Archive for the ‘Property News’ Category

Long queue to ownership

March 9th, 2012 No comments

FOREIGN workers are being paid up to RM1,000 to queue up for housebuyers to book hot properties in land-starved Penang island.

These professional queuers — mostly Bangladeshis and Indonesians — even bring along their wives and children to camp outside the developer’s office up to one week ahead of a project launch.

They are paid between RM200 and RM250 per day to stay in queue for numbers which are then passed on to buyers to enter the sales office to book their units.

Architect Jessica Tan said she forked out RM150 to a “local agent” of the foreigners for a Bangladeshi to stay in the queue from 8pm the night before the launch until 7.30am the next day.

The 30-year-old, who did not want to spend the night for safety reasons, said the foreigners brought along their children and wives to camp outside the developer’s office.

“My friend from Kuala Lumpur paid RM1,000 for a Bangladeshi to stand in line for five days,” she said, adding that some locals even offered such a service for a hot property in town recently.

Engineer Edward Wong claimed that foreigners camping overnight on behalf of buyers was a common sight since late last year but lining up as early as a week before the property launch was a new trend.

“Usually, there will be two of them who take turns queuing in front of the developer’s office,” said the potential buyer in queue.

Wong, however, said the professional queuers had irked genuine buyers who find themselves far behind the line despite turning up early to book their units.

“An elderly man was here at 5.30am on the launch day itself but only managed to get in at 4pm because the foreigners had started queuing days before.

“With foreigners lining up for property investors, common folk like us won’t get a chance to purchase the affordable units,” said Wong.

Sophie Low, 34, said Penang was a “developer’s market”.

The property investor said she was not surprised at people hiring foreigners to queue for them as new projects in Penang island were in such high demand.

“It’s a free market — if you have the money to pay someone to stand in line for you, that’s fine,” she said.

Real Estate and Housing Developers’ Association (Rehda, Penang) chairman Datuk Jerry Chan said there was “absolutely nothing wrong” with genuine buyers paying foreigners to stand in line for them.

“Those who are working cannot be expected to stand in line overnight, so engaging a property agent or even their maids to do it is fine.

“However, it’s unethical (though not illegal) for scalpers to line up and then sell their spots in the queue because it could deny genuine buyers the opportunity to purchase a unit of their choice.

“One way to eliminate scalpers is to require those lining up to come with a bank draft as evidence of their intent to purchase,” he said.

Source: The Star

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Dijaya in amalgamation exercise

March 7th, 2012 No comments

title=DIJAYA Corp Bhd will buy assets worth RM1.1 billion owned by its major shareholder, Tan Sri Danny Tan Chee Sing, under a consolidation exercise to spur its growth.

The exercise is specifically aimed at streamlining and rationalising a majority of land and properties held by Tan into Dijaya.

Both parties entered into a conditional amalgamation exercise agreement yesterday.

Under the deal, Dijaya will acquire 73 properties, including 24ha of land in Kuala Lumpur, Penang, Johor and Sabah, and investment assets held by Tan, excluding the liabilities incurred by these properties, for RM948.7 million.

The deal is expected to conclude by September this year.

Tan said the assets would give Dijaya good recurring income of eight per cent per annum.

The assets include Dijaya Plaza in Kuala Lumpur, Casa Square in Puchong, Intan Square in Petaling Jaya, Jaya Square in Subang and Wisma TT in Bandar Sunway.

The land acquisition, meanwhile, will increase Dijaya's land bank to 348ha, generating a gross development value of RM37 billion over the next 12 to 15 years.

Dijaya managing director Datuk Tong Kien Onn said the deal would benefit the company over the long term as all the assets would help improve its financial figures.

The exercise, upon completion, will increase Dijaya's market capitalisation to over RM1 billion at a price of RM1.50 per share. This will make the company one of the largest property developers on the Main Market of Bursa Malaysia.

The acquisition will be satisfied by RM250 million cash and the balance via the issuance of redeemable convertible unsecured loan stocks (RCULS), with a staggered conversion price range of RM1.30 to RM2.50 over a 10-year period.

As an integral part of the deal, Dijaya will undertake an equity fund raising exercise via a renounceable rights issue of up to 491.3 million new shares of RM1 each at an issue price of RM1.20 per rights share, together with a bonus issue of up to 122.83 million new RM1 shares.

Tan and the parties related to him will provide Dijaya with undertakings to subscribe for RM250 million in value pursuant to the proposed rights issue, which will constitute the minimum subscription level for the proposed rights issue.

Dijaya has also proposed a debt funding via the issuance of up to RM500 million guaranteed commercial paper/medium term notes programme (CP/MTN) with an option to issue detachable warrants to further meet the business investments and long-term capital requirement of the group.

In view of the proposed amalgamation exercise, Dijaya has cancelled its proposed private placement as announced on August 18 last year to mitigate any further dilution of shareholdings in the company.

SOURCE: Business Times

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The fear factor in property purchases

March 6th, 2012 No comments

PETALING JAYA: Property developers and consultants from Penang to Johor are generally bullish about the residential property market and do not think there is a bubble.

They are of the view that there are two types of buyers, one who is buying out of need and the other out of fear that prices would go up further. The speculative element which was evident a few years ago has dissipated.

Real Estate and Housing Developers’ Association (Rehda, Penang) chairman Datuk Jerry Chan said: “Buyers have money which they would like to park somewhere.

“Sales this year have been better than last year, driven by fear rather than the speculative element,” said Chan who is also group managing director for Penang-based Asas Dunia Bhd.

Chan was commenting on a report Debunking the property bubble myth by CIMB which said that talk of a property bubble was overstated as the sharp rise in residential property prices over the past few years was confined to selected areas.

“Affordability is near its all-time high and prices have to surge 50% to 100% before affordability falls to pre-Asian financial crisis levels,” the report said.

The report said it was surprising that residential prices had not risen at a faster pace as new supply had fallen significantly over the past few years.

Chan said tourism was also very big in Penang and if China and Indian nationals were to buy in Penang, it would “turn the market upside down.”

“So I foresee Penang prices would continue to rise because of inadequate supply of land, not because of inadequate developments,” he said.

In the Klang Valley, Reapfield Properties Sdn Bhd chief executive officer Gerard Kho said domestic demand for residentials was expected to be strong until the middle of this year.

Managing director for the Khong & Jaffar group of companies Elvin Fernandez said “it is not a question of whether there is a bubble or not but whether prices in certain areas are tied in to fundamentals or not.

“And we know in certain hot spots, they are not,” Fernandez said.

In Johor, KGV International Property Consultants Samuel Tan said the state was undergoing a transition because of the Iskandar Malaysia factor.

“New houses entering the market are priced a lot higher than three years ago but the market is accepting it,” he said.

SOURCE: The Star

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Ivory expects nod for RM10b Penang project this week

March 5th, 2012 No comments

title=GEORGE TOWN: Ivory Properties Group Bhd is expecting approval from the Penang Development Corporation (PDC) this week for its proposed RM10 billion “Penang World City” project at Bayan Mutiara.

Executive director Murly Manokharan said yesterday the development was expected to incorporate, among others, medical facilities, Grade-A offices and both high-end and affordable housing units.

“We are open to working with strategic partners for certain components of the development, such as a shopping mall and a medical centre, as opposed to seeking investors for an outright sale of chunks of the land,” he told Business Times after the company’s extraordinary general meeting (EGM).

Present was Ivory’s deputy chairman and executive director Datuk Seri Nazir Ariff Mushir Ariff.

During the EGM, which lasted 40 minutes and saw a shareholder turnout of 62 per cent, the company received unanimous approval from those present for its plan to purchase and develop a 41.02ha site in Bayan Mutiara on Penang island, from the PDC and Chief Minister of Penang (Incorporated).

The land was sold for RM1.07 billion, or RM240 per sq ft, to be paid over five years.

Shareholders also gave their nod for a joint-venture between Ivory and Dijaya Corporation Bhd to develop the land, which is located near the Penang Bridge.

After the execution of the Builder Agreement, Tropicana Ivory Sdn Bhd – which is 55-per cent owned by Dijaya and 45 per cent by Ivory – will develop the RM10-billion Penang World City development. The development will be a mixed-use residential and commercial project.

Murly said the master-planned development, which has been crafted by international firm Design 103 International Ltd, would adhere to any height restrictions imposed by the Department of Civil Aviation, owing to the project’s proximity to the Penang International Airport at Bayan Lepas. Any project sited within 15km from the airport is deemed by the DCA to be in the flight path.

Penang World City, he noted, was expected to be completed in eight years, with work on the first phase commencing at the end of this year.

“Now that we have obtained shareholder approval to enter into the joint-venture with Dijaya and also for the proposed rights issue, we are looking at a RM500 million capitalisation and are in a better financial position to carry out the project,” Murly said.

As the principal builder of the project and turnkey contractor, Ivory will manage and develop the entire project, for which it will be entitled for 48 per cent of the gross development value.

“We are currently engaging with both local and foreign investors who may been keen to partner us in certain phases of the proposed development.

“However, our first obligation is to honour whatever outstanding payments which are being owed and we are looking at settling the RM80 million being owed to the PDC by April 10,” Murly added.

PDC and Chief Minister Inc sealed a deal on November 11 last year to sell the land to Penang-based Ivory Properties Group Bhd for RM1.07 billion, or RM240 per sq ft, to be paid up in five years.

Ivory’s chairman and group chief executive officer Datuk Low Eng Hock was quoted last month saying that the company has paid a RM22.1 million deposit for the land and that the remainder will be paid according to the scheduled progress payment after shareholder approval was obtained at the EGM.

SOURCE: Business Times

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Home sweet home

March 5th, 2012 No comments

THE Penang Development Corporation (PDC) Properties has successfully completed the construction of 715 low to low medium-cost housing units in Sungai Dua.

PDC Properties chief executive officer Phan Gaik Cher said the development cost of the project was about RM80mil.

“Construction started in early 2009 with a targeted completion date in July this year.

“We managed to finish the project four months ahead of schedule,” Phan declared, adding that the required Certificate of Fitness (CF) was ob-tained on Jan 30 this year.

PDC Properties is a subsidiary of the state’s development arm Penang Development Corpo-ration.

The project called Halaman Kenanga stands on a 1.74ha plot and has 510 low medium-cost units and 204 low-cost units in two 22-storey blocks.

The 700sq ft low medium-cost units cost RM72,500 while the 680sq ft low-cost units cost RM42,000.

Chief Minister Lim Guan Eng, who was present yesterday to hand over keys to some of the owners, said that the project was proof that the state put the interests of the people first.

“There has been criticism from certain quarters that the state has not provided a single low-cost unit.

“Since taking over the state government, the Pakatan administration has in fact approved 11,596 low-cost and low medium-cost units,” he said after handing over mock keys to 22 Halaman residents.

Lim hopes that the affordable housing issue would finally be put to rest.

“The state could have used this land for profit, but instead we decided to use it in the commu-nity’s interests,” he added.

The Penang Government came under fire last year after the Auditor-General’s Report 2010 stated that the state had not built a single low-cost house from 2008 to 2010.

Among those who received their keys was self- employed Ahmad Yatim, 70.

“This is the first home I have ever owned,” the grandfather of 10 said, adding that he would move into the three-bedroom flat with three family members.

Source: The Star

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