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Foreign firms keen to build major roads in Penang

August 4th, 2011 No comments

INTERNATIONAL contractors from several countries have indicated that they are interested to build four proposed major road projects in Penang.

Chief Minister Lim Guan Eng said the contractors were from China, Singapore, Hong Kong, Japan and Korea.

He said the state government would invite those interested to bid for the projects via request for proposals (RFP) at the end of the year.

“The RFP will be out at the end of the year. It will take another six months before the contracts can be awarded to the successful bidders,” Lim said in an interview on Friday.

He said the time was needed for the state to evaluate the bids and for the bidders to conduct feasibility studies for the projects.

The proposed projects are the 4.2km Gurney Drive-Lebuhraya Tun Dr Lim Chong Eu by-pass, the 4.6km Lebuhraya Tun Dr Lim Chong Eu-Bandar Baru Air Itam bypass, the 6.5km Penang-Butterworth Tunnel, and a 12km proposed road connecting Tanjung Bungah and Teluk Bahang.

The Beijing Urban Construction Group (BUCG) is now carrying out a study for the 6.5km Penang-Butterworth Tunnel project that will connect Gurney Drive on Penang island and Bagan Ajam in north Seberang Prai.

Lim has said earlier that BUCG had stated that they had secured RM10bil in funds should the project move forward.

The Penang-Butterworth Tunnel project stemmed from a memorandum of understanding between BUCG and the state government signed in Putrajaya in April.

It was one of eight agreements signed between Malaysia and China in the presence of Prime Minister Datuk Seri Najib Tun Razak and Chinese premier Wen Jiabao.

Lim had earlier also said that while the state welcomed all proposals, the project would be awarded by open tender.

BUCG is an established state-owned company in China whose projects included the Bird’s Nest Olympic Stadium in Beijing.

Source: The Star

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AmInvest: Property bubble building up but not alarming

August 3rd, 2011 2 comments

KUALA LUMPUR: There is a property bubble building up in Malaysia and the region but it is nowhere near alarming levels as the main indicators are still at comfortable levels, AmInvestment Bank Group said.

“As an investor, I love bubbles because that’s where the money is. At this juncture, I see a small bubble in the property market, it’s no where near big yet and I’m not seeing any property bubble bursting soon,” AmInvestment Bank Group director of retail funds Ng Chze How said.

“For that to take place, I think you need to see a few factors taking place. Firstly, you need to see very high overall borrowings and leveraging, which is currently not happening. Secondly, is to look at the non-performing loans (NPLs). Across this region, the NPLs are still very healthy. Thirdly, you need to look at the liquidity in the market. There’s so much liquidity, so much cash sitting in the system.”

Ng was speaking to the media after the launch of the country’s first Asia Pacific REITs unit trust fund by AmMutual here yesterday.

The unit trust funds will be solely investing in REITs in Asia.

For a start, it is looking at Australia, Hong Kong, Singapore, besides a minimal exposure in Malaysia. The fund will be managed by Funds Management Division (FMD) of AmInvestment Bank Group.

“When we are creating this fund, we want it to be riskier than bonds but safer than equities. This fund does that. It offers investors opportunities to diversify away from stocks and bonds and thus, reducing investors’ overall portfolio risks,” said FMD chief executive officer Datin Maznah Mahbob.

She added that investors will receive high dividend yields from investing in REITs as the fund is structured to distribute a high percentage of its profit to shareholders.

Over the past five years, the performance of REITs in Asia had outperformed global REITs by more than three times. During the period, REITs in Asia grew 46.2 per cent, while REITs globally grew 14.4 per cent.

“We are comfortable with Asian properties, in line with the region’s continued growth, which will lead to an increasing demand for commercial occupancy rates in Asia, which are averaging to above 90 per cent.

“For certain countries in Asia Pacific, we are seeing an uptrend in rental rates for both offices and the retail sector, which will bode well for unitholders of REITs as this translates to higher income distribution,” said Andrew Wong, chief investment officer of equity, asset allocation, and fund management.

The approved fund size is 200 million units with an initial offer price of 50 sen per unit. The initial offer period ends this Sunday, and its minimum investment being RM1,000 for Malaysian residents and the minimum additional investment for Malaysian residents is RM500.

The fund is distributed by all AmBank branches, AmBank Agency sales force, AmPriority Banking, AmPrivate Banking and Hong Leong Bank.

Source: Business Times

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CM: Don’t blame state govt

August 3rd, 2011 1 comment

GEORGE TOWN: The state government should not be blamed for the increase in land premium charges as the rate is fixed by the Valuation and Property Services Department.

Chief Minister Lim Guan Eng was commenting on the statement by Penang Barisan Nasio- nal working committee deputy chairman Datuk Zainal Abidin Osman who had accused the state government of increasing the land premium rates resulting in a rapid rise in property prices in the state.

Zainal Abidin alleged the state government had hurriedly increased the land premium rates to cash in on the demand for property in the state.

He said when the premium was increased, developers were forced to increase the price of their houses.

Lim said the state government was merely following the rate set by the department, which is a body under the Federal Govern-ment.

“If he (Zainal) is not satisfied with the current rate, he should raise the matter with the department,” he said at a press conference here yester- day.

SOURCE: The Star

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Property prices inflated by state’s action, says Barisan

August 2nd, 2011 No comments

KEPALA BATAS: Penang Barisan Nasional claims that the state’s move to increase land premium charges, has inadvertently led to a rapid rise in property prices in Penang.

State Barisan working committee deputy chairman Datuk Zainal Abidin Osman said the DAP-led state government had apparently hurriedly increased the land premium rates so it could cash in on the demand for property in the state.

“When the state government increases the premium as it wishes, the developers are forced to increase the value of the houses. It is a simple cause-and-effect factor,” Zainal Abidin said.

The low to middle-income local residents were the victims, as they could not afford to buy even low to medium-cost houses in Penang, he told a press conference before a Barisan walkabout at the Pasar Ramadan here yesterday.

Also present were Penang Gerakan chairman Datuk Dr Teng Hock Nan, state MIC chairman Senator Datuk P.K. Subbaiyah, PPP chief Datuk Dr Loga Bala Mogan, state Umno liaison committee deputy chairman Datuk Musa Sheikh Fadzir, Kepala Batas MCA division head Goh Poh Chuan and state Gerakan Wanita chief Ng Siew Lai.

Penang Barisan also challenged Lim to produce the statistics concerning the total of low to medium-cost units approved by the state government since 2008.

Zainal Abidin said he was issuing this challenge to Lim after the latter wrote in his blog that Penang had approved 11,596 low and medium-cost units priced between RM42,000 and RM72,500.

“We would like to know whether the approval was for houses built by the state or Federal Government,” he added.

SOURCE: The Star

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Duplicates of Southgate on drawing board

August 2nd, 2011 No comments

title=KUALA LUMPUR: Property developer Mah Sing Group Bhd is confident that the recently completed Southgate project in Sungei Besi here will be a success and the group plans to replicate the model elsewhere.

Mah Sing Properties Sdn Bhd chief operating officer Andy Chua feels that there are at least two other other locations where the Southgate model can be duplicated – in Johor and Penang.

Chua, however, said they must be in the right location.

Southgate, a development project on 1.93ha with RM466 million gross development value, comprises office-cum-retail building. All units have been sold.

The project, comprises two main blocks – Apex and the Corporate Building – and three other blocks named Vox, Vivo and Vertex. Together, they offer 600,000 sq ft of net lettable area.

The eight-storey main block has three storeys of retail space and is owned by Kooperasi Permodalan Felda Bhd.

Felda bought this block for RM226 million and has leased it back to Mah Sing’s unit. For the first two years, Felda will receive a guaranteed 8 per cent monthly rental based on the purchase price. Thus far, 60 per cent of the main block has been leased.

Total retail leasable area is 200,000 sq ft in Southgate, of which 40 per cent is yet to be rented out.

Chua expects the retail portion to be 90 per cent tenanted within a year’s time. The average rental for the retail portion on the ground floor is RM10 per sq ft, including service charge.

“This is not a conventional mall. It is more like street mall, where it is about al fresco dining where one can have a stroll. It is a covered area, but sunlight can come in,” he told Business Times in an interview.

The tenants are predominantly from food and beverage business, he added. Its retail tenants include Nichi Fashion, Georgeous, OverTime, Papa King and Sushi King.

Southgate’s target market during the day will see the the office tenants complementing the retail component. At the same time, Chua expects people driving by the area to stop for breakfast and lunch at Southgate.

He said for dinner, Southgate will attract those heading home from Kuala Lumpur and will use the place as a meeting point. “This is the southern gateway out of KL,” he added.

SOURCE: Business Times

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