Wednesday, 30 April 2014

(The Star) Moviegoers get to experience latest cinema technology at Summer Mall

Movie time: An artist’s impression of the open-concept box office at LFS Cinemas’ new multiplex in Summer Mall.
Movie time: An artist’s impression of the open-concept box office at LFS Cinemas’ new multiplex in Summer Mall.

KUCHING: LFS Cinemas will open its largest multiplex with 12 halls at Summer Mall Kota Samarahan tomorrow.

The LFS Summer Mall will showcase the latest in cinema technology to enhance the viewing experience for moviegoers.

The RM25mil multiplex occupies 40,000sq ft and has a seating capacity for 2,038 people.

Patrons can look forward to a state-of- the-art moviegoing experience which features the first Dolby Atmos surround sound in Sarawak.

There will be a Lotus Hall, a premier screen concept with double seats for couples or friends who want to sit close together during a screening.

There will also be a five-star hall with the largest giant screen in the state and ultra- comfortable seats.

Other facilities include on-screen advertising, foyer advertising, product sampling, product launching and popcorn box advertising.

To complement the strong emphasis on technology, the new multiplex’s design is clean and contemporary while its open- concept box office will bring it closer to patrons.

The Summer Mall is a three-storey landmark building covering 800,000sq ft with a concept of “Everything Under One Roof”.

It is an integrated development comprising over 335 retail lots with a wide range of trade mix, hence LFS Cinemas’ significant investment in the venue.


(The Star) Firm plans to upgrade and manage facility in Komtar

Strategic site: The Komtar multi-storey car park currently has 288 parking bays.
Strategic site: The Komtar multi-storey car park currently has 288 parking bays.

The Komtar multi-storey car park in George Town will be brighter and safer once the PDC Setia Urus Sdn Bhd approves a proposal for One World Group to upgrade and manage the car park.

Tanjong MP Ng Wei Aik said a meeting would be held between PDC Setia Urus and One World on Monday to further discuss the proposal.

He said One World had invested RM40mil to upgrade several floors in Komtar for shopping purposes and to introduce a rooftop restaurant, adding that it had expressed interest to upgrade and manage the nine-storey car park.

“PDC (Penang Development Corporation)’s board of directors have agreed in principal to the proposal but further details will be ironed out in the meeting,” he told reporters recently.

Ng said upgrading works at the car park, which had 288 parking bays in operation, would include installation of CCTVs, more lighting and a total clean-up of the car park to give the place a “brighter and safer feeling”.

He also said the car park, which was once known for its exorbitant parking rates, would have a revised parking rate effective tomorrow.

The current rate of RM1.20 per hour will be reduced to RM1 per hour while the monthly parking pass of RM127.20 (which includes the 6% service tax) will be revised to RM100.

“The operating hours will also be extended from the present 7am-9pm to 7am-10.30pm because of the Pacific Hypermarket and Departmental Store which closes at 10pm.

“Once the new rates are enforced, we hope to see our current occupancy rate of 60% increase to more than 80%.

“On the weekends, we strive to achieve at least 95% occupancy rate at the car park,” he added.

It was reported on July 7, 2012, that the High Court here had ruled that PDC had the right to terminate the contract of Tropiland Sdn Bhd, which was the tenant of the car park, due to Tropiland’s breach of the lease agreement.

The car park had been leased to Tropiland for 30 years effective Aug 1, 1984.

PDC had filed the suit against Tropiland in 2006 for failing to pay rent.

Tropiland, in its statement of defence, had said that it was unfair for PDC to terminate the lease as it (Tropiland) had invested about RM14mil in the car park.

Ng also said the Penang Municipal Council was also studying a few sites for multi-storey car parks to be built in Penang Road and Chulia Street.

Komtar assemblyman Teh Lai Heng, who was also present, said a site for a new multi-storey car park at Weld Quay, opposite the Pengkalan Raja Tun Uda ferry terminal, has been identified.

“The land belongs to the state government and the council is currently carrying out some studies there,” Teh said.


(The Star) Units priced from RM292,000 to RM390,000 will be built in Paya Terubong

A man checking out the project's revival and rehabilitation plan.
A man checking out the project's revival and rehabilitation plan.

The state government has managed to get a developer to build 7,658 affordable homes in Paya Terubong, Penang.

Chief Minister Lim Guan Eng said PLB Land Sdn Bhd had agreed to build the units ranging from 750 to 1,000sq ft priced between RM292,500 and RM390,000.

The developer is also the ‘white knight’ tasked to revive the abandoned 370 units of Taman Paya Terubong (Majestic Heights Phase 2A) which are scheduled for completion within 18 months.

Lim said the affordable homes would be built on a 26ha piece of land, next to Majestic Heights Phase 2A.

He said the state was looking to not only end the woes of the abandoned units’ owners, but to also provide “shelter” to first-time house buyers in the north-east district.

The upcoming development will consist of 1,532 units with a build-up size of 750sq ft priced at RM292,500, 4,594 units of 850sq ft (RM331,500) and 1,532 units of 1,000sq ft (RM390,000).

“The affordable housing scheme is scheduled for completion in six years starting from the date of commencement of work.

“It will only be eligible to qualified applicants registered with the state Housing Department,” he said before inspecting the abandoned Majestic Heights project yesterday.

Lim said: “Traffic management will be an important factor once the vast development takes shape.”

He said the state would construct a paired road from the development site to Bukit Gambier to ease traffic burden.

On the revival and rehabilitation of the abandoned Phased 2A project, Lim said the move was seen as a small step towards achieving the state’s vision that every Penangite would get to a own a house.

“It has been a long 18 years’ wait for these buyers. Now, they need to contribute RM10,000 each for the revival of the project under PLB Land Sdn Bhd.

“It is my wish to see all of you (affected owners) move into the houses eventually but there are still many issues ahead.”

Meanwhile, Taman Paya Terubong (Majestic Heights Phase 2A) pro-tem committee secretary Khor Boon Peng said they had managed to contact about 80% of affected owners.

“Those who have yet to get in touch with us can call me at 016-4969690 or email me at,” he said.

The Majestic Heights project is the largest abandoned housing scheme in Penang and has caused hardship and financial losses to the housebuyers over the last 11 years.

It consists of several phases but only Phase 1 obtained the certificate of fitness on Dec 31, 2003, while Phases 2A, 2B and 3A were abandoned. When Phase 2A was abandoned, the physical completion was already at 70%.


(The Star) Thousands of visitors check out new KLIA2 airport on its open day

The shopping centre Gateaway@ klia2 will fulfil the needs of local and international travellers alike. — Photos by LOW LAY PHON
The shopping centre Gateaway@ klia2 will fulfil the needs of local and international travellers alike. — Photos by LOW LAY PHON

Thousands visited KLIA2 during its open day on Sunday to get a first-hand look at the new airport.

Visitors were taken on a guided tour of the new facility, including a bus ride through the runway and visited the international arrival hall to view the Skybridge.

Many came as early as 8am to ensure they received a “boarding” pass to check out the new airport.

One of the visitors was bank manager Zulkifli Zuhri from Petaling Jaya.

“I have been waiting to see the new airport and did not want to waste the opportunity. It is not often that we get the chance to see an airport before it opens,” he said.

KLIA2 opening its door for public at open day.
A total of 78,000 visitors turned up at the new airport’s open day.

Zulkifli added he was impressed by the new building.

“KLIA2 takes the concept of low-cost air travel to a new level and it will give a good impression to foreigners,” he said.

University lecturer Dr Ahmad Yasin Omar said the new airport was better than the former low-cost carrier terminal.

“There is plenty of parking space and the terminals are big enough to accommodate many travellers,” he said.

Cheryl Kong brought her children to the open day for a fun day out.

“They learnt a lot about how an airport functions, thanks to the guided tour,” she said.

KLIA2 opening its door for public at open day.
The arrival flight gates can be seen from the Skybridge at KLIA2.

Kong added that the long wait for the airport to be completed was worth it as KLIA2 is of world-class standard.

Businessman Darren Lai said the Malaysia Airports Holdings Bhd (MAHB) employees were very helpful.

“They directed me to the right place to get the boarding pass for the guided tour and the staff manning the counter were very friendly even though the queue was really long,” he said.

Malaysia Airports chairman Tan Sri Dr Wan Abdul Aziz Wan Abdullah said the opening of KLIA2 was expected to bring in more travellers to Malaysia.

“KLIA2 was designed and built to accommodate 45 million passengers a year. It was also designed to fulfil visitors’ needs with an adjacent shopping centre, Gateway@klia2,” he said.

KLIA2 will start operations on May 2.

KLIA2 opening its door for public at open day.
Visitors checking out the immigration section before the airport opens its doors on May 2.


(The Star) MBPJ inks deal for free bus service

An MoU on the much-awaited Petaling Jaya City Council (MBPJ) free bus service will be inked today with RapidBus after months of negotiations.

MBPJ’s initiative is to encourage commuters to shift to public transport, thus reducing carbon footprint, traffic congestion and freeing parking lots for pedestrian walkways.

It is welcome news for commuters in the city, who will be able to use the buses that are equipped with WiFi connectivity and fitted with LED monitors for onboard entertainment.

Previously, MBPJ and RapidBus, a division of transport conglomerate Syarikat Prasarana Negara Bhd, had been working together on the basis of a verbal agreement.

Paperwork pertaining to the free bus service will be ironed out for the Land Transport Commission’s guidance and approval.

Mayor Datin Paduka Alinah Ahmad said the service would be an extension of the community bus service that has been in place for the past six years.

“We want to connect the people from high-density neighbourhoods to hubs such as markets, commercial areas and shopping complexes. Our observation reveals that students, office workers and senior citizens will benefit,” she said.

Currently, about 85% of the city population of more than half a million people depend on personal transport and this has contributed to the traffic congestion.

According to MBPJ, an estimated 51% of the city’s main thoroughfares and several neighbourhood roads are congested during rush hour.

On April 24, StarMetro had reported that discussions were being carried out but the leasing fees for the 10 buses were the sticking point.

In the initial negotiations, the fee for each bus was set at RM1,300 from 6am to 9pm daily but MBPJ had agreed to RM950 per bus daily. MBPJ plans to start the service on May 6 and it will cost the council about RM2.5mil annually.

MBPJ has allocated RM1mil for the project under Budget 2014. Based on discussions, the buses will not operate on weekends as the council aims to cut cost.

The council will also install advertising panels on the buses to bring in revenue.

With 10 vehicles for the inaugural free service, Alinah envisioned a five-minute frequency during peak hours and 10 minutes during off-peak hours.

Peak hours are from 6am to 9am and from 4.30pm onwards, although this may change based on traffic conditions and feedback.

Former adviser of All Petaling Jaya Selangor Residents Association Coalition Mohamed Umar Peer Mohamed said the MoU was similar to the discussions that had been carried out over the past months.

“An MoU only expresses mutual accord on the issue between two or more parties on the business ideas but Petaling Jaya residents want a more concrete agreement that gets the free bus service on the road,” he said.

Mohamed Umar added that students and senior citizens were waiting for the free bus service, especially in light of the current economic climate.


(The Star) Masterplan to improve public transport in PJ

The Petaling Jaya City Council (MBPJ) is preparing a Transport Masterplan to improve infrastructure and ensure public transport integration.

“We want to see more improvement in public transport and its usage as well as road infrastructure upgrades,” said Bukit Gasing assemblyman Rajiv Rishyakaran.

He said the masterplan would have to tackle the issue of lack of feeder bus services and proper bus stops in Petaling Jaya.

“The lack of buses in Malaysia, coupled with the inefficient service, is a stumbling block to more Malaysians switching from private to public transport,” he said.

Currently, there are only about 1,500 buses serving the Klang Valley compared to 3,200 buses in Singapore and 7,500 buses in London.

The masterplan would address the issues and be submitted to the Land Public Transport Commission (SPAD) so that both parties could work together to improve the public transportation system further.

“Buses cost only a fraction of the MRT lines. Just a RM1bil investment can put an additional 2,000 buses on the road,” said Rajiv, who urged SPAD to place equal emphasis on bus services.

“This would help make the new LRT and MRT stations more accessible to a greater number of commuters,’’ he said.

The draft would take about a year to complete and work will begin once the tender is awarded to one of the five shortlisted consultants.


(BUSINESS TIMES) MAHB plans catalytic projects at KLIA Aeropolis

DIVERSIFIED AIRPORT CITY: Mega development includes cargo and logistics hub, commercial business district, a theme park

MALAYSIA Airports Holdings Bhd (MAHB) is planning catalytic projects at KLIA Aeropolis here, which will spur domestic and foreign investments in the multi-billion ringgit development.

More than 2,428ha of the 8,966ha KLIA Aeropolis has been developed, while the undeveloped area is planted with oil palm trees.

The development is located about six kilometers from the Kuala Lumpur International Airport (KLIA) and the Kuala Lumpur International Airport 2 (klia2).

MAHB senior general manager of planning, Mohd Khair Mirza, said several catalytic projects are at planning stages, including a cargo and logistics hub, a commercial business district and a theme park.

“KLIA Aeropolis is a mega development and we have interested parties who want to invest in it. We are talking to them,” he said on the sidelines of the ground-breaking of Mitsui Outlet Park KLIA, here, yesterday.

Mohd Khair had earlier said about 1,000ha has been reserved for the theme park and the size suits Disneyland, whose operator is looking for a site to expand in this region.

KLIA Aeropolis will also feature a free commercial zone, a centre for meetings, incentives, conventions and exhibitions, hotels, natural conservation and green tourism zones, which will be completed within the next five to 10 years.

Mohd Khair said KLIA Aeropolis, when completed, will help increase MAHB’s non-aeronautical revenue and net profit contribution to between 60 per cent and 70 per cent. 

Currently, non-aeronautical businesses contribute more than 50 per cent to the national airport operator’s revenue and net profit.

For fiscal year 2013, MAHB, which manages 39 airports in Malaysia and overseas, posted a net profit of RM388.93 million on revenue of RM4.09 billion.

MAHB chairman Tan Sri Dr Wan Abdul Aziz Wan Abdullah said that KLIA Aeropolis will spark growth for the company, KLIA, klia2, retailers and aviation companies.

“Our vision is to transform KLIA into a diversified airport city with significant business, tourism and employment opportunities,” he said.

He added the encouraging growth in passenger movements augurs well for the KLIA Aeropolis vision, whose critical returns, among others, is the opportunity to expand the group’s non-aeronautical base, in line with its 2010-2014 business direction.

(The Edge) Axis REIT to strengthen its balance sheet

PETALING JAYA: Axis REIT Managers Bhd (ARMB), the manager of Malaysia’s first listed real estate investment trust Axis Real Estate Investment Trust (Axis REIT), plans to strengthen its balance sheet by buying more assets and refurbishing its existing ones.

According to chief executive officer Datuk Stewart LaBrooy, the company was in a consolidation mode last year when it took the assets off the market, and started to refurbish them.

“People will not pay a premium for an old building, so we take the buildings off the market, completely strip them down, build them up from scratch again and put them back on the market.

“So effectively it’s a lot cheaper to refurbish an old building than to buy a new one today because the costs are much lower and the returns are much higher,” he told reporters after the company’s annual general meeting (AGM) yesterday.

He cited the refurbishment of Axis Business Campus in Petaling Jaya as an example, adding that he is optimistic it will rake in double-digit returns.

At the AGM, unitholders approved a placement exercise involving an issue of 86.04 million units, representing 18.65% of the existing fund size of 461.24 million units. This is expected to raise approximately RM275 million.

The unitholders also passed a resolution to increase the fund size to a maximum of 547.28 million units from its current size of 461.24 million units. The net asset value per unit will increase from RM2.23 to RM2.38 after the new units are allotted and issued.

This is in line with ARMB’s capital management and growth strategy of reducing gearing once it exceeds 35% of the total assets of the fund, and will provide Axis REIT with sufficient headroom to make future cash acquisitions. Axis REIT’s current gearing stands at 33%.

It was previously reported that Axis REIT will spend around RM380 million in 2014 to acquire several new assets. LaBrooy said the company is currently in the process of negotiating several terms with vendors.

(The Edge) Sunway REIT’s 3Q profit up despite closure of Sunway Putra Mall

KUALA LUMPUR: Sunway Real Estate Investment Trust (REIT) has raked in a net profit of RM58.5 million in its third quarter ended March 31 (3QFY14), an increase of 5.9% year-on-year from RM55.2 million.

Its revenue came in 1.5% higher at RM108 million from RM106.4 million. Earnings per share came in higher at two sen compared with 1.98 sen a year earlier.

As for its nine months ended March 31, the REIT posted a net profit of RM175.9 million, climbing 7.7% year-on-year from RM163.4 million. Revenue increased 2.1% to RM318.6 million from RM312 million.

In a press statement yesterday, Sunway REIT said that despite the closure of Sunway Putra Mall since May last year, lower income contribution from Sunway Putra Hotel as well as higher property operating costs arising from tariff hike and provision for higher assessment tax for Kuala Lumpur properties, revenue and net property income (NPI) grew by 1.5% and 1.2% year-on-year respectively.

It pointed out that the hotel segment recorded a marginal 1.1% decline in revenue year-on-year in 3QFY14 mainly due to lower income contribution from Sunway Putra Hotel, which was “adversely affected by the ongoing refurbishment”.

As for its retail segment, the group registered a commendable NPI growth of 2.5% year-on-year in 3QFY14 despite loss of income from Sunway Putra Mall, supported by strong performance of both Sunway Pyramid Shopping Mall and Sunway Carnival Shopping Mall.

The office segment’s revenue was higher by 3.5% year-on-year in 3QFY14, underpinned by rental reversion for both Menara Sunway and Sunway Putra Tower.

NPI, however, fell 1.9% year-on-year, mainly attributed to higher utilities expenses and provision for higher assessments for properties located in Kuala Lumpur.

The manager of Sunway REIT, Sunway REIT Management Sdn Bhd, has proposed a higher distribution per unit (DPU) of 2.1 sen for 3QFY14, bringing cumulative 3QFY14 DPU to 6.33sen. This translates into annualised distribution yield of 6.2% based on closing price of RM1.36 on 31 March 2014.

“Barring any unforeseen circumstances, we endeavour to maintain previous financial year’s DPU for FY2014.

“We are well-positioned to face the challenges with the fixed versus floating rate ratio at 77:23 and our average cost of debt of 3.85% (as at 3QFY14) is among the lowest in the sector,” said Sunway REIT Management chief executive officer Datuk Jeffrey Ng.

Tuesday, 29 April 2014

(The Edge) PNB weighs merging property units

KUALA LUMPUR: Permodalan Nasional Bhd (PNB) is considering a proposal to merge four of its portfolio companies to form Southeast Asia’s second largest property firm by assets, a source with direct knowledge of the matter said.

The proposal comes as Malaysia faces a slowdown in the property market after the government imposed a series of curbs to rein in surging housing prices, mimicking efforts taken by several other Asian countries including Singapore and China.

The softer real estate market has depressed property stocks, giving PNB an opportunity to wrest control of its property units and try and maximise investment returns, the person added.

PNB, which manages about US$73 billion (RM239 billion), started restructuring its property portfolio in 2009.

The merged entity, with at least RM41 billion under assets, will be Southeast Asia’s largest real estate developer after Singapore’s CapitaLand Ltd.

Under the proposed deal, PNB could pay about US$1.3 billion to take control of its portfolio companies Sime Darby Bhd, S P Setia Bhd and Eastern & Oriental Bhd (E&O), and merge it with private company I&P Group Sdn Bhd, said the source, who declined to be identified as the information is not public.

The merged entity could take the form of a listed company or property trust, or could even stay private, the source said, adding that the plan is still in its early stages and subject to changes.

Officials at PNB, Sime Darby, E&O and I&P Group did not reply to requests for comment. S P Setia officials declined to comment.

The move comes in line with Prime Minister Datuk Seri Najib Razak’s initiative to increase local companies’ exposure to Southeast Asia’s fast-growing economies.

PNB could end up with a landbank of 27,960 acres (11,315ha), with properties spread across major cities in Malaysia and also in London’s Battersea Power Station area.

The plan to build a mega property firm started in 2009 when PNB merged three property developers into I&P Group after buying Pelangi Bhd, Island and Peninsular Bhd and Petaling Tin Bhd for RM1.43 billion.

(The Edge) Naza TTDI targets RM3b in assets in 5 years, may mull REIT

SHAH ALAM: Naza TTDI Sdn Bhd, the property development arm of the Naza group, may consider launching a real estate investment trust (REIT) if it hits its target of RM3 billion in total investment assets within five years, according to its group managing director SM Faliq SM Nasimuddin.

“I think [our investment asset target of RM3 billion] is quite achievable. Whenever we develop some strategic properties, the group will also look at investing in the retail and office components to get some recurring income,” he told reporters after unveiling the master plan for its TTDI Gateway development in Section 13 here yesterday.

The 38.8-acre (15.7ha) integrated development will be developed over three phases and it features offices, serviced apartments and retail components. The entire project is expected to generate a gross development value of RM2.5 billion and is targeted to be completed by 2020.

“One of the pillars of the group now is to build our asset investments. We own the Naza tower [at KLCC Platinum Park], which is due for completion in the first quarter of 2015.

“And whatever the group develops which we see potential in value, we will invest in that element. Probably five years from now, the group will have a sizeable portfolio of assets to set up a REIT,” said Naza TTDI chairman SM Nasarudin SM Nasimuddin.

The group’s investment assets are currently more than RM1 billion, mostly office and retail units.

On whether the group plans to list on Bursa Malaysia, Nasarudin said there are no plans for now. “It is something we have been talking about for a while. It’s all about timing and value. Probably we as a family will look into it in about two years,” he added.

“There is a lot of competition in the market, [but] I still feel the assets we own are strategically located in very prime areas. So, I think the demand and yield in those prime areas are still there,” said Faliq.

This year, Naza TTDI is confident of meeting its sales target of RM1.5 billion on ongoing projects, including the residential components of TTDI Sentralis and TTDI Alam Impian Shah in Shah Alam; TTDI Dualis in Equine Park, Kuala Lumpur; and TTDI Grove Kajang. In 2013, the group achieved RM1.4 billion in sales.

Faliq (left) and Nasarudin at the unveiling of TTDI Gateway in Shah Alam yesterday.

“We have the right products and right location. If you look at [Naza] TTDI, we don’t aggressively launch projects in many areas. We are focused on what we do.

“We have been developing and launching mid-sized projects, but we always make sure we release the amount of units based on what we think the market can absorb at the time,” said Faliq.

On the development of the RM20 billion KL Metropolis project at Jalan Duta, Kuala Lumpur, Faliq said the group has completed 30% of Matrade Centre, which it hopes to deliver to the government by the first quarter of 2016.

Meanwhile, Naza TTDI will launch the Platinum Park Residences, the second last component of its RM4 billion KLCC Platinum Park development, in September, with a soft launch planned for mid-June. The development of the last component, a hotel, will be announced later.

(The Star) No plans for high-rises

There are no plans for skyscrapers to be built in Ipoh, maintaining its character as a rustic city.

Perak Tourism Committee chairman Datuk Nolee Ashilin Mohd Radzi said development in the city area would only be confined to development of low-rise buildings.

“We have no plans to have high-rise buildings.

“Part of the attraction in Ipoh is its rustic charm,” she told journalists after welcoming an entourage of Swiss students from the Lucerne School of Tourism Management on Friday.

“We have developed the Heritage Trails and will start several projects to restore some buildings in the Old Town of the city,” she added.

Nolee said some of the sites whereby old buildings were situated would be marked as a heritage building zone.

She stressed that while development in the city centre would be limited, there were other areas in Ipoh, like Meru Valley, that could be developed.

Some 75 students from the school were in Ipoh for a research-based seminar for nine days.

The students, comprising of professionals in the tourism industry and full-time students, would also visit Royal Belum rainforest before flying back to Switzerland.

Nolee Ashilin said she hoped the students would learn more about the state and also return here for their holidays in future.

School committee member Manfred Ritschard said the seminar was part of its curriculum to learn about the tourism industry of various countries.

“This is the first visit by the school to Ipoh and we are curious to see what the city could offer.

“We hope to learn how the tourism industry in the state could be developed further,” he said.

Ritschard said it was also his first visit to Ipoh while having been to other parts of Malaysia including Pangkor, Kota Kinabalu and Kuala Lumpur.

“The first impression I get from Ipoh is that it is a small but very cosy city,” he said.

“We do have a lot of old folks in Switzerland and I am sure they will love this place,” he added.


(BUSINESS TIMES) Horizon Outlet to buy 16.2ha for RM400m luxury retail project

KUALA LUMPUR: Horizon Outlet Shoppes Sdn Bhd is buying 16.19ha of land from Sime Darby Property Bhd to build the Kuala Lumpur International Outlets (KLIO) worth more than RM400 million.

Horizon Outlet Shoppes is a joint venture between USnited States-based Horizon Group Properties and Mainstay Holdings Sdn Bhd, a local builder.

Located 39km south of Kuala Lum-pur and 10km north of Kuala Lumpur International Airport, KLIO will offer shoppers 400,000 sq ft of luxury-oriented retail outlets in an elegant setting.

“We are extremely excited to kick off our KLIO development, which we fully expect to be one of the most popular and groundbreaking among any outlet centres in the world,” said Horizon Group international leasing director Greg Clarke.

“We believe that our combination of upscale design, convenient location and value-oriented luxury retail will be very popular with retailers and shoppers alike,” he said in a statement recently.

Kuala Lumpur’s mature transport infrastructure and sheer variety of shopping choices has made the city one of the greatest retail markets in the world.

Boasting three entrants in the world’s top 10 largest malls, CNN Travel ranked Kuala Lumpur fourth in the world for shopping in 2013.

Clarke said with no luxury-oriented retail outlets currently serving the seven million residents of Kuala Lumpur and Selangor or its nine million annual tourists, Horizon Outlet Shoppes is confident of filling the gap.

“Not only are luxury retail outlets a fairly new concept in Malaysia, they are also a gap waiting to be filled. With products priced at as much as 70 per cent below their full retail price, we expect KLIO to be a big hit with local and international shoppers alike,” he said.

The joint venture will begin construction this year, with a grand opening expected on July 1 2016.

“With an esteemed local developer partner in Mainstay Holdings Sdn Bhd, our combined outlet and local property market expertise is a tremendous strength for our project,” Clarke said.


(BUSINESS TIMES) Naza banks on TTDI Gateway to drive sales

SHAH ALAM: Naza TTDI Sdn Bhd is banking on TTDI Gateway, its RM2.5 billion business lifestyle hub in Section 13 here, to drive property sales this year.

The property arm of Naza Group is targeting RM1.5 billion in sales this year from all its ongoing projects.

Naza TTDI is developing, among others, the iconic RM20 billion KL Metropolis in Jalan Duta and the RM4 billion Platinum Park in Kuala Lumpur.

TTDI Gateway is a 15.5ha integrated development comprising offices, serviced apartments and retail components.

Naza TTDI deputy executive chairman and group managing director SM Faliq SM Nasimuddin said the project will be developed over three phases and slated to complete by 2020.

Speaking at the unveiling of TTDI Gateway development master plan, here, yesterday, he said the project is earmarked to transform the Shah Alam city into a more vibrant lifestyle hub.

The first phase of the project, the TTDI Sentralis business suites and retail units, was launched late last year. 

According to Faliq, the retail units have been sold out while the take-up rate for the business suites is about 70 per cent. 

He said the upcoming phase will see the launch of the TTDI Sentralisserviced apartments in the third quarter, as well as retail and offices for Phase 2.

“The development was planned in line with the city’s goal to create a clean, beautiful, vibrant and safe city,” he said.

Faliq said another proposition TTDI Gateway has to offer is its value. There will be three major retail components featuring an existing hypermarket, a home improvement store and a retail mall that will position TTDI Gateway as one of the shopping attractions in the Klang Valley.

(BUSINESS TIMES) klia2 launch on schedule, says Maybank

MAYBANK Research said Kuala Lumpur International Airport 2 (klia2) has some outstanding works to be done, but this should not hamper its May 2 launch date.

“Malaysia Airports Holdings Bhd hosted a site visit to klia2 last Friday, which included Gateway@klia2 Mall. The entire site requires some finishing touches and we think that it will take another two months before it is 100 per cent ready. 

“The airport and the shopping mall will be able to start operations on May 2, while the finishing touches are ongoing. Fears of cracks on the runway and apron are proven unfounded, and the entire site looks wonderful, so to speak,” Maybank Research said in its note.

The research house said klia2 is not a low-cost carrier terminal (LCCT) by any sense of the word and is a fully equipped terminal with all the functionality and comforts of a world-class airport. 

“Full-service carriers will have no problems shifting their operations here, as all the required amenities are available. For the low-cost carriers, klia2 provides them with a platform for high and uninterrupted growth, with the opportunity to boost their service levels. The klia2 concept puts a high emphasis on retail, so much so that we can agree with its ‘airport-within-a-mall’ concept. 

“It has the highest retail floor space composition of any airport globally. There are two elements of retail, the Gateway@klia2 Mall and air-side retailers. The combined retail floor space amounts to 67,516 metre square, which is almost on par with the entire retail space of all three terminals at Singapore Changi Airport.”

“AirAsia Bhd will also benefit as the terminal provides an uninterrupted platform to grow and enhance its customer experience. However, it has to abandon some of its low-cost procedures as the terminal is not fully compatible for LCCT operations,” it said.

(The Star) Malaysia's 2nd-quarter retail growth seen slower

PETALING JAYA: The local retail sector is expected to grow at a slower pace in the second quarter, mainly due to cautious consumer spending and lack of festive holidays during the period.

“There are new malls coming up and there is still demand for retail space,” saidMalaysian Association for Shopping and Highrise Complex Management past president Richard Chan (pic). “However, we do expect more careful spending.”

The Malaysia Retail Industry, in its report last month, echoed this sentiment when it forecast retail sales in the second quarter of the year to expand 5%, due to cautious consumer spending as prices of more products and services rose.Chan said the second quarter generally tended to be “the slowest period” in terms of sales for the retail sector.

“It’s quite cyclical. Sales were good up to Chinese New Year and most people would have already done all their spending then. We expect sales to pick up in July when it’s Hari Raya.”

Chan, nevertheless, said that he expected certain segments to continue to do well.

“There are some food and beverage outlets in malls like Mid Valley where people are queueing up to eat! It also depends on the promotions that are done.”

He added that consumer sentiment was cautious due to uncertainty created by the impending goods and services tax (GST), which takes effect on April 1 next year.

“In some countries, just before they implemented their own GST, people were buying things like crazy. We expect that to happen here. For now, many are waiting to see if prices will drop.”

According to the Malaysia Retail Industry’s report, the Hari Raya celebration is expected to contribute to 6.3% growth in retail sales during the third quarter.

“However, the likely increase in overnight policy rate by the second half of the year may affect retail sales of big-ticket items,” it said, adding that the entire 2014 was expected to see an overall growth of 6%.

Kenanga Research in its report earlier this month on the consumer sector pointed out that higher cost of living, increased subsidy rationalisation and anticipation of GST being implemented were among the factors which would underpin the more cautious spending habits of customers.

“More recent negative news that have transpired include the likely increase in overnight policy rate by the second half of the year as well as lower tourist arrivals for Visit Malaysia Year 2014 due to the missing flight MH370.”

(The Star) Naza TTDI launches RM2.5bil integrated development

Faliq (left) and group CEO SM Nasarudin at the launch of Naza TTDI's new project in Shah Alam.

KUALA LUMPUR: Naza TTDI Sdn Bhd is strengthening its presence in Shah Alam, this time with another integrated development with a gross developmental value (GDV) of RM2.5bil.

The 38.8-acre business lifestyle hub in Section 13, TTDI Gateway, comprising offices, serviced apartments, retail components, a hotel and a hypermarket, will be built over three phases from now until 2020.

Phase one, comprising a block of business suites, retail units and serviced apartments with a GDV of RM295mil, is slated for completion by the third quarter of 2017, while phase two (GDV of RM1.2bil), comprising office and retail spaces, serviced apartments, a home improvement store, office tower, retail mall and a four-star hotel, will be ready by the final quarter in 2020.

The retail mall will be slightly bigger than Empire in Subang. These two phases have a combined investment value of RM900mil.

Speaking at a press conference, Naza TTDI deputy executive chairman and group managing director SM Faliq SM Nasimuddin said the home improvement centre would see an Asian brand opening its first store in Malaysia.

“You might liken it to a competitor to Ikea. We’re in the midst of finalisation with them and the store will be launched by the third quarter of 2015. It will add value to the Section 13 area,” Faliq said.

Phase three will entail a 13-acre development with a hypermarket, serviced apartments, offices and small office home office (SOHO) units with a total GDV of RM1bil. It is expected to be ready by 2020.

Other projects by the property developer were on track, Faliq said, including the KL Metropolis and two office towers in the RM4bil development Platinum Park.

The Lembaga Tabung Haji office tower in Platinum Park was handed over last month.

The first phase of the residential component of Platinum Park, a serviced apartment tower with over 500 units, will be launched in June.

Overall, Naza TTDI’s projects launched in 2014 have a total GDV of RM1.7bil while the sales target for the year is RM1.5bil.

“We are on track to hit that target as we did for last year’s target of RM1.3bil-RM1.4bil,” Faliq said.

With some 1,100 acres of undeveloped land bank in the Klang Valley and Penang, Naza TTDI is looking to build an 850-acre township in Bertam in the northern state.

Faliq said they would focus on mid-sized projects in prime and strategic locations within the peninsula while keeping watch for opportunities in Indonesia and Singapore.

Currently, Naza TTDI’s assets total about RM1bil, which Faliq was confident would triple to RM3bil in five years.

“That would position us to list as a real estate investment fund when our assets mature. The group has invested in Platinum Park as well as Sentralis, which has a net lettable area of 150,000 sq ft,” Faliq said, adding that Naza TTDI might list in two years if all went well.

“Although there is competition, there is demand for office spaces in prime locations. In light of current challenges of the property market, we are safe as long as we get our model and location right.”

Monday, 28 April 2014

(The Star) Plug on bumi property sale

KUCHING: Housing Minister Datuk Amar Abang Johari Tun Openg will propose the formation of a real estate investment trust as a means to maintain bumiputera ownership of landed properties in areas to be designated as new business districts in the city here.

He said he would discuss with Chief Minister Tan Sri Adenan Satem on the proposal that could plug the loopholes in bumiputeras’ grip over properties in the city’s prime areas.

Speaking to reporters here, he said the trust fund could become a vehicle to solve the problems faced by bumiputera families in dealing with properties in prime areas that had to be subdivided due to the demise of their parent owners.

“Sometimes there’s no consensus on how to divide the property, so it has to be sold on the open market (involving non-bumiputeras),” he said.

He said the inability of bumiputeras to come up with sufficient funds to purchase the properties had led the estates being bought by other people.

Johari cited cases of properties in redeveloped areas in other towns in Sarawak namely Kampung Nyabor in Sibu, Kampung Dagang (Miri) and Kampung Dagang (Bintulu), which had been acquired by non-bumiputeras due to their bumiputera owners’ lack of funds to maintain the ownership.

“We know what happened there and we are not blaming anybody (for that) but we have to have a vehicle (a trust fund) to buy the properties,” he said.

To start such a trust fund, he said the Satok constituency in Kuching, where he is the state assembly member, would try to raise a core fund of RM5 million to maintain Malay properties in the constituency.

He said Petra Jaya MP Datuk Fadillah Yusof, who is also the Works Minister, was committed to realising the formation of the trust fund.

“This (trust fund for landed properties in Satok) will be the first one in Sarawak, the next one will be for Darul Hana (redevelopment of 12 Malay villages in Kuching city),” he added. — Bernama


(BUSINESS TIMES) New Pullman head upbeat revenue will grow by 5-8pc

KUALA LUMPUR: The new head of Pullman Kuala Lumpur Bangsar is upbeat the hotel will break even on a revenue of RM50 million in its first year of operation.

“It is a tough target, and it is given to motivate and drive the team,” said Eric Tan, the hotel general manager who came on board last month.

Tan told Business Times recently he is upbeat that revenue will also grow by between five and eight per cent on a yearly basis.

Pullman Bangsar, which is the Accor Group’s largest hotel in Southeast Asia by rooms, started operations five months ago.

The hotel has 513 rooms but only 350 are open at the moment. Based on that count, the hotel’s occupancy is at 60 per cent.

Tan has no qualms of achieving 50 to 55 per cent occupancy once all the rooms are opened and to raise that to over 65 per cent from the third year of operation.

He said the light rail transit (LRT) line extension and MRT projects, and the KL Sentral transport hub in Brickfields, which is linked to the Kuala Lumpur International Airport and the Kuala Lumpur International Airport 2 will help the hotel to grow.

“Many people see this area as very secluded and not central but I take it as a plus point. If you look at the city hotels, their location is quite congested because of the on-going LRT and MRT works.

“That is a plus point for us as many local and foreign leisure travellers are now coming over to this side. We have a LRT station within walking distance from the hotel, which is connected to KL Sentral, and it is attracting a lot of corporate and MICE business for us.”

Meanwhile, Tan said the building owner, Cygal Development Sdn Bhd, will invest between US$4 million and US$5 million (RM13 million and RM16 million) to improve the facade and open two new outlets.

“We are adding two iconic outlets, including a Skybar on the 28th floor. All these improvements will be completed by the first or second quarter of next year,” Tan said.

Accor, which is a French hotel operator, is managing and operating Pullman Bangsar for Cygal Development.

It also manages seven other properties in Malaysia, including Pullman Putrajaya Lakeside, Pullman Kuching, Novotel Kuala Lumpur City Centre and ibis Styles Kuala Lumpur Cheras hotel.

SOURCE: cache=03%2F7.230513%2F7.238403%3Fkey%3Dkuala+lumpur%2F7.287813%3Fkey%3Dmalaysia%2F7.325431#ixzz308gw1PQD

(The Star) Good demand for YTL Land's latest project

PETALING JAYA: YTL Land & Development Bhd saw about 80% or 650 units of its latest Midfields 2 project snapped up during its sales preview recently.

The group said the total gross development for the project alone for this phase was RM400mil.

“Although we had received more than 5,000 registrants, it was humbling to see our customers’ confidence in Midfields 2,” said YTL Land & Development executive director Datuk Yeoh Seok Kian in a statement.

“It proves that a competitively priced product in the right location is always attractive to genuine home buyers,” he added.

The Midfields 2 will have three towers block of 792 condominium unit on 9.26 acres of leasehold land. The price starts from RM499,000.

Yeoh said the crowd at the sales preview was mostly first time buyers from a young demographic profile.

“The level of enthusiasm among the public could be seen in the long queue that had formed before the sales gallery’s doors were opened,” he said.

Located along the convergence of 3 major highways, Midfields 2 is only 8 minutes to Mid Valley and a few minutes drive to Smart Tunnel, shortening car rides to downtown KLCC to within 15 minutes.

The recent confirmation of the new High Speed Rail station (Kuala Lumpur to Singapore), to be completed by 2020 in Sungai Besi, further adds to the attractiveness of the Midfields 2 address.

(BUSINESS TIMES) Naza TTDI to build life style business hub

KUALA LUMPUR: Naza TTDI Sdn Bhd, the property arm of NAZA Group, intends to build a landmark business lifestyle hub with an expected gross development value of RM2.5 billion in Section 13, Shah Alam, Selangor.

The 15.7018-hectare TTDI Gateway is targeted for completion by 2020, the company said in a statement here today.

The integrated development will cover three phases and comprise offices, serviced apartments as well as retail components.

The first phase of the TTDI Gateway, the TTDI Sentralis business suites and retail space, was launched late last year.

The retail units are fully sold and the business suites have seen a healthy take-up rate of 70 per cent.

The upcoming phase will see the launch of the serviced apartments of TTDI Sentralis and also the retail and offices for phase two in the third quarter of 2014.

Naza TTDI deputy executive chairman and Group managing director SM Faliq SM Nasimuddin said TTDI Gateway's strategic location at the main entry point to the Shah Alam city centre, was planned to transform the city to be a more vibrant lifestyle hub, which will be a key business and retail destination in the Klang Valley.

"The development is in line with the goal of creating a clean, beautiful, vibrant and safe city, with all these elements incorporated in the master plan," he added. -- Bernama

(The Star) Unlocking land value in Selangor

Perbadanan Wakaf Selangor (PWS) and Nada Sepakat Corporation (Malaysian) Sdn Bhd (NSC) have made an important step towards unlocking the value of wakaf or endowment land in Selangor.

Recently, the two organisations signed a joint-venture agreement to develop two adjacent parcels of wakaf land measuring 2.3ha in Shah Alam. The housing project that will be developed at the site is expected to have a gross development value of RM40mil.

PWS is a corporation established as a coordinating body to undertake property development of wakaf properties belonging to the Selangor Islamic Council (MAIS) as set out in the Establishment of Wakaf Selangor 2011 order.

Nationally, PWS is the first body corporatised by a state Islamic council to specifically coordinate the commercial development of wakaf lands. It is estimated that wakaf assets in Selangor are valued up to RM80mil consisting of wakaf premises, people’s bazaars and 114 parcels of land.

As of August last year, a total land area of 366ha had been successfully registered to MAIS as the single trustee of wakaf estates in Selangor.

NSC, a niche property development company based in Kuala Lumpur is collaborating with various state Islamic councils to release the value of wakaf lands in response to the nation’s call to commercially develop wakaf lands for property development.

In the JV agreement with PWS, the company will develop 40 units of semi-detached houses on each of the two lots on the land that was donated as a religious endowment (wakaf) by the late Abdul Rahman Ali to MAIS for the benefit of Surau Al-Falah Telok Pulai.

PWS and NSC are combining their resources to unlock the value of wakaf lands in Selangor and generate income through a collaboration that will solidify the institution of wakaf to help improve the socio-economic status of Muslims.

The signing parties will apply the concept of “Ijarah” or lease in the implementation of development projects for the land. Through the concept of Ijarah, the land to be developed continues to remain the property of MAIS and only its benefit is transferred.

Under the wakaf land development project, NSC will bear the cost of development and is responsible for marketing the product. The site consist of two lots each measuring one hectare and is located in a high-growth area adjacent to the established residential districts of Kota Kemuning, Alam Impian and Berjaya Park.

There are already established amenities within a 5km radius of the site, including a golf course, commercial centres, several hypermarkets. Two shopping malls are also being developed in the area.

Access is also convenient through KESAS Highway, Kemuning-Shah Alam Highway (LKSA) and Elite connecting the area to the larger Klang Valley and airport.

NSC will develop an exclusive community totalling 80 units of 1½-storey semi-detached houses with built up areas of 1,600 sq ft. Each of the two sites will have 40 units. The project is expected to be completed in 2016.

The semi-detached houses will be marketed as affordable homes priced at RM500,000. In compliance with MAIS restrictions for wakaf land, the houses will only be sold to Muslims.

PWS is confident its partnership with NSC to develop the site is the best strategy to maximise the benefits of wakaf lands and generate sizeable income for the land’s beneficiary. The synergistic partnership with NSC provides PWS the platform to leverage on NSC’s experience to further develop wakaf lands in Selangor.

When the residential development is completed, it is expected to enhance the diversity and overall value of properties within its vicinity and augurs well for the current and upcoming property projects in the area. The PWS – NSC JV agreement is expected to be the template and catalyst in the future development of wakaf lands in Malaysia.


(The Star) Greenland looks for a slice of RM4.4bil river rehabilitation project in KL

PETALING JAYA: Fresh from selling land worth RM600mil to China’s Greenland Group, Iskandar Waterfront Holdings Sdn Bhd’s (IWH) Tan Sri Lim Kang Hoo is believed to be eyeing another tie-up with Greenland – this time for the RM4.4bil River of Life (RoL) project in Kuala Lumpur.

Sources familiar with the matter said that Greenland, one of China’s top five property developers by sales, is in preliminary talks with Lim to explore ways it can play a role in the RoL project.

The Shanghai-based firm could be planning a “city within a city” à la Shanghai’s iconic The Bund along the bank of the Klang and Gombak rivers that flow through Kuala Lumpur, sources say.

Lim’s construction outfit Ekovest Bhd has a 60% stake in the joint-venture company that was appointed the project delivery partner (PDP) of RoL in 2011 by the Government. Malaysian Resources Corp Bhd (MRCB) holds the remaining 40%.

A spokesperson for Ekovest declined to comment when contacted.

RoL – an anchor project of the Economic Transformation Programme for Greater Kuala Lumpur that aims to breathe new life into the long-polluted Klang and Gombak rivers – is spearheaded by a multiagency task force under the purview of the Federal Territories Ministry.

The project calls for a massive cleanup and redevelopment of an 110km stretch of river by 2017. In return, the contractors given the mandate get plots of land along the river for development.

Greenland had two weeks ago agreed to buy 13.96 acres from IWH in the coastal Danga Bay area south of Johor for properties with an estimated gross development value (GDV) of RM2.2bil, marking its maiden foray to Malaysia.

It is understood that the state-owned enterprise may seal another purchase from IWH soon for two parcels measuring some 20 acres on the eastern side of Johor near the Permas Jaya township.

The deal is yet to be finalised as the land is held under IWH’s 47.16% associateTebrau Teguh Bhd, another listed entity in Lim’s stable, and will have to undergo the usual due diligence processes.

“Greenland ultimately plans to acquire up to 150 acres in Johor with a GDV exceeding RM10bil. The land alone is expected to cost RM3.8bil,” says a property executive.

That would make Greenland the biggest China-based landowner in Iskandar Malaysia. Guangzhou R&F Properties, which last year bought 116 acres in Tanjung Puteri from the Sultan of Johor for RM4.5bil, is a close second.

Lim owns 60% of IWH via Credence Resources Sdn Bhd, and Kumpulan Prasarana Rakyat Johor, a state-backed vehicle, 40%.

Shares of Tebrau Teguh are up some 14% since early-April to RM1.37 on Friday. Ekovest, however, has drifted downwards after hitting a peak in December. The counter closed Friday at RM2.62.

A deal between Greenland and Lim on RoL, should it materialise, is unlikely to have any implications for MRCB.

MRCB officials told Starbiz that the company has no intention of selling down its interest in RoL currently, and neither was it on the lookout for buyers.

Unlike the Duke highway, in which MRCB used to own a 30% stake, the RoL is a division we want to keep, an executive says. “We will honour our commitment to the Government as PDP.”

Even so, the executive concede that RoL cold be a target of various parties given its large construction orderbook.

MRCB had in January hived off its interest in highway concessionaire Duta-Ulu Kelang Expressway to Ekovest for RM230mil in cash in a bid to pare down its debt and dispose of non-core assets.

Although RoL is still sorting our land valuation issues, its first phase kicked off in March involving a 10.7km stretch of the river dubbed Precinct 7. Ekovest-MRCB JV Sdn Bhd is the contractor appointed to carry out the project.

Work on the other four phases, comprising 10 precincts, is expected to begin in September.

A slew of developers from China have expanded abroad aggressively in recent years, but Greenland could well be the most ambitious of the lot.

Greenland, a Fortune 500 company, has interests in real estate, coal mining, finance and automobiles. Known as a builder of skyscrapers, three of its towers rank among the 10 tallest in the world.

It is targeting a spot in the Fortune 200 and revenue of 500 billion yuan by 2015.

In January, it had launched a US$480mil project in Sydney, its first in Australia, as part of a US$1bil push Down Under. The Greenland Centre in Sydney’s central business district will comprise a high-end boutique hotel and residential tower.

The group had acquired land in downtown Los Angeles, its first in the United States, last July for US$1bil from a teacher’s pension fund, with plans for a hotel, offices, serviced residences and luxury homes.

Across the pond, Greenland is investing £1.2bil in two London developments, one in the southwest and the other in the Canary Wharf financial district.

Foreign news reports suggest that Greenland also has its eye on France, Canada, Singapore and Thailand.

Four other major Chinese property firms are in talks with IWH for mixed-use developments featuring waterfront properties.

IWH is the master developer of 1,620ha of waterfront land in the eastern and western side of the Johor Causeway, with Danga Bay, located in Zone A of Iskandar Malaysia, as its centrepiece.

It has inked 17 deals to-date with local and foreign partners to develop properties worth RM127bil in GDV, bolstering its plan to transform the coastline of Johor bordering Singapore into a waterfront metropolis.

(The Edge) Penang, take a leaf out of HK’s Star Ferry

KUALA LUMPUR: The loss-making ferry service linking Penang island to Butterworth is expected to be a major focus of the new owner of Penang Port Sdn Bhd (PPSB), the company operating the port and ferry, as it has previously been a stumbling block to its initial public offering.

While doing away with the iconic ferry service is definitely a no-no since it is regarded as one of Penang’s most famous heritage entities, some industry observers are suggesting that Penang’s ferry operation should take a leaf out of Hong Kong’s Star Ferry, or the ferry system from Sydney Harbour to Manly in Australia, in order to become commercially viable.

Shipping Association of Malaysia chairman Ooi Lean Hin is of the view that the ferry service could be used solely for the carriage of passengers and light vehicles such as motorcycles and bicycles.

“Times have changed. With the opening of the Second Penang Bridge, there is no necessity to transport [heavier] vehicles any longer,” he told The Edge Financial Daily.

“[Instead], the ferry operator (PPSB) could redevelop the vehicle marshalling yard (for vehicles waiting for the ferry) at both the Sultan Abdul Halim ferry terminal in Butterworth and the Raja Tun Uda ferry terminal at Weld Quay in George Town on the island into bus and taxi stations, along with retail shops, including food and beverage outlets,” Ooi said.

He also suggested replacing the ageing ferries with fuel-efficient craft such as those offered by Hong Kong’s Star Ferry, which not only serve to transport passengers but are an attraction in their own right.

“Better service would in turn attract more riders and help the ferry service to build a profitable business,” said Ooi.

Former Bukit Bendera MP, Liew Chin Tong, concurs.

Liew believes the ferry service provides tremendous potential for growth and should be incorporated as part of the state’s transportation system just like in Hong Kong, and not be treated like a “step child”.

He said PPSB should consider investing in larger boats to ferry passengers more efficiently and comfortably, which would provide better returns for the company in the long run.

Liew cited Eastern & Oriental Bhd (E&O)’s private charter water limousine service which started in September last year. The service plies the waters between the Straits Quay Retail Marina and the E&O Hotel in Penang.

Under the service, E&O Hotel guests and selected patrons of the Straits Quay Retail Marina can buy tickets at RM10 for a return trip.

When contacted by The Edge Financial Daily, PPSB chairman Datuk Mohd Sidik Shaik Osman said there are no plans to revamp the ferry service for now.

“We just took over three months ago. Whatever changes [that need to be carried out] would need the approval of the [various] stakeholders,” he said.

In January, Seaport Terminal (Johore) Sdn Bhd, controlled by tycoon Tan Sri Syed Mokhtar Al-Bukhary, assumed ownership of PPSB after edging out four other companies to privatise the port in a restricted tender process.

Under the deal, Seaport Terminal (Johore) is to undertake PPSB’s social obligations which include providing the ferry service, settling the port’s debts of over RM1.2 billion, paying for the capital dredging cost (dredging of the seabed from 11.5m to 14.5m) and providing capital injection to develop the area surrounding the port.

PPSB was previously a wholly-owned subsidiary of the Minister of Finance Inc. Under its previous owner, PPSB had planned to hive off its ferry operation as early as 2004 as the service has been dragging down the company’s overall profits from the start.

The ferry service reportedly cost PPSB to lose RM16 million a year. The problem is said to be its fares which are priced too low. Passengers pay RM1.20 for a one-way trip, while the fare for a car is RM7.70.

Founded in 1920, the Penang ferry service is the oldest in the country. PPSB currently operates a fleet of eight ferries.