Naza banks on TTDI Gateway to drive sales

By Sharen Kaur
Published in NST on April 29, 2014

SHAH ALAM: Naza TTDI Sdn Bhd is banking on TTDI Gateway, its RM2.5 billion business lifestyle hub in Section 13 here, to drive property sales this year.

The property arm of Naza Group is targeting RM1.5 billion in sales this year from all its ongoing projects.

Naza TTDI is developing, among others, the iconic RM20 billion KL Metropolis in Jalan Duta and the RM4 billion Platinum Park in Kuala Lumpur.

TTDI Gateway is a 15.5ha integrated development comprising offices, serviced apartments and retail components.

Naza TTDI deputy executive chairman and group managing director SM Faliq SM Nasimuddin said the project will be developed over three phases and slated to complete by 2020.

Speaking at the unveiling of TTDI Gateway development master plan, here, yesterday, he said the project is earmarked to transform the Shah Alam city into a more vibrant lifestyle hub.

The first phase of the project, the TTDI Sentralis business suites and retail units, was launched late last year. 

According to Faliq, the retail units have been sold out while the take-up rate for the business suites is about 70 per cent. 

He said the upcoming phase will see the launch of the TTDI Sentralis serviced apartments in the third quarter, as well as retail and offices for Phase 2.

“The development was planned in line with the city’s goal to create a clean, beautiful, vibrant and safe city,” he said.

Faliq said another proposition TTDI Gateway has to offer is its value. There will be three major retail components featuring an existing hypermarket, a home improvement store and a retail mall that will position TTDI Gateway as one of the shopping attractions in the Klang Valley.

Naza TTDI group managing director SM Faliq SM Nasimuddin (left) and Naza TTDI chairman SM Nasarudin SM Nasimuddin at the unveiling of TTDI Gateway development master plan yesterday.

MAHB plans catalytic projects at KLIA Aeropolis

By Sharen Kaur
Published in NST on April 30, 2014

DIVERSIFIED AIRPORT CITY: Mega development includes cargo and logistics hub, commercial business district, a theme park

MALAYSIA Airports Holdings Bhd (MAHB) is planning catalytic projects at KLIA Aeropolis here, which will spur domestic and foreign investments in the multi-billion ringgit development.

More than 2,428ha of the 8,966ha KLIA Aeropolis has been developed, while the undeveloped area is planted with oil palm trees.

The development is located about six kilometers from the Kuala Lumpur International Airport (KLIA) and the Kuala Lumpur International Airport 2 (klia2).

MAHB senior general manager of planning, Mohd Khair Mirza, said several catalytic projects are at planning stages, including a cargo and logistics hub, a commercial business district and a theme park.

“KLIA Aeropolis is a mega development and we have interested parties who want to invest in it. We are talking to them,” he said on the sidelines of the ground-breaking of Mitsui Outlet Park KLIA, here, yesterday.

Mohd Khair had earlier said about 1,000ha has been reserved for the theme park and the size suits Disneyland, whose operator is looking for a site to expand in this region.

KLIA Aeropolis will also feature a free commercial zone, a centre for meetings, incentives, conventions and exhibitions, hotels, natural conservation and green tourism zones, which will be completed within the next five to 10 years.

Mohd Khair said KLIA Aeropolis, when completed, will help increase MAHB’s non-aeronautical revenue and net profit contribution to between 60 per cent and 70 per cent. 

Currently, non-aeronautical businesses contribute more than 50 per cent to the national airport operator’s revenue and net profit.

For fiscal year 2013, MAHB, which manages 39 airports in Malaysia and overseas, posted a net profit of RM388.93 million on revenue of RM4.09 billion.

MAHB chairman Tan Sri Dr Wan Abdul Aziz Wan Abdullah said that KLIA Aeropolis will spark growth for the company, KLIA, klia2, retailers and aviation companies.

“Our vision is to transform KLIA into a diversified airport city with significant business, tourism and employment opportunities,” he said.

He added the encouraging growth in passenger movements augurs well for the KLIA Aeropolis vision, whose critical returns, among others,  is the opportunity to expand the group’s non-aeronautical base, in line with its 2010-2014 business direction.

Eco World's explosive growth

By Sharen Kaur

TOP 20 DEVELOPER: Company to own 1,793ha generating RM43.53b in GDV, following corporate exercise

ECO World Development Group Bhd will emerge as among the country's top 20 developers, with 1,793ha land generating RM43.53 billion in gross development value (GDV), following a corporate exercise.

    The company, which is controlled by former executives of SP Setia Bhd, announced a corporate exercise yesterday that comprises two components - proposed acquisition and proposed funding.

   Its president and chief executive officer Datuk Chang Khim Wah said the exercise would conclude in October and help to raise the company's market capitalisation to about RM3 billion.

    Eco World currently has 536ha with a GDV of RM13.49 billion, and three projects in hand.

     Eco World is proposing to acquire the development rights to eight projects, with a combined GDV of RM30 billion, from the subsidiaries of Eco World Development Sdn Bhd.

     It also plans to acquire two units from Eco World Development, namely Eco World Project Management Sdn Bhd and Eco Macalister Development Sdn Bhd, which owns an investment property in Penang.

    Chang said the net consideration for the eight projects was RM1.77 billion.

    It is understood that the market value of the land for the eight projects, which totals more than 1,200ha, is RM3.78 billion.

    Eco World plans to issue 806.84 million new shares to raise RM1.37 billion and a rights issue to raise RM788 million to fund the acquisitions and as working capital for its development activities.

    It is also proposing a subscription of shares in Eco World by shareholders of Eco World Development.

   Chang said following the completion of this exercise, Eco World will become a property player for all sectors.

    "We will have affordable homes, semi-detached and terraced houses, bungalows, high-rise residences, townships, commercial centres, and business and industrial parks," he said at a media briefing here, yesterday.

    Chang also said the corporate exercise would not affect the company's performance in the financial year ending October 31.

     "This exercise will allow us to achieve explosive growth for the next eight to 10 years as we integrate all the development projects of the unlisted entity into the listed company," he said.
 

Proton eyes China production

By Sharen Kaur from Beijing

DRIVEN BY LOTUS' SUCCESS: National carmaker exploring partnerships

PROTON Holdings Bhd is looking at manufacturing cars in China, riding on the success and future growth of  the Lotus marque in the region, says former Prime Minister Tun Dr Mahathir Mohamad.

  Dr Mahathir, who is Proton adviser, said the company is looking at partnerships in China to start producing the cars soon.

  Proton has been in China since 2007, under a strategic partnership with Youngman Automobile Group, where it receives royalties from the Chinese company in exchange for the usage of its engines.

  Proton,  a wholly-owned subsidiary of DRB-HICOM Bhd, owns 100 per cent of Norfolk-based Group Lotus Plc which sold about 150 cars last year in China.

  "The presence of Lotus in China will contribute to developing Proton in the Chinese market. However, to enter the Chinese market, we need to manufacture the cars in China and that will involve huge capital investments. We are looking at partnerships," Dr Mahathir  he said, after opening the first Lotus 4S (sales, service, spare parts and system) centre, here, on Tuesday.

  Present were DRB-HICOM controlling shareholder Tan Sri Syed Mokhtar  Albukhary, DRB-HICOM group managing director and Proton chairman Tan Sri Khamil Jamil, Lotus chief operating officer Aslam Farikullah, Proton covering chief executive officer Datuk Abdul Harith Abdullah, wife of the Malaysian Ambassador to China Datin Rahmah Mohd Lajis and vice-president of Chinese People's Institute of Foreign Affairs, Ambassador Peng Keyu.

  Aslam said that Lotus, which has eight dealerships across China, aims to sell 200 units this year.

  He said the 4S centre, which houses four floors at the Golden Port Motor Park, here, will help Lotus achieve its sales target this year.

  Globally, Lotus is targeting to sell 2,500 cars.

  "We are expanding in China, which has the world's largest automotive market, and huge demand for expensive and high performance cars. We are targeting people who enjoy fast cars.

  "The 4S centre is the starting point for us in China. We will also set up a driving academy here to allow people to test drive the cars first," he told reporters, adding that the investment for the centre, including the setting up of another facility in Beijing, is US$17 million (RM56 million).

  Aslam said the centre will also offer a complete Lotus experience with a showroom that provides comprehensive services.

  "We have been receiving positive demand for Lotus cars in China, hence there is a need for Lotus to position itself strategically and it is only fitting that these valued customers are able to enjoy the level of services and comforts that befit the brand's iconic status," Aslam said.

  Lotus sells the Evora S IPS, Exige S240, Exige S260 and the Elise CR in China, and there are plans to launch new models this year, he said.

Asean car among plans discussed at meeting

By Sharen Kaur
Reporting from Beijing

STRENGTHENING BILATERAL TIES: Malaysia keen to work with China

 MALAYSIA is discussing several proposals with China, including a plan to develop an Asean car, to deepen bilateral ties between the two nations.

  Two meetings were held on Monday at the Great Hall of the People here between former prime minister Tun Dr Mahathir Mohamad and Chinese Vice-President Li Yuanchao.

  Accompanying Dr Mahathir was Country Heights Holdings Bhd founder Tan Sri Lee Kim Yew, Malaysian Ambassador to China Datuk Iskandar Sarudin, Asian Strategy and Leadership Institute chief executive officer and World Chinese Economic Forum chairman Tan Sri Michael Yeoh.

  Yeoh said Malaysia is interested in forming a joint venture with a Chinese carmaker to develop the Asean car.

  Business Times reported last year that national car manufacturer Proton Holdings Bhd is expected to be a key driver of the Asean car development plan.

  Dr Mahathir, who is Proton adviser, also talked about the Lotus 4S centre here.  Proton, a subsidiary of DRB-HICOM Bhd, opened the Lotus 4S centre  on Tuesday in a bid to improve sales of Lotus cars and spare parts in the Chinese market.

  According to Lee,  Dr Mahathir and Li also discussed the rubber city project in the Thai-Malaysian border, and the setting-up of the Zheng Ho Multicultural and Economic Association (ZHMEA).

  He said a key development during the discussion was the go-ahead to set up ZHMEA, an idea mooted by Dr Mahathir.

  Lee, who is chairman of ZHMEA, said the association will strengthen ties between Malaysia and China, and other countries in the Asia Pacific.

  “The setting-up of ZHMEA is  timely and important. It will help  create new economies for both  countries and generate billions of  dollars in  new investments.

  “We expect ZHMEA to also encourage budding entrepreneurs to come into the market with new ideas and businesses,” Lee told Business Times, here, on Monday.

    Lee said ZHMEA is in line with Chinese President Xi Jinping’s Maritime Silk Road Initiative to boost connectivity between the Asia-Pacific   and  Indian Ocean regions.

  “We expect ZHMEA to be formed in Malaysia in the third or fourth quarter of this year,”  he added.
 

KSK taps Kempinski for Conlay project in KL

By Sharen Kaur
Published in NST on April 16, 2014

KUALA LUMPUR: KSK Group Bhd will bring Europe's oldest luxury hotel outfit, Kempinski, to its RM4 billion Jalan Conlay project, here, adding another opulent accommodation to the city, said sources.

    Formerly known as Kurnia Asia Bhd, the group is developing a mixed-use project on a 1.6ha site in Jalan Conlay, next to Prince Hotel & Residence.

    KSK acquired the land for RM568 million from Suasana Simfoni Sdn Bhd in a deal that was completed last month.

    The project will be developed by its subsidiary, KSK Land Sdn Bhd, and  will feature three towers and a 200,000 sq ft retail podium.

   The sources said the tallest tower is 60-storey high and will house the five-star hotel and serviced apartments, which are expected to be managed by Kempinski.

    The other two blocks, standing at 50 and 55 storeys each, will comprise luxury condominiums.

     According to the sources, KSK had considered either Kempinski and Nevada-based gaming and hospitality company, MGM Resorts International, to manage the hotel and serviced residences.

     Kempinski is an international hotel chain founded in Berlin, Germany, in 1897.

     It is majority controlled by Thailand's Crown Property Bureau, a Royal Thailand authority responsible for administering the properties of the Royal House of Thailand.

    Kempinski operates around 80 historic grand hotels, city hotels, resorts and residences in 30 countries in Europe, the Middle East, Africa and Asia.

    KSK Land  will develop the Conlay project starting year-end. The project is slated to be completed by 2020.

     "KSK Land will also launch the condominiums by year-end. No price is fixed yet, but it will surely be above RM2,500 per sq ft.

    "There will be competition from Banyan Tree residences and Harrods Hotel, which are also under construction in Jalan Conlay.  KSK Land, however, is bullish on property sales and is targeting 50 per cent local investors," the sources said.

      The KSK group is expected to use part of the RM1.63 billion obtained from the sale of its core insurance business, Kurnia Insurans (M) Bhd, to AmG Insurance Bhd in September 2012, to fund the project's initial stage.

     The group, which currently focuses on growing its two general insurance operations in Indonesia and Thailand,  ventured into property development last year.

Petronas - Maximising O&G output

By Sharen Kaur
Published in NST on April 14, 2014

INCREASING ENERGY SUPPLIES: Petronas looks to deepwater projects, risk service contracts and unconventional gas sources

PETROLIAM Nasional Bhd (Petronas) is focusing on deepwater projects, risk service contracts (RSC) and unconventional gas sources internationally to increase energy supplies and earnings.

The national oil company believes that there is still upside potential in every aspect of the oil and gas industry in Malaysia and overseas.

“We are looking at marginal oil fields internationally, such as in the Middle East, central Asia, South Africa, the United States and Russia,” Petronas director Tan Sri Megat Najmuddin Megat Khas told Business Times.

Vestigo Petroleum Sdn Bhd, a unit of Petronas Carigali Sdn Bhd, has been set up to focus on development and production in small, marginal and mature fields in Malaysia and abroad.

Petronas has 107 marginal oil fields, mostly in Peninsular Malaysia and Sarawak.

Each oil field has reserves of 30 million barrels of oil equivalent (BOE) and is governed by RSC.

With crude oil trading at around US$100 (RM324) per barrel, these marginal fields hold US$58 billion worth of oil.

“For unconventional gas sources, we are looking at Canada, Australia and others.”

Petronas’ capital expenditure (capex) for the next five to six years is around RM200 billion.

There will be allocation for the Refinery and Petrochemical Integrated Development (Rapid) in Pengerang, Johor, upstream (exploration and production) and downstream activities.

“I estimate the capex for downstream activities to be RM40 billion as we need to refurbish some old plants and lay new pipelines,” said Megat Najmuddin.

He said Petronas is doing well and will continue to churn out high revenues and profits.

“We have good governance and management structures.”

In the financial year ended December 31 2013, Petronas’ revenue rose nine per cent to RM317.3 billion from RM291.23 billion in fiscal year 2012.

Its profit after tax was up 13 per cent to RM65.58 billion from RM59.52 billion as total production rose 5.8 per cent to 2.13 million barrels of oil per day.

Total assets increased to RM528.7 billion from RM489.2 billion in 2012, helped by higher profit generated in the year.

On its exploration and production operations, Petronas reported that total production volume in fiscal year 2013 was 2,127,000 BOE compared with 2,010,000 BOE in 2012.

Crude oil and condensates production volume was higher by 6.8 per cent, mainly due to production resumption in South Sudan, coupled with new fields in Malaysia and Iraq.

Natural gas production volume was higher by 5.3 per cent compared with the same period last year, mainly contributed by new producing fields in Malaysia and additional production from Canada.

‘No concrete plan for Mutiara Beach Resort’

By Sharen Kaur
Published in NST on April 14, 2014

25-YEAR-OLD PROPERTY: Tradewinds focusing on mega projects in Langkawi, KL

TRADEWINDS Corp Bhd, may only look at redevelopment plans for Mutiara Beach Resort in Penang next year, said a key official.

“We have too much on our plate to start planning now, with two major ongoing projects in Langkawi and the large developments in Kuala Lumpur. We are focusing on these mega projects,” the official said.

According to him, the Penang resort project has not reached the drawing board and there is no concrete plan as to what the company may want to do there. 

“Of course, the best thing is to have more rooms so that there will be a good return on investment. Whether we sell the property or not would depend on the market situation and the offers,” he said.

The 25-year-old property, which is located on 4.05ha in Jalan Teluk Bahang, has been closed since 2006.  There were earlier plans to renovate and rebrand the property as InterContinental Resort Penang.

However, both Tradewinds and InterContinental mutually terminated the management contract in early 2009.

Tradewinds, which owns eight hotels and resorts, is developing the RM4 billion Perdana Quay and the Burau in Langkawi for RM420 million.

In Kuala Lumpur, Tradewinds' existing projects include the upgrading of Menara Tun Razak and the development of Tradewinds Centre in Jalan Sultan Ismail, both of which are projected to cost more than RM4 billion.

The group is demolishing the 40-year-old Crowne Plaza Mutiara Hotel and 33-year-old Kompleks Antarabangsa to make way for the Tradewinds Centre, which has an estimated gross development value of more than RM7 billion.

Tradewinds has said it will redevelop the 2.8ha site on its own over seven years.

The project will comprise a 65-floor skyscraper and 54-storey bloc of residences, Grade A+ offices, a 24-storey corporate block, a large-scale 14-storey medical centre, retail offices, serviced apartments and hotel.

At Menara Tun Razak, Tradewinds is upgrading the 35-storey office tower and constructing a new 40-storey office tower adjacent to it.

“Tradewinds’ financial results will improve tremendously from next year as property sales from some of the projects start to kick in,” the official said.

Its last financial results for the six months ended June 30, 2013, showed that it made RM75.44 million in net profit from RM474.57 million in revenue.  Its total assets stood at RM3.6 billion.

The 25-year-old Mutiara Beach Resort in Penang has been closed since 2006.

Majuperak looking to diversify income streams

By Sharen Kaur
Published in NST on April 15, 2014

EXPANSION: Firm eyes ventures, such as in energy sector, that can provide good returns

 MAJUPERAK Holdings Bhd, which is involved in the manufacture of bamboo-based products, is looking to venture into the energy sector so as to become a larger and more profitable entity.

Majuperak, which is majority controlled by Perbadanan Kemajuan Negeri Perak (PKNP), a state incorporated body under the Perak State Development Corp, is involved in property development, renewable energy and palm oil plantation.

The company posted a pre-tax loss of RM2.61 million in fiscal year 2013 compared with a net profit of RM3.7 million in 2012, mainly because of a big fall in revenue.

Majuperak’s revenue in the same period was RM10.22 million, almost three times less than the RM32.11 million achieved the year before.

Its revenue last year was mainly derived from land sale in Manjung and Manong, Perak, amounting to RM3.28 million, and property income in Langkap, Tanjung Tualang, Ipoh and Batu Gajah (all in Perak).

Its chairman Tan Sri Megat Najmuddin Megat Khas said Majuperak is looking at new businesses that are able to provide good returns.

These include alternative energy, mini-hydro power plants and solar power, he said.

“We are looking at the energy sector, but in a small way first, to test the waters. We are currently building a solar farm in Perak. We expect it to be operational by the middle of this year. Once it starts operating, we will expand our interest in this sector, albeit cautiously,” he said.

He said moving forward, Majuperak will not only focus on property development but other potential profitable businesses as well.

Majuperak has a few joint-venture (JV) projects, which are expected to contribute to the company’s earnings starting this year.

They include its RM800 million property development with Xtreme New Sdn Bhd.

Based on the supplemental agreement inked last February between the JV partners, Majuperak will receive RM37 million in cash and RM8 million in property assets from the project.

For its bamboo business, the company has a concession to extract bamboo from Hutan Simpan Hijau in Hulu Perak. Its factory is located at the Bandariang Industrial Area in Gerik.

The initial cost for the project is RM7.5 million, and together with its partner Tetap Murni Sdn Bhd, they will produce bamboo products such as toothpicks, skewers, chopsticks, blinds, bio char, pulp and activated carbon.

“We are re-aligning things in Majuperak. I am very confident that the company will perform better,” he said.

For future funding of projects, he said the company will look at all fund-raising options.

Majuperak chairman Tan Sri Megat Najmuddin Megat Khas says the company is looking at the energy sector, but in a small way first, to test the waters.

TREC set to make its mark

By Sharen Kaur
Published in NST on April 14, 2014

NEW CONCEPT: Avant City plans international tenant mix for RM400m entertainment hub

THE RM400 million TREC entertainment hub here will change the city's night life, and provide a boost to the tourism sector and local economy.

Developed by Avant City Sdn Bhd, TREC will open in the third quarter of next year and would be comparable to Singapore's Clark Quay, Hong Kong's LanKwai Fong and Shanghai's Xin TianDi. It will be developed on a 2.83ha site at the Royal Selangor Golf Club (RSGC).

                   Electric Boulevard - set to be one of the world’s most exciting night-time destinations

                                              TREC’s ground-breaking concept and design

It will feature front-row views over the spectacular greens of the golf course in Jalan Tun Razak and sit directly opposite the billion-ringgit Tun Razak Exchange. 

                                                        Dining with a view of the golf course

Avanti City, which is owned by Daman Land Sdn Bhd (35 per cent), Modern Falcon Sdn Bhd (35 per cent) and Berjaya Assets Bhd (30 per cent), has leased the land for 30 years.

The coming together of these companies will ensure that TREC is sustainable, and it would provide a new destination for local and international clubbing and dining enthusiasts.

Daman Land is controlled by Datuk Douglas Cheng and his father Tan Sri David Cheng. They own several outlets and clubs, including the Dragon-i and Canton-i Chinese restaurants.

Modern Falcon is run by Cher Ng, the co-founder of Zouk KL, and his business partners. Berjaya Assets is the developer of Berjaya Times Square in Jalan Imbi, here.

"The idea for TREC came from Ng, who had to relocate Zouk KL from its present location in Jalan Ampang. We saw the piece of land at the golf course and decided to set up TREC there.

"The project will cost RM152 million and funded via equity by the three parties," the younger Cheng told Business Times.

TREC, comprising five unique zones, will have a net lettable area of 256,000 sq ft and the anchor will be the new Zouk KL.

"We are talking to club owners in the United Kingdom and restaurant operators in Indonesia, Thailand and Singapore to lease the space for between RM10 and RM12 per sq ft.

"We want a good tenant mix for TREC. We are looking for new concepts and don't want what is already in Kuala Lumpur. I am very bullish TREC will be fully taken up before its opening next year," he said.

Majuperak eyeing Perak Corp?

By Sharen Kaur
Published in NST on April 11, 2014

 MAJUPERAK Holdings Bhd may buy over Perak Corp Bhd after it is taken private by shareholder Perbadanan Kemajuan Negeri Perak (PKNP), sources said.

PKNP, a state-incorporated body under the Perak State Development Corp, intends to privatise Perak Corp via a selective capital reduction and repayment totalling RM183 million, or RM3.90 per share.

PKNP owns 52.27 million shares, or a 52.27 per cent stake, in Perak Corp.

Perak Corp received the proposal from PKNP and three other shareholders to undertake the corporate exercise about three months ago.

The three are Fast Continent Sdn Bhd, Cherry Blossom Sdn Bhd and Perak Equity Sdn Bhd, which together own 0.63 per cent, or 627,150, of Perak Corp shares.

The sources said Majuperak is interested in Perak Corp because of its infrastructure and township-development capabilities, which gel with its expansion strategy.

Perak Corp also owns a 15.73 per cent indirect stake in Integrax Bhd, a company which has valuable and income-generating assets with huge potential, such as Lumut Port.

In fiscal year 2012, port operations contributed RM33.87 million in pre-tax profit to Perak Corp - about 45 per cent of its total earnings.

"Perak Corp is a fast-growing company and if PKNP is willing to sell, Majuperak may consider buying it with shareholders' approval But they are not discussing this matter as yet," said the sources.

Majuperak is involved in property development, renewable energy, manufacturing of bamboo products and oil palm plantations.

Its chairman Tan Sri Megat Najmuddin Megat Khas is not ruling out a move for Perak Corp.

"Maybe we can make it our subsidiary. But it depends on whether PKNP is willing to sell. There are a lot of options on how we can work with Perak Corp as we have common shareholders," he told Business Times.

Datuk Aminuddin Md Desa, who joined Perak Corp as chief executive officer (CE0) last February, is Majuperak's non-executive director.

He is also CEO of PKNP, which holds a majority stake in Majuperak.

Not enough hotel rooms in Langkawi, say airlines

By Sharen Kaur

KUALA LUMPUR: AIRLINES are hoping that the number of hotel rooms on Pulau Langkawi can be doubled so that they could expand by offering more direct flights to the resort island.

"The airlines are targeting seasonal air travellers from Europe, the Middle East and Asia Pacific, including China and India," said industry players.

Currently, there are about 8,000 hotel rooms in Langkawi, but during peak seasons, the demand for rooms drastically outnumbers the supply.

"There is a lack of hotel rooms to meet an influx of tourists and this has caused airlines to promote Bali, Krabi and Phuket instead of Langkawi," the sources said.

Kedah Menteri Besar Datuk Ser Mukhriz Mahathir said recently the state government was intensifying efforts to lure more investments to Langkawi.

He said the room occupancy rate in Langkawi was very high and at times, the island had 20,000 tourists but far fewer rooms to accommodate them.

"We have spoken to several airlines to offer direct flights to Langkawi but they said we must first increase the number of hotels to accommodate a larger number of tourist arrivals," he said.

There are more than 10 airlines offering flights to Langkawi, including Malaysia Airlines, AirAsia, Firely, Tiger Air and Silkair.

The sources said more rooms need to be built in line with Malaysia's ambitious plan to make Langkawi one of the top 10 tourist islands in the world by next year.

The government is aiming to attract RM5 billion in private sector investments.

Tourism-based projects worth more than RM7 billion have been started on the island, comprising properties of every standard, such as from simple homestays to posh resorts.

All the brands mirror what is being profiled in the Langkawi tourism blueprint, which aims to promote the island an international eco-tourism destination.

They include Paramount Resort Langkawi by Paramount Hotels & Resorts, the official licensee of Paramount Licensing Inc.

The resort comprises more than 200 floating chalets, villas and homes.

Rahsia Estates Sdn Bhd is constructing Rahsia Estates Resort Residences, Eco-Hotel and Spa.

The RM480 million project will finish by end-2016 and will feature a 116-room five-star hotel, 30 luxury cabana villas and 130 resort suites.

Other developments include Ritz Carlton Langkawi, Paradise Island Hotel & Gardens and St Regis Langkawi.

The biggest project on the island is the RM4 billion Perdana Quay development by Tradewinds Corp Bhd, touted as a more nature-oriented alternative to Indonesia's Bali and Phuket in Thailand.

Perdana Quay involves the development of 105ha at Pantai Kok-Teluk Burau over six phases and spanning over 10 years.

It will feature a posh resort called The Burau, as well as apartments and villas, among other things.

The Burau, which is expected to be completed by end-2017, consists of 245 deluxe rooms and 60 high-end villas, including 26 ultra-luxurious villas on Pulau Anak Burau.

Eversendai founder ups stake in company

By Sharen Kaur
Published in NST on April 9, 2014

KUALA LUMPUR: Tan Sri A.K. Nathan, founder and group managing director of Eversendai Corp Bhd, is raising his stake in the company on its future prospects and to give confidence to investors.

Nathan owns 70.95 per cent of Eversendai, an integrated structural steel turnkey and power plant contractor.
According to Bursa Malaysia filings, he has been actively accumulating shares in small numbers since March last year.
The last transaction was on Monday, when he acquired 130,000 shares at RM1.05 apiece, or RM136,746.
“I believe in Eversendai and I know the actual worth of the company. If the market is not able to rationalise, then I have to buy. I am buying only small stakes and not big quantities,” he told Business Times in a recent interview.
Analysts are advising investors to hold their position in the company.
Their median target price for Eversendai is RM1.15, with a high estimate of RM1.90.
For fiscal year 2013, Eversendai’s net profit fell to RM30.99 million from RM115.32 million in 2012, while turnover also dropped to RM965.05 million from RM1.02 billion previously.
The near completion of significant projects and the initial stages of new ones, as well as impairment loss on its investment in associated companies, resulted in lower earnings for the company.
Nathan said Eversendai’s current order book of RM1.1 billion will reflect better in the current year’s earnings. He is bullish that the company will achieve its RM2 billion revenue target by 2017.
“The outlook and future of Eversendai is promising and the numbers (revenue and net profit) will keep improving as the company progresses.” Despite lower earnings last year, the company
increased its cash reserves by 32.77 per cent, or RM35.01 million.
Cash flow from financing totalled RM245.2 million, or 25.4 per cent, of revenues. In addition, the company generated RM38.42 million in cash from its operations.

RM3.5b Oxley Towers to transform KL skyline

By Sharen Kaur
Published in NST on April 8, 2014

PRIME LOCATION: Developer plans 2 six-star hotels, serviced apartments, retail mall and customised offices

SINGAPORE-listed Oxley Holdings Ltd is planning a RM3.5 billion first-of-its-kind mixed-use project here called Oxley Towers.
  Oxley Towers will feature two six-star hotels as well as posh serviced apartments, a niche retail mall and multimedia super corridor (MSC)-status custom-built offices, sources said.
  The project is located on a 1.4ha freehold tract near the Petronas Twin Towers.
  The land was acquired by Oxley for around RM450 million, or a record RM3,300 per sq ft, last November.
  The project will be carried out by its subsidiary Oxley Holdings (Malaysia) Sdn Bhd, which is headed by its new chief executive officer Datuk Othman Omar.
  The sources said the project has received the approval to begin development and the launch will take place in the third or fourth quarter of this year.
  According to them, the gross development cost for the project will be around RM1 billion to RM1.5 billion.
  The sources said Oxley Malaysia will appoint international operators from either Japan or the United States  to run the mall.
  For the two hotels, the company will seek international operators from the United States and the Middle East, who will operate in Malaysia for the first time, the sources added.
  “Oxley Malaysia plans to retain the two hotels and mall for recurring income. But if there is a good offer from the operators, the company will not hesitate to sell,” one of the sources said.
  The serviced apartments and the offices will be marketed worldwide.
Oxley Malaysia aims to sell  70 per cent of the properties to foreign buyers and the rest to locals, the source said.
  The source added that the project has generated strong interest from investors in Singapore, the United States, China and the Middle East.
  “The average launch price for the serviced apartments will be around RM3,000 per sq ft. The company is bullish on sales thanks to its location and unique building and development structure.
  “Oxley Malaysia is talking to interested parties from the Middle East, China and the United States, to help finance the project.
“That may also  include other developments in Malaysia in the future,” the sources said.
  Oxley Malaysia has eight projects in Malaysia with total estimated gross development value (GDV) of RM10 billion.
  Besides Oxley Towers, its other projects are in Jalan Hang Tuah here, Medini in Iskandar Malaysia, Johor, and in Penang and Selangor.

An artist’s impression of the Oxley Tower in Kuala Lumpur. The average launch price for its serviced apartments are expected to be around RM3,000 per sq ft.

1MDB may delay power asset listing

By Sharen Kaur
Published in NST on April 5, 2014

MATURING IN MAY: Fund’s priority is to repay debt and interest incurred from energy plant buys, say sources

1MALAYSIA Development Bhd’s (1MDB) plan to raise around US$2 billion  (RM6.6 billion) from the listing of its energy assets is expected to be delayed further.
Sources said the sovereign fund’s nearterm priority is to repay debt and interest incurred from its acquisitions of several power plants.
1MDB has a bridging loan of RM6.2 billion maturing next month, they said.
The bridging loan was used to finance the acquisition of T. Ananda Krishnan’s power generation business of RM8.5 billion.
The sources said based on the current situation, 1MDB may seek a second extension to repay the loans to Malayan Banking Bhd and RHB Bank Bhd.
Last year, the fund received a six-month extension until May to repay the loans.
According to the sources, 1MDB was planning to list its power assets this year to pay off some of the loans.
“It may not list so soon as it has several issues to resolve, including its financial position. 1MDB is paying high interest rates and fees from borrowing private placement bonds, and this has affected its net profit.
“1MDB was targeting more than RM2 billion in revenue last year. It was quite certain of paying the loans due this year. However, it too has been busy acquiring power assets,” the sources said.
The company’s profit has dipped from RM544.3 million in fiscal year 2011 to RM44.7 million in 2012.
Meanwhile, 1MDB did not confirm nor deny that it will be deferring its initial public offering.
“We have recently issued RFPs (request for proposals) for various services required for the potential listing of our energy assets.
We will be releasing further information in due course,” the official told Business Times.
1MDB has more than RM35 billion of bonds, which include US$6.5 billion arranged by Goldman Sachs, and loans outstanding.
It was planning to raise funds to pay off US$6.5 billion in debt taken to buy power assets and develop its real estate projects.
Besides Ananda Krishnan’s RM8.5 billion power generation business, 1MDB bought Genting Bhd’s domestic energy options for RM2.3 billion, and 75 per cent of the Jimah power plant for RM1.2 billion from the Negri Sembilan royal family.
Last month, it won an estimated RM11 billion deal for the 2,000 megawatt coal-fired power plant project 3B, beating rival YTL Power International Bhd.

Khazanah wants to up fund for CR initiatives

By Sharen Kaur
Published in NST on April 3, 2014

KUALA LUMPUR: Khazanah Nasional Bhd said one of the key initiatives for the company this year is the continuous effort to build capacity of its Civil Society Partner Organisations (CSPO).

The government investment arm is raising its investment for its corporate responsibility (CR) initiatives this year by 20 per cent to RM100 million, as part of its commitment to CSPO, said its managing director, Tan Sri Azman Mokhtar.

 

He said through the company's CR grants programme, CSPOs will be able to broaden their impact by strenthening their service delivery, governance, and financial sustainability.

 

Khazanah also reaffirmed its pledge to deepen and expand its CR initiatives via the newly incorporated Yayasan Hasanah.

 

The foundation is a strategic approach to support and empower communities, encourage social inclusivity and improve local environments, Azman said.

 

Azman said the establishment of Yayasan Hasanah is significant as Khazanah celebrates 20 years in operations and stands at the cusp of completing 10 years of its transformation programme to boost Malaysia's economic competitiveness and growth.

 

He said Yayasan Hasanah will consolidate while expanding Khazanah's existing CR work in five core sectors, namely education, community development, environment, arts, heritage and culture, and knowledge.

 

"Khazanah has spent RM335 million on its CR initiatives since 2006 and we will continue investing, if required," he said yesterday, after launching the 2013 Corporate Responsibility (CR) Report and the Khazanah-Wolfson Press Fellowship Programme.

 

The 2013 CR report, the fifth since 2009, maps out the various CR initiatives that Khazanah and partner organisations completed last year.

 

Azman said Khazanah spent RM80.5 million on its CR initiatives last year, as compared to RM62.4 million in 2012.

 

He said the increase in spending was due to the Healthcare Assistance Fund, a cooperation between Khazanah and its investee company IHH Healthcare Bhd.

 

An amount of RM50 million was set aside when IHH Healthcare went public in 2012 and RM16 million was allocated out in 2013, he said.

 

Azman said funds were also allocated for flood relief and disaster preparedness in 2013 for affected communities in Malaysia.

 

For 2014, Khazanah is offering CR grants to CSPOs in two cycles.

 

Under cycle 1, the recipients include OrphanCARE Foundation, MERCY Malaysia, Persatuan Pengasih Malaysia, Voice of the Children, Yayasan Chow Kit, Johan Cruyff Foundation, Teach for Malaysia, EcoKnights, Enactus Malaysia Foundation and Reef Creek Malaysia.

 

Meanwhile, the Khazanah-Wolfson Press Fellowship Programme, established last year, is a joint venture with Wolfson College and University of Cambridge, to further develop journalism in Malaysia.