OSK: Residential property market to remain encouraging next year

KUALA LUMPUR (Dec 28): The residential property market is expected to remain rather encouraging next year as consumers start to focus on affordable homes. OSK Research Sdn Bhd said the fact that most of recent launches were of units in the high-end segment could signal that the upcycle is at its tail-end and developers were rushing to capture any remaining upside before the sentiment for such properties turns sour. "Subsequently, we expect developers to shift to the more affordable mass-market housing segment to tap into the high demand by first-time young buyers," it said in a research note on Wednesday. The shift became more apparent recently when high-end developers such as S P Setia Bhd and Mah Sing Bhd acquired sizeable pieces of land in the Klang Valley for developing townships that offered affordable housing. "For those which remain focused on the high-end market, we see them offering smaller housing units with the aim of making the price per unit appear more affordable," it said. OSK maintained a "neutral" call on the property sector, on the fact that property counters tend to underperform or market perform when sentiments weaken. — Bernama

 

Panoramic park plan for Pearl Hill

A PIECE of land covering the peak of Pearl Hill in Tanjung Bungah and its surrounding area in Penang will be transformed into a park with a viewing point for tourists.

Tanjung Bungah assemblyman Teh Yee Cheu said a 6.07ha piece of land where a Tua Pek Kong Temple is located near the peak of the hill had been identified for the project.

He said the park would be loca-ted some 152.4m above sea level.

It would provide tourists with a panoramic view of the sea, Tanjung Bungah, Tanjung Tokong and Batu Ferringhi, he said.

Historic site: The park project will include an existing Tua Pek Kong Temple.

He also said a working committee comprising temple committee members, residents, Tanjung Bungah Resident Association members, Tanjung Bungah Community Development and Security Committee (JKKK), Taman Seri Setia JKKK, would be formed in two weeks’ time.

“The committee will look into cleaning and beautifying the surrounding area.

“We hope to allocate a small plot for a Chinese medicine practitioner to plant some herbs,” he said, adding that the Penang Municipal Council would also be working together with the committee on the project.

Teh said development in the area would be kept minimal.

“We do not know how much will be needed for the project until the committee is formed.

“The state has agreed in principle to the project and I hope the paperwork will be completed soon to get the project started,” he said after holding a discussion session on the project with residents and members of the concerned groups yesterday.

Teh said the private sector was also welcome to sponsor some tables and chairs for the pro- ject.

He said that besides the Chinese temple, there were also seven army bases and an observatory built by the British in the area. - The Star

Residential property mart seen 'encouraging'

The residential property market is expected to remain rather encouraging next year as consumers start to focus on affordable homes.

OSK Research Sdn Bhd said the fact that most of recent launches were of units in the high-end segment could signal that the upcycle is at its tail-end and developers were rushing to capture any remaining upside before the sentiment for such properties turns sour.

"Subsequently, we expect developers to shift to the more affordable mass-market housing segment to tap into the high demand by first-time young buyers," it said in a research note today.

The shift became more apparent recently when high-end developers such as SP Setia and Mah Sing acquired sizeable pieces of land in the Klang Valley for developing townships that offered affordable housing.
"For those which remain focused on the high-end market, we see them offering smaller housing units with the aim of making the price per unit appear more affordable," it said.

OSK maintained a "neutral" call on the property sector, on the fact that property counters tend to underperform or market perform when sentiments weaken. -- Bernama

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Property market to see a gradual slowdown next year

KUALA LUMPUR: The Malaysian property market is likely to see a gradual slowdown next year, taking into consideration the uncertainty in the global economic situation.

Fiabci Malaysia president Yeow Thit Sang said the high end residential units were already seeing a slowdown both in pricing and take-up rate.

“There are fewer expatriates from multinational companies coming here and rentals with a yield of between 6% and 8% are no longer achievable. Investors in these units will have to wait longer to realise their investment. The slowdown in global economy is definitely affecting the high-end property market,” he told Bernama recently.

He also saw a fallout for office space next year, saying the category was already overbuilt and the overhang felt in the market with rental falling and a slow take-up rate.

Meanwhile, Zerin Properties chief executive officer Previndran Singhesaid the slowdown in the property market would only last until the first quarter next year and the industry would be stable afterwards.

“Prices will remain stable, with asking prices, not values, becoming more reasonable as owners check their values to real pricing. At present, sentiment is down due to the eurozone financial crisis and the US double dip fears, which has been faring for a long time, but I think we are more Asia focused,” he said. - Bernama

Consultants: Right timing for PNB's RM1.74bil London property buy

PETALING JAYA: Permodalan Nasional Bhd's (PNB) reported 350mil (RM1.74bil) purchase of Milton & Shire House building in London is a good move owing to the weak pound sterling and the European economic woes, said property consultants.

The Times reported recently that PNB had bought the 15-floor complex from US-based fund manager Beacon Capital Partners.

The complex is said to have 460,000 sq ft of office space, and houses global law firm Linklaters which is paying RM100mil in rental annually on a lease that expires in 2026.

CB Richard Ellis executive chairman Christopher Boyd said that it was a unique time to buy real estate in London, as traditional major funds from the United States and Europe were not in the market due to the global economic slowdown.

“So you have less competition for buildings like this. The downside risk is minimal as PNB bought the building with a long lease,” he said.

Property consultancy DTZ Nawawi Tie Leung executive director Brian Koh pointed out that London was a global financial and commercial centre, and had some of the most expensive real estate in the world.

“In good times, it is very difficult to penetrate the London market due to high competition for prime properties, which accounted for its low historical yield,” he said.

Koh said the weak pound and the liquidity crunch in Europe, due to the eurozone debt crisis, had made it easier for players from the Middle East, South Korea and Malaysia, among others, to enter the London real estate market at reasonable prices.

The Times said it was the “largest single asset transaction in central London this year”.

It also said PNB was believed to have allocated 1bil (RM4.98bil) for London investments.

The daily quoted PNB president and group chief executive Tan Sri Hamad Kama Piah Che Othman as saying the transaction was “part of a strategic plan in acquiring premium assets in major cities globally after the acquisition of our maiden overseas property, Santos Place in Brisbane last year”.

PNB reportedly bought the upmarket office block in Brisbane for more than A$290mil (RM931mil).

The 37-storey building has 373,508 sq ft of lettable space with about two-thirds of that leased to Australian oil and gas giant, Santos.

A recent StarBiz report quoted sources as saying PNB was looking to invest in properties primarily in London, Sydney, Melbourne and Perth.

PNB's management could not be reached for comments at press time. - The Star

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