Upbeat developers, upscale projects

By Sharen Kaur

sharen@nstp.com.my

Published in NST on November 27, 2012

MORE developers are launching upscale projects next year as they are upbeat that the real-estate market will perform better despite global financial turbulence and tighter credit here.

Sunway Bhd managing director of property development division Ho Hon Sang quashed talk of a property bubble due to oversupply situation.

"We don't expect a bubble burst as Malaysia's economy is resilient and it will continue to grow. Malaysia has massive projects under the Economic Transformation Programme (ETP) that will keep the economy healthy.

"Employment will also be positive. When people have income, they will invest, especially in real estate and you will never go wrong with that," he told Business Times in an interview.
Sunway, developer of the award-winning Sunway Integrated Resort City in Bandar Sunway, Selangor, will be launching se-veral projects with various offerings next year in the Klang Valley, Penang and Johor, Ho said.

It will launch condominiums and shop offices at Sunway South Quay, courtyard villas and semi-detached homes at Sunway Montana, serviced apartments, office and shop units at Sunway Velocity, and superlink houses, apartments and retail at Sunway Alam Suria, Sunway Eastwood and Sunway Bangi.

In Penang, it will launch three-storey terraced houses at Sunway Cassia and semi-detached houses and townhouses at Sunway Wellesley while in Johor, it plans to offer semi-detached homes and bungalows.

MRCB Land Bhd, the property arm of Malaysian Resources Corp Bhd (MRCB) is launching Kia Peng Residences in Kuala Lumpur, a mixed development in Brickfields and Batu Ferringgi Residences in Penang and targeting the high-income group.

The firm expects to rake in over RM1.5 billion in gross development value.

According to MRCB Land's website, the indicative selling price for Kia Peng Residences, located on Jalan Kia Peng, is RM1,200 per sq ft to RM1,300 psf. Various sizes are offered, ranging from 600 sq ft to 2,600 sq ft.

Batu Ferringgi Residences, with a view of Andaman sea, will feature 17 boutique Villas and 48 units of condominiums.

Eastern & Oriental Bhd has plans to launch RM2.5 billion worth of properties between now and December next year, with half of the targeted sales to come from both its local and overseas ventures.

Bolton Bhd will develop its maiden residential project in Kota Kinabalu, Sabah, comprising 500 units of luxury condomi-niums and 50 villas, worth a combined RM480 million.

Its executive chairman Tan Sri Azman Yahya believes Kota Kinabalu is a good market offering high potential for both developers and investors.

MRCB: Penang Sentral to take off in 2013

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 26, 2012

MALAYSIAN Resources Corp Bhd (MRCB) says the Penang Sentral project in Butterworth, estimated to be worth over RM3 billion, will begin in 2013 after more than four years of delay.

Penang Sentral, an integrated mixed commercial development was expected to start in 2008 but works got delayed due to land acquisition matters. MRCB was awaiting federal government allocation to fund the public utility project.

It was then reported that Phase 1, comprising the integrated transportation hub with a retail component, worth an estimated RM400 million, would start in December 2010.

MRCB's property division head of marketing Zamry Ibrahim said construction will begin next year and there would be some changes to the plan, like the incorporation of more green elements in the buildings.
"There is a lot of demand for energy efficient buildings from multi-national companies and local players. We will develop what is required by the market," Zamry told Business Times in an interview recently.

The 9.6ha Penang Sentral will feature a transport terminal for ferries, buses, taxis, trains and a projected monorail station.

Zamry said the terminal will be integrated and surrounded with commercial, residential and retail components, similar to MRCB's Kuala Lumpur Sentral integrated commercial hub in Brickfields.

The 28.8ha KL Sentral development, which started over eight years ago, currently comprises a transport hub for rail, buses and taxis, two hotels, a mall, and several residential and commercial towers.

Penang Sentral, which is part of the Northern Corridor Economic Region initiative, will be developed by MRCB and Pelaburan Hartanah Bumiputera Bhd.

The project is poised to be the catalyst of growth to rejuvenate the economy in the northern region.

It has been reported that Penang Sentral is expected to generate economic spill-over effects of over RM8 billion when it is completed in about 10 years.

It is also expected that with the completion of the KTMB electrified double tracking project, train service between Penang Sentral and KL Sentral will be shorten to three hours.

Read more: MRCB: Penang Sentral to take off in 2013 http://www.btimes.com.my/Current_News/BTIMES/articles/MRCB21/Article/#ixzz2DLgrcx00

UEM: Outcome of Turkish bids soon

By Sharen Kaur

sharen@nstp.com.my

Published in NST on November 23, 2012

UEM Group Bhd may soon know the outcome of its bid for the privatisation of bridges and highways in Turkey.

The Privatisation Administration of Turkey (OIB) is expected to decide on the privatisation by year end, the group said.

Group managing director and chief executive officer Datuk Izzaddin Idris said UEM and its joint venture partners are in discussions with OIB on the bid they had submitted.

UEM's partners are Turkish industrial conglomerate KOC Holding and financial services firm Gozde Girisim Sermaesi Yatirim Ortakligi. UEM and KOC Holdings each own 40 per cent stake in the joint venture while Gozde holds the balance.

The three joint venture partners last month submitted a bid for the privatisation of two bridges over the Bosphorus Straits in Istanbul and seven motorways across Turkey.
The roads and bridges, which link Europe and Asia and span a total of 1,975km in cumulative distance, are being privatised in a single package for 25 years.

According to OIB's website, there are two other contenders for the privatisation of these assets. The first group includes Nurol Holdings, MV (Mustafa Vargi) Holdings, Alsim Alarko, Kalyon Insaat and Fernas Insaat.

The second consortium comprises Italy's Autostrade Per I'Italia SPA, Dogus Holdings, Makyol Insaat and Akfen Holdings.

"We can't comment further on the deal until it is concluded. We have been advised by OIB that they want a closure on this by the end of this year," Izzaddin told Business Times after the signing on the corporate adoption of CIMB-Principal's new private retirement schemes on Wednesday.

He said for project financing, the cash flow from the 25-year concession will drive the funding requirements.

UEM, via its engineering and construction division and expressway arm, has ongoing projects worth over RM9 billion.

They include contracts for klia2 and the Mass Rapid Transit packages V8 and S3, Penang Second Bridge, the Cikampek-Palimanan toll road project in Indonesia, and the Brunei national housing project.

Scomi eyes Penang monorail deal

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 21, 2012

Scomi Engineering Bhd says it is keen to participate in the RM2 billion Penang monorail project and will bid for the job when the government calls for tenders next year.
"We won the bid before and are keen to tender again. We are very well prepared to execute the project," its group chief operating officer of transport solutions Kanesan Veluppillai told Business Times.

The Penang monorail was proposed under the Ninth Malaysia Plan (9MP) and Northern Corridor Economic Region. Tenders were called by the Federal government in November 2007.

In January 2008, government-owned Syarikat Prasarana Negara Bhd issued a letter of intent for the RM1.6 billion job to a consortium comprising Scomi Engineering, Malaysian Resources Corp Bhd and Penang Port Commission.

Other contenders for the job were Melewar Industrial Group Bhd and its partner Putera Capital Bhd, as well as MMC-Metrail Sdn Bhd.

The government, however, shelved the project during the mid-term review of the 9MP, in favour of people-centred developments.

Penang, with a population of about 1.5 million people and registered private vehicles exceeding two million, requires a new mode of transport due to heavy congestion.

It is understood the government has proposed the Penang monorail project to cabinet for approval. The project is expected to cost over RM2 billion due to changes to the alignment and more stations needed.

Under the initial plan, two lines were proposed - Tanjung Tokong to the Penang International Airport via Scotland Road, Jalan Air Itam and the Penang State Mosque; and Paya Terubong to Weld Quay Terminal, via Jalan Air Itam, Jalan Dato' Keramat, and Kompleks Tun Abdul Razak (Komtar).

On government-owned Kuala Lumpur monorail system, Kanesan clarified that Scomi Engineering is keen to participate in the project as an engineering, procurement and construction contractor, supplying the systems and trains to Prasarana.

"We have not looked at taking it private and to enter the concession business. However, we will continue to play a role as a systems supplier and designer in the transportation business," he said.

Business Times reported yesterday that Scomi Engineering wants to take the KL monorail system private and expand the services to Bandar Sunway, Selangor, in a deal that could be worth over RM3 billion.

Scomi tracking KL monorail system

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 19, 2012

LINE EXTENSION: Company wants to take operations private, expand coverage to Bandar Sunway, Selangor SCOMI Engineering Bhd wants to take the government-owned Kuala Lumpur monorail system private and expand the services to Bandar Sunway, Selangor, in a deal that could be worth over RM3 billion.

The KL Monorail project was built at a cost of RM1.18 billion by KL Infrastructure Group, which had a 40-year concession to collect fares.

The monorail began operations on August 31, 2003, offering services through 11 elevated stations from Titiwangsa Station in Jalan Tun Razak to KL Sentral in Brickfields.

Government-owned Syarikat Prasarana Negara Bhd stepped in and took over the assets and operations of the monorail system in December 2007 after KL Infrastructure suffered financial constraints.
The system is now operated by Prasarana's wholly-owned unit, KL StarRail Sdn Bhd, and uses 12 two-car trains built by Scomi Rail Bhd, a subsidiary of Scomi Engineering.

Scomi Engineering president Suhaimi Yaacob said the company has prepared two proposals involving the KL monorail system - extending the line to Bandar Sunway on a build, operate and transfer mode and privatising the project.

"We hope the government will reinstate the KL monorail extension project which, we believe, may only be realised in 2014. If given the opportunity, we would like to take it private and run the operation, including the line extension," Suhaimi told Business Times in a recent interview.

Suhaimi said the 22km line extension will start from KL Sentral, passing through Mid Valley City and Old Klang Road before ending at Bandar Sunway.

"The existing line is already highly stressed, which is why the government is expanding from two-car trains to four-car trains, and extending the line beyond Brickfields," he said.

"Monorail is the only rail system that is able to navigate through limited space, thus alleviating the need to acquire properties and other conventional hurdles to make way for it," he said.

As the current trains are running on full capacity, Prasarana has awarded a contract to Scomi to build 12 sets of new four-car-trains for RM494 million.

Suhaimi said the new trains will be supplied to Prasarana in batches between next month and the third quarter of next year.

Club Med plans to expand into Sabah, Sarawak

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 19, 2012
PETALING JAYA: France's Club Mediterranee, which operates the Club Med resort chain worldwide, is assessing opportunities to expand into Sabah and Sarawak.

The Paris-listed group, which has 80 properties in its portfolio, has owned and operated Club Med Cherating in Kuantan, Pahang, since 1979.

Malaysia was the group's first stop in Asia Pacific, as part of its global expansion plan.

Sprawled within an 80ha enclave, Club Med Cherating is also the largest resort under the "Club Med" banner in Asia Pacific, by land size.

Its country sales and marketing manager for Malaysia, Steven Tan, said the group is mulling setting up a replica of Club Med Cherating in Sabah.

"We were looking at opportunities in Sabah earlier and we are still on the look out in Malaysia. It is always in our discussion to expand in Malaysia. Tourism is great here. We love to have more resorts in our portfolio as we move along," Tan told Business Times in an interview recently.

Club Med Cherating has 297 traditionally-designed Malay kampung-style rooms in 15 three-storey buildings built on stilts. The structures are all made of teak.

Each room is selling from RM620 per person a night, which includes accommodation, three meals, snacking and free flow of alcohol and non-alcohol beverages and entertainment.

According to Tan, more than RM100 million has been invested in the development of Club Med Cherating since its opening.

Tan said despite the global financial turmoil, the total business registered by the Malaysian office has been in the region of around RM40 million to RM45 million per annum.

He said Club Med Cherating welomes around 35,000-40,000 visitors a year, made up mostly of locals.

"We have a growth about five per cent annually in number of new visitors to the resort in the past few years. Our  global strategy of being upscale and premium has led to the increase, not just in Malaysia, but globally," Tan said.

The resort has about 25,000 active members from Malaysia. One can become a member (coupled with insurance coverage) for a fee of RM95 for the first year and RM65 for year-on-year renewal.

"Revenue has been increasing steadily over the past few years. Last year was a challenge because of the global economic crisis. Prices of goods and services had eroded. It is a challenge faced by any business."But things have improved now. We see more families and honeymooners staying at our place."

In 2004, when there was turmoil in the global market, the resort went through a RM30 million overhaul, which has helped to increase its occupancy rates from 50 per cent to between 60 per cent and 65 per cent.

-ends-

Club Med to open 5 more resorts in Asia Pacific

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 19, 2012

PETALING JAYA: French-based Club Mediterranee (Club Med), which operates the Club Med resort chain worldwide, is opening five new resorts in Asia Pacific within the next five years to increase its presence in the region.

With vibrant economic growth seen in emerging markets, global companies from mature markets continue to expand across the Asia-Pacific region, including in Malaysia.

Asia Pacific is currently the fastest growth region for the Paris-listed travel and leisure group.

It is understood that the group will invest more than RM200 million to open the five resorts.

Set up in 1950 in France, Club Med offers all-inclusive vacations in 80 resorts in 40 countries, from beach to ski holidays for families, couples and the corporate sector. The group is the world leader for ski resorts.

According to Steven Tan, its sales and marketing manager for Malaysia, Club Med, which rakes in around 1.5 billion euro in revenue a year, is bullish on the outlook for Asia Pacific.

To be more concentrated, Club Med has split its business in the region into two units - Greater China, which covers China, Hong Kong and Taiwan, and East and South Asia Pacific comprising Southeast Asia, Japan, Australia, New Zealand and Korea.

Tan said Club Med, which is mulling a second resort in Malaysia, plans to open new resorts in China and Maldives between now and 2015.

In May, Club Med will open its second Chinese resort at Guilin, a 40-hectare site framed by misty jagged mountains that southern China is famous for.

"There are many more on our radar. Beyond five years, we are looking at Southeast Asia, targeting Indonesia, Vietnam and Cambodia," Tan told Business Times in an interview.

Since 2004, Club Med has sought to move upscale and set up resorts in developing countries.

In June, Club Med reported a 70 per cent increase in its first-half net profit. It gained 17 million euro from November through April, a threefold increase over the same period last year.

Its revenue increased 4.6 per cent to 798 million euro.  The group reported a 10 per cent increase in Asian countries like China, Singapore and South Korea.

However, it remained prudent for the full year, due to uncertain global economic prospects, expecting its profit margin to be in the range of nine per cent.
-ENDS-

Glomac plans more Grade A offices

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 16, 2012

KUALA LUMPUR: Glomac Bhd, a property developer and investment group, aims to build more Grade A office towers in the Klang Valley as part of its expansion, its chief says.

Group managing director and chief executive officer Datuk FD Iskandar Mansor said there is a trend now where multinational companies are moving out of the central business district.

"We anticipate more demand for Grade A office towers. As a developer, if there is demand, we will definitely put up more towers," Iskandar said recently.

Glomac caused a stir in the market in the late 2007 when it sold an A-Grade office tower opposite the Petronas Twin Towers, which was recorded as the highest priced commercial transaction per sq ft in town.

The 40-storey Glomac Tower was sold en bloc to Kuwait Finance House and a private company for a record price of RM1,120 per sq ft or RM577 million. This was the first major en bloc deal for Glomac.

The tower was built by Glomac Al Batha Sdn Bhd on a 0.5ha property, which it acquired for about RM1,000 per sq ft from the Tan family of the Continental Hotel group.

Glomac Al Batha is a 51:49 joint-venture firm between Glomac and Al Batha Group, respectively, one of the largest private business concerns in the United Arab Emirates.

Glomac is currently developing Glomac Damansara, which comprises four high-rise towers - two each for residential and commercial.

While the group has retained one of the office towers for its own use, the second tower with 25 floors was sold to Lembaga Tabung Haji for RM170.73 million in 2009.

Glomac had said that the en-bloc sale to financially strong institutions such as Tabung Haji was part of its strategy to reduce sales risks for new projects.

Sales for residential towers have reached 85 per cent to 90 per cent.

Since its set-up, Glomac has completed properties worth over RM4 billion in total sales value.

From managing just over three projects a year, Glomac now has over 10 ongoing projects including well- received townships Saujana Utama in Sungai Buloh, Saujana Rawang in Rawang and various residential and commercial developments focused in Greater Kuala Lumpur.

Iskandar said Glomac is mulling to build office towers at some of the on-going projects in Greater Kuala Lumpur.

Moving forward, Glomac is entering into a new phase of growth as it is in the midst of launching more than RM1 billion worth of properties per year.

Scomi eyes RM5b Chennai monorail project

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 16, 2012

MID-2013 BID: Company in midst of preparing tender documents

SCOMI Engineering Bhd expects to submit its bid for a RM5 billion monorail project in Chennai, the capital city of Tamil Nadu by mid-2013.

"We are preparing the tender documents for the project. We hope to submit the bid by March or June," said its president (rail) Suhaimi Yaacob.

If the group gets the job, it would be its second major monorail project in India.

In November 2008, Scomi and consortium partner Larsen & Toubro secured a RM1.85 billion monorail project in the financial district of Mumbai.

Scomi's portion of the job is worth RM785 million. Phase 1 of the project is expected to be completed by mid-2013, and Phase 2, six months later.

In Bangalore, Scomi has a joint bidding agreement with Geodesic Techniques Pvt Ltd to bid for a 59km monorail line.

Suhaimi told Business Times during a visit to the group's monorail plant in Rawang Wednesday that it is also planning to bid for two monorail projects that are coming up in Maharashtra in Mumbai.

Besides Chennai and Mumbai, Scomi is eyeing monorail projects in other states in India like Delhi, he said.

In Delhi alone, the Union Urban Development Ministry has asked the government to build 13 to 14 separate monorail lines across the capital city.

"The market for monorail development in India is estimated to be worth US$15 billion (RM45.9 billion) over the next five years. We hope to get a large share of the pie," Suhaimi said.

Scomi is currently one of four integrated suppliers of monorail systems in the world. The others are Canada's Bombardier Inc, Japan's Hitachi and new player, Chongqing of China.

Following the award of the Mumbai monorail project, Scomi has became a well-recognised brand in India and in other parts of the world.

The group's monorail system is high in demand worldwide. The system enables smooth ride quality, energy efficiency, lower operating costs, environmentally friendly transportation needs and futuristic designs.

In 2011, Scomi won a monorail project each in Sao Paulo and Manaus, Brazil, worth a combined RM5.2 billion. The two joint-venture projects are expected to be completed by end-2014 and mid-2015.

Scomi's operation in India also serves Bangladesh and Sri Lanka whose governments have master plans for monorail projects, worth several billions of ringgit.

RM12b Sunway resort city in Johor

By Sharen Kaur

sharen@nstp.com.my

Published in NST on November 14, 2012

2014 LAUNCH : Project in Medini to be a replica of integrated development in Bandar Sunway, Selangor

SUNWAY Bhd's award-winning Sunway Integrated Resort City (SIRC) in Bandar Sunway, Selangor, will be replicated in Johor from 2014, with a RM12 billion gross development value (GDV).

The managing director of Sunway's property development division Ho Hon Sang is bullish on the project due to the large number of foreigners buying properties worth above RM1 million in the state.

Ho told Business Times in an interview that Sunway will offer a wide range of properties when it launches them in phases from 2014.

"The properties would start from RM500,000 to above RM1 million each, catering to the medium- to high-end segments. We will be addressing issues on affordability," Ho said.
Sunway acquired 277ha in Medini Iskandar last year for RM745.3 million, via a joint-venture vehicle with Khazanah Nasional Bhd.

The acquisition is in line with Sunway's strategy to extend its expertise in building and managing integrated cities, as exemplified by its projects in Bandar Sunway, Sunway City Ipoh, Sunway Velocity and Sunway Damansara.

The choice to build in Medini would offer Sunway a window of opportunities. Medini is home to other developments like Legoland Malaysia, Pinewood Iskandar Malaysia Studios, Edu City, Kota Iskandar and the International Financial District.

To extend its interest in the state, Sunway bought a 35.2ha land near Taman Molek in Johor Baru to build apartments, condominiums, semi-detached houses, townhouses and bungalows, with expected GDV of around RM1 billion.

Ho said both the projects in Johor are in the planning stage.
He said the project in Medini, which will be transformed into an integrated development similar to SIRC, is expected to attract foreign interest.

SIRC, which started in 1986, is the only integrated resort city in Malaysia which fully encapsulates the "livability" concept with the presence of six key components - mall, hotel, office, theme park, education institute and medical centre.

"Our flagship project in Johor will be the development near Taman Molek, which we aim to launch by the middle of next year.

We are bullish on the project. There are a lot of international players within the vicinity of Taman Molek, especially foreign banks. We believe there is a market for new houses," Ho said.

Iskandar Malaysia enters the fast lane

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 5, 2012

The chief of Iskandar Investment Bhd (IIB) is bullish on the outlook for Iskandar Malaysia in Johor, attributing his optimism to various projects like the high-speed rail (HSR) plan and the transformation of Desaru.

"Hopefully, it (HSR) can come earlier. Iskandar Malaysia will benefit from the MRT link between JB Sentral and Woodlands in Singapore," said IIB president and chief executive officer Datuk Syed Mohamed Syed Ibrahim.

"The outlook from 2013 onward will be strong within the context of Nusajaya and Iskandar Malaysia. We see some of the current developments coming up and investors will be submitting their plans for new projects," he told Business Times in an interview recently. 

Khazanah Nasional Bhd recently said plans are underway to transform Desaru, starting with Phase 1 that carries a gross development value of RM5 billion. The transformation will be carried out in three phases over 15 to 20 years.

For the HSR, a study to link Kuala Lumpur and Singapore is being carried out by the Land Public Transport Commission (SPAD), which is expected to be completed by year-end. 
If found feasible, SPAD will call for pre-qualification bids by mid-2013.

IIB, set up in 2006, is a strategic developer of catalytic projects in Iskandar Malaysia, the country's special economic zone. 

It is developing four clusters - education, driven by Educity; leisure and tourism, led by LegoLand; healthcare and wellness, with Gleneagles Medini Hospital being the key driver; and creative development, with Pinewood Iskandar Malaysia Studios the catalytic project. 

Syed Mohamed said the catalytic projects will generate substantial multiplier effects, triggering economic activities.

"Without Educity, it would be difficult for any developers to enjoy the current pricing level. For the past 10 years, apartments in Johor were selling at RM300psf but UEM Land (Holdings Bhd) recently launched properties at RM700psqf," he said. 

Syed Mohamed said growth for IIB is on the cards.  By end-2012, the company is expected to ink six to seven new deals, including joint venture and land-lease purchase agreements.

IIB currently has such agreements with China's Qingdao Zhouyuan Investment Holdings, Mah Sing Group Bhd and WCT Bhd to undertake projects worth RM2.5 billion, RM1.1 billion, and RM1.5 billion, respectively.

WCT to embark on fifth Johor project

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 3, 2012

NEW investments and surging property prices in Johor have led WCT Bhd to embark on a fifth project in the state, which will have an estimated gross development value of RM1.5 billion.

WCT, through its subsidiary WCT Acres Sdn Bhd, yesterday signed a 99-year lease purchase agreement with Iskandar Investment Bhd (IIB) for a 7.25ha plot in Medini North in Iskandar Malaysia for RM99.47 million.

The RM1.5 billion mixed commercial project will comprise office spaces, retail components and apartments, to be developed over five years, starting from the third quarter of next year.

"We hope we can go upmarket with this project and attract foreign investors from the neighbouring city state," WCT managing director Taing Kim Hwa said at the exchange of documents with IIB, the master developer of Medini.


WCT's maiden property project in Medini North is called 1Medini Residences, comprising two residential buildings worth RM400 million.

The first block, launched at RM450 per sq ft in January this year, is fully sold. The second block, which was launched at around RM560 psf in April, is about 90 per cent sold.

According to Taing, 40 per cent of the total 644 units were sold to foreigners.

Taing said in the first quarter of next year, WCT will be launching Medini Signature, featuring 456 luxury apartments worth a combined RM400 million, or starting from RM600 psf.

"Property prices have been increasing in Medini. We are excited at the prospects Johor has to offer as well as the future of Medini. We have confidence with developments in Medini which we think will give us reasonable returns," he said.

Taing said the company is currently enjoying profit margins of between 20 and 30 per cent from its projects in Medini North.

The remaining two projects in Johor by WCT are slated for launch next year and in 2014. The projects are located at Jalan Skudai and within the Medini Business District, next to Medini North.

IIB chief executive officer Datuk Syed Mohamed Syed Ibrahim said some RM3 billion investments have come into Medini, with a significant portion contributed by Singapore.

Syed Mohamed said there is also rising interest from the Japanese.

Aeon expansion spree in S-E Asia

By Sharen Kaur

sharen@nstp.com.my

Published in NST in November 2, 2012

Aeon will be investing 30 billion yen (RM1.1 billion) to open its first stores in Vietnam, Indonesia and Cambodia by 2014.

Japan’s top supermarket operator Aeon Co Ltd will spend 300 billion yen (RM11.4 billion) to open 45 new stores in Southeast Asia by 2020, in addition to the 15 billion yen (RM572 million) to buy the Malaysian operations of France-based grocer Carrefour SA.

Aeon’s Asean business chief executive officer Nagahisa Oyama said the group will be investing 30 billion yen (RM1.1 billion) to open its first stores in Vietnam, Indonesia and Cambodia by
2014.

The 300 billion yen investment will be in stages and it will include renovating and rejuvenating the existing 55 Aeon stores and Carrefour hypermarkets under Aeon (Japan).

Aeon yesterday completed the acquisition of Magnificient Diagraph Sdn Bhd (MD), which owns Malaysia’s Carrefour hypermarkets.

MD will be renamed Aeon Big (M) Sdn Bhd and it will come under the purview of the Japanese company. The hypermarkets will be branded as Aeon BIG.

“For Aeon, the acquisition of Carrefour Malaysia provides the group with the opportunity to expand its existing roots in Malaysia and further develop its Asean operations,” Oyama said.

“We decided to explore growth opportunities in new areas in Southeast Asia as part of our expansion as we have full confidence that there is a growth market here,” he said at a media briefing yesterday.

Aeon is the third largest retailer here with 29 stores and its regional headquarters is based in Malaysia. As at end-2011, the stores generated RM2.6 billion in net retail revenue.

Carrefour Malaysia, meanwhile, is the fourth biggest retailer with 26 stores that generated sales of ?400 million (RM1.6 billion) in the 12 months to June 30 2012.

The acquisition of Carrefour Malaysia gives Aeon a spot as the country’s second largest retail group by sales.

However, Carrefour Malaysia is loss-making as it registered a net loss of RM81 milllion in 2011 from RM2.9 million in 2010 due to rising overheads.

“I believe the performance of Carrefour Malaysia can be turned around. The reason for the poor business in the past was because the management didn’t invest properly.

“We are drafting a three-year growth strategy that includes the opening of new stores and investing in existing outlets. We have no plans to shut down any stores. Instead, we will be pumping in money to uplift the business,” Oyama said.

On operating profits, Aeon is forecasting to achieve 15 billion yen to 17 billion yen (RM572 million to RM648 million) for its Asean operations this year, majority of which will come from Malaysia.

The group operates in Thailand, the Philippines, Vietnam, Indonesia and Cambodia mainly as a credit service provider.

Lido Boulevard work starts, first launch in 2013

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 2, 2012

KUALA LUMPUR: Work on the Lido Boulevard project in Johor worth over RM4 billion has started with Lido Residences being the first component to be launched.

Central Malaysian Properties Sdn Bhd (CMP) chief executive officer Khoo Boo Teng said mitigation works at the project site started in July, and would be completed in the next two months.

Khoo said CMP is planning to launch Lido Residences by early next year and it is upbeat on sales.

Lido Residences comprises eight blocks of 18-26 storey condominiums with 908 fully furnished units, ranging from 2,459 sq ft to 9,089 sq ft. The units are priced over RM2 million each, or around RM1,300 per square foot.

"We are targeting foreign markets like Asean and Europe. We have a lot of enquiries and are confident of launching it next year," Khoo told Business Times.

Overlooking the Straits of Johor, the 50ha Lido Boulevard is an integrated residential and commercial development that spans 2.4km along the Tebrau Straits coastal line.

The project is located within the Iskandar region and nearby Johor Baru's Central Business District, the Customs, Immigration & Quarantine (CIQ) complex, Johor Baru's railway station and the Johor Baru-Singapore Causeway.

Lido Boulevard is one of the biggest privately-financed initiatives in Iskandar. The project is a joint venture between CMP and the Johor state government, the landowner.

CMP is a private property developer majority-controlled by Berjaya Group's Tan Sri Vincent Tan Chee Yioun.

Besides Lido Residences, the project will feature serviced residences/hotel, office suites, a mall, an art and cultural centre and The Gardens.

Lido Boulevard was introduced in 2007 and was approved by over 30 departments and agencies and the Malaysia-Singapore joint-committee on the environment.

The detailed Environment Impact Assessment studies were approved in May 2008 and the Environmental Management Plan in March 2009.

The project was said to be abandoned after a portion of the land, which had been reclaimed, caved in, resulting in loss of a life, in November 2010.

Khoo said mitigation works are being carried out in accordance with the environmental guidelines. The works involve rigging out the sea area it will reclaim with sheet piles to prevent waste and debris from getting into the straits.

"Work at the project site is focused on putting in place all prescribed environmental mitigation work measures to ensure full compliance with our Environmental Management Plan," he added.

Gapurna sees gain from HK property measures

By Sharen Kaur
sharen@nstp.com.my
Published in NST on November 1, 2012

GAPURNA Sdn Bhd, a private real-estate company, sees the recent property cooling measures in Hong Kong working in favour of the company.

Group managing director Datuk Mohamad Salim Fateh Din believes the measures introduced by the Hong Kong government would help the company gain more business from multinational corporations (MNCs).

This is because the latest property measures are likely to make some MNCs relocate their businesses because of cost factors.

Hong Kong introduced its third set of measures in two months last week, requiring foreign property buyers to pay 15 per cent tax. There was also a hike in stamp duty for properties sold within three years of purchase.

Mohamad Salim said as a property developer and investor, Gapurna would ride on the opportunities available.

"We design and build custom-made buildings for MNCs and lease it to them for long term. This is our business model and we have been doing it for many years, giving us reasonable recurring income," he said after sealing a deal with Scope International (M) Sdn Bhd yesterday to build a nine-storey block at Technology Park Malaysia in Bukit Jalil.

He said the company is close to inking several agreements with MNCs to occupy the purpose-built office towers at its PJ Sentral Garden City development in Petaling Jaya.

PJ Sentral is a project by Nusa Gapurna Development Sdn Bhd (NGDSB), in which Mohamad Salim and several of his associates have a 60 per cent stake.

The project, which will commence next year, comprises several phases. Under Phase One, NGDSB will construct five purpose-built office towers with an expected gross development value (GDV) of RM2.6 billion.

On Scope International, Mohamad Salim said Gapurna will take 12 months to construct the 450,000 sq ft building via bank borrowings, and lease it to the company for 14-years.

Scope International, also known as Global Shared Services Centre, is a subsidiary of Standard Chartered Bank plc.

Gapurna is currently constructing a 38-storey building at the KL Sentral transport hub in Brickfields, Kuala Lumpur, for Shell People Services Asia Sdn Bhd.

Shell will move into the building, which has a GDV of RM1.1 billion, next year, under a 15-year lease.

"We sign long-term lease with MNCs to help us recoup our investments. We are achieving good yield for all our properties at a range of 5.5 per cent to 6.5 per cent, and we are comfortable with that," said Gapurna director Imran Salim.

Meanwhile, Mohamad Salim, who is also the major shareholder of NGDSB, says talks are still ongoing for the company to take a stake in Malaysian Resources Corp Bhd (MRCB), a property and infrastructure group. "We hope to make an announcement on this soon," he said.

NDGSB is 60 per cent controlled by Mohamad Salim and his associates, and 40 per cent by the Employees Provident Fund, which holds a 42.2 per cent stake in MRCB, the developer of KL Sentral, an integrated transport hub with a gross development value of over RM8 billion.