Survey points to positive rental market in Malaysia

 By NST Property/Sharen Kaur - April 16, 2024 

Photo/Sharen Kaur

KUALA LUMPUR: Rents in Malaysia have rebounded to their 2018 levels across all generations, according to Juwai IQI.

Currently, Baby Boomers (born between 1946 and 1964) lead the pack in paying the highest average rent of RM2,120 per month in Malaysia.

They slightly edge out Gen X (those born from 1965 to 1979), who pay an average of RM2,104 per month.

These insights come from Malaysia's inaugural Home Renters Generational Trends Report, published by IQI, a member of Juwai IQI.

"It makes sense that Baby Boomers pay the most. They tend to be at the peak of their income and savings and have large homes to accommodate families," said Juwai IQI co-founder and group chief executive officer Kashif Ansari.

Kashif said that Builders (those born before 1946) are the third-highest payers, with an average rent of RM1,931, followed by Gen Y (born from 1980 to 1994), with an average rent of RM1862. 

Gen Z (born between 1995 and 2009) has the lowest average rent, at RM1,750, as befits a young generation whose members are just getting started in their careers and may not yet have married or had children.

"Not everything about the pandemic was bad for renters. Every generation paid less for rent on average during the pandemic years.

"Two generations (Builders and Gen Z) saw their rents fall more during the pandemic than any others. The average rent paid by Builders dropped by 35 per cent between 2018 and 2021, and Gen Z's average rent fell by 24 per cent.

"The generation that received the smallest Covid-19 benefit saw their average rent fall by a still significant 18 per cent between 2018 and 2021. That was the Baby Boomers," he said.

According to IQI, it examined data from more than 67,000 rental transactions for the report.

The data shows that members of Gen Y accounted for 38 per cent of all rental transactions in 2023. Gen Z followed at 31 per cent and Gen X at 13.1 per cent. 

By contrast, Baby Boomers and the Builders accounted for a relatively small number of transactions, just 3.0 per cent and less than one percent, respectively.

"Over the past five years, Gen Z has seen the fastest growth in its share of rental transactions. In the first quarter of 2024, Gen Z accounted for a 3.5-fold larger share of all transactions than in the first quarter of 2019.

"Apart from Gen Z, every other generation saw its share of rental transactions decrease between 2019 and 2024. Baby Boomers' share of rental transactions fell by more than half. The share of transactions that went to Gen X fell by about 40 per cent. Gen Y accounted for about a one-quarter smaller share of transactions in 2024 than in 2019," Kashif said.

According to the report, Millennials, or Gen Y, accounted for about half of all transactions in both apartment and home rentals in 2023.

"When it comes to apartments, only a tiny share of transactions went to Baby Boomers and Builders. However, Baby Boomers made up a significant, if small, share of nearly 5.0 per cent all home rental transactions.

"When it comes to Gen X and Gen Z, they accounted for the second and third-largest shares of rental transactions in both landed homes and apartments last year," he said.

Malaysia's property tycoons make a fortune with affordable houses, overseas expansion, says Forbes

 By Business Times/ Sharen Kaur - April 16, 2024 

Lim Peng Cheong and his brother Lim Peng Jin, the major shareholders of property development and packaging company Scientex Bhd, saw a 20 per cent surge in their net worth, now standing at US$885 million. 

KUALA LUMPUR: The combined wealth of Malaysia's 50 wealthiest individuals has experienced a modest 2.0 per cent uptick, now totaling US$83.4 billion for the year. Notably, this year's list includes a number of property tycoons who have amassed fortunes through affordable housing sales and international ventures.

Among them, brothers Lee Yeow Chor and Yeow Seng of the IOI Group have made their debut in the top five wealthiest Malaysians, boasting a combined net worth of US$5.35 billion, as per Forbes. 

Yeow Seng, spearheading IOI Properties, has been steadily expanding the company's presence in Singapore, with plans underway for a multibillion-dollar office complex in the city's central business district.

Tan Sri Francis Yeoh and his siblings have surged seven spots to secure the seventh position on the list, with their combined wealth more than tripling to US$4.7 billion.

Tan Sri Jeffrey Cheah

Property mogul Tan Sri Jeffrey Cheah, renowned for Sunway Bhd's township developments across Malaysia, has also more than doubled his wealth to US$2.4 billion, claiming the eighth spot in the top 10 for the first time.

Tan Sri Ong Leong Huat, leading the financial services-to-property firm OSK Holdings, is preparing to launch the third phase of Melbourne Square, a A$2.8 billion mixed-use complex developed in collaboration with the Employees Provident Fund in Southbank, Melbourne. Ong, who serves as the executive chairman of OSK, has seen a 35 percent increase in his net worth, now reaching US$560 million, according to Forbes.

Meanwhile, brothers Lim Peng Cheong and Lim Peng Jin, the major shareholders of packaging giant Scientex Bhd, witnessed a 20 per cent surge in their net worth, now standing at US$885 million. 

During the first half of fiscal 2024, Scientex's residential property division invested RM507 million in acquiring 325 hectares of freehold land in Johor and Selangor, marking an almost eightfold increase from the previous fiscal year's total land expenditure. This reflects their ambitious target of constructing 50,000 affordable homes nationwide by 2028. By February, Scientex had made significant progress, delivering 33,580 affordable homes, with the majority priced below RM300,000.

"The outlook for affordable housing in Malaysia is promising, given the persistent shortage," Scientex chief executive officer Lim Peng Jin told Forbes by email.

In its debut overseas ventures last year, Scientex collaborated with Jakarta-based Mustika Land and Japan's Creed Group to develop 400 affordable homes in West Java, Indonesia, with a gross development value of US$19 million. Additionally, it initiated a US$42 million joint venture in Thailand to construct 334 townhomes in Bangkok's Bang Na district alongside Creed and Thailand's Altitude Development.

A surge in home sales propelled Scientex's revenue to RM2.2 billion in the quarter ending January 2024, marking a 2.0 percent rise.

Forbes reported that three individuals from last year's list did not meet the cutoff, which was slightly raised to US$320 million, including property developer Yu Kuan Chon, as shares of his YNH Property Bhd plummeted amid financial concerns.

Source: https://www.nst.com.my/property/2024/04/1038653/malaysias-property-tycoons-make-fortune-affordable-houses-overseas

ParkCity Group debuts Kuching's first strata-titled landed homes priced from RM3.1mil

 By NST Property/Sharen Kaur - April 17, 2024

An artist’s impression of The Mansion semi-detached homes.

KUALA LUMPUR: ParkCity Group has introduced its debut development in Kuching, Sarawak, unveiling the city's premier strata-titled landed residences. 

Nestled within the affluent Kenny Hill suburb, the 45-acre Kenny Heights mixed development sits adjacent to Jalan Ong Tiang Swee, in the southern precinct of Kuching City.

The initial phase of this development, named The Mansions, presents an exclusive gated and guarded community with an exceptionally low density. It comprises 25 units of double-storey bungalows and 28 units of double-storey semi-detached homes.

The double-storey bungalows are priced at RM5.1 million, while double-storey semi-detached homes start at RM3.1 million onwards. 

ParkCity announced securing 80 per cent of the bungalow homes and over 55 per cent of the semi-detached homes prior to its official launch in late February 2022.

Crafted for multi-generational living, the homes' timeless design blends colonial charm with modern, contemporary materials and finishes. 

The Mansions' bungalow homes boast a total gross built-up area starting at 6,564 square feet, while the semi-detached homes start at 4,140 square feet, offering ample space for elegant living.

The developer said The Mansions @ Kenny Heights is well-positioned to become one of the most desirable addresses in Kuching.

Inspired by the success of Park Homes at ParkCity's flagship masterplan township, Desa ParkCity in Kuala Lumpur, Kenny Heights features a unique living-by-the-park concept, incorporating the developer's signature elements of lush green spaces, connectivity, and sustainable living principles.

The development features a linear park, meandering walkways, a flora pavilion, picnic lawns, and other shared amenities.

Safety and security are paramount at The Mansions, with a guard house, 24/7 security patrolling, anti-climb perimeter fencing, and CCTVs along the boundary. 

Source: https://www.nst.com.my/property/2024/04/1038970/parkcity-group-debuts-kuchings-first-strata-titled-landed-homes-priced

RM70bil for high-speed bullet train project?

 By Sharen Kaur/Business Times - April 19, 2024 

The Kuala Lumpur-Singapore high-speed rail (KL-SG HSR) project might tally up to about RM70 billion, a notable decrease of around 30 to 35 percent from the previously reported RM110 billion, according to market insiders.

KUALA LUMPUR: The Kuala Lumpur-Singapore high-speed rail (KL-SG HSR) project might tally up to about RM70 billion, a notable decrease of around 30 to 35 percent from the previously reported RM110 billion, according to market insiders.

"No definitive cost estimate has ever been provided for the HSR project. The RM70 billion figure is a projection based on factors such as the length and alignment of the railway line, as well as the number of trains and stations required," said an insider.

MyHSR Corporation, the government-owned entity overseeing the HSR's development, received concept proposals from seven local and international consortia by the January 15, 2024, deadline. The RFI was held in order for the Malaysian government to assess the private sector's ability to fully finance the project without state funds or guarantees. 

Despite efforts to assess the private sector's capability to finance the project independently, there seem to be three shortlisted consortiums, and they are seeking some form of government financial support. 

The three shortlisted consortiums are YTL Construction Sdn Bhd-SIPP Rail Sdn Bhd, Malaysian Resources Corp Bhd-IJM Construction Sdn Bhd-Berjaya Rail Sdn Bhd-Keretapi Tanah Melayu Bhd (MRCB-IJM-BRail-KTMB), and a Chinese consortium led by state-owned China Railway Construction.

The MRCB-IJM-BRail-KTMB consortium has reportedly requested in its proposal that the government compensate it if the number of passengers falls below a minimum number.

The YTL-led group has also requested some form of government financial support in its bid to manage the mounting costs of building the line.

"This contradicts the government's stance that it will not fund the 350-km-long line. Of the shortlisted consortia, only the China Railway-led consortium possesses robust finances to undertake the project via private funding," said the insider.

Dr. Yeah Kim Leng, a Professor of Economics at Sunway University Business School, indicated that the mega rail project has edged closer to fruition with MyHSR shortlisting three consortiums. 

However, he cautioned that numerous obstacles must be overcome before the project commences, including clarifying funding sources, assessing the project's feasibility, and determining the extent of government support.

Private financing hinges on commercial viability, particularly concerning financing, given the maturity of high-speed rail technology in China, Japan, and Europe, Yeah said. 

Yeah emphasised that if economic viability and financing feasibility challenges are resolved, the mega project could significantly benefit the Malaysian economy by the end of the decade. 

Transport Minister Anthony Loke Siew Fook said early this month that the concession method used for private companies to build highways could be emulated for the HSR.

He said the HSR remained an integral project that could be an economic changer for the country.

"I don't see why we must say no, but it should not be a government-led project. Instead, the private sector can contribute capital and carry on the project," he said during the Keluar Sekejap podcast with Khairy Jamaluddin and Shahril Hamdan on April 5.

The 330-350 km-long project, first mooted over 20 years ago by YTL Group, resulted in a legally binding agreement signed in December 2016, with the aim of having the line operational by 2026.

However, it was put on the back burner following several delays at Malaysia's request and the eventual lapsing of an agreement in December 2020.

Malaysia paid more than S$102 million in compensation to Singapore for the project's termination.

Talk of reviving the project intensified following the general elections in 2022 and Prime Minister Datuk Seri Anwar Ibrahim's visit to Singapore early in the new year, where he met with Singaporean leaders.

KGV International Property Consultants executive director Sr. Samuel Tan said that from the surface, it appears that only the Chinese consortium possesses the financial capacity to undertake such a massive project, estimated at RM70 billion or more.

"Whatever the case, this KL-SG HSR project, when operational, will transform the entire transportation landscape in Malaysia. The country will be part of the big jigsaw within the Pan Asian Railway Network, possibly starting from Singapore, Malaysia, to Indo-China, then to China, and finally to Europe.

"With that in place, more investors will be keen to invest here, as travelling by rail is seamless and yet an experience to be enjoyed," he said.

Source: https://www.nst.com.my/business/corporate/2024/04/1039838/rm70bil-high-speed-bullet-train-project