Applications are coming in for the RM40mil Penang SME Centre which is scheduled to open in June this year.

It has received enough to cover about 100,000sq ft of the floor area of the 166,874sq ft building.

Penang SME Centre management council chairman Datuk Seri Kelvin Kiew said about 10 small and medium companies from the electronics and semiconductor manufacturing sector were being considered for the four-storey building at the Bayan Lepas Industrial Park.

“The rental at the centre is very competitive at RM1.50 per sq ft for the second floor compared to RM2.50 per sq ft in the market for a similar level.

“The rental for the first floor at the centre is RM1.80 per sq ft,” he said in an interview.

Kiew added that during times of economic crisis, the centre could help local small and medium companies to expand as the cost to rent was at a very low rate.

The key business areas that the centre aims to promote are research and development, manufacturing activities for the light-emitting diodes (LEDs), solar power manufacturing, industrial electronics, and the semiconductor industry.

Meanwhile, investPenang general manager Loo Lee Lian said tenants at the centre could tap into investPenang and Penang Development Corporation’s industrial network to gain access to venture capitalists, research and development centres, and potential markets.

“The tenants will be promoted to local multinational corporations with the aim of becoming preferred suppliers.

“The centre will also serve as a local supply chain showcase to foreign and local investors,” she said.

Loo said the tenants would also be given priority to move into the proposed SME village in Batu Kawan.

Source: The Star

There are still several questions left unanswered by the Penang government over the sale of the prime property.

Several Penang-based analysts and local community leaders have questioned the Penang government for selling a 41.5ha plot of prime state land to a private developer, Ivory Properties Group Berhad, for RM1.07bil.

Their concern is understandable due to scarce availability of state-owned land on the island which may hinder the ability of the state government to drive a balanced development and ensure it does not drive out the lower middle-income group from the area.

Most private property projects on the island are focused primarily on premium and luxury property which have driven up prices beyond the reach of most Penangites. There is worry that the sale of the state-owned Bayan Mutiara land to a private developer may end up in a similar fate.

Apart from escalating property prices, there is a concern that the land may have been sold below the prevailing market value. The state government had explained that the current selling price was above market value at the time of transaction.

However, it does not explain if it is usual to allow the purchaser a period of five years to settle the full payment. Did the transacted price factor in any interest payment accrued by the five-year payment period?

The opportunity cost derived from a potential increase in land premium over the next five years should be included to ensure that it is a fair deal.

Accusations and allegations of a lack of transparency in the tender process should be comprehensively addressed by the state government. Critics had alleged that the sale was done through direct negotiations between the state government and the purchaser.

Without justifying the five-year payment period, these allegations will create doubt over the much ac­­claimed transparency and ac­­count­ability of the state government.

Moreover, the allegations are peppered by talk that a bidder who is prepared to make a full payment for the purchase was not selected during the tender process.

Some analysts have questioned how can the sale benefit the people? They wonder why the development of Bayan Mutiara cannot be taken up by the Penang Development Corporation (PDC) which has the capacity and experience to handle people-centric development projects such as the Penang Free Trade Zones, housing estates, Komtar and others.

Regrettably, the issue of public accountability and good governance has been grossly politicised by certain parties. Politicians have gone to the extent of throwing down the gauntlet of challenging each other to resign over false allegations related to the land sale. We expect such showmanship from politicians but we deserve straight and accurate answers from them.

Politicising this issue is going to deprive many concerned stakeholders a chance to ask relevant and legitimate questions about the decision to sell the land to a private developer.

Chief Minister Lim Guan Eng had described allegations of wrongdoing over the tender award for the Bayan Mutiara mixed deve­lopment project by PDC as “a pack of lies”.

While some of these allegations may be malicious, it is pertinent for Lim’s administration to identify legitimate concerns over the sale. He should acknowledge that the state government controls less than 5% of total land size on the island and this calls for a prudent and strategic management of state-owned prime land.

Hence, it is best for his administration to address these issues immediately in order to convince the people of Penang that it has taken the best interests of the people into consideration before agreeing to the sale. Major issues include:

> What was the rationale to allow a five-year payment period to the purchaser? It gives an impression that the purchaser may not have secured financing for the purchase.

> Is it true there was another bidder who was prepared to pay an upfront full payment for the asking price?

> Did the transacted price factor in any interest charges or projected land price appreciation over the next five years?

> Is there any restriction or precondition between the state government and the purchaser to discourage any sub-sales? If the purchaser were to divide and resell some parcels of the land to other developers at a higher premium, it may further drive up property prices on the island. If such sales were allowed, is the state government entitled to a share of the higher premium?

> It is understood that the government would like to use the proceeds from Bayan Mutiara land to finance its low-cost housing scheme in Batu Kawan. While the low-cost housing scheme is welcomed and encouraged, the state government needs to justify if the sale of Bayan Mutiara land is the best option to help finance the project.

> Lim said part of the RM500mil financing for the housing scheme came from the state coffers. If this is the case, what is stopping the state from raising money through external sources to fund the entire project and carefully weigh all options to optimise the use of the Bayan Mutiara prime land bank?

Bayan Mutiara is no longer about selling above the current market value but the use of scarce prime land on the island for the purpose of socio-economic transformation. Ownership of prime land is very crucial for the state government to drive the state’s economy.

We do not want a repeat of high premium-reclaimed lands being sold to private developers who in turn inflate property prices in Penang and raked in billions in profit at the expense of the people.

Bayan Mutiara could be what the state government needs to help transform the landscape of Penang and create new attractions to boost its attractiveness as a tourism and cultural destination and a services hub.

Time will judge if the current state government has made the right decision on Bayan Mutiara and if the proposed plan is not going to turn out to be just another expensive commercial project by a private property developer.

Source: The Star

Straits Garden, an upcoming mixed development by Tambun Indah, strategically located within the established township of Jelutong, Penang. The development comprises shop offices, commercial suites, residential condominium and a low-medium cost apartment.

Second block of Straits Garden comprises residential condominiums.

Property Project : Straits Garden
Location : Jelutong, Penang
Property Type : Shop offices, Commercial suites, Condominium/Apartment
Total Units: 230 (Block A1 – Suites), 91 (Block A2 – Condo), 183 (Block B – Condo)
Total LMC Units: 152 (69 units for relocation) 
Developer : Tambun Indah

Location Map: 

Contributed by reader (3/6/2012) – Show Unit

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PETALING JAYA: Bank Negara has assured that issues arising from the implementation of the Guidelines on Responsible Financing, which came into effect on Jan 1, would be smoothened out.

However, the spirit of the guidelines, which promotes prudent, responsible and transparent retail financing practices as well as to ensure that the household sector and credit market stayed resilient, would remain.

Bank Negara said in a statement after a meeting with members of the automotive industry that access to financing would not be hampered as it would still be available to borrowers who could afford to repay their loans.

“Bank Negara has written to financial institutions to ensure that consumers who have the ability and capacity to repay should continue to have access to such financing,” it said.

The central bank said the meeting was held with representatives from Proton Holdings Bhd, Perusahaan Otomobil Kedua Sdn Bhd (Perodua), DRB-Hicom Bhd, the Malaysian Automotive Association, Proton Edar Dealers Association and Perodua Dealers Association.

“The meeting discussed various implementation issues which will be resolved with financial institutions, including documentation requirements for purposes of income verification. This will contribute towards more efficient procedures and processes for vehicle financing,” it said.

Bank Negara said in the past five years, the proportion of vehicle financing over total loans to household sector had averaged about 20%, the second highest after financing for residential properties.

“While there have been some reduction in the total number of vehicle financing applications received between December 2011 and January 2012, due in part to the shorter working month, the approval rate for vehicle financing has remained stable at about 54% for the month of January 2012,” it noted.

The guidelines cover all new and additional financing including home and vehicle financing, credit and charge cards, personal financing as well as overdraft facility for the purchase of securities, except for share margin financing governed by stock exchange rules.

Among the guidelines’ measures, financial institutions must ensure that customers who were offered financing products could afford to repay in full throughout the financing tenure, without recourse to debt relief or substantial hardship.

SOURCE: The Star

SHAH ALAM: SP Setia Bhd recorded a 26.6% year-on-year jump in new property sales to RM933mil for its first quarter ended Jan 31, 2012, compared with RM737mil a year earlier.

President and chief executive officer Tan Sri Liew Kee Sin said he was confident about achieving the group’s target of RM4bil in new property sales for its financial year ending Oct 31, 2012 (FY12), despite credit-tightening measures as a result of Bank Negara’s responsible lending guidelines.

Effective this year, banks have started using net income instead of gross income to calculate the debt service ratio for loans.

The credit-tightening measures were partially blamed for a 25% year-on-year drop in new vehicle sales in January.

For FY12, SP Setia plans to launch properties with a gross development value of RM6bil.

Liew said the group’s projects in Johor, Setia Alam and Setia Eco-Park in Shah Alam, as well as KL Eco City mixed development in Kuala Lumpur were expected to generate RM1bil each in new property sales in FY12, while another RM1bil would come from sales of other domestic and foreign projects.

KL Eco City, located on a 24-acre site along Jalan Bangsar (opposite Mid Valley City), was launched last October and recorded RM303mil in sales for the first quarter of FY12.

“Yes, the central bank’s lending guidelines would definitely impact the property sector. But, speaking for SP Setia, we will do well and also increase our prices,” said Liew after the group’s AGM in Setia Alam.

He pointed out that the recent soft launch of the group’s Phase 8D of semi-detached homes in Setia Eco Park had seen bookings for nearly all the units offered, over one week-end.

“Today, our landbank is 4,218 acres. We have a lot of things going on.”

On Saturday, SP Setia will officially launch its maiden project in Sabah, namely the Aeropod integrated commercial development in Tanjung Aru.

In Johor, the group recently launched Setia Eco Cascadia on a 259-acre site within the Tebrau Corridor.

For FY12, the group has plans for its Setia Eco Glades, Cyberjaya, which is sited on 268 acres of freehold land. Setia Eco Glades will consist of gated and guarded enclave with linked villas, semi-detached homes and bungalows.

In Penang, SP Setia’s projects will include a high-rise development called Setia V Residences in Gurney, and Brook Residences comprising 11 bungalows on Brook Road in the upmarket Jesselton area.

In Singapore, the group will launch its maiden project, namely a high-rise condominium development called 18 Woodsville.

According to Liew, there were also plans to launch another phase for the group’s Fulton Lane in Melbourne, Australia.

The EcoLakes and EcoXuan projects in Vietnam are also expected to help augment sales in FY12.

Liew said the group was also looking to acquire prime city land for development in Hanoi or Ho Chi Minh City.

“The Vietnam property market has slowed down tremendously. So, this is a good opportunity for us to acquire prime land in the city. So far, we are still talking.”

He reiterated that SP Setia was continuously on the lookout for prime city land in London and Singapore. “In central London, prime properties are still in high demand,” he said. “Even in Singapore, if we have the chance.”

Liew also expressed confidence that the group’s 18 Woodsville development in Singapore would do well.

“Despite the recent 10% hike in stamp duty for foreigners buying private homes (in the island republic), we think that at least 30 to 50% of our sales in Singapore will be Malaysian buyers.”

SOURCE: The Star