sector investments and accelerate growth in the various areas of the economy.

Second Finance Minister Datuk Seri Ahmad Husni Mohamad Hanadzlah said on Wednesday, July 7 the government had formed 10 focus groups to help draw up the Budget 2011 proposals. The discussions with three such groups were completed on Tuesday.

He said the government would hold discussions with the remaining seven focus groups this month. It was also mulling the possibility to invite other groups in the next two months to o give their views especially on accelerating private investments.

"The focus is to enhance the government's vision of a high income economy. That is the basically the basis of Budget 2011," Ahmad Husni said after opening the "National Tax Conference 2010" organised by the Inland Revenue Board of Malaysia (LHDNM) and Chartered Tax Institute of Malaysia (CTIM).

The three focus groups that have completed their discussions are: Accelerating Services Sector Development; Innovation for a High Income Economy; and Accelerating Private Investment.

The remaining seven are: Human Capital for the New Economy; Enhancing Quality of Private and Public Service Delivery; Green TECHNOLOGY [] for Sustainable Growth; Income Generation for the Poor; Addressing Social Issues through Gender Budgeting; Inclusive Development; and Strengthening Small, Medium and Micro Enterprises.

CPO FUTURES

THE crude palm oil (CPO) futures market closed lower yesterday on expectation of rising supplies in the next few months, dealers said.

"The immediate trend is towards a bearish-divergence and the market will continue to remain under selling pressure from long-liquidation and unwinding of long-hedge," a dealer said.

Crude palm oil hit a 7½ month low below RM2,300 a tonne yesterday due to a stronger local currency and concerns about demand for vegetable oils.

A dealer said palm oil production in the next three months may rise as much as 10 per cent due to the seasonal rise in supply.

July 2010 declined RM26 to settle at RM2,380 a tonne, while August 2010 fell RM47 to RM2,311.

September 2010 slid RM45 to RM2,290 and October 2010 depreciated RM40 to close at RM2,282.

Turnover, surged to 11,214 lots from 8,853 lots last Friday while open interests rose to 72,771 contracts from 72,093, previously.

On the physical market, July South lost RM20 to RM2,420.

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