While the Covid-19 pandemic has shaken up the investment plans of property developers over the last year-and-a-half, the outlook of certain subsectors remains resilient and continue to attract focus.

In a survey by Knight Frank on the investment outlook for Malaysia, it points out that a majority of developers and lenders have existing exposure to the retail market as well as the hotel/leisure segments.

These sub-sectors have been hard-hit by the Covid-19 pandemic.

Amid the prolonged pandemic, Knight Frank Malaysia managing director Sarkunan Subramaniam says the hospitality industry continues to bleed due to international travel bans, interstate travel restrictions and cancellation of major events.

Similarly, he says the retail industry has also been badly impacted due to various phases of lockdowns and subdued consumer sentiment, while the future of offices continues to evolve as the work-from-home trend is the way to go.

“The severe disruptions to supply chains globally has revolutionised e-commerce services, driving the industrial property market and putting logistics assets at the forefront to capture growth opportunities.

“Also, the critical need for good medical and healthcare support amid the pandemic coupled with attractive tax incentives for new and expansion of private hospitals and ambulatory care centres, as well as for manufacturing of pharmaceutical products are expected to draw more investments into the healthcare segment,” he says in a research note.

Knight Frank’s annual survey consists of representatives in the senior management levels of the Malaysian commercial property industry. More than half (59%) are developers, followed by lenders (27%) and fund/Real Estate Investment Trust (REIT) managers (14%).

Additionally, Sarkunan says the demand for senior living facilities is also expected to grow as Malaysia becomes an ageing population nation by 2030.

“Going forward, our respondents are optimistic about venturing into new growth areas which are logistics and healthcare, despite being still keen on the traditional sectors such as retail and office.

“As for the hospitality sector, accelerated vaccination deployment both locally and across the globe leading to gradual opening of more international borders, is key to travel and tourism recovery.”

In the near-term, Knight Frank says there will be lesser investment and funding in the retail and hotel/leisure segments by developers due to the prevailing challenging market conditions.

“As for the fund and REIT managers, their exposure is fairly distributed among all the key property sub-sectors such as office, retail and industrial/ logistics.

“Lenders have expressed higher interest in funding the industrial/logistics sector since last year due to the accelerated growth in e-commerce, supported by technological advancements.”

Knight Frank adds that they are, however, expected to exercise more caution in providing financing for the hotel/leisure and institutional segments.

Stellar residential sector

In spite of the adverse impact of the pandemic, public-listed property developers still recorded stellar performances during the latest corporate earnings season.

With the residential sub-sector still being the main driver of the local property market, KAF Equities Sdn Bhd says sales are expected to pick-up by this month.

“We also expect the fourth quarter of 2021 to be the strongest as developers would likely be more aggressive in their launches in the fourth quarter of 2021.”

Additionally, with the Home Ownership Campaign (HOC) tentatively scheduled to end at the end of this year, KAF Equities believes there will be strong buying momentum in the final quarter of 2021 as people will be rushing to purchase their desired property while incentives are still available.

Meanwhile, Knight Frank, in its survey, says all sub-sectors with the exception of the hotel/leisure, office and retail segments, are anticipated to see a recovery by 2022.

“About half of the respondents (52%) anticipate the overall commercial property market to recover only by 2023 and beyond, although some 46% of them are more optimistic, expecting recovery next year.

“A deeper observation unveils that 42% of developers are comparatively more optimistic of recovery in 2022 compared with 37% of fund/REIT managers and 35% of lenders. A total of 28% of developers and 25% each of fund/REIT managers and lenders anticipate recovery to only set in by 2023.”

Knight Frank says the majority of respondents (more than 60%) believe that the logistics and healthcare-related sectors will continue to do well in the second half of 2021.

“The resurgence in the number of Covid-19 cases leading to the reimposition of various phases of the movement control order continues to disrupt supply chains leading to growth in the e-commerce market and higher demand for added healthcare facilities.”

In the retail sub-sector, Knight Frank says the percentage of respondents expecting recovery in 2022 or 2023 and beyond are fairly split at 45% and 46% respectively.

Conducive environment

To support economic recovery and lift real estate sentiment, Knight Frank says respondents in its survey would like to see more tax reliefs under the upcoming Budget 2022, which will be tabled on Oct 29.

Knight Frank adds that respondents will also want to see the implementation of additional stimulus packages, resumption of the high speed rail project, acceleration of the vaccination programme, more incentives to attract foreign direct investments, extension of the HOC, reduction or waiver of the real property gains tax (RPGT) and revival of the Malaysia My Second Home (MM2H) programme.

Commenting on the new MM2H conditions, RHB Investment Bank, in a recent report, says the impact of the new rules will be neither positive nor negative.

“In our view, the government can always introduce more targeted measures or incentives to attract the return of foreign investors to the local property market. Policies such as the RPGT can be relaxed as speculative buying of properties has been fairly minimal in recent years.”

More importantly, the research house says having better economic growth prospects, a stable political landscape and steady currency would help to spur foreigners’ interest over the longer term.

Source: TheStar.com.my

Penang government will continue to carry out maintenance works in all eligible public and private housing schemes in the state.

This assurance was given by state Local Government, Housing, Town and Country Planning Committee chairman Jagdeep Singh Deo after he had announced the state government’s financial assistance for the upgrading of three lifts at Sri Saujana Apartment in Jalan Macallum today.

The total cost for the repairs is RM239,400. Under the Penang Maximum 80% Maintenance Fund (TPM80PP), the state government will bear RM191,520 (80%) while the management committee will bear RM47,880 (20%).

“This clearly shows that the Penang government cares for the people and will continue to help them as much as possible to alleviate their burden, even during this Covid-19 pandemic.

“From 2008 to September 2021, the Penang government has spent almost RM285 million on maintenance projects in all public and private housing schemes throughout the state of Penang.

“Economically, we will assist where we can. Covid-19 will not stop the Penang government from doing its part. We will not let Covid beat us; we will beat Covid,” Jagdeep told a press conference during his visit to the apartment today.

Under the TPM80PP, he said a total of RM45 million has been spent by the state government, involving a total of 283 applications for 479 projects.

The bulk of the expenses go to upgrading or replacing the elevators followed by water tank repairs, he said.

Pengkalan Kota assemblyman Daniel Gooi thanked Jagdeep and the state government for understanding the plight of the residents there.

“With the approval of the lift upgrading for Sri Saujana, I am happy to say that today is a historical moment as all strata buildings in Gat Lebuh Macallum have at least one maintenance project approved by the state government.

“Even though we are hit by the pandemic, the state government will not stop in helping to maintain eligible public and private housing schemes either through repainting the building or repairing the lifts,” Gooi said.

Source: Buletin Mutiara

Factories and construction sites in Penang have contributed a major portion of Covid-19 cases in the state, says state Housing, Local Government and Town and Country Planning Committee chairman, Jagdeep Singh Deo.

He said the local enforcement authorities have been constantly monitoring the premises throughout the state and taking firm action to curb the Covid-19 transmission.

Jagdeep said that as of this month, the Penang Island City Council (MBPP) has issued stop-work orders on five construction sites due to the Covid-19 cases detected.

“Three of the construction sites are located in the Northeast district and the other two in the Southwest district,” he told reporters at Dewan Sri Pinang, here.

He said other premises such as factories and markets would be shut down if there is at least one Covid-19 case found.

“Looking at the record-high number of Covid-19 cases in Penang on Wednesday (Sept 8), the state government has to up the ante and implement stricter enforcement and monitoring for public health and safety,” he said on Thursday (Sept 9).

On Wednesday, Penang recorded 2,474 Covid-19 cases, bringing the cumulative number to 100,906 in the state.

Earlier today, Phase 2 of the community mobile vaccination (MOVAK) programme was launched in Penang, aimed at vaccinating 5,200 licensed hawkers and traders throughout the state by Sept 12.

Licensed hawkers and traders can either pre-register to make an appointment for their vaccination or choose a walk-in at the dedicated vaccination centre in Dewan Sri Pinang, here, or Dewan Dato Haji Ahmad Badawi in Butterworth.

Source: Bernama

Real estate associations are urging the public to beware of illegal brokers under the guise of technology and innovation.

The associations consisted of The Royal Institution of Surveyors Malaysia (RISM), The Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia (PEPS), Malaysian Muslim Real Estate Consultants Association (PEHAM), Malaysian Institute of Property and Facility Managers (MIPFM) and Malaysian Institute of Estate Agents (MIEA).

In a joint statement today, the associations are calling for members of the public to deal only with real estate agents and firms registered with the Board of Valuers, Appraisers, Estate Agents and Property Managers (BOVAEP) when engaging any person or persons to carry out real estate services which include selling, buying, renting, leasing, tenancy administration and advisory services.

The associations said the statement served as a reminder that there are people who are not estate agents but operating estate agency businesses illegally and using many forms of creative ideas to do so.

They said real estate service is gazetted as a professional service under the Valuers, Appraisers, Estate Agents and Property Managers Act 242, 1981 to protect the public.

“It is also to ensure that if anyone other than those registered carries out the work as an agent in any form or shape or manner, they will be committing an offence and can be charged in court with a fine of not more than RM300,000 and imprisonment for not more than three years or both,” the associations said.

“It is important to state that we are not against innovations and technology but we want to reinforce our stand that we cannot condone anyone, either individuals or companies in any form or shape, who do not comply to existing laws of the land where it fits as far as real estate agency practice is concerned,” they added.

Source: Bernama

The Penang government may apply for a judicial review against the Appeal Board’s decision earlier today that cancelled approval of the Environmental Impact Assessment (EIA) of its ambitious sea reclamation to build three artificial islands.

State executive councillor Zairil Khir Johari said the state will consider using this legal option pending obtaining the official written decision by the Appeal Board.

“The state will also consider other actions such as the possibility of presenting an updated EIA based on the approvals from the local authorities as referred to in the decision by the Appeal Board,” the infrastructure and transport committee chairman said in a brief statement in response to the decision.

This morning, the Appeal Board under the Environmental Quality (Appeal Board) Regulations 2003 allowed the preliminary objections submitted by fisherman Zakaria Ismail, against the approval of the EIA for the Penang South Reclamation (PSR).

In allowing the objection, the approval by the Department of Environment (DoE) director general (DG) on the PSR EIA was also set aside as it was ultra vires, null and void.

Ultra vires in legal terms means acting beyond one’s authority.

The PSR is a massive reclamation project to create three islands off the southern coast of the main Penang island.

The islands, loosely named A, B and C, will measure a total 4,500 acres (1,821 ha) in land size off the coast from Permatang Damar Laut.

The PSR project was first introduced back in 2015 as the funding module of the RM46 billion Penang Transport Master Plan (PTMP) after SRS Consortium was appointed as the project delivery partner (PDP) for the PTMP on August 14, 2015.

Source: MalayMail.com