Tuesday, 30 April 2013

(The Star) RM600mil Splash Park to be built on seafront land within Palm Springs

Coming attraction: Splash Park, to be completed in 2015, is set to be the largest water theme park in Negri Sembilan.
Coming attraction: Splash Park, to be completed in 2015, is set to be the largest water theme park in Negri Sembilan.
VISITORS to the resort town of Port Dickson will soon have an added attraction catering for young families with the establishment of Splash Park.
Set to be the largest water theme park in Negri Sembilan, it is due for completion in 2015.
Palm Springs Development Sdn Bhd, a subsidiary of listed developer, Tanco Holdings Bhd, will be developing Splash Park as a water theme park cum resort complex on 9.2ha land located within Palm Springs Resort City (PSRC), which itself encompasses 162ha of seafront land in Port Dickson.
Splash Park will have a gross development value of RM600mil.
The Splash Park adventure will centre around a large water play ship structure which could set it to be the biggest playship structure in Malaysia.
Families can have fun exploring the large water ship, sliding down a multitude of water slides, floating along lazy rivers, engaging each other with various water play items, playing among a forest of jumping jets and relaxing by beach pools, along with restaurants facilities and night entertainment.
Special areas will also be equipped with cabanas and lounge chairs that will allow parents to relax while seeing their children at play or for group outings or events.
In addition to the water theme park, the first phase of Splash Park will also have, among others,830 units of serviced suites which will be managed and operated by reputable operators.
This will be followed by a 250- room hotel block with a conference centre that can cater for up to 2,000 people for meetings, incentives, conferences and exhibition (MICE) activities.
According to PSRC executive director Chan Chee Meng, Splash Park is a one-of-its-kind tourism product in Port Dickson for families with young children as exciting activities are open to them throughout the day with fun and safety being our top priorities.
“Splash Park will enhance the tourism experience in Port Dickson by filling the ‘gap’ in the current lack of facilities experienced by the large numbers of day-trippers from places such as the Klang Valley, Seremban and surrounding areas,” said Chan.
The water theme park will provide tourists with exciting attractions in what promises to be Malaysia’s next premier lifestyle destination.
Chan said Splash Park would be complemented by existing facilities already in place in the PSRC namely the 18-hole Kelab Golf DiRaja Palm Springs, its Club Village and extreme park.
“While mothers and younger children splash away in the park, fathers could take the opportunity to sneak in some golf at our nearby golf course, while older teenagers will find thrilling activities including go-karting, paintball matches etc. at the Extreme Park. PSRC is truly designed for the whole family.
“Even though Port Dickson is an established beach resort, we believe much more can be done to enhance its popularity.
“Splash Park can help increase tourists arrivals by providing best-in-class tourism attractions,” he added.
Splash Park aims to kick-start the new phase under the master development plan of PSRC which spans over 400 acres (162 ha) of sea fronting land in Port Dickson.
Apart from Splash Park, other exciting development components will include an international destination-based spa retreat village, international hotels and serviced residences, a wellness zone, a marina and duty-free shops.

(The Star) KPJ Healthcare to maintain dominance in local market

KUALA LUMPUR: KPJ Healthcare Bhd’s aggressive expansion plan of two new hospitals per year could help maintain its dominance in the local healthcare sector, said RHB Research.
In addition, its active pursuit of the lucrative healthcare tourism market could lift its profile over the longer term, it said in a note.
“The management has reaffirmed that the company would stick to its internal target of opening at least two new hospitals annually to meet its longer-term goal of owning at least 40 hospitals by 2020,” RHB Research said.
The company has targeted revenue contribution from medical tourism business to grow to 25% by 2020 from the current 10%.
The research house said KPJ intended to transform three of its existing hospitals at Damansara, Johor and Ipoh into reference centres for oncology treatment.
These hospitals would be upgraded to include new facilities in oncology and radiotherapy treatment, while an additional nuclear medicine facility would be introduced at the KPJ Johor Specialist hospital by second quarter of 2013.
RHB research said KPJ has earmarked its new flagship hospital in Bandar Dato’ Onn as a medical tourism hub.
“We are positive on this, as KPJ’s bold move into the more competitive but lucrative medical tourism industry, could lead to improvement in margins over the longer term,” it added.
Upon opening in 2014, the hospital will house six centres of excellences in the field of oncology, women and child, cosmetics and reconstruction, orthopedic, cardiology and geriatrics. “Services would be priced competitively to tap into the more price-sensitive foreign community from Singapore,” it added.
RHB Research has maintained a “buy” call on the stock with a revised fair value of RM7.14. — Bernama

(The Star) Zeti: Malaysia on track for 5%–6% GDP growth

KUALA LUMPUR: Malaysia is on track to achieve gross domestic product (GDP) growth of 5% to 6% this year, driven by strong domestic demand and investment inflows despite the current slowdown in China, Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz said.
She said the central bank had already included the risk from global slowdown in the projection and that the current situation in China would not affect the GDP target for the whole year.
“These (global risks) are already priced into our forecast, but if it deteriorates further of course it will affect us,” she told reporters after presenting the Kijang Emas Scholarship to selected students in Kuala Lumpur yesterday.
However, she said should the global economy slow down significantly, the effect would not be as bad as previously due to the strength of the domestic demand and strong growth in investment.
Zeti said the country’s economy was still strong as investment was still taking place and consumption was steady at 6% to 7%.
“We face a lot of challenges that are happening in the global economy, in Europe, the US, the UK and Japan, which are important trading partners, but it is important for us to stay focused on the economy and keep going,” she said.
Asked on the expansionary fiscal policy highlighted by contesting parties in the upcoming general election, she said fiscal sustainability was very important and it needed to be accompanied by an increase in revenue.
Zeti also said fiscal policy needed to be targeted at areas that had the highest impact and ensured that everyone would receive the benefit.
Meanwhile, commenting on the strengthening ringgit, she said the rise of the local unit was due to the weakening of other currencies as well as good inflows of investment into the country.
“This is not unusual, we have seen it before. But what is more important is our foreign exchange market has been orderly.
“And also the financial system, the banking system in particular, bond market and capital market in general, has been able to intermediate these flows in an orderly manner,” Zeti said.
THe governor said the capability of the local market to absorb the volatility of the global economy was due to the liberalisation of the rules for foreign exchange transaction. — Bernama

(The Star) Malaysia is well on its way to achieving high-income status

GNI per capita up 49% since 2009 following the launch of the Economic Transformation Programme
<B>Great accomplishment:</B> The country may achieve high-incom e-nation status by 2018, two years ahead of the 2020 goal, especially after the rollout of the ETP.
Great accomplishment: The country may achieve high-incom e-nation status by 2018, two years ahead of the 2020 goal, especially after the rollout of the ETP.
PETALING JAYA: Malaysia is well on its way to achieving high-income status by 2020 or earlier, going by official data and economic performance thus far.
While there has been much debate over how effective the various measures and initiatives under the Economic Transformation Programme (ETP) have been, numbers do not lie.
In terms of gross national income (GNI), Malaysia saw its GNI per capita increase to US$9,970 (RM30,239) as of end last year compared to US$6,700 (RM20,321) in 2009, a surge of 49% in the three years since the ETP was launched.
The ETP, the brainchild of Datuk Seri Najib Tun Razak, contains a detailed plan of action that aims to place the country in the high-income band, as defined by the World Bank's criterion of US$15,000 per capita based on GNI by 2020.
The ETP was launched in October 2010, which saw gross domestic product (GDP) rise 7.2% year-on-year in that year. Projects under the ETP have given the economy a much-needed boost amid a slowdown in trade and the bleak global outlook, with GDP up 5.1% in 2011 and 5.6% last year.
For one thing, robust domestic demand, especially in private consumption, continues to be an indication that people's incomes have risen, while the continued growth of the economy also indicates income growth, especially since many jobs have been created in areas which have pushed the country's manufacturing sector up the value chain.
At end-2012, projects under the ETP had attracted committed investments of RM211.34bil and grew GNI to RM135.64bil, creating 408,443 jobs. The ETP as a whole envisions investments worth RM1.4 trillion and the creation of 3.3 million jobs in the 2011 to 2020 period for the country to achieve high-income status.
According to the Performance Management and Delivery Unit (Pemandu), Malaysia had surpassed its GNI and GDP targets for last year.
Pemandu pointed out that the country might even reach high-income-nation status by 2018, two years ahead of the 2020 goal, should current projections hold true, when measured against GDP growth, especially after the rollout of the ETP.
Growth last year even outpaced Asia-Pacific's, which rose an average of 3.8%. Again, this was supported by private investments and consumption.
“We believe that these developments were largely driven by the economic transformation agenda undertaken by the Government from 2010 to propel Malaysia towards becoming a high-income nation by 2020,” Pemandu said in its 2012 annual report.
“It is this healthy economic growth that enabled the Government to record its highest revenue in our history in 2012, estimated at about RM207bil. As a result, the Government was able to implement many socio-economic programmes, including those under the Government Transformation Programme such as the Bantuan Rakyat 1Malaysia or BR1M.” However, there appear to be some disparities in economic progress for certain corners of the country. Besides politicians, economists would also like to see all parts of Malaysia improving at more or less the same pace.
But this has not been the case, with the states of Kedah and Kelantan lagging behind.
According to the latest available data from the Statistics Department, Kedah's GDP per capita (a measure of the standard of living and not an indicator of per-capita income) was valued at RM9,557, with Kelantan at RM6,496 based on constant 2000 prices compared to the country as a whole, where GDP per capita was at RM19,772.
In that year, Malaysia's GDP was valued at RM559.6bil while the population stood at 28.3 million. Granted the data was from 2010, but things would not have changed much for both states when the 2011 data being compiled by the department becomes available.
The data showed that Kedah, largely an agrarian state with paddy rice production among the major crops, recorded a 4.4% GDP growth, among the lowest in 2010, while Kelantan, also with an economy largely driven by agriculture with fisheries and cottage industries among its main economic activities, saw GDP grow 4.1%.
Kedah's poor performance was compounded by weak finances, as noted by the 2011 Auditor-General's Report. In fact, the report said the state had been facing losses since 2008, reflecting the performance of its economic development unit, Kedah Corp Bhd.
The report described some of the unprofitable investments like shrimp farms, rubber and oil palm as well as logging projects as “wasteful”.
As for Kelantan, it only attracted a meagre 0.3% or RM187mil of Malaysia's total domestic and foreign investment in 2010 of RM33bil.
In terms of investment, Penang's foreign direct investment dropped to RM2.47bil last year from RM9.11bil in 2011. Between 2008 and 2010, the average negative growth was -1.8% compared with the national average of 5.4%, while 10,000 jobs were also lost between 2010 and last year.

(BUSINESS TIMES) RM500m job for Lion Pacific

Privately held Lion Pacific Sdn Bhd is believed to have won a rail contract worth RM500 million to build a railway link in Subang, Selangor.

Business Times was told that Lion Pacific had won the job via a joint venture with Skypark Link Sdn Bhd and that engineering works have already started.

Rail consultant KL Consult Associates Sdn Bhd, on its website, lists Skypark Link as its client for the proposed Subang Jaya-Sri Subang-Subang Skypark Rail Link.

It is understood a tender has been called by KL Consult for the electromechanical portion of the contract. Some six firms had submitted bids, which are Siemens Malaysia, E to E Engineering from India, Intelligent Essence Sdn Bhd, Global Rail Sdn Bhd, Pestech Sdn Bhd and CMCE Sdn Bhd.

The Skypark Link-Lion Pacific venture (Slip) received the letter of award from the Transport Ministry early this year.

The project, which is slated for completion by 2015, is the first of a three-phase contract.

The plan is for Slip to lay 8.5km of new double-tracking railway line on the existing KTM alignment from the KTMB station in Subang Jaya right up to Sri Subang, as well as to construct a new elevated alignment near the roundabout leading to the carpark area opposite the Subang Skypark Airport Terminal.

The rail project comes under the private financing initiative (PFI) programme, which seeks to transfer responsibility of financing and managing capital investment of public sector assets to the private sector.

The PFI initiative was first announced under the Ninth Malaysia Plan in March 2006. Although, the project is placed under the PFI category, the government has allocated some RM125 million, if required, to help jump-start the project.

This is the second major rail contract over the past nine months won by Lion Pacific, which was active in the railway industry more than a decade ago. Little was heard of it since then, only emerging in the public eye in July by notching a contract valued just under RM1 billion.

Last July, Syarikat Prasarana Negara Bhd announced that the Lion Pacific-George Kent Bhd joint venture had won a RM955.84 million contract for the system works for the Ampang light rail transit line extension project.

George Kent is a public-listed company controlled by husband-and-wife team of Tan Sri Tan Kay Hock and Puan Sri Tan Swee Bee, who together own nearly two-thirds of the company.

Lion Pacific's partner in the Subang rail venture, Skypark Rail, is believed to be linked to Tan Sri Ravi Menon, who has substantial interest in the country's railway sector due to his involvement in Ara Group and Hartasuma Sdn Bhd.

Ravi founded Ara group but his reputation in the marketplace glowed due to his role in running Skypark Group, which leases Subang Skypark airport in Subang Jaya from Malaysia Airports Holdings Bhd via Subang Skypark Sdn Bhd.

Ravi is also an executive director at Subang Skypark, which plans to embark on a RM420 million infrastructure redevelopment to transform Subang Skypark, formerly the Sultan Abdul Aziz Shah Airport, into a full-fledged aerospace city by 2015.


(BUSINESS TIMES) UEM Land, TM in tie-up to roll out UniFi in Nusajaya

KUALA LUMPUR: UEM Land Bhd has allocated about RM13.5 million to roll out Internet connectivity for the residences in Nusajaya, Johor.

Recently, the company has formed a partnership with Telekom Malaysia Bhd (TM) to provide UniFi, its high-speed broadband (HSBB) service, to more than 4,000 residential units in the area.

Under the pact, the HSBB provision obtained by UEM Land will cover residences in Nusa Bayu, Nusa Idaman, East Ledang and Puteri Harbour. TM will also provide UniFi infrastructure to UEM Land's projects in Ledang Heights, Ujana Apartment, Port of Puteri Harbour Ferry Terminal and Southern Industrial and Logistics Clusters.

TA Securities Holdings Bhd said the exclusive agreement between TM and UEM Land will enable TM to gain a strong foothold in Iskandar, given that the latter is the master developer of the project, which is expanding at a rapid pace.

"We are positive on this announcement, which indicates traction in TM's ongoing efforts to accelerate expansion of its UniFi subscriber base and coverage via collaborations with property developers," it said in a research note issued yesterday.

As at end-December 2012, UniFi has a total subscriber base of 483,000 (including business subs), of which 406,000 are residential customers.

The research firm said the addition of 4,000 new subs in Nusajaya by 2016 implies a one per cent expansion to UniFi's current residential subscriber base.

"We view TM's first-mover status at greenfield property developments as the group's major edge over competitors," it said, adding that demand-driven rollout of HSBB fibre is also beneficial for TM's cash flows and margin, given the lower capital expenditure and depreciation costs.

UEM Land, a wholly-owned subsidiary of UEM Land Holdings Bhd, is the master developer of Nusajaya, part of the five flagship zones in Iskandar Malaysia.


(BUSINESS TIMES) I&P plans luxury residential towers

I&P Group Sdn Bhd is hoping that its strategy of building luxury residential towers will lead to better results for the company.

Its group managing director Datuk Jamaludin Osman said its first project, which is worth RM800 million, will be launched in Bandar Kinrara, Puchong, Selangor, this year.

I&P, a wholly-owned unit of Permodalan Nasional Bhd, has 13 ongoing township projects and around 2,000ha landbank in the Klang Valley and Johor Baru.

These include Bandar Baru Sri Petaling, TemasyaGlenmarie, Bandar Kinrara, Alam Impian and Alam Damai in the Klang Valley, and Taman Industri Jaya, Taman Rinting and Taman Perling in Johor.

The residential component in these townships have always focused on landed properties and affordable apartments.

For the new project in Bandar Kinrara, Jamaludin said it will comprise five serviced apartment blocks totalling 1,200 units.

Speaking to Business Times in an interview recently, he said the company will be launching the first block, featuring 236 serviced apartments, within the next two months.

Each unit ranges from 642 square feett to 1,600 sq ft and will be priced at about RM650 per sq ft.

"This will be our first time embarking on high-rise luxury residential property projects. We are doing this to enhance the land value. We need better returns for a company that is growing," he said.

Jamaludin said besides Bandar Kinrara, the company will also be launching luxury serviced apartments in Bandar Baru Sri Petaling and Alam Damai.

I&P was formed in 2009 after the rationalisation exercise of three companies, namely Island & Peninsular Sdn Bhd, Petaling Garden Sdn Bhd and Pelangi Sdn Bhd.

For its fiscal year 2009, the company posted earnings of RM142.51 million on the back of RM1.07 billion revenue, translating into a profit margin of 13.28 per cent.

Last year, its revenue was around RM1.1 billion.

The company is expected to maintain that performance in the current year, Jamaludin said.



PETALING JAYA: Oldtown White Coffee celebrated the opening of its 200th outlet recently.

Some 200 guests comprising business partners and friends attended the event at its restaurant in Oasis Square, Ara Damansara.

First established in Ipoh in 1999, the management of the kopitiam chain plans to open 30 more restaurants this year.

Its group managing director Lee Siew Heng said Oldtown White Coffee will continue to work on providing customers' an enjoyable experience.

"This is in line with our mission of giving our customers a good time," said Lee.

(NST) Infrastructure projects a boost for state

SEREMBAN: THE rapid pace of infrastructure projects in Negri Sembilan, particularly its capital of Seremban, has enhanced the attractiveness of the state to investors and property buyers.

One area which stands out is the building and upgrading of routes to Kuala Lumpur which has resulted in more people working in the federal capital relocating their homes to Seremban.

This has helped speed up the development of the state capital,once regarded as unattractive and under-developed despite its proximity to Kuala Lumpur.

The excellent roads and highways serving Seremban have turned the town into an attractive and highvalued Kuala Lumpur suburb.

Menteri Besar Datuk Seri Mohamad Hasan said the various measures implemented by the state government was not only aimed at attracting investors and property buyers but also retaining people in the state.

“We have adopted a holistic approach in providing the necessary infrastructure and basic facilities for people from and outside the state.”

Among the on-going infrastructure projects is a RM160 million interchange at Km267.8 (between Seremban and Nilai) of the North-South Expressway.

The interchange, which will have a 12-lane toll plaza, will benefit more than 40,000 road users daily.

Other projects on in the pipeline are an elevated interchange on the Lebuh Raya Kajang Seremban (Lekas) highway, Seremban middle ring road and Paroi-Senawang-Kuala Lumpur International Airport highway.

“The state government is now working on efforts to beautify and upgrade Seremban, with a better road, sewage and drainage systems.

Work to install streetlights at all villages in every district in the state is on going,” said Mohamad.

A total of RM16 million has been set aside for the streetlight project over the last three years. For this year, another RM4 million has been allocated.

Mohamad said people in the state had also benefited from the restructuring of water supply system.

Another area which concerned the state government, svaid Mohamad, was resolving traffic congestion in Seremban.

“An overhaul of the traffic management is being carried out to ensure a smoother traffic flow.”

The exercise is being carried out by the Public-Private Partnership Unit in the Prime Minister’s Department (Ukas).

“Matters being looked into are enhancing traffic flows and diversion system aimed at reducing congestion in the town centre, especially during peak hours.”

A congestion-free and efficient traffic system in Seremban, he added, would make the city more attractive to investors and property hunters.

Mohamad said work on the RM2 billion Seremban Sentral had started.

Among the components of the project is the building of 300 parking lots.

“The state government is aware about parking problems which have hindered many from using the train service.

“However, this will be a thing of the past when the project is fully completed. Coupled with a better traffic management system, Seremban will become an exciting and attractive place to call home.”


(The Edge) Sunway gets RM222m KLCC development project

KUALA LUMPUR: Sunway Bhd, through Sunway Construction Sdn Bhd, has been awarded a RM222 million contract by Cititower Sdn Bhd for the mixed development project at Persiaran KLCC in Kuala Lumpur.

Cititower is a joint venture between KLCC (Holdings) Sdn Bhd and QD Asia Pacific Ltd. QD Asia Pacific Ltd is a wholly owned subsidiary of Qatari Diar real estate investment company, an investment arm of Qatar Investment Authority.

In a filing with Bursa Malaysia yesterday, Sunway said the contract comprises the construction and completion of piling and sub-structure works as well as associated works for the mixed commercial development project on two lots of land at Persiaran KLCC.

The project is slated for completion within 82 weeks. Sunway will commence work after the site has been handed over. The handover date has yet to be determined.

“The project is expected to contribute positively to the earnings of Sunway group from the financial year ending Dec 31, 2013 onwards,” Sunway said in the filing.

It said the proposed project is subject to normal construction risk of materials price fluctuation.

“However, with the past experience and expertise of Sunway Construction in construction projects in Malaysia, this risk could be mitigated,” it added.

Monday, 29 April 2013

(BUSINESS TIMES) Debt-fuelled property boom unlikely, says Standard & Poor's

KUALA LUMPUR: A debt-fuelled property boom is unlikely in Malaysia as credit losses facing local banks from housing exposures should remain limited, said Standard & Poor's Rating Services.

Housing loan growth has been in line with the overall industry growth, suggesting that a debt-fuelled property boom is unlikely, S&P's said in a report.

"Resilient economic conditions will support borrower repayment ability, while the government's cooling measures should help to soften price growth."

The pace of Malaysian property price increases has gathered momentum in recent years.

A supportive economy and mortgage rates at near-historical lows have spurred buyer demand, which, in combination with supply issues, have led to a marked increase in house price growth since 2010.

According to S&P's, home loans currently make up about 26 per cent of Malaysian banks' loan portfolios, the single largest segment.

However, it warned that rising prices and household leverage heighten the risks to Malaysian banks' portfolios in the event of adverse changes in interest rates or the labour market.

House price growth saw a marked increase from the long-term trend beginning the third quarter of 2010 and continued to trend upwards last year.

"In our view, supply and demand imbalances, low mortgage rates, and speculative buying are likely pushing property prices higher."

Demand is partially driven by the prevailing low interest environment and easy availability of affordable mortgage financing, reflecting price competition among banks offering close to breakeven rates.

Although rising property prices can give rise to bubbles, they are not necessarily the sole determinant of future financial imbalances, S&P's said.

"In Malaysia's case, housing loan growth has been moderately higher than overall loan growth, but the rate is in line with the system and has declined slightly in recent years."

Loan growth from 2010 to 2012 was relatively stable, even as property price growth accelerated to about nine per cent.

"While the impact of rising house prices on the overall household sector appears manageable, we believe the impact is uneven, in particular, the leverage position of borrowers earning a monthly income of RM3,000 and below - constituting about 16 per cent of system loans is considerably higher than those in other income groups.

"Weaker financial buffers mean this group will be more vulnerable to rising unemployment and interest rates in the event of a downturn."

The government has announced the Responsible Lending Guidelines and tighter loan-to-value ratios (maximum 70 per cent for the third housing loan) and an upward revision to property gains tax aimed at preempting any speculative bubble and ensuring a stable and sustainable property market.

S&P's said the household repayment ability will continue to be supported by resilient economic growth forecast at 4.8 per cent in 2013, an unemployment rate of 3.3 per cent and the prevailing low interest rate environment at 3.0 per cent.


(NST) RM3.8m bridge over Sg Tapah

IPOH: BY July 7, some 50,000 residents of Gugusan Manjoi will be able to use the new arch culvert type of bridge in Jalan Menteri costing about RM3.8 million.

The cost of the bridge will be borne by the Federal Government (RM2.94 million) and the balance by the state government.

The bridge will be 16.46m long and 10.8m wide and run across Sg Tapah.

It is built to accommodate vehicles as well as pedestrians.

It connects Jalan Menteri to Kg Dato Ahmad Said Tambahan I, II and III.

Ipoh mayor Datuk Roshidi Hashim said the new bridge will replace a 10-year-old concrete bridge which was damaged, causing its drainage system to be faulty.

"The old drain is also too shallow, and thus unable to control the heavy rush of water in rainy seasons.

"As a result, there were occasional flash floods due to the drain overflowing with rainwater that flooded homes," he said.

Roshidi said the residents complained to the council in January last year regarding the bridge and floods.

"On March 9 last year, the council engaged a contractor, REV Group Sdn Bhd, to demolish the old bridge and remove Telekom cables and the major water pipe.

"The construction work is now 20 per cent completed."

Meanwhile, the council's assistant director of engineering (road section), Ridza'uddin Mohd Radzi, said the construction of the bridge will include increasing the depth of its drain by 14m, having a two-way traffic flow for it, and creating the latest design for its look.

Businessman Megat Arif Abdul Aziz, 51, who resides in Jalan Menteri, said it was timely for the state government to build a new bridge for the safety of the people here.

"The old bridge used to be the 'main road' for residents to get from one place to another in Manjoi. So a new bridge is good," said Megat Arif.

Another resident, Nourmardiana Ahmad Suhame, 26, a sales personnel who lives in nearby Jalan Jelutong, said the bridge is a necessity to the people as they use it to run errands, send their children to school and travel about in Manjoi.

"It helps to reduce time spent in travelling from one place to another as we run our businesses," she added.

Hawker Ameelia Abdul Wahab, 40, who lives in Jalan Perwira, said the new bridge and its drainage system would certainly help to reduce flash floods which damage vehicles and houses.

(The Edge) Alam Perdana low-cost housing project restored

KUALA SELANGOR: Despite the various obstacles put in its way by the Pakatan Rakyat-led Selangor government, Syarikat Perumahan Negara Berhad (SPNB) managed to restore the abandoned low-cost housing project in Bandar Alam Perdana, thus fulfilling the dream of 2,500 buyers to own a house.

SPNB chairman Datuk Idris Haron said the Selangor government which had jurisdiction over land matters in the state had imposed various conditions and that SPNB was "kicked" here and there like a football in the process of restoring the low-cost project which had stalled since 2002.

"I am grateful that today, Prime Minister Datuk Seri Najib Tun Abdul Razak could personally hand over the mock keys to 10 representatives of the buyers who have been waiting for 12 years for their units," he said after the ceremony, here.

The rehabilitation of the abandoned project was delayed for about a year due to the state government's bureaucracy. Idris said the Selangor government also played politics by promising to give the temporary certificate of fitness and house-keys to the buyers last year in order to win over the voters, but this did not happen when the general election did not take place in 2012 as some people predicted.

The Alam Perdana project on a 20ha site consists of 2,500 units of five-storey low-cost flats, each 650 sq ft in floor size. It is one of 10 abandoned housing projects in Selangor that SPNB managed to restore including Taman Dalma (Semenyih), Taman Sungai Pinang (Klang), Taman Desaria (Petaling Jaya), Bandar Pinggiran Subang and Taman Khalid Al-Walid (Shah Alam), Taman Lingkaran Nur Phase 1, Taman Kantan Permai Phase 1 and Phase 2 (Kajang), and Taman Nuri Indah (Kuala Langat).

To date, SPNB which is a wholly-owned company of the Minister of Finance Incorporated, has completed 88 abandoned projects involving 28,039 units nationwide at a cost of RM802.71 million.

Idris said the launching of the SPNB mobile office using four-wheel-drive vehicles by Najib today was to facilitate the public, especially prospective house owners under the People-Friendly Housing Projects, to forward their complaints to SPNB, such as on poor workmanship.

(The Star) Oneworld factor lifts MAS passenger load 3.5% in Q1

MAS group CEO Ahmad Jauhari Yahya with the oneworld alliance logo.
MAS group CEO Ahmad Jauhari Yahya with the oneworld alliance logo.
PETALING JAYA: Malaysia Airlines' (MAS) entry into the oneworld alliance, among other factors, has lifted loads, although not drastically. The airline saw a 3.5% rise in passenger loads for the first three months of 2013 to 76.6% from the 73% recorded a year ago.
It also saw a 16.5% rise in revenue passenger km (RPK) over the said quarter as opposed to the same period last year. RPK is the average amount an airline makes for flying a paying passenger over a distance of one km.
For the same quarter, it carried a total of 3.6 million passengers, compared to 3.1 million in the same period a year ago, although lower than the 3.7 million it carried in the fourth quarter of 2012. Traditionally, the first quarter is not as strong as the fourth quarter.
“We are glad that our passenger growth in terms of RPK in the first quarter of this year is 16.5% higher than last year, and (attributed) by a combination of factors, and not necessarily a direct result of MAS' oneworld entry,” the airline said in a reply to StarBiz's queries.
MAS became a member of oneworld in February, giving it access to its member network and making it easier for its travellers to fly to parts of the world where it does not serve directly.
Its passenger loads in January 2013 was 73.9% , 76.9% in February, followed by 78.9% in March.
Having crunched MAS' operating statistics, RHB Research said operating statistics had improved significantly, with the overall load factor increasing to 74.0% from the 70.9% recorded in the first quarter of 2012.
“We maintain our stance that MAS' turnaround could materialise on the back of strong passenger feeds from the oneworld alliance that may eventually improve its yield and load factor. The rationalisation of routes is showing positive results and the effective cost control may eventually improve MAS' profit margin,” the research house said.
It added that it was maintaining its “buy” call on the stock, with a target price of RM1.
Out of the 13 research houses tracking the stock as per Bloombergdata, four have a “buy” call, two a “hold” call and seven a “sell” call on the stock. MAS' shares closed unchanged at 70 sen on Friday.
MAS said there had been an increase in interline and code-share traffic upon joining oneworld, and that it had also seen a significant number of oneworld frequent flyer programme members using its network. It is leveraging on its partner networks to have greater access to Europe, China and North America.
MAS said it expected “a substantial increase in revenue from more strategic partnerships that would increase passenger flow and interline cost savings. By leveraging on partner networks, MAS would have greater access to Europe, China and North America.”
With such numbers, it is no surprise then if it was looking to expand its list of code-share partners. The airline is in talks at present with British Airways (BA), Latam Airlines, Qatar Airways and Sri Lankan Air.
Even Air France, which arrived in Malaysia last Tuesday, is looking to co-operate with it to expand into Asia. Last week, Air France chairman andchief executive officer Alexandre de Juniac met up with the MAS top management to explore co-operation with the airline, since both the carriers now ply the KL-Paris route.
MAS has deployed its A380 aircraft for its daily flights to Paris, while Air France is using its B777 for its thrice-weekly flights.
When asked what came out of the meeting with De Juniac, MAS group CEO Ahmad Jauhari Yahya said “the meeting was cordial. We discussed several areas of co-operation. Details are still being worked out”.
“They are already helping us in the A380 component support area and are now looking at possible code-share opportunities,” he revealed, declining to elaborate.
Whether the code-share is for the KL-Paris route is unclear, but what Air France also needs is connectivity to Australia, since it no longer has a code-share with Qantas from Singapore to the Australian cities.
MAS stands a good chance of hammering out a deal that could include domestic travel, Asia and also Australian cities. If that happens, experts feel MAS would be carrying more traffic in the future.
Both BA and Air France had code-share arrangements with Qantas in the past but all that came to an end after the Australian carrier entered into a partnership with Emirates. MAS is already talking to BA for a possible code-share.
Airline alliances help create a global network that can be used by airlines and air travellers alike. It helps airlines save cost in the areas of operations, maintenance, investments and purchases, while travellers have an option in departure times, availability of flights to a greater number of destinations, reduced travel time and various special offers.
A code-share, meanwhile, is where two or more airlines share the same flight to save cost. Under code-share arrangements, airlines can sell the seats, as they are operating the same route. Such arrangements allow greater access to cities through partner networks without having to offer extra flights.
Among oneworld members are Qantas, BA, American Airlines, Cathay Pacific, airberlin, Finnair, Iberia, Japan Airlines, LAN, Royal Jordanian and S7 Airlines.

(The Star) Golden Triangle of KL has grown bigger

KUALA LUMPUR: The Golden Triangle of Kuala Lumpur city centre may have just grown bigger, accommodating the developments that have been rippling from the heart of the city in the past few years.
Property consultancy CH Williams Talhar & Wong believes that the commercial, retail and entertainment hub should be redefined to encompass a larger area reflecting the growth of city.
“Our definition of the new Golden Triangle has expanded. Where the border originally ends at Bukit Bintang in the south, it will now include theTun Razak Exchange while the north will be expanded from Kuala Lumpur Convention Centre to The Intermark,” managing director Foo Gee Jen said.
On the outlook of other areas, Foo said that while property hotspots like Kuala Lumpur, Penang, Kota Kinabalu and Johor Bahru continued to flourish, the upcoming states were Ipoh and Malacca.
“These two areas will be driven by infrastructure and tourism projects. There's the announcement of a RM400mil jetty terminal for cruise liners in Malacca which will boost a high-end tourist market in the state,” he said during a briefing on the consultancy's property market outlook report for 2013.
Ipoh, for example, would benefit from the Electrified Double-Tracking Project running through Perak, Kedah, Penang and Perlis. The RM12.5bil project is due for completion in November 2014.
In the Klang Valley, Foo said the property sector growth would be upheld primarily by infrastructure projects like the mass rapid transit and residential demand while Johor Bahru would continue to benefit from the developments in the Iskandar region.
Up north, Penang was expected to have a stable market in 2013 while Kota Kinabalu would benefit from the expansion of its international airport.
During the media briefing, Foo also noted that residential properties buyers needed to be aware of what they were getting into under the Developers Interest-Bearing Scheme.
“There should be a regulation by the Housing Ministry or Bank Negara to ensure developers highlight this because a majority of the market is not aware of what they are buying into,” he said of the scheme that has interest payments borne by developers during the constuction peiod of a project.
Typically under the scheme, buyers only foot a 5% to 10% deposit upon signing the sale & purchase (S&P) agreement and only begin payment when the project is completed.
“There are caveats to this scheme as buyers commit to a financial obligation upon signing of S&P and interest cost are actually already passed on to buyers through the higher selling prices,” he said.
“In many cases, the 20% to 30% higher selling prices do not reflect the appreciation of the market values in the locality of the projects,” he said, adding that the scheme was banned in Singapore two years ago.
At the same time, he cautioned against participation in property investor clubs as these bodies were not regulated unlike real estate investment funds or mutual funds. “The market has to be wary about putting their life savings into something not regulated.”

Saturday, 27 April 2013

(The Star) WCT to build two more shopping complexes

Goh (left): ‘If the land is good, we are always prepared to look at it.’ Beside him is Ahmad Sufian.
Goh (left): ‘If the land is good, we are always prepared to look at it.’ Beside him is Ahmad Sufian.
KLANG: Property and construction player WCT Bhd is going big on malls with the addition of another two malls in Overseas Union Garden (OUG), Kuala Lumpur, and Kemayan City, Johor to its portfolio in a bid for growth.
Chairman Datuk Ahmad Sufian said there were plans in the pipeline for more developments such as Paradigm Mall in Kelana Jaya.
Kemayan City is a 10-year abandoned project, which WCT plans to rebuild and include as part of its shopping mall extension. The company bought Kemayan City in Kulai for RM180mil after going through an aggressive tender and is in the midst of cleaning up and conducting engineering tests on the existing structures there.
He expects to commence physical works by year-end, and for it to be completed in two-to-three years' time. The mall has a gross development value (GDV) of RM1bil, and will include a hotel.
The company has three existing operational malls: Paradigm Mall, the Bukit Tinggi Shopping Centre in Klang and the soon-to-be-opened Gateway@Klia2.
Meanwhile, the OUG development has been planned as a mixed development with a GDV of RM4bil, which includes a shopping mall, set over 24.28ha.
Ahmad Sufian said at a press conference after the company's extraordinary general meeting that it was continually looking to expand its landbank.
“If the land is good, we are always prepared to look at it,” added deputy managing director Goh Chin Liong.
Its current landbank stands at 414.39ha, including its ongoing developments that are mainly situated in the Klang Valley, the Iskandar region as well as Kulai.
Last year, the company bought 189.39ha in Sungai Buaya, Rawang, to develop a mixed-development township with a GDV of RM1.5bil, which Goh hopes to start works next year.
WCT's current total GDV stands at RM10bil.
Moving forward, Goh expects the group's engineering and construction division to contribute about 45% to group bottomline by 2016. Meanwhile, the property development division is expected to contribute 30% while the remainder 25% will come from its property investment and management division.
In terms of its business in the Middle East, Goh said the group was still tendering for projects in Qatar and for some follow-up projects in Oman.
Earlier in April, WCT had announced that Oman had terminated the RM1bil Batinah Expressway-Package 2 project. On Aug 16 last year, the company announced that its 80:20 joint venture had received a letter from the ministry on the acceptance of its tender for the construction and completion of the highway.
Goh, however, said he was unfazed by the termination of the project, as it was quite a normal practice in the Middle East. While this is a business risk that WCT has to assume, Ahmad Sufian noted that the company had completed some successful projects in the region, including the Bahrain City Centre, the Bahrain F1 and Abu Dhabi F1 circuits and some highways.
“We were informed that they would likely re-tender it,” Goh said in regards to the Oman tender that was pulled back.
He added that the company would most likely re-submit a bid for the highway.
WCT has an outstanding orderbook of RM2.5bil, of which RM1bil is in the Middle East.

(The Star) TM to wire up UEM Land homes

KUALA LUMPUR: Telekom Malaysia Bhd (TM) will wire up more than 4,000 UEM Land Bhd residential units in Nusajaya with its high-speed broadband (HSBB) service UniFi.
UEM Land, a wholly owned subsidiary of UEM Land Holdings Bhd, is the master developer of Nusajaya, part of the five flagship zones in Iskandar Malaysia. It has allocated about RM13.5mil to roll out Internet connectivity for the residences in the area.
“With this agreement, the residences there do not have to undertake additional messy renovations to have their homes piped in with the HSBB service. This is the focus: on the concept of the digital lifestyle,” said TM group chief executive officer Datuk Seri Zamzamzairani Mohd Isa at the signing ceremony.
TM gave a ballpark figure of RM5bil in capital expenditure for its HSBB project, including the Nusajaya venture.
The agreement will see houses in Puteri Harbour, East Ledang, Nusa Bayu and Nusa Idaman having ready access to TM’s 20Mbps HSBB Internet connection and its HyppTV Internet protocol television service upon moving in.
Depending on the type of houses purchased, residents will enjoy the services for free for up to 24 months.
TM has to-date activated more than 548,000 UniFi subscribers on the back of 1.39 million premises passed, covering 102 exchanges at a take-up rate of 38%.
UEM Land managing director Datuk Wan Abdullah Wan Ibrahim, meanwhile, said the company was not prioritising land sale in Nusajaya to boost performance, but rather considered this strictly on a case-by-case basis.
“As long as the sale is strategic to our intent, we would consider it. Our board is very sensitive to land sales, as it is not our business model to keep selling land,” he said.
“But in the case of Puteri Harbour, we cannot possibly do it alone because we have so many other projects. That’s why we are considering some land sales, and most of these are joint ventures. Are we going to keep on selling land? Definitely not,” Wan Abdullah added.
He said UEM Land had about 2832.79ha of undeveloped land-bank, of which the bulk was in Gerbang Nusajaya – its biggest contiguous land-bank of 1821.09ha.
“This will be our focus in the next few years while we focus on the employment situation. We want to raise the bar. Nusajaya today its really hot, as everyone wants a piece of the action. We constantly rework and improve and always move up, never going south,” he said.

(The Star) Monetary policy in the spotlight

Inflation in Malaysia is expected to remain moderate, between 2% and 3% this year.
Inflation in Malaysia is expected to remain moderate, between 2% and 3% this year.
IS Malaysia’s monetary policy – measures affecting the money supply, interest rates and exchange rates – at the optimal level, especially when taking into account the pro-growth policies that has been rolled out under the Economic Transformation Programme or is there room to raise rates?
Policymakers make changes to monetary policy in tandem with economic growth, inflation expectations, employment and trade. For Malaysia, gross domestic product (GDP) growth has been steady, expanding at a 6.4% pace in the fourth quarter of 2012 while inflation pressures remain largely benign amid full employment.
The question is relevant because with loose monetary policy prevailing across the world, investors chasing higher yields will continue to flow into regions where the growth prospects are brightest, which is East Asia, including Asean.
This has led to asset prices in this region being pushed way up, be it bonds, equity or property. However, in a reply to an email query fromStarBizWeekBank Negara governor Tan Sri Dr Zeti Akhtar Aziz says the current stance of monetary policy is appropriate given the outlook for inflation and growth. Malaysian’s benchmark overnight policy rate (OPR) has been maintained at 3% since May 2011.
“While inflation is expected to rise during the year, it is rising from very low levels and hence expected to remain moderate between 2% and 3%. Growth will continue to see robust private investment activity and the continued expansion in private consumption,” she says.
Zeti adds that the central bank will continue to carefully assess the global economic and financial developments together with their implications on the overall outlook for inflation and growth of the country’s economy when deciding on monetary policy.
CIMB Investment Bank Bhd economic research head Lee Heng Guie observes that policymakers will have to achieve the fine balance between monetary policy measures and other policy measures designed to stimulate growth after taking into account inflation expectations and economic growth prospects.
However, this is easier said than done as central bankers have in recent years and especially since 2008/2009, taken a much more important role than most of them will have liked in the management of the economy.
“The optimal level of policy” is how Lee explains the dilemma policymakers are facing especially when loose monetary policy will lead to asset or credit bubbles down the road.
Even in countries such as Malaysia where growth has been fuelled by pro-business policy measures, easy lending conditions have also played an important role in supporting economic activities, in particular for private consumption and investment.
This is probably what analysts have to weigh when they peruse Bank Negara’s statement on monetary policy issued after the central bank’s monetary policy committee meets.
Last week, the stimulus measures arising from looser monetary policy, the latest of which were announced by Japan, were the focus of officials when they met at the joint spring meetings of the World Bank and International Monetary Fund (IMF) together with Group of 20 policymakers in Washington, DC.
Their fear is that central banks may find it difficult to exit markets in which they have intervened heavily to prop up the economy with the IMF noting that risks may grow the longer these policies are maintained.
The unwelcome consequences... down the road
The point was underscored by IMF managing director Christine Lagarde, who, in a speech delivered during a meeting of the Economic Club of New York on April 10, cautioned that although it made sense for monetary policy in the emerging and developing countries to do the “heavy lifting” by remaining accommodative during the recovery period and in a low-inflation environment, there were unintended consequences.
She points out that “low interest rates push people to take on more risk – some of which justified, some of which not”.
Standard & Poors Rating Services analyst Ivan Tan says low mortgage rates is one of the reasons that have spurred demand for residential property in Malaysia.
He says in a report titled “Rising property prices could expose vulnerabilities in the Malaysian banking system” that a resilient economy has also spurred demand, which in turn has driven up prices since there is also a lack of supply.
Tan says borrower repayment ability will be supported so long as the economy remains resilient, unemployment stays low and interest rates remain low but notes that price increases have also placed the credit quality of some home loans in the spot light.
He adds that the group of borrowers earning below RM3,000 and with weaker financial buffers will be at higher risk should interest rates increase or if there is unemployment in the event of an economic downturn.
“Although home loans form the largest segment in banks’ loan portfolios, we believe the credit losses facing Malaysian banks from housing exposures are likely to remain limited,” Tan says, adding that the pace of loan growth has generally been in line with the overall loan growth, and does not suggest a property bubble developing in the country.
Furthermore, he says household indebtedness levels have remained relatively constant even as property prices have gone up, suggesting that household borrowings remain broadly in line with rising household incomes and stable employment.
But Zeti assures that considerations will also be given to avoid the build-up of financial imbalances, in particular household indebtedness. Several targeted macro-prudential measures have been pre-emptively implemented and are showing positive effects in ensuring household debt remains manageable.
She says monetary policy’s primary objective is to maintain price stability giving due regard to growth and the central bank will take into consideration the outlook for inflation and growth in determining the stance of monetary policy.
“As monetary policy works with considerable lags, it must be pre-emptive and respond to forward looking assessments,” Zeti says.
The dilemma
How can the effects from central bank policies be dealt with and what can be done about volatile capital flows? What then is the optimal balance between monetary and macroprudential policies?
CIMB’s Lee says in a mid-March report that it will be essential to improve the effectiveness of monetary and macroprudential policies in containing systemic risk.
“Asian policymakers face the dilemma of dealing with the spill overs from capital flows, which can be very volatile in nature. The use of blunt monetary and credit restriction measures could hurt the real economy; and this raises the question of what the optimal balance is between monetary and macroprudential policies in order to safeguard financial vulnerabilities,” he says.
Lee points to high global liquidity and financial repression, along with the still- accommodative monetary stance in Asia, creating a “conducive and easy” route of hedging, arbitrage and “carry trade”, and resulting in money flows from low-yielding to higher-return asset markets.
This then leads to excessive lending concentration in less productive assets, such as real estate, fuelling asset bubbles, financial imbalances, and the rise of households’ indebtedness.
“It is optimal for monetary policy to stay at a level to achieve both price and financial stability. Prolonged low interest rates lead to lower returns for savers and investors, and could result in excessive household leverage, over-investment in unproductive sectors, and hence, contribute to property bubbles and asset price inflation,” Lee says, adding that previous boom-bust asset price cycles clearly demonstrate that excessive asset price gains beyond their fundamental valuations are unsustainable.
Zeti says in managing the economy, policymakers do not just rely on a single tool but on a number of policy tool to sustain growth, including a combination of monetary policy, fiscal policy and other policies.
“Macro-prudential measures could also be implemented to manage emerging imbalances within the financial system to ensure financial stability,” she says, adding that the optimal combination of monetary, fiscal or other policies in providing support to the economy depends on the situation, the root causes of the problems and the degree of policy space available.
Zeti points to the reduction of the OPR during the global financial crisis by a cumulative 150 basis points together with the reduction of the statutory reserve requirement by 300 basis points coupled with the implementation of two fiscal stimulus programmes amounting to RM67bil providing support for domestic demand.
She says several complementary measures were also introduced to reach specific sectors of the economy.
“The outcome of the concerted policy measures was seen in the second half of 2009 as clear signs emerged that the impact of the crisis was contained. GDP growth for the year registered a more modest decrease of 1.7% compared to the earlier projection of -4 to -5%, amid a low inflation of 0.6%.In 2010, the economy expanded by 7.2%,” Zeti adds.