Foreigners and PRs have to pay more stamp duties in Singapore

ON Wednesday, The Singapore government imposed a new 10% stamp duty on foreigners and companies buying private residential property in the city state. The move, its fifth in the past two years, is the first in 15 years targeted at foreign buyers. The stamp duty, effective from Dec 8, is in addition to the existing buyers' stamp duty, which is 1% for the first S$180,000 of the purchase price, 2% for the next S$180,000 and 3% for the rest, The Straits Times reported. Permanent residents who already own a property, and who are buying a second or subsequent property, will now have to pay an extra stamp duty of 3%. Singaporeans who already own two properties and are buying a third or subsequent property will also pay extra stamp duty of 3%. For a S$1 mil property, a foreigner will have to pay an additional buyer's stamp duty of S$100,000 on top of the current S$24,600. The move underscores two important issues. The first, that inspite of the “open and free” market system there, the government is ready to swallow the bitter pill of plying measures that may well add to an already weakening Singapore economy, if those measures were to be the salvation of the country's greater economy in the long-term. The second is its timing. Why, at this juncture when European leaders are meeting this week in an attempt to solve the eurozone crisis? Thus far, foreigners and Permanent Residents, many of whom are Malaysians, have enjoyed a fairly “open and free market” when it comes to property ownership. Until Wednesday, they faced only certain restrictions in buying landed homes. Notwithstanding this open, free and transparent system, Singapore has a two-tiered property market. There is the HDB (or Housing Development Board) and the private residential market. HDB housing makes up the bulk of the market, at about 80%. Private residential market accounts for only 20%. The fact that the government is concerned about prices shooting further in this 20% portion underscores the primacy of the property sector in the country's greater economy. It also underscores its vast exposure in terms of value, that this 20% commands in Singapore's property market. This private residential portion is primarily owned by foreigners where prices are many times that of the HBD portion. In the event the eurozone talks hit a snag due to disagreements among the eurozone members this weekend, and because of Singapore's high foreign exposure, any price fall in that 20% portion will also affect the HBD portion. In any market where there is a large foreign exposure, there will be a greater degree of volatility because foreign buyers will be the first to leave that market. They will not be staying around to weather the storm. It is the PR holders and citizens who will be staying put. Foreign buyers accounted for 19% of all private residential property purchases in the second half of this year, up from 7% in the first half of 2009. These figures exclude purchases by PRs, The Straits Times reported. Sales of new private homes hit a record 16,292 last year. This year looks to be another banner year with 13,688 units sold in the first 10 months, Straits Times reported. That imposition of the stamp duty is sending a message to investors and speculators that the government is seriously concerned about the formation of any bubbles in that 20% private residential portion. Let us return to Malaysia. For years, property consultants and developers have been trying hard to sell high-end properties, both landed and high-rise to foreigners. They are at a loss why despite comparatively low prices in Malaysia, our properties have not enjoyed the same attention as those in Singapore, Hong Kong, China, Vietnam and other southeast Asian countries. The fact is, low prices alone will not attract foreign buyers. While property ownership seems easy enough foreigners can buy residentials exceeding RM500,000 there are many other factors that play an important role. Notwithstanding all these, do we want a large foreign exposure? There are mixed views about this among property consultants, developers and government. It is a fact that the Malaysian property sector will not have the global intricacies tied up with being an international financial hub, so we need not be too worried about that. But we do need to mull over our own property sector as a result of Singapore's move and consider how we can fine-tune our property sector less the threat of eurozone woes come knocking on our doors. We do have a lot of high-end properties waiting to be sold and authorities who approve such projects need to consider today's global climate. Assistant news editor Thean Lee Cheng has two questions: Do we want a large foreign exposure? And if not, what are we to do with the thousands of units of high-end housing which are unsold today? - The Star

Singapore move likely to benefit Iskandar

JOHOR BARU: Property developers in Iskandar Malaysia are expected to benefit from the new ruling introduced by Singapore for foreigners buying private properties in the republic. The move was introduced on Wednesday to cool private residential property prices in the island state which are on the uptrend despite a slowing economy. Johor Real Estate and Housing Developers Association branch chairman Simon Heng said foreigners buying properties in Singapore for investment might look elsewhere in the region. “With Iskandar Malaysia progressing well since its inception five years ago, these buyers (foreigners and Singaporeans) are most probably looking at Johor Baru,’’ he told StarBizWeek. Heng said prices of residential properties in Johor were much lower than those in Singapore and Johor’s close proximity with the republic was an added advantage compared with places like Kuala Lumpur and Penang. He said developers with projects in Nusajaya would benefit the most as there were no restrictions on property ownership by foreigners, including Singaporeans. On the other hand, areas outside Nusajaya in Iskandar did not enjoy the privilege and in places where the 30% quota was imposed on developers selling residential properties worth RM500,000 and above, Heng said. Another strong selling point for Nusajaya was its location, not far from the second link crossing, which made it a favourite place for Singaporeans living in Johor Baru but working in the island, he added. UEM Land Holdings Bhd is the master developer of the 9,308ha Nusajaya which is the key driver of Iskandar and one of the five flagship development zones in the country’s first economic region. Nusajaya comprises seven signature developments – Kota Iskandar (Johor State New Administrative Centre), Southern Industrial and Logistics Clusters, Puteri Harbour Waterfront Development, EduCity, Medical City, International Destination Resort and Residential Developments. Other flagship development zones in Iskandar are the Johor Baru City Centre, Eastern Gate Development Zone, Western Gate Development Zone and Kulai-Senai. “Rehda members are hoping that the special treatment accorded to Nusajaya would be extended to other development zones in Iskander as well,’’ he said. Meanwhile, Daiman Development Bhd general manager Siah Chin Leong said it was still too early to see the impact on the Johor Baru property market following the new ruling. He said majority of foreigners buying private residential properties in Singapore were investors and high net income individuals who already owned properties in other major cities in the world. Siah said overseas investors were particularly the affluent Chinese from the mainland, Indonesian Chinese, Indian nationals and, to some extent, Malaysians, were flocking to buy properties in Singapore. Berinda Group sales manager Lim Sung Heng expected that there would be a spill-over effect from the ruling on the Johor Baru property market probably within the next few months. He said the state government and other relevant agencies must make more effort to make Iskander a preferred destination for property buyers not only Singaporeans but also other nationalities. - The Star

A house built on smart ideas

WITH cool breeze blowing into his house which is also basking in ample natural light, retiree Tan Vait Leong does not need to switch on the lights or air conditioner during the day. Even at noon, the 56-year-old’s bungalow at Puncak Bukit Mutiara in Pearl Hill is still cool, thanks to the environmentally-friendly and open concept design of the house. “The planning of the design of the house started five years ago, while construction of the property took three years to complete. “I would draw up the designs and concepts for the house while I was at airports or in planes, as I travelled frequently for work. “I enjoyed the process, as it was also an outlet for me to destress,” said the former vice-president of a multinational company. Having spent a substantial amount of time travelling, the father-of-four said it was only right that he designed his house ala-resort style so he would not “need to go for holidays anymore”. One of the special features of the house is the photovoltaic (PV) solar panel fixed on the roof, which Tan had obtained through the National Suria 1000 programme to generate power from solar energy. With that, his household is automatically enlisted under the newly launched feed-in-tariff (FiT) programme where Tenaga Nasional Bhd will buy back power generated from the PV solar panel. Currently, the PV electricity subsidised about 20% of the household’s total electricity intake while Tan pays about RM700 monthly for his power bill. “With the FiT, I might not have to fork out a single sen for my electricity bill,” he said yesterday. A tour around the handsome house with a built-up area of 8,000sq ft shows there are five spacious rooms, four bathrooms, an infinity pool with a view overlooking the sea which is also connected to the living room and master bedroom, an indoor fish pond, a kitchen, a family room, a study room, a living room, an outdoor deck as well as a cosy playroom for Tan’s 10-year-old twin daughters. Aptly named after Tan’s wife, Foo Sin Gein, 54, he said his home Gein Villa was constructed to blend into existing green environment where the big trees around are spared from the axe. “I don’t spend money on landscaping. The trees shed leaves seasonally but it is part of the feature of the house. I don’t understand the reasons behind cutting down trees if people want to build houses on the hillside. “Well there are occasions where our ‘special guests’ — monkeys, squirrels and bats will pay a visit but we don’t harm them as they are not aggressive, just playful,” he said. There are no excessive furniture in the house, with only the walnut and cherry flooring along with salvaged chengal wood which Tan used to lay the staircase and kitchen tabletop. “I also use the hollow bricks that were left over from the construction as display shelves,” he said. “We water the plants with water from the fish pond, and we keep plants at the pool and the filter tub to absorb the nitrate.” - The Star

RM7mil drainage system to reduce floods caused by siltation in Batu Ferringhi

A DRAINAGE system costing RM7mil will be constructed in Batu Ferringhi by the Penang Drainage and Irrigation Department (DID). State Local Government and Traffic Management Committee chairman Chow Kon Yeow said the project was expected to solve the flood woes plaguing residents there as the sand buildup at the river mouths was preventing the water from flowing out to sea. “Therefore, each time a heavy rainfall occurs, the overflowing water from the streams will flood to the nearby villages.” He was speaking to reporters after attending a press conference at a hotel yesterday to announce the ‘Penang Beach Make-Over01’ programme to be held at the Batu Ferringhi beach this Saturday. The beach cleanup, which will start from 8am, is aimed at restoring Batu Ferringhi’s status as one of the country’s premier tourist destinations. It is also aimed at instilling awareness among the people to take care of beach cleanliness. Some 500 people from the various non- governmental organisations (NGOs) and government agencies are expected to take part in the programme which will cover the estimated 2km beach stretch. Go green: Chow (third from right) planting one of the trees with MPPP president Patahiyah Ismail (third from left) and other councillors at the intersection of Jalan Sungai Pinang and Jalan Jelutong The event is jointly organised by the state government, Penang Municipal Council (MPPP) and Malaysian Association of Hotels (Penang) with support from the area’s Village Security and Development Committees. Chow said that the programme would be the first of many beach make-over programmes as the state government and the local council were determined to turn Batu Ferringhi into one of the top tourist destinations in the region. He later attended a tree planting session at the intersection of Jalan Sungai Pinang and Jalan Jelutong. The session was held to replace the four trees that were allegedly cut down by certain individuals who were involved in the placement of an illegal billboard at the area. Council Public Health Standing Committee alternate chairman Ong Ah Teong, who was present, said the trees were probably cut down as they were blocking the billboard which had since been taken down. - The Star

减少房屋计划遭搁置 发展商抵押金或调高

吉隆坡8日讯）房屋及地方政府部长拿督斯里曹智雄在国会上议院表示，必须在房屋发展商法令修正案（控制与准证）里增添一项条文，规定发展商需要支付建筑计划成本的3%作为抵押金，以减少遭搁置的房屋计划。 需支付3%建筑成本 曹智雄指出，此新修正案是为了确保发展商是在有信心和拥有足够的资金下，才购地发展。 “如果发展商在计划上遇到什么困难，此抵押金就可以即时地把问题解决了。” “虽然这抵押金的数额看起来相当高，但是如果发展商是以有诚意和认真的态度来进行开发土地计划的话，那这修正案将不会是个阻碍。” 曹智雄是于周四在国会上议院回答巫统上议员拿督费达勿斯的问题时，如是指出。 目前20万抵押金偏低 曹智雄指出，以现在的市场来说，付20万令吉的抵押金已是偏低，而基于许多发展商不符合资格发展，以致加剧房屋计划搁置的问题。 他说，该部会配合此新修正案，研究发展商是有意或无意地搁置房屋计划。 “透过这项新修正法案，房屋部希望能有效解决和减少房屋计划遭搁置的案例，与此同时，也可以维护购屋者的权益。” 对于费达勿斯质问政府是否打算建立一个特定的价格管制方法，以确保房屋的所有权与合理的价格，曹智雄回应说，基于我国是个经济自由的国家，所以目前政府没有这个打算，这也是取决于市场的需求。- 光华

槟政府再出招 峇都丁宜海滩将大整顿

（槟城8日讯）继10月新关仔角大型海滩清洁运动后，槟州政府再出招整顿峇都丁宜海滩，誓要还原其“美貌”！ 槟州政府将于周六上午8时至上午11时联合槟岛市政局、酒店业者、各政府单位、非政府组织、丹绒武雅区州议员服务中心、丹绒武雅文秀组屋乡委会、峇都丁宜双溪尔马斯乡委会、厂商及理科大学展开“槟城沙滩大改造01”运动，并成功号召逾380人参与逾2公里海滩清洁运动！ 槟州行政议员曹观友表示，过去峇都丁宜海滩问题多多，严重影响槟州旅游业。他说，尽管有关当局采取各项必要措施重振该区旅游业，惟依然徒劳无功，最终导致州政府被逼禁止所有海滩活动，这才让大家醒过来。 他指出，有关当局后来也采取业者互相监督方式、实施扣分制度等一系列措施，才逐渐改善问题。他认为，欲改造海滩，首先必须从思想开始改造。他也强调，槟州政府不仅满足于现状，况且在获得业者配合下，未来将陆续展开更多改造行动，包括整顿该区的夜市，鉴定海水污染程度等。 无论如何，他周四召开“槟城沙滩大改造01”运动记者会时呼吁，水利灌溉局极力争取700万令吉拨款，以改善该区的排污系统，避免海水继续受到污染。 此外，针对记者询问非政府组织投诉槟岛市政局官员在古迹区施工过程破坏古迹看法时，他表示，世遗机构身为古迹领导机构，应更主动提升各政府单位对古迹的敏感度，而非等候其他单位来咨询。 出席者有槟岛市政局主席芭堤雅、槟岛市政局旅游、休闲及国际事务部主任莫哈末阿克峇等。- 光华

14日再开汇报会 选更达标海底隧道公司

（槟城8日讯）拟议中槟威海底隧道计划“大肥肉”出现争夺战，然在近半百个有意竞标公司中，其中一半被发现不合格，已遭淘汰出局。 在槟州政府于上个月29日就海底隧道计划举行的“投标资格预审”（pre-qualification）汇报会中，高达48家海内外工程公司出席汇报会，足见海底隧道这块大肥肉的诱惑力之大，然而回到现实中，却有一半公司不符合州政府所拟定的资格条件，如缴足资本，公司背景等，以致未战先败。 槟州公共工程、基本设施及交通委员会主席林峰成行政议员即向本报记者透露，共有48家海内外工程公司出席上个月29日州政府举行的投标资格预审汇报会，在投票预审程序中，将进行首回合筛选，不合资格公司将被淘汰。 林峰成：半数不合条件 他说，有关预审取得承包公司的热烈参与，然其中有一半公司不合条件，关键原因包括有关公司缺乏此方面即打造隧道或公路经验，再来是有关公司所承接的工程规模有限，并非庞大工程项目。 与此同时，林峰成透露，在汇报会后，州政府继续接获来自“错过”出席汇报会的本地及国际工程公司有意参与投标计划，向州政府作出查询要求，由于有关计划将以公开招标方式进行，州政府决定于本月14日，早上10时在光大4楼，再办另一场汇报会，以便让更多有潜能公司参与在聆听汇报后及进行首回合筛选下，同样加入竞标行列。 林峰成说，也有一些工程公司告知没有阅读到有关汇报会的广告，有鉴于此，州政府决定在5家报馆同步刊登广告。 然而他表示，有关截止日期将保持不变，即必须明年1月14日提交“征求献议书”（RPF）文件。 据本报记者也发现，州政府除了在主流各语文报章刊登进行海底隧道及大道工程的投标资格预审广告，同样也在网络媒体如当今大马刊登广告。 曾家麟：影响巨轮进港　局限槟海运业未来发展 在槟州政府如火如荼启动“两岸三通隧道”计划之际，计划也招来反对声浪，其中马来西亚物流师协会即与槟州港口有限公司同声反对该计划。 物流师协会即指计划不只波及未来槟州海运业发展，更将殃及槟州经济发展命脉，更甚的是影响外来直接投资。 马来西亚物流师协会总会会长曾家麟硕士即向本报记者表示，目前世界最大艘货轮的标准集装箱吨量单位为1万8千TEU，而2万TEU集装箱单位的的货轮也在开发研究中，以目前发展趋势，货轮的体积及运载量只会越来越大，没有人可以保证未来集装箱单位将是多少。 他表示，槟州港口在10年前的集装箱货轮只有500至600TEU，如今的集装箱单位却高达1千至2千，最高可达3千，目前的海床深约10点5公尺至11公尺。同样的道理，集装箱单位将会越来越大。 隧道变得不实际 曾家麟认为，将海底隧道计划放在槟威码头北岸将会造成货轮进港受影响，所以真要打造海底隧道，又能兼顾海运业，那么隧道应改建在码头南部。然而问题却是南部已同时有槟城大桥及施工中的第二大桥，使到隧道变得不实际，这也意味槟州无须建造海底隧道。 他认为，海运业直接涉及世界经济贸易，一旦海运业受波及，将影响槟州的国际贸易，将带来连锁性影响，也会造成外来直接投资(FDI)受影响。- 光华

Singapore property shares plunge on cooling move

Singapore will impose an additional 10 per cent stamp duty on foreign buyers of its real estate. — Reuters pic SINGAPORE, Dec 8 — Shares of Singapore property developers fell sharply today after the government announced new measures to cool the city-state’s housing market. CapitaLand Ltd shares fell as much as 6.5 per cent to S$2.44 (RM5.93) while smaller rival City Developments Ltd fell 7.6 per cent to S$9.26 and Wing Tai Holdings was down 6.5 per cent at S$1.00. Shares of Ho Bee Investment Ltd, which develops high-end condominiums in Singapore, tumbled by as much as 12.1 per cent to S$1.09. Singapore said yesterday foreigners who buy private homes will have to pay an additional stamp duty equal to 10 per cent of the property value. Analysts said they expect developers with greater exposure to high-end luxury apartments to face more pressure because as foreign buyers make up a large chunk of their sales. “We believe each of the key residential demand drivers, foreign buying, job creation and credit availability, will likely see signs of softness,” Goldman Sachs said in a report. It added that this could lead to a 15 per cent decline in home prices over the next 18 months with the prime segment facing more immediate pressure as foreign buyers pull back. — Reuters

New measures to cool Singapore housing mart

SINGAPORE: Singapore yesterday announced new measures to cool the city-state’s housing market, saying foreigners who buy private homes will have to pay an additional stamp duty equal to 10 per cent of the property value. Permanent residents who already own a Singapore home will pay an additional stamp duty of three per cent when they buy a second and subsequent properties, while citizens who purchase a third and subsequent homes will pay three per cent. Reuters

隆胶囊酒店 住宿新体验

(吉隆坡讯)在东京、上海等人口与游客量密集的城市，到处都能看到胶囊旅馆的踪影。为了节省住宿金钱与成本，这一种密集型的住宿设施，打破了传统的酒店客房的概念，在寸土寸金的市中心以最小的面积容纳更多的住客，形成以组合格子式舱位的住宿设施。 胶囊旅馆逐渐在许多城市流行起来，而大马也于3月份开始引入首个胶囊酒店，并且得到不俗的反应。胶囊酒店最讲究地点的便利性，与吉隆坡时代广场毗邻的UFO Capsule Hotel位于市中心，靠近单轨电车，与著名景点与购物广场距离不远。 引入较大舱位设计 不过，日本胶囊酒店的舱位设计较小，刘宝良认为需寻找更大的舱位以符合体格较大的外国人要求。“找了一段时间后，终于让我在日本找到较大的舱位设计，并且将之引入大马。” UFO Capsule Hotel星期二至星期四的住宿费为28令吉，星期五至星期一以及公共假期的收费则为38令吉（税前价格）。该酒店经理谢招洋说：“其实，附近一带的经济型酒店都是以出租床位的方式营业，一间房间分成四张床，每个床位收费约40至50令吉， 不过彼此间毫无遮掩，少了隐私空间。胶囊酒店的格子式舱位设计能提供更好的隐私空间，而且收费也相对便宜，吸引不少的国外背包客光顾。” 分男部与女部　24小时柜台服务 UFO Capsule Hotel分为男部与女部，分在不同的区域，男宾在楼下而女宾在楼上。男宾也被禁止进入招待女宾的区域，并且有24小时的服务柜台看管。谢招洋说“光顾胶囊酒店的顾客有来自国外的专业人士，他们在本地稍作停留，为节省金钱与方便就住在胶囊酒店里。有的甚至是上班族，因为放工时间交通阻塞而选择在酒店睡几个小时，避开塞车时间。由于酒店与时代广场酒店毗邻，不少的旅游巴士司机也会选择在胶囊酒店过夜。” 舱位里设有床垫、枕头、被子、冷气机、烟雾侦察机、灯、折叠式小桌子、挂衣架、充电插座、柜台服务电话与镜子，能符合基本的住宿要求。舱内高5英尺、长7英尺、阔4英尺，可以容纳体格较大的外国人之余，空间也不至于过于狭窄。UFO Capsule Hotel同时也提供免费无线上网服务，可以让住客随时使用电脑或手机上网。 男部设有13个舱位，女部则有16个舱位，并各别设有3间厕所与3间沐浴间，提供洗发水及沐浴露。“通常，住客都是一早洗刷以后出门，回来以后洗刷睡觉，并不会在酒店内多逗留，这里只是提供他们休息的空间。住客也可以选择将他们的贵重物品锁在酒店提供的收纳柜里。” 酒店里也提供完善的消防设施，可见灭火筒、烟雾侦察机、逃生出口指示牌。 刘宝良也透露即将在KLIA2与马来西亚开设胶囊酒店分行，以迎合市场对于廉价住宿设备的要求。“我们也计划在舱位设置电脑与电视机一体机，为住客提供更多的便利性。” 相关照片 ■ 身高176公分的谢招洋，在舱内里活动自如，可见里头空间颇大。 ■ 住客在晚上睡觉时，可拉下竹帘阻挡光线进入，营造私人空间。 ■ 女部舱位，走道宽阔。 ■ 设计摩登明亮的卫浴间，为住客提供洗刷的空间。 ■ 刘宝良相信胶囊酒店的概念在本地可行，他也不怕其他的本地业者引入一样的胶囊舱位，他认为生意各有各做，不成问题。- The Star

Penang SME Centre looking for tenants

SMALL and medium-scale (SME) operators can now apply to rent lots at the RM40mil Penang SME Centre at Phase Four of the Bayan Lepas Industrial Park. Chief Minister Lim Guan Eng said the centre, aimed at incubating and developing new local SMEs, would be ready in April next year. He said the applicants would be selected by industry experts led by Penang Science Council’s Mentoring Scientific Pillar head Datuk Seri Kelvin Kiew. “By March, the tenant list should be ready. “We hope to get more SMEs that are involved in the solar energy sector,” he said at a press conference recently. For the first year, the rental of the facility lots range from RM1.50 to RM1.80 per sq ft. He said that for the first two years, the state would subsidise 80 sen per sq ft monthly to ensure the rental was affordable for local SMEs. Lim said the subsidy was only for two years because “if they cannot make it in that time, chances are they won’t make it at all and will have to make way for others”. He said the state government wanted to groom technopreneurs — people who are both entrepreneurs and innovators. “That’s why we’ve also established the SME Market Advisory, Resource and Training (SMART) Centre and the SME Village in Bukit Minyak and Batu Kawan. “You go to the SMART Centre for free advice and then you set up your operations at the SME Centre. “After two years, the SME can move to the SME Village and build their factories there,” he said. He said although it was unquestionable that local SMEs had developed strong technical competencies over the last four decades, they had failed to establish “a Penang brand”. He said most SMEs formed the lower tiers of the supply chain of their multinational customers. Kiew said he, together with other industry players, were willing to share their expertise with local SMEs. “All of us started as an SME and we will support companies located in the SME Centre as much as possible. “Although there are many grants and programmes available for SMEs in the country, what’s more important is to look at the basic needs like affordable space and proximity to the industry. “Local SMEs need to be where the action is and the SME Centre allows for that at nominal rental rates,” he said. For details on the SME Centre, call the Penang Development Corporation at 04-6340244 (Sharidah Talib), InvestPenang at 04-6468833 (C.H. Chong) or SMART Centre at 04-6409988 (Lim). - The Star

Composting plants to be set up in each residential area

PENANG plans to take another step forward in its green campaign next year. A composting plant will be set up in each residential area to process food waste into liquid fertilisers. State Health, Welfare, Caring Society and Environment Committee chairman Phee Boon Poh said the facility would be paid for by the respective assemblyman’s allocation. “The project which is based on 3As — availability, accessibility and affordability — will be available in residential areas as the state intends to expand its effort from hawker centres to households. “By placing the composting plants within the community, we hope to make it more convenient for the people to bring their waste to be processed into fertilisers. “The composting plant is meant to educate the people on the benefits of recycling,” he told a press conference after launching the Penang Eco-Town workshop at a hotel yesterday. Phee added that the approach would be executed through four approaches — educate, create awareness, implement and enforce. “However, we do not intend to impose strict regulations on the people because the commitment to go green should come from within ourselves.” There are currently three composting plants which are at the Bagan Ajam market in Butterworth, Bayan Baru market in Penang and the Desa Damai resource centre in Bukit Mertajam. On May 3, The Star reported that the pilot project at the Bagan Ajam market could process organic wastes into fertilisers within 24 hours.- The Star

拒峇都丁宜巴刹缩水 郑雨周反对“一分为二”公寓计划

(槟城6日讯)由于面对州议员大力反对，造成拟议中峇都丁宜巴刹“一分为二”的计划受阻，发展商拟议打造私人公寓的计划也面对触礁！ 私人公寓计划触礁 一家私人公司於今年向槟岛市政局建议，以便将一块2.2依格，作为建造耗资500万令吉的峇都丁宜公共大巴刹的土地一分为二，在土地上分别打造巴刹及公寓，然而计划却招来丹绒武雅区州议员郑雨周的反对，反对原作为巴刹用途的土地“一分为二”，从大巴刹成为迷你巴刹。 曹观友：另寻新方案 对此，槟州地方政府委员会主席曹观友行政议员受询时指出，由于计划招来区内州议员反对，造成市政局必须重新另寻找方案，以便公共巴刹计划最终能落实。他承认市政局已接获献议以便能最终完成巴刹，不过在议员反对土地一分为二建议下，造成有关献议也宣布触礁，不能继续进行。 反之，他唯有指示市政局重新审阅有关土地的原本发展概念，不过据他了解，原有计划并未提及涉及打造的在巴刹面积规模，只提及摊格数量，所以在这计划下，即使巴刹的摊格数量不敷，也可以献金方式取代。 他表示，当务之急是如何使巴刹能尽快落实，这也是议员多年来所争取及乐见其成的。他表示，目前局面尚未全面明朗化，州政府必须先再研究以找出最终的方案。 郑雨周：勿沦私人产业 丹绒武雅区州议员郑雨周受询时表示，拟议中的峇都丁宜公共巴刹地将成为公共产业，该土地不该一分为二成为缩小版迷你巴刹，一半土地更最终变相沦为私人地。 他向本报记者表示，上述土地原是峇都丁宜伊甸发展大蓝图下规划为公共大巴刹用途，前朝政府指示发展公司在完成蓝图下的第2000间房屋单位后才须在有关地段上建巴刹。然而他表示，有关土地却被人“看上”，拟议向政府作为交换条件，以在该土地上的一半地段上兴建巴刹，另一边厢要求政府批准另一半土地作为高楼公寓计划。 郑雨周也表示，质疑有关私人公司与该土地的关系及合法性，有关土地原是归划为巴刹，所以不该沦为私人产业及沦为公寓等私人发展用途。不过他承认，市政局原本今年拨款作为峇都丁宜公共巴刹用途，所以若有关拨款未及今年动用将面对收回情况，他希望有关事件可在本月内会出现转机，以便巴刹早日落实。 相关照片 ■ 拟议中的公寓计划触礁。 ■ 峇都丁宜巴刹地一分为二计划触礁，图前方空地即是拟议中巴刹地段，座落於惹兰双溪沙杜，即Pinang Emas公寓毗邻对面空地。- 光华

Residents object to high-rise project proposal

GEORGE TOWN: A group of residents in Lembah Permai, Tanjung Bungah are objecting to a proposal by a developer to construct two 32-storey apartment blocks and a nine-storey apartment there. The residents attended a dialogue session called by the Tanjung Bungah Residents Association (TBRA) to raise awareness about amendments in the development plan that has yet to receive approval from the Penang Municipal Council (MPPP). TBRA founding member Lee Laina, 54, said that the project would be constructed on a plot of land behind Lorong Lembah Permai 4. “The traffic situation in Lembah Permai is already bad with all the developments around, so do we really need more high-rise buildings in the area?” she asked. A spokesman for the developer said the company’s submission of development planning was in accordance with the council’s rules and regulations. - The Star

More trees to be planted in George Town

THE Penang Municipal Council (MPPP) is turning George Town into a green lung with several tree-planting projects lined up. State Local Government and Environment Committee chairman Chow Kon Yeow said that the inner city lacked trees. “We must plant trees not only for our generation, but also for many generations to come,” he added. He said this at a press conference in Weld Quay where he proceeded to plant a tree along the newly upgraded road divider. MPPP president Patahiyah Ismail said 101 trees from four different species had been planted along a 550m stretch costing RM127,470. “We have also raised, widened and deepened the kerb for effective growth of the trees,” said Patahiyah. She added that the next projects were the Friendship Park in front of City Bayview Hotel and the stretch along Jalan Datuk Keramat from Gama to the junction of Jalan Perak.- The Star

Precursor to property market outlook

THE Global Financial Crisis (GFC) of 2007/2008 is a watershed event that calls into question the robustness of the global financial system. The system itself, to take a long view,is a continuously evolving system. Crises and events in the past have aided in the evolution of the system and this recent crisis ought to spur even greater evolutionary improvements and that includes down-the-line restructuring of real estate markets (clearly central to any modern economy) and the valuation profession (central to a modern and efficient real estate market). What caused the crisis? Roberts Samuelson in his book The Great Inflation & Its Aftermath takes a board view, spanning 40 years, as he builds up to the crisis. He focuses on the rise of inflation in the 70s (the oil shocks being symptoms rather than causes) to heights of 13% per annum in the United States and the subsequent taming of it by Paul Volcker (Federal Reserve Chairman) as an important background setting for the subsequent, extraordinarily low interest rates regime (easy money) that enabled the unusual economic conditions, among other parallel frameworks, for the tech bubble to form and burst, in 2000, and then shift into the housing bubble, that also burst, in 2007, and which precipitated the global financial crisis. Completed houses at Austin Perdana, Johor Bahru. Anti-speculative devices such as the Real Property Gains Tax for real estate are necessary to arrest undue speculation, control property prices and contain emerging property bubbles, timely. Root cause Joseph Stiglitz in his book Freefall identified that a root cause of the crisis was the stagnant household incomes of the United States and said that house prices began running in parallel with increasing household debt. Is the crisis over? Yes, by many who point out that the synchronised actions taken by central banks in 2009 averted “a depression greater than the Great Depression”. No, by many others who feel that the loose monetary and fiscal policy engendered by QE1 (quantitative easing) and QE2 and other measures, may have saved the world from a depression greater than the Great Depression, but the measures are temporary stop gap measures that have not restored underlying aggregate global demand on a more permanent basis and more importantly have not solved many of the ills in the global financial system for it to go forward on a more sound footing. Standing at this point in time, post a few months of heightened turmoil caused mainly by the Euro Zone debt crisis, and the US credit rating downgrade and anaemic recovery and growth, there are very serious concerns about the global outlook. The outlook for Asia looks more promising but that too must be viewed with a jaundiced eye as the global economy is more linked that most admit or know and the majority of final demand still emanates from the west. Real estate plays a complicit role in financial crises. In the Japanese decades-long economic downturn, it began with the bursting of a highly inflated real estate bubble. Twenty years later house prices have retreated from highs of 18 times household income to a benign six times. The Asian Financial Crisis of 1986/97 was one which afflicted this region and we in Malaysia have very personal and clear memories as to the role played by real estate in the build up to the crisis and the subsequent bust. Luckily for us, taking the cue from the formation of the Resolution Trust Corporation in the United States Savings and Loans crisis, we formed Danaharta which acquired bad loans from banks and financial institutions, timely, and restored the banking system and put the economy back on track, quicker. Real estate's role As for the GFC itself, there would be few who will not be able to appreciate the complicit role of real estate. As the Federal Reserve cut interest rates after the Tech bubble burst, the final run up to the housing bubble began. By late 2005 and early 2006 there were many who saw that the peak was at hand (those who saw it coming) but who could not stop the process because the bigger system had a life of its own. One must acknowledge that it is not possible for smart people to stand in the way as bubble go on self-sustaining, aggressive build up when “the herd is in a full run”. When the bubble burst in 2007, fingers initially pointed to the “sub-prime” mortgage market with the suggestion that that was a small part of the housing market in the United States and that it was not a very serious problem. But the so called sub-prime mortgage crisis rolled on and morphed into a full blown housing crisis which went on to affect the huge edifice of structured securitised products that were built upon the housing market (collateralised debt obligations) and these markets froze, which resulted in a credit crisis, so big, and which reverberated around the world, in a way that suggested a global depression, greater than the Great Depression. When the tech bubble burst in 2000, the world was not brought to the edge of the financial cliff. But when the housing bubble burst, that was exactly what happened. When asked, the Nobel Prize winning economist, Paul Krugman said that the stock market bubble burst was not as impactful as the subsequent housing bubble burst because it was “widely diffused”. Seven years later, when the property market bubble burst, the impact was substantial because it was concentrated in the financial sectors and there were large edifices of new financial products built upon it, the tentacles of which were global in reach and the cascading knock-on effects, global in extent. To prevent or tame the emergences of financial crises, we ought to also better understand the fundamentals that drive property prices and contain emerging property bubbles, timely. Is this possible? Monetary policy by itself it is said is not good enough to control the formation and development of real estate bubbles. Arresting speculation In this connection, the Federal Reserve Chairman of the United States, Ben Bernanke himself has said that “Monetary policy is a blunt tool; raising the general level of interest rates to manage a single asset price would undoubtedly have had large side effects on other assets and sectors of the economy.” We need, instead or additionally, permanent, anti-speculative devices such as the Real Property Gains Tax for real estate so that its rates can be adjusted timely to arrest speculative fervour, as well as administrative devices such as directives that tweak property rules appropriately to derive the desired result. Many East Asian countries, fearing the flow of speculative funds into their markets from carry trades have tweaked loan-to-value ratios, introduced sellers stamp duties, required banks to stress test based on percentage increases in interest rates as to their mortgage portfolios and so on. For residential properties the generally recognised key fundamentals that drive house prices are household income levels since residential properties are largely bought for owner-occupation. In most matured economies, when they are not inhabited by undue speculation, they reflect an average household income to house price ratio that revolves around three times. In many emerging markets, for various reasons, the ratio can be higher and even more than ten times is evident today in some hot spots around the globe. In Malaysia, the long term ratio is four times. When the ratio moves up it is an indication of a bubble formation in the market and market participants and regulators should stand alerted. A second fundamental that drives the residential market is rental returns, because apart from owner occupation, houses are also purchased for investment purposes. Net returns from residential property usually occupy a lower value, in the hierarchy of returns. In Malaysia the residential rental returns are 3% to 6% net depending on whether it is a landed property or a strata property and depending on a number of other factors. The range itself moves glacially over time depending on risk levels in the general market, and again, in Malaysia, over the past few decades yields have been moving downwards in sympathy with the era of easy money worldwide and its effect on asset returns generally. With the coming to the end of this long period of easy money, post the global financial crisis, the trend should be for the entire spectrum of residential yields, other property yields in general and global asset yields to be moving north. Valuers, who undertake professional valuations on a day to day basis in the residential market are well placed to upload information on the property market to market participants and other stakeholders in the property market, including regulators, and this upward flow of information into the market helps to stabilise the market and alert all involved when the market is in need of tweaking towards fundamentals. Rental is fundamental The fundamentals that bear watching for the office market are rents, but rents are a function of business profitability. Ultimately the profitability of businesses in any city sets the sustainable level of rents for that city and it also explains the different levels of rents that prevail in different cities. In Kuala Lumpur the long term yield for Grade A office space has been about 7% net. From time to time this yield has compressed to lower numbers, as low as 5%, but over the long term the market seems to return to the equilibrium level of 7% when the exuberance dies. The fundamentals that drive the retail sector are also rents but rents for this sector are driven in turn by retail turnovers and it is this that bears closer monitoring. Turnovers depend on the multitude of shoppers including tourists. In Kuala Lumpur the long term rental return on average for the Grade A, downtown shopping centres used to be about 8% but this is, I believe, on a structural transit towards 7% as shopping centres become more mainstream assets. Real Estate Investment Trusts or REITS have helped and are continuing to help in this re-rating. The fundamentals that drive the hotel industry are usually a combination of sustainable average room rates and average occupancy rates. This business income can be translated to an equivalent yield that usually sits on the higher end of commercial property yield spectrum. By understanding the workings of the property market through the key driving fundamentals and by the dissemination of that market information to market participants and other stakeholders in the property market, we can prick real estate bubbles. Professional Valuers who operate in the market on a day to day basis, can help enormously in bringing about stability in the market. The greater use and appreciation of valuations help in diffusing real estate bubbles and bring about financial stability. Elvin Fernandez believes in the free market and timely nudging by policy makers and key market participants to iron out any, and only where needed, imperfections in the system. To do this, and over time, they need a steady stream of in-depth market knowledge and insight. - The Star

Five MNCs in negotiations to invest in Kulim Hi-Tech Park

KULIM: Kulim Hi-Tech Park is negotiating with five multinational corporations to bring in over RM3bil in investments in the next six months. Kulim Technology Park Corp (KTPC) president Muhamad Sobri Osman told StarBizWeek that the five companies were from Europe, the United States and Japan and were involved in solar-related and electronics industries. “We are in preliminary and advanced stages of negotiations with the five companies,” he said. “Their investments should create some 5,000 job opportunities.” For 2011, KTPC has drawn about RM6bil for Kulim Hi-Tech Park. “These include new investments from Saint-Gobain Solar of France, Fuji Logistics of Japan, QT Technology of Singapore and Whizz Systems of the United States. “Then there are also additional investments from existing MNCs such Infineon for its second phase. “These investments should generate some 4,000 jobs,” Sobri said. Saint-Gobain Solar manufactures glass for the solar panel industry, Fuji Logistics is a logistics solutions provider, QT Technology provides wafer fabrication training and Whizz assembles printed circuit board products. On another note, Sobri said: “We will start the infrastructure development for the phase four, which is about 400 acres, in the first quarter of 2012. Works should be completed in seven to eight months. “We are investing about RM220mil for phase four, of which RM120mil is for land acquisition.” He said since 1995, KTPC had spent more than RM500mil to develop the first three phases of Kulim Hi-Tech Park, spanning 1,432 acres. Sobri said KTPC was exploring opportunities to bring in more investments from Japan and Thailand, in view of the natural disasters that had damaged their manufacturing industries. “The rental to lease the land in KHTP is very competitive, currently being priced at about RM23 per sq ft, compared with RM18 a year ago,” he said. On the recent RM1.85bil investment by Panasonic in KHTP, Sobri said the solar manufacturing facility would employ some 1,500 workers. The Kulim Hi-Tech Park currently had 24 MNCs and 37 small and medium-scale enterprises, employing some 26,700 workers. - The Star

槟中小型企业中心即起开放申请 州政府提供租金津贴

（槟城2日讯）槟城中小型企业中心（Penang SME Centre）即日起，开放予州内中小型企业者申请；而州政府将每月提供每平方尺80仙的租金津贴。 槟首长林冠英周五召开记者会，指该中心预计于2012年3月竣工，并在明年首季结束前启用。这项计划由槟城发展机构承建，耗资4000万令吉，占地逾16万平方尺，坐落在峇六拜自由工业第4园区。这栋共4层楼高的建筑物备有13个单位，每平方尺的租金为每月1令吉80仙（第一层）及1令吉50仙（第二层至第四层）。 大马首创租金极具优势 林冠英说，该中心的建成是大马首创，主要通过提供极具租金竞争优势的场地，培养及孕育创新的中小型企业，同时提供本地中小型企业展示自家产品及服务的场所，促进发展及完善供应链以推广槟州工业。 他说，这是州政府推广中小型企业所采取的3项步骤之一，以提升本地中小型企业的产业价值链及打造槟城品牌或拥有“槟城实力”的产品及服务。其他2项步骤则是2010年6月推展的中小型企业市场咨询、资源及训练中心(SMART)及在武吉敏惹、峇都加湾及北赖所建立的中小型企业村。 该中心将由槟州科学理事会5大支柱中的科技企业指导部、投资槟城机构及槟州发展机构组成的中小型企业中心管理委员会所管理。中心单位租用期为2年，可选择性续约1年。承租人在合同生效时需付3个月按金、12个月租金的银行担保、1个月预付租金及印花税，而免租金期限为1个月。 有兴趣者可至投资槟城SMART中心或槟州发展机构工业部索取表格，或致电04-6409988或04-6340111。录取名单将于明年3月公布。 林冠英：每平方尺80仙津贴　让中小企业茁壮成长 林冠英指出，槟州政府将提供每月每平方尺80仙的租金津贴。 “在获得津贴后，通过比槟岛市场上还要低廉的租金，中小型企业中心将让中小型企业从这里开始获得培育发芽成长。这是受到槟州硅谷各重要电子大厂围绕着的策略性地点，在提供支援及推广工业上获得便利，如发光二极管(LED)或固态照明(SSL)工业、医药器具工业、飞航工业、半导体工业及太阳光电工业等。” 透过槟州科学理事会，新开发的创新与创意，将获得提供技术支援与租金津贴。同时，成功的工业领袖将指导他们如何成为一个成功的行政总裁。 丘光宪：创造更多“槟城品牌” 拿督斯里丘光宪说，这是存在他脑中多年的概念，终在槟州政府的支持下落实。他希望这项在日本、韩国、台湾及美国等取得成功的计划，在槟城也有同样的成效，希望借此协助需要协助的中小型企业，创造更多“槟城制造”的品牌。 出席者尚包括槟州第二副首长拉玛沙米、刘镇东国会议员、槟州发展机构总经理罗斯里、槟州供水机构总经理查瑟尼及槟州政府投资促进机构总经理吕丽莲等。 伊斯兰断肢法及升旗山停车场课题　林冠英今记者会回应 针对记者提及马华智囊团策略分析与政策研究所的邀约（辩论伊斯兰断肢法论坛）及升旗山停车场相关问题，林冠英以“今日记者会课题繁多”为由拒绝回应，并表示明日课题较少，明日才召开记者会回应。 记者在林冠英周五记者会尾声时，提出以上的这两道问题。林冠英表示周五是伊斯兰教祈祷的时间，而今日课题较繁多，因此明日才回答。他补充，他将在周六特别召开记者会，针对记者的问题做出回应。 针对记者询及，巫统主席兼首相拿督斯里纳吉暗示大选已近，林冠英说，他们确实已感受到山雨欲来风满楼的大选前夕，并已对此准备就绪。而在周四已通过的国会遴选委员会，他表示会确保中央政府实际执行。否则，第13届大选将会是“最肮脏的选举”。 诺贝尔经济学奖得主詹姆斯教授　9日莅槟专题演讲 1996年诺贝尔经济学奖获得者詹姆斯莫利斯教授将于12月9日，莅临槟城开讲“槟城在亚洲：金融与当前的经济衰退”专题演讲。 槟首长林冠英在记者会上表示，这项活动主要是配合槟州社会经济及环境研究所（SERI）的更名仪式。该研究所将于12月9日更名为槟城研究院，协助州政府发展相关与研究政策，带领槟城前进，在符合能力、问责和透明度（CAT）原则下，实现长期和符合可持续发展的制度。而槟州政府是全马首个成立自主公共政策研究院的州属。 他说，借此，该院将在当天举办一天的论坛和演讲，包括由诺贝尔经济学奖得主詹姆斯莫利斯教授主讲的“槟城在亚洲：金融与当前的经济衰退”。主讲人尚包括世界各地顶尖大学的学术界著名讲师和马来西亚领导人等。 刘镇东： 助槟立足世界版图 刘镇东国会议员说，在欧债危机下，槟州社会经济及环境研究所的任务是协助槟州在世界版图寻求一个举足轻重的区域位置，并在国际舞台上占有一席之地。这项演说论坛于12月9日（周五）上午8时至下午5时45分，在槟岛市议厅举行。入门票分为50令吉（公众）及20令吉（学生），有兴趣预约者可在12月7日之前，电邮syedmikael@penanginstitute.org或致电04－2283306。 出席记者会的尚包括槟州第二副首长拉玛沙米、槟州发展机构总经理罗斯里、槟州供水机构总经理查瑟尼、槟州研究院执行员思亚米卡尔及威省市议员沈志强等。 冀明年易名“槟岛国际爵士音乐节”　吸引更多国内外者参与 第8届槟岛爵士音乐节已于周四在海湾沙滩酒店开唱。由于参与演出的乐队及观众有60%来自国外，因此，林冠英希望该活动在明年易名为“槟岛国际爵士音乐节”，借此吸引更多国内外爵士爱好者前来槟岛参与其盛。 音乐节总监保罗说，每届音乐节，他们皆确保至少要有一支来自槟城的本地乐队，借此提拔及提供本地乐队曝光及表现的机会。他相信，这也是大马最大型的爵士音乐节。- 光华

恐吉灵万山多层巴刹设计难引人潮 部分贩商宁在外营业

（槟城2日讯）吉灵万山周边部分贩商，宁愿向市政局缴税希望可继续在外营业，也不愿迁进吉灵万山内，因担心多层巴刹的设计无法引进人潮，恐影响生计。 吉灵万山周边贩商参加光大区州议员黄伟益举行的提升计划汇报会时，向他反映以上观点。Arkitek LLA董事翁仁清向贩商们解说初步概念设计时，根据早前的调查报告指出，贩商希望当局增加停车位、68%贩商希望重组肉类、海鲜、蔬菜档口、50%贩商赞成小贩中心设在1楼，而75%顾客希望肉类、海鲜、蔬菜档口在吉灵万山内底楼、50%顾客赞成小贩中心在1楼、30%顾客希望地上不会潮湿或积水、28%希望停车场在附近。 概念计划中，当局将会从1楼至2楼抽出三分之一的空间，建造5层停车场，共153个停车格。新设计中，也会去除吉灵万山后部围墙，让巴刹内更透光及通风。斜坡式电梯也会重新装上，类似霸级市场，让顾客可从底楼逛到最高层，也方便行动不便者。 底楼将集中肉类、海鲜及蔬菜档口，地面不再潮湿及积水，1楼及2楼将计划引进公共服务机构，如邮政局、银行或自动提款机，杂货店也会安排在1楼。目前底楼比路面高，计划中将会与路面保持同样水平，方便老人家到巴刹内购物，而顶楼将会实现目前国外流行的城市内务农计划，栽种蔬菜。 一名贩商认为，该区街头小贩已形成一种文化，如果要全部贩商搬进吉灵万山内，恐令游客失望，因游客曾向他表明，这文化吸引对方到当地一游。另对服装业贩商在计划中没阐明驻进哪一楼时，有关贩商也向黄伟益反映。 质疑古迹文化现代化设计 另一贩商则质疑当局称吉灵万山是古迹文化，但却大费周章花1100万令吉提升为现代化设计，与此说法有出入。他建议市政局仿效北海阿波罗市场，为吉灵万山周边贩商装置遮阳伞就行了，而吉灵万山则整座改装为停车场，因计划中的153个停车格，可能连贩商车辆都无法满足。也有一名贩商以峇央峇鲁巴刹为例，他认为无论如何花巨额装修多层巴刹，顾客也不会到内购物。 是日，出席汇报会者包括吉灵万山贩商公会主席纳斯莫希登、槟岛市议员戴良成及王耶宗。 符国明：妥当安排　绝不让贩商自生自灭 槟岛市政局卫生及执照组官员符国明强调，当局重整吉灵万山绝不会让贩商自生自灭，他认为，家庭主妇欲烹饪料理，除买了肉类蔬菜，也需到1楼杂货店购买调味料等用品，当局将会使用这样的店铺档口设计，让顾客到1楼或2楼。 黄伟益：现代化设计　重整计划耗逾千万 黄伟益指出，基于吉灵万山拥超过50年历史，就算原本设计不良也不可拆除古迹，所以当局计划以现代化设计，重整吉灵万山，整个重整计划需1100万令吉，但市政局只拨款100万令吉。基于卫生考量，海鲜、肉类及蔬菜的贩商得驻进吉灵万山内。 保留部分贩商周边营业 当然当局也可保留部分贩商继续在周边营业，因目前只是一个初步概念，往后当局还会委派各小组与相关业者讨论，但保留的贩商只限花卉植物小贩、水果业者等，其他贩商则需迁入。对于服装业贩商的反映，黄伟益促请有关业者无需担心，当局委派各小组与相关贩商讨论后才有最终结果。 他补充，如果吉灵万山顶楼不作城市内务农计划，贩商有更好的意见也可以告诉他，如建造社区中心或其他。他说，把吉灵万山夜市场当作新旅游景点也是当局的其中一项计划，把该地活络起来，同时让游客或本地人，夜间有个好去处。 相关照片 ■ 概念设计图中，吉灵万山更加绿化。- 光华

Be ethical, Chor urges property sector

KUALA LUMPUR (Dec 1): Housing and Local Government Minister Datuk Seri Chor Chee Heung has urged all parties in the property sector to always put the interests of the buyers first, by ensuring quality and timely delivery of their developments. Chor said all stakeholders, from bankers to project consultants and property consultants, should uphold their professional code of ethics in executing their respective responsibilities. "I urge all professional bodies involved directly or indirectly in the property segment to remind their members to be ethical at all times on their exercise of responsibilities. "Bankers who provide financing should only disburse funds based on actual work carried out on site, while developers should only use the funds from the banks and their project accounts for legitimate and allowable expenses," he told reporters after launching the official website of Rimbun property project by Amphil Corporation Sdn Bhd, here on Thursday. Chor said project consultants, on the other hand, should only certify payments when real work has been properly carried out, and at the same time provide true and fair property valuations and market trends to house buyers. "These measures will address the current shortcomings in the industry and ensure continuous and sustainable growth of the property sector," he said. Chor said the government can always regulate the property players and relevant bodies by means of a bill in Parliament. "However, as the world is moving towards liberalisation and deregulation, any act of over-regulation would stunt the growth of any business activity including the housing sector. "It would also drive away potential investors," he said. — Bernama

E&O: Hot property in Penang

Eastern & Oriental Bhd (Dec 1, RM1.41) Maintain outperform at RM1.39 with revised target price of RM2 (from RM1.98): Although annualised 1HFY12 core net profit was only 30% of our forecast, it is in line as future quarters should be stronger. We make no change to our target basis of 30% realisable net asset value (RNAV) discount or "outperform" call. But we adjust our target, RNAV and earnings per share for housekeeping and ICSLS conversion. E&O sold RM380 million worth of properties during 1HFY12, 52% more than its RM250 million sales in 1HFY11. Unbilled sales leaped from RM650 million a year ago to RM880 million. The bulk of 1HFY12 sales came from Penang, with the remainder coming from unsold units of St Mary Residences in Kuala Lumpur. As expected, E&O did not propose a 2Q dividend, in line with last year's practice and our expectations. Take-up rates for both the St Mary Residences and Phase 1 of the Penang Quayside condos have reached 80%. Phase 2 of the Penang condos will be launched this month and indications are that demand should be strong. Although minority shareholders may be disappointed that there was no general offer, we view positively the recent emergence of Sime Darby Bhd as a 30% shareholder of E&O. This provides E&O with a strong parent which could come in handy for the upcoming Phase 2 of Seri Tanjung Pinang. Also, we would not discount the possibility of joint ventures between the two companies as Sime Darby has 37,000 acres of undeveloped land with an estimated gross development value of RM100 billion. E&O's expertise in high-end residential projects will provide a good fit with Sime, especially for its landbank in the Klang Valley. — CIMB Research, Dec 1

Chua slams Pakatan govts over high rates for land conversion

SEPANG: Property prices in Selangor and Penang will keep escalating if Pakatan Rakyat continues to impose high land conversion premiums on housing developers in these states. MCA president Datuk Seri Dr Chua Soi Lek said the state governments in Selangor and Penang had placed high premiums on land conversion. He added that people should not assume that this only affected developers because they would in turn transfer the cost to housebuyers. “Because of this, property prices will continue to increase. If this goes on, only the rich will be able to live in these states,” he said, adding that sand price in Selangor was the highest in the country. “In reality, Pakatan has done nothing for Selangor and Penang this past three-and-a-half years. If there has been any development, it is due to efforts by the previous state governments,” he said after a 1MCA Medical Foundation fund-raising dinner in Sungai Pelek here on Wednesday. Earlier in his speech, Dr Chua criticised the Selangor government for not handing out scholarships equally among the races. “Last year, 1,500 scholarships were given out under Yayasan Selangor. Out of these, only two recipients were Chinese and three were Indians. “This year, 240 student loans were given out. However, only two Chinese and 11 Indian students were offered the loans,” he said. He said in comparison, 1,648 of the 4,000 scholarship recipients this year under the Public Service Department were Chinese. - The Star

Ministry to come down hard on errant developers

KUALA LUMPUR: Housing and Local Govern­ment Minister Datuk Seri Chor Chee Heung has vowed not to be lenient on developers who abandon projects. He said with the passing of the Housing Development (Control and Licensing) (Amendment) Bill 2011 in the Dewan Rakyat on Wednesday, all errant developers would be taken to task. “In the past, some local authorities were slack in the inspection of housing projects and some projects were carried out without approval of the ministry or relevant government agencies,” he said after the launch of Rimbun by Amphil Corporation Sdn Bhd’s website here yesterday. He added that there were 195 cases involving unlicensed housing developers due to this reason. Another milestone: Chor launching Amphil Corporation Sdn Bhd’s new website in Kuala Lumpur yesterday. Looking on is the company’s chief executive officer and director P. K. Poh. So far, 54 errant developers have been taken to court. Chor hoped the amendments to the Act would serve as a deterrent to developers seeking to make a quick buck by collaborating with professionals and bankers to cheat house-buyers. “Some bankers simply issued loans, before the certificate of completion, without checking properly the necessary documents and this allowed some developers to run away with the money without completing their projects,” he said. He said bankers who provided the financing should only disburse funds based on actual work completed on site while project consultants should only certify payments when real-time work had properly been carried out. It was reported by The Star recently that as of Nov 15, 1,308 developers and 4,703 directors of the companies concerned had been blacklisted by the ministry. These developers were involved in offences that fall under four categories – failure to pay compound fines, abandoning of projects, involvement in “sick” or problematic schemes and non-compliance with the judgment of the Tribunal for Homebuyer Claims. Chor said that previously, developers were allowed to ask for discount when they were fined but this would become “a thing of the past” with the amendments to the Act. “Previously, those who made genuine mistakes would be gi­­ven discounts but they will now have to pay the full amount,” he said. - The Star

Greater protection for buyers with new housing Bill

KUALA LUMPUR: The Housing Development (Control and Licensing) (Amendment) Bill 2011 with a new provision that developers who abandon their projects can be jailed has been passed in the Dewan Rakyat. Housing and Local Government Minister Datuk Seri Chor Chee Heung said that Section 18A provides for errant developers to be fined not less than RM250,000 but not more than RM500,000 or jailed not more than three years or both. Currently, Section 22(1) of the Housing Development (Control and Licensing) Act 1966 only provides for housing development company directors to be jailed not less than 12 months but not more than three years as well as fined not less than RM50,000 and not more than RM250,000. “The amendments passed involved eight existing provisions, one new provision and one abolished provision,” he said during the second reading of the Bill yesterday. Chor said the ministry had successfully revived 83 housing projects and was in the midst of reviving 61 projects while another 22 were at an early planning stage of being revived. Another amendment to the Bill was the term “housing developers” under Section 3 of the Bill which now includes private liquidators appointed by the court in the event it takes over the responsibility of failed developers. An amendment to subsection 6(1) set the deposit for a housing developer's licence at 3% of the development project cost, an increase from the current RM200,000 while changes to subsection 6(1)(a) and 6(1)(b) ensure that only developers with strong financial standing are involved in the industry. Section 8A allows individuals to apply for the sale and purchase agreement to be cancelled at any time if there was no continuing development at a project site for six months or more. With the amendment to Subsection 16N(2), the Tribunal for Home Buyers' Claims could now hear cases involving sale and purchase agreements signed between house buyers and unlicensed housing developers while subsection 16AD(1) increases the current penalty rate against developers who refuse to honour the tribunal's award from not less than RM5,000 but not more than RM10,000, to not more than RM50,000. - The Star

Housebuyers at a dead end

IT’S been 10 years and housebuyers of more than 60 abandoned houses in Taman Bukit Permai are still waiting for their houses to be completed. Six abandoned houses along Jalan Bukit Permai 2 were 95% completed and overgrown with weeds. The buyer of one of the six houses, Choo Lee Mae, said she has been waiting for over 10 years. “We are left in a lurch, we do not know who to approach for help. I have given a copy of the sales and purchase agreement to the liquidator,” she said. Makeshift carpark: A car parked inside this abandoned housing project in Taman Bukit Permai. A councillor with the Kajang Municipal Council (MPKj), Lee Kee Hiong, who visited the site with another councillor Eddie Ng, urged the housebuyers to come forward to provide details. “We do not have the contact details of the buyers as no land titles were issued. “This is a complicated case as the liquidator is only in charge of unsold houses,” she said, adding that the council will act as a coordinator. She can be contacted at 03-9010 3137 or leekeehiong@gmail.com or visit her service centre on Mondays, Wednesdays, and Fridays, 8pm-10pm, at 33-2, Jalan Temenggung 9/9. Bandar Mahkota Cheras. Not much have changed since the abandoned project was highlighted in StarMetro (“Task force to monitor abandoned projects”, March 26) eight months ago. “Some of the cars dumped in the area were towed away by council enforcement officers. We have since spoken to the liquidator but to no avail. “The Ministry of Housing and Local Government was notified of this abandoned project but no action has been taken to date,” Lee said. There were even cars abandoned in some of the houses. Forty-five notices were issued to the liquidator under the Street, Drainage and Building Act 1974, Section 46(1)(e) for having derelict vehicles in any public place. Lee said she would check with the Customs Department if the cars were brought into the country illegally. Chong Nyit Seng was furious that his abandoned house was used as a dumping ground for cars. He claimed that a makeshift porch was also erected without his knowledge within the compound to provide shade for the cars. “I did not give permission to have these cars placed here. “Years ago when I first found out that the project was abandoned, I contacted the lawyer who handled the sales and purchase agreement but it was all in vain,” he said. On the issue of abandoned cars, V. Mathevan, who lives in the nearby Taman Desa Permai, said six cars were brought to his neighbourhood on Sunday. He promptly notified Lee. “I’m afraid that more will be dumped here and that it will become a breeding ground for mosquitoes,” he said. - The Star

Solution to stop flooding for good

A LONG-TERM solution involving the widening of the drain in Jalan Arratoon is being planned to overcome floods near Lebuhraya Pykett, Jalan Westlands, Jalan Khaw Sim Bhee and Jalan Anson in Penang. State Local Government and Traffic Management Committee chairman Chow Kon Yeow said that these areas were frequently affected by floods. He said the main cause was the bottleneck when the water flowed down to Jalan Arratoon leading to the sea. “The drain there is only 2.13m wide,” said Chow at a press conference at Lebuhraya Pykett yesterday. As a long-term solution, Chow said that the council was looking into getting that drain widened in the near future. Small and narrow: Chow (right) and some residents checking the drains along Lebuhaya Pykett “We are working on an agreement with the new land owner to provide some space for the council so they can widen the drain,” said Chow. He said that the council was working on two short-term projects to mitigate flooding. “The first one is upgrading the drains along Jalan Burmah from the junction of Jalan Arratoon to SRJK (C) Union. “The project started on Friday and is expected to be completed by the end of next month,” said Chow. He said the second project was to repair the box culverts along Jalan Burmah from Lebuhraya Pykett until the junction of Jalan Arratoon. He added that the cost of the projects was RM173,549 and RM90,044 respectively. “Although we are working on the short-term solutions, we are considering a long-term solution to be completed in three years,” he said. - The Star

NGOs against land swaps

GEORGE TOWN: The Penang Government should use state land as collateral to obtain loans from banks to start proposed mega road and sea tunnel projects. This is better than allowing developers to deal in land swaps and be given the right to reclaim prime land near or off Gurney Drive in exchange for RM8 billion worth of such projects, said Sahabat Alam Malaysia and Consumers’ Association of Penang president S.M. Mohamed Idris. Idris said there should also be a public hearing and an inquiry of all reclamation and mega pro- jects before they were awarded to avoid unnecessary compensation later. Idris said that in Hong Kong and Singapore, the governments reclaimed the land on their own and sold them for higher profits. Idris was commenting on the state government’s proposal to adopt a land swap scheme with developers to build three roads and a tunnel. The roads are a 4.2km road from Gurney Drive to the Tun Dr Lim Chong Eu expressway, bypassing the city centre; a 4.6km road linking Bandar Baru Air Itam to the same expressway and a 12km dual-carriage road from Tanjung Bungah to Teluk Bahang to pair with the existing coastal road. The 6.5km sea tunnel is to connect Gurney Drive on the island to the north of Butterworth. On the proposed RM120mil Escape Theme Park project in Teluk Bahang, Idris said there was no need for such a park in the state. Penang Institute senior research fellow Datuk Dr Goh Ban Lee is also not in favour of the road and tunnel projects, saying they would only bring in more vehicles into the island. “We should look into adding more buses and bus routes to improve public transport. What would a high-cost tunnel do for Penang other than reduce travelling time?” he said. Malaysian Nature Society advisor Kanda Kumar said that if the land was to be reclaimed for the project, the government must ensure that they should not be converted into freehold status. “At least leasehold land will not be given away permanently. If we keep on giving away land and then reclaim some more, the environment will be damaged,” he said. Penang Citizens’ Awareness Chant Group advisor Y.C. Lee said there should be public hearings held for any proposed reclamation or mega infrastructure projects. “Such projects may be sustainable, but there should be a proper study, public comment and feedback on them,” he added. - The Star

槟耗资逾12万种进口树 海墘路将变林荫大道

（槟城28日讯）槟州政府耗资12万7470令吉种101棵进口树，要在2年内将海墘路蜕变成林荫大道。 12万7470令吉栽种101棵树，这意味槟州政府在海墘路栽种一棵树的经费为1262令吉。 周一上午，槟州地方政府委员会主席曹观友行政议员及槟岛市政局主席芭堤雅一行人在红灯角码头一带的海墘路双向道的分界堤上栽种树木，以逐步打造绿化乔治市的宏愿。 曹观友：绿化红灯角码头道路 曹观友议员说，槟岛市政局计划从海墘路（Weld Quay)的《光华日报》旧址到槟岛邮政局总部全长约550公尺的分界堤上栽种101棵树木，以绿化红灯角码头一带道路。 他说，当局选用4种品质优良的进口乔木，即：Bucida Molineti、Gardenia Carinata、Jacaranda Obtusifolia及Syzgium Campanulatum乔木，分批栽种在海墘路分界堤上，每棵20尺高的树之价格为800令吉。 曹观友说，槟岛市政局从本月初开始在海墘路种树，并加宽及加高分界堤，以让树木茁壮成长，2年之内绿叶成荫，美化海墘路。整个绿化经费耗资12万7470令吉，预计将于本月底完成海墘路的种树计划。 他说，为了栽种树木，海墘路的分界堤从原本的1尺半宽度，拓宽至4尺半至5尺宽。高度从原本7寸添高至13寸。并挖深土地一米之深，以让树木稳固扎根。 曹观友透露，槟岛市政局将于明年初在柑仔园，即从加马购物中心前至柑仔园及霹雳路交界处的分界堤上栽种280棵乔木。 他说，槟岛市政局已于去年在沓田仔分界堤成功栽种树木，目前也在华盖街一带的乔治市海湾酒店前的友谊公园栽种树木。 相关照片 ■ 曹观友议员及槟岛市政局主席芭堤雅主持海墘种树推介礼。 ■ (右起）林清和市议员及郑来兴市议员为进口树浇水。 ■ 212万7470令吉栽种101棵树，州政府在海墘路栽种一棵树的经费为1262令吉。- 光华

Tan brothers look to 'conquer' Penang

KUALA LUMPUR: For a while now, there has been speculation about who would partner Ivory Properties Bhd in its multi-billion ringgit Bayan Mutiara project in Penang. That was ended when it roped in Dijaya Corp Bhd. They now plan to build residential and commercial properties on the land, estimated to generate sales of some RM10 billion. This is not their first tie-up. Within the Batu Ferringi tourism belt, Dijaya has a joint-venture project called "10 Island Resort" with Ivory. In Bukit Mertajam, Dijaya has a mixed development project dubbed Aston Villa, in which Ivory is the turnkey developer. But that partnership has overshadowed an interesting fact. Penang has now seen the entry of two highly successful businessmen and both happen to be brothers. Dijaya is controlled by Tan Sri Danny Tan Chee Sing, the younger brother of Berjaya Corp Bhd founder and chairman Tan Sri Vincent Tan Chee Yioun. Barely three months ago, the senior Tan made a comeback to Penang as a property developer after a hiatus of nearly two decades. The Berjaya Group - via Berjaya Land Development Sdn Bhd - signed a deal to buy 22.8ha of prime freehold land within the Penang Turf Club for RM459 million. At the signing ceremony in Penang, Vincent did not mince his words in expressing his displeasure with the previous state government. Vincent's approval of the current state administration is a strong signal to other developers that the island state has plenty of potential. And this probably explains Danny's continued interest. The latest alliance with Ivory is a very big undertaking and one which will ensure its presence in the state for many years to come. Danny, the man behind Petaling Jaya's Tropicana Golf and Country Resort, will have his hands full with the latest venture. As for Vincent, he did not discount the possibility of enlarging Berjaya Group's footprint in Penang. Together, the Tan brothers will be a force to be reckoned with in Penang. marinae@nstp.com.my - Times Read more: Tan brothers look to 'conquer' Penang http://www.btimes.com.my/Current_News/BTIMES/articles/monvy/Article/#ixzz1f3VcJx6S

China to maintain curbs on property market

BEIJING: China will maintain restrictions on the property market, vice-premier Li Keqiang has said, despite growing speculation that curbs could be eased to prevent a damaging slump in prices. Real estate sales and prices have been falling nationwide due to tough restrictions on purchases and bank lending, fuelling fears that the market could collapse and send debt-laden property developers to the wall. China’s property market was “in a key stage” and restrictions needed to stay in place to “promote the healthy development” of the sector, the official Xinhua news agency quoted Li as saying on Sunday. “We must maintain policies to prevent property prices from rising overly fast and further consolidate the results of the controls,” Li said. China has introduced a range of measures aimed at bringing down property prices the last year, such as bans on buying second homes in some cities, hiking minimum down-payments for buyers and introducing property taxes. A surge in bank lending in recent years has fuelled investment in the real estate sector and pushed property prices out of the reach of many ordinary Chinese, angering people struggling to buy their first home. The government would maintain restrictions and step up construction of low-cost housing to “satisfy the multiple and diversified housing needs of the public,” Li said. Li’s remarks echoed those of Chinese Premier Wen Jiabao, who recently said house prices should return to “reasonable levels” before policies were eased. Renmin University in Beijing said last week it expected the government to relax some property market curbs next year due to concerns that slumping prices could hurt growth in the world’s second largest economy. Cash-strapped local governments were heavily reliant on revenue from land sales, and the central government would likely intervene to prevent property prices from falling more than 25%, it said in a report. Property investment was also a contributor to economic growth, so Beijing might act to help ensure gross domestic product growth – which creates jobs and prevents social unrest – remained strong, it said. Official data showed the number of major Chinese cities posting a drop in home prices doubled to 34 in October from September, in a sign efforts to cool the country’s surging property market are working. — AFP

Kobay may privatise subsidiary Lipo

PETALING JAYA: Kobay Technology Bhd, the parent company of Lipo Corp Bhd, is considering an exercise to privatise the latter, according to reliable sources. The industry sources pointed to the fact that Kobay already owned 53.16% of Lipo, was cash-rich and Lipo was trading at a significant discount to its net tangible asset (NTA) value of RM1.60. It is understood that the advisory services of an investment bank has already been sought for the proposed deal although it is not clear which bank is involved. Both Kobay and Lipo are Penang-based companies involved in the manufacture of precision engineering equipment, although as of late last year, Lipo had ventured into property development. The Kobay-Lipo group is 26% owned by the Koay brothers Datuk Koay Hean Eng, Koay Cheng Lye and Koay Ah Bah. Hean Eng and Cheng Lye are common directors of Kobay and Lipo. Kobay's management was unavailable for comment. “Kobay is taking the cue from the flurry of privatisations that has taken place on Bursa Malaysia, stemming largely from the undervalued nature of the assets,” said a source. Kobay has more than RM60mil in cash and cash equivalents, which means that funding the privatisation should not be a problem. It will cost Kobay some RM27mil to buy back all the shares in Lipo it does not own at current prices or slightly over that if it is going to pay a premium to market. Lipo itself has a clean balance sheet, with RM28mil in cash and cash equivalents and with very little borrowings. Its venture into property development in Penang started last year when it bought nine lots of freehold land measuring a total of 47,679 sq ft in Tanjung Bungah for RM6.88mil or about RM144.30 per sq ft. It then said the plan was to develop that into residential and commercial properties. Lipo had also told shareholders then that the expansion into property development was a diversification strategy to help it move away from depending solely on the existing precision component manufacturing business, which was cyclical. The management of Lipo and Kobay had then declined to elaborate on the property development venture. Lipo's earnings fell to RM1.6mil in its latest quarter ended Sept 30, 2011, from RM2.7mil earlier due mostly to unfavourable performance of its China segment as result of the change of sales mix of overseas precision components and the loss incurred by the setup of a subsidiary in China. Since Kobay increased its shareholding in Lipo last December, Lipo's share price has risen by some 80% to RM1.14 per share last Friday. - The Star

To better serve women

THE Women’s Centre for Change (WCC) Penang is still short of RM1.5mil of its fundraising goal for its new premises on Burmah Road, George Town. Its president Mariam Lim said the total target was RM2.5mil to cover the building cost of RM1.5mil and the renovation cost of up to RM1mil. “To date, we have raised a total of RM1mil, which is 40% of the target,” she said. “We hope the public can support us with donations, as the new building is aimed at providing better facilities for single mothers, children and youth.” Lim said the three-storey building on Burmah Road had been vacant for a few years and required renovation. “The building, covering a 5,000sq ft built-in area, will give the centre more space for counselling services, seminars and training activities,” she said. “We are planning to rent out the ground floor which covers 1,500sq ft with an offered price of RM5,500 per month. “The rental is negotiable. This is aimed at generating income for the centre.” Lim was delivering her speech during the soft launch of WCC’s building fund themed ‘Give, Build, Change’ at the Little Penang Street Market on Sunday. The launching ceremony was kicked off with a live singing performance by Jazz singer Dasha Loganathan. Also present were Bukit Mertajam MP Chong Eng and state Youth and Sports, Women, Family and Community Development chairman Lydia Ong Kok Fooi. For details or to make a donation, call 04-2280342 or visit www.wccpenang.org/givebuildchange. Tax-exempted receipts will be issued for those who donate at least RM50. - The Star

Resort lifestyle of condo a draw for westerners, says developer

CAUCASIANS comprise the bulk of those purchasing the RM255mil Infinity Beachfront Condominium that recently clinched the FIABCI Malaysia Property Award 2011 under the residential (high rise) category. Hunza Properties Berhad executive chairman Datuk Khor Teng Tong said the project attracted Caucasians because it had access to a 105m-long beachfront as well as a 136m-long river frontage. “Beachfront accessibility is a key attraction for Caucasians as they prefer a beach resort lifestyle. “While the project was still under construction in 2008, we adopted Sungai Kelian to beautify and maintain its cleanliness for the long term. “Hunza and the FIABCI Penang Branch used the effective microorganism (EM) biotechnology to clean the river. It is now free of sludge and its water clearer,” Khor said. “The Caucasians, forming about 65% of the buyers, are from countries such as Britain, the United States, Australia, Belgium, Switzerland and Canada,” he said. He said other foreign buyers came from countries such as Vietnam, Hong Kong, Indonesia, Korea, Macau and Singapore. Khor also said the company’s RM480mil Gurney Paragon condominium project attracted many purchasers from Singapore, Indonesia, Hong Kong, Korea and Macau as the project was close to shopping malls and lifestyle facilities. He said this at a recent cocktail event in Penang to celebrate Infinity’s FIABCI award win. The event was attended by business partners of the project and corporate leaders. The project, comprising 119 condominiums units and penthouses, obtained the certificate of fitness (CF) in 2010. It is all sold out except for four of the eight penthouses. Initiated 19 years ago, the FIABCI Malaysia Property Award invites the best projects in Malaysia to contest in various categories. The winning projects this year will represent Malaysia in the international competition FIABCI Prix d’ Excellence awards which will be held in St Petersburg, Russia, in May next year. FIABCI is the acronym for Federation Internationale des Administrateurs de Bien-Conselis Immobiliers (International Real Estate Federation). - The Star

Influx of office space in Klang Valley worsens oversupply situation

KUALA LUMPUR: An influx of office space in the Klang Valley is putting a downward pressure on yields. Property consultants said the entry of more office space was making the oversupply situation worse. However, they said the situation could be remedied should the economy perform better, thus keeping demand afloat. “In certain areas, yields will be pressured downward because of the glut situation. But this is also highly dependent on the location of the offices. Those located in prime areas will have less chance of coming under yield pressure,” DTZ Debenham Tie Lung executive director Brian Koh told StarBiz. Khong & Jaafar managing director Elvin Fernandez said that the slightly higher vacancies this time around was “not too abnormal a situation”. “The thing about property cycle is that there can be a glut today but this oversupply condition can be offset if demand returns. I do not view it as being serious, “However, there could be a lot more supply that would flood the office space sector in the medium to long term,” he said. There were 20 million sq ft of vacant space in the Klang Valley, 22.5 million sq ft of office space under construction and 25 million sq ft which had been approved for construction. The Government recently earmarked several areas for commercial development such as the KL International Financial District in Jalan Tun Razak, the 100-storey Warisan Merdeka, the Sungai Besi military airport and the Rubber Research Institute land in Sungai Buloh which are expected to come onstream within the next 10 years. Meanwhile, a report by CB Richard Ellis released earlier this month revealed that office yields in Kuala Lumpur prime area had been flat from 2005 until 2011, ranging from a low of 6.25% to a high of 6.75% (see chart). The report also showed the office space vacancy rate in the Klang Valley was under 13% on an average basis, which consultants said could rise once new space came in with the completion of several mega projects. “With all the large-scale development projects coming in, we are looking at a potential oversupply situation but if the economy does exceptionally well despite the problems in the eurozone, this problem would ebb,” said Koh. Vacancies had risen during the 2008 global financial crisis in prime office spaces and rental rates had been on a slight decline. The prevalent trend among corporates was to move their bases away from the city centre into newer office buildings within other established suburbs such as Petaling Jaya and Klang as many of the workers lived in these suburbs. “After the My Rail Transit has been completed, office development would focus back to the city centre as long as they are affordable and corporates can make a decent profit even after paying off these leases. I expect this trend to reverse and that Kuala Lumpur will remain at the primacy of development in the Klang Valley,” Fernandez said. - The Star

‘Home is where heart must be at peace’

KUALA LUMPUR: Since ancient times, shelter has been the basic need of every human and the home is regarded a sacred space because it comforts, inspires and heals the body, mind and spirit. Columnist and author T. Selva shared this philosophy and knowledge of the 5,000-year-old Vasthu Sastra the Indian art of geomancy with visitors to The Star Property Fair, which reached its finale at the Kuala Lumpur Convention Centre here yesterday. “The ancient science, which can be applied in modern times to achieve a balance with cosmic forces, can assure harmonious living. Positive feedback: Selva giving out the ‘Vasthu’ pyramids to lucky recipients after his talk at the property fair at the KL Convention Centre in Kuala Lumpur Sunday. “One has to be tuned in with the universal rhythm of certain creations in seeking peace and prosperity,” he said, explaining that Vasthu Sastra was not just about a piece of land but something “that starts from oneself from the moment he wakes till he goes back to sleep”. Selva emphasised on the five elements of nature (ether, air, fire, water and earth) and the corresponding five senses in a person (hearing, smell, sight, taste and touch). “When working or living in a building or property, a person is to respect the five elements, which must be present around the individual,” he said. He explained: “Ether and hearing: one is encouraged to listen to soothing music early in the morning, not disturbing noises or loud music. “Air and smell: the burning of fragrant incense or uplifting scents purify the air and allow fresh air to flow into the house. “Fire and sight: watch the sunrise and allow the morning sun into the house to have a good headstart. “Water and taste: have an indoor fountain in the northeast space of the room to be in harmony with the water element. “Earth and the sense of touch: allow your bare feet to touch the ground to discharge and recharge your body with positive earth energies. Selva, who put up Vasthu Sastra guide books for sale, also gave away 100 mini-pyramids, imported from India, to lucky visitors and explained how they drew subtle positive energy. He said one of the pyramid's functions was to remove or recycle stagnated and negative energy and focus on harmonising energies instead.-The Star

Australian homes on show at fair

KUALA LUMPUR: House buyers and property seekers continued to make a beeline to The Star Property Fair, Malaysia's premier showcase for stylish living, at the Kuala Lumpur Convention Centre here. They not only got to check out on the latest offers by local developers but also useful tips on buying and managing property in Australia. Anthony Phey, senior manager and consultant of Central Equity, a leading inner-city residential developer in Melbourne, said: “If it's your first investment, make sure you are doing it right because what you will be spending is your hard-earned money. “Buying a property in Australia is a great investment due to the economic factor, job opportunities and world-quality lifestyle. Spoilt for choice: Potential housebuyers visiting the booths at The Star Property Fair 2011 at the Kuala Lumpur Convention Centre yesterday. “The Australian Government allows foreign ownership but with the proper documents and certain criteria,” he said. Phey was met during a one-hour talk on the second day of the fair yesterday. The fair at Halls 4 and 5 of the convention centre ends today. Award-winning interior designer Benson Saw gave an interesting insight into selecting the right furniture for the home. “We should break the convention and be creative. It does not mean you can place a sofa in your living only but in your bedroom too.” “Use the space well because when you invest a lot on a property you should consider investing in good and quality furniture too,” he said, spicing his talk with images of well-decorated homes. “Lighting plays an important role too,” added Saw. David Koh from the Malaysian Institute of Geomancy Sciences presented interesting tips on how to enhance the living environment with “environology” a new word he coined to mean feng shui. “Those buying property should know the type of energy in their house as ancient living styles are still applicable in modern life,” said Koh. - The Star

槟威海底隧道及3道路 中韩马竞标2015动工

槟城25日讯）估计总造价高达80亿令吉的槟威海底隧道及3条主要道路兴建工程，根据州政府拟定的招标及施工日程表，最快要在2015年中才能动工。 州政府秘书署经于本月15日通过州政府官方网站让有兴趣竞标这项工程的本地及外国公司下载资格鉴定申请书。 据悉，除了已经和州政府签署谅解备忘录的中国公司，目前最少还有一家韩国跨国公司及多家本地公司已经表达他们要争取这项工程的意愿。 根据州政府的规定，任何有意参与竞标的公司，必须出席11月29日举行的资格鉴定说明会。没有出席的公司将自动失去竞标资格。 没出席说明会不能投标 槟州公共工程、基本设施及交通管理委员会主席林峰成受询时说，没有代表出席说明会的公司，将不能投标这项工程，除非行政议会决定再另外举行多一场说明会。 因此他吁请有意投标有关工程的公司不要错过这次的资格鉴定及说明会。 他说，州政府目标是希望能有多家公司参与。 根据州政府的资格鉴定申请书列明的工程日程表，有意竞逐这项工程的公司必须在2012年1月14日前提呈他们的申请书，通过资格鉴定后，必须在明年6月前提呈他们的建议书。 由于这将会是一项涉及隧道及3条主要道路的大工程，从开始鉴定发展商资格到选出得标公司，将耗时3年6个月时间。根据日程表，州政府与得标公司签约日期是在2015年5月，预料有关工程最快也要在第二年中旬才能动工。 竞标公司需有经验 资格鉴定活动主要是让州政府在正式公开招标前，初步筛选具有资格的竞标公司。当局对竞标公司的要求首先是要具备相关经验、可信任及有财力基础。 不提供预支工程费用 通过资格鉴定这一关的公司，才会受邀提呈他们对有关工程的建议书，对有关工程提出设计、研究及执行方案。在工程完成前，州政府将不会给予得标的公司提供预支工程费用，不过，竞标公司在建议书中可以提出他们在完成工程后的收费方案。 据悉，州政府将会以丹绒道光填海计划的100英亩地段做为支付工程费用的部分款项，并允许发展公司征收过路费以取回成本。 3大主要工程 这项涉及衔接槟威隧道及另外三条主要道路的工程，或会分为几个不同的部分来落实。 继槟城大桥及第二大桥之后，第三条接通槟岛及威省的通道，计划中的隧道将会从新关仔角衔接威北的峇眼阿占。 另外将和隧道工程捆绑在一起的3条主要道路分别是： 1. 乔治市绕道：从建议中的新关仔角隧道出口经过邦咯路、霹雳路及双溪槟榔路进入敦林大道。 2. 亚依淡新市镇（发林）绕道：此绕道将会是一条接通发林和敦林大道的新路，根据政府的要求，有关绕道将会开通几个出口连接叶祖意路、苏丹阿兹兰莎路。 3. 丹绒武雅通往直落巴巷的平行道路：有关道路将会在现在丹绒武雅通往直落巴巷道路的内则，再建造一条平行道路，以疏解有关道路车辆日益增加的压力。- 光华

Panasonic to invest RM1.9bil

GEORGE TOWN: Panasonic Corp will invest RM1.85bil in its latest solar manufacturing facility in Kulim Hi-Tech Park (KHTP).

The company will be leasing a 60-acre site from KHTP for the facility.

According to sources, Panasonic is now negotiating to finalise the lease payment, which will be a one-time payment, to lease the land for 60 years and an option to renew it for another 39 years.

In KHTP, the rental to lease the land starts from RM23 per sq ft.

Panasonic will start construction of the facility as soon as possible, as it plans for the plant to start operations in December 2012, with an annual production capacity of 300MW.

In an announcement made available at its website, Panasonic announced that it would establish Panasonic Energy Malaysia Sdn Bhd next month to produce solar cells and modules.

Panasonic’s solar manufacturing facility in KHTP will be the second company there after the US-based First Solar, which occupies 160 acres.

First Solar, to date, has invested RM2.9bil in KHTP since 2007, employing 3,400 workers in its six plants.

There are 37 companies providing support services for solar power and semiconductor industries in the country.

Among them is Saint-Gobain Solar (SGS) from France, which has invested RM46mil in KHTP for a glass manufacturing facility to support the solar industry, and is expected to start operations this month.

In the announcement, Panasonic said with environmental awareness increasing globally and the introduction of subsidy systems and feed-in tariff schemes in Japan and other countries, the solar cell market was predicted to grow further.

“Robust demand is expected particularly in the residential sector, the main target of the Panasonic solar modules.

“The new factory in KHTP will not only help Panasonic meet this growing demand, but also strengthen the company’s module’s cost-competitiveness with the vertically-integrated production,” the announcement said. - The Star

Demand for housing likely to be stronger in H2 next year

KUALA LUMPUR: The number of applications for property development licences is expected to be slightly lower in 2012, according to Housing and Local Government Minister Datuk Seri Chor Chee Heung.

“This year there is a very high number of applications. Also, the trend for the property market next year is optimistically cautious,” Chor said after the launch of the Star Property Fair 2011. Chor reiterated that the construction sector was expected to grow 3.4% this year compared with 5.1% in 2010.

He pointed out that speculative activities in the property market might be dampened in the first half of next year due to the recent measures such as the 5% increase in the real property gains tax to 10% for units sold within the first two years after purchase and Bank Negara’s guidelines on responsible lending.

However, Chor said he believed that demand in the housing market would be stronger in the second half of 2012.

“Towards the second half of next year, once purchasers are used to these measures, they would be back in the market.”

Chor said he was expecting a “rationalisation” in residential property prices although they were not expected to be lower due to increases in the cost of land, raw materials and wages.

“This is because the Federal Government has put in place measures to build affordable homes for first-time buyers or those with household incomes not exceeding RM7,000 a month. When the Federal Government starts to do this, property developers would invariably build homes at affordable prices.

“But they would not be right in the middle of Kuala Lumpur; maybe they would be in Rawang and Semenyih. The price of housing cannot go up every year; it has to reach equilibrium at some point.”

Chor said that one reason for the rise in property prices in Penang and Selangor was the high premium paid by developers for the conversion of land use.

The Star Property Fair is being held until Nov 27 at the Kuala Lumpur Convention Centre.

Developers such as SP Setia, IOI Properties, Naza TTDI and Mah Sing are exhibiting their property offerings at 130 booths. - The Star

Giving of rebates to attract buyers

A COUPLE of weeks ago, a bit of controversy arose over the purchase of two residential units in One Menerung, located behind Bangsar Shopping Complex.

For non-city dwellers, Bangsar is an upscale commercial and residential area next to Damansara Heights, one of Kuala Lumpur's most prestigious neighbourhood. The developer is Bandar Raya Developments Bhd (BRDB). It is unclear how much the two units actually cost. There are reports which cited that one of the units cost RM9.8mil and the second unit cost RM6.9mil. For the sake of consistency, let us just put the two units at RM6.9mil each.

Although it was reported that both are condominium units, it is also likely that the units may be landed duplex units as the entire project is known as a condominium project.

According to a previous press report, the Government had given a RM250mil loan to the National Feedlock Corp (NFC) for the cattle business but a portion of this money was instead used to buy two residential units in One Menerung, besides other uses. There are many interesting aspects to this cattle versus property investment episode.

The NFC is managed by the husband of Women, Family andCommunity Development Minister Datuk Seri Shahrizat Abdul Jalil,Datuk Seri Dr Mohamad Salleh Ismail. The rationale behind the diversion of funds from cattle to bricks and mortar was given during a press conference in mid-November.

According to press reports, the investment into these two units is rendering NFC a monthly rental income of RM70,000, or a gross return of about 13%, for each unit. Initially, it seemed quite impossible for a condominium to fetch that kind of rental. Even a bungalow in Damansara Heights does not fetch that kind of rental. Later, it was revealed that the monthly rental is RM18,000 for a unit.

At RM18,000 a month, a year will provide the buyer a gross rental income of RM216,000. Annually, this means a gross rental income of 3.13% (216x100/6.9). But the units come with a monthly maintenance and sinking fund charge. The monthly charges at One Menerung is at the rate of 55 sen per sq ft. Assuming that the unit is 6,340 sq ft, that works out annually to RM41,844, or RM3,487 every month.

The gross rent of RM216,000 less maintenance charges of RM41,844 is RM174,156. This means the annualised net rental income is 2.52%.

Now this is the interesting bit. In a press conference, it was revealed that BRDB gave NFC a cash rebate of 10% of the purchase price of the units. Assuming that both units are priced at RM6.9mil, this means apart from the rental income of RM216,000, the buyer received another RM690,000, or RM57,500 a month from the developer. This works out to the buyer receiving about RM75,500 (RM57,500+18,000) a month. Based on the 10% rebate excluding the rental income, over a 24-month period, the buyer received about RM1.3mil from BRDB for the two units.

But this 10% rebate ends next month, which means come January 2012, the return on investment takes a drastic fall from a return of 13% to 2.52% net, or 3.1% gross. This is the fixed deposit interest rates offered by commercial banks today.

This episode of giving a 10% cash rebate over 24 months raises other questions. Did all the other buyers of One Menerung receive the same 10% cash rebate over a period of 24 months? According to a former staff of the company, different incentives were given at different times to different buyers.

One Menerung was launched in 2006. In the first quarter of 2008, it was reported that One Menerung was doing well with 85% of the units sold. If that project was doing well, why did BRDB give that 10% cash rebate?

A developer who declined to be named says it is possible for developers to provide some form of incentive to push sales. But the quantum must be reasonable. There are also cases of buyers getting bulk discounts when they buy multiple units.

On a larger scale, why would BRDB, a very reputable developer give buyer or buyers a 10% cash rebate which stretches over 24 months? This effectively reduces the price of the properties, and the company's revenue. Normally, it is a one-off thing and is clearly spelled out and given when the property is sold.

When the price of a property is fixed and that price is approved by the Government, the developer cannot increase the price without prior approval. However, there is no issue with reducing the price of the property, although by right, this should not occur as it gives rise to other issues, the developer says.

This leads us into another area, the marketing of properties. Just as there is today, a buy-one-get-one-free in the supermarket and fashion, these purchases are small and for day-to-day use. These purchases cannot be compared to property purchases.

When it comes to property investment or an outright purchase because of a need, it is a different ball game altogether. Afterall, buying a property is a very big commitment that goes on for years and if the loan tenure is long, for decades. While it is fine to invest, decisions have to be weighed very carefully. Each investor has different needs and wants and for many of us, property investment will be the largest monetary investment many of us are likely to make in a lifetime, apart from a car. Because property prices tend to increase in Malaysia, this does not mean that property prices will not fall. It may fall for a period. Because there is always that risk, it is best to use one's own money to invest in property simply because it is a long-term investment.

As property, be it commercial or residential, is a popular asset class in Malaysia as elsewhere in Singapore and Hong Kong isn't it time that Malaysia set up a sort of regulatory framework under the ambit of some housing related assocation to govern how developers should conduct their business? This framework could include the selling and marketing of properties.

By all means, let there be some form of “inducements to buy” but let this enticement be reasonable. This is an important issue for the simple reason that property development and investment is very closely linked to the banking sector, which is the backbone to any national economy. If one falls, the other falls with it. As we have seen in the West, it was the property sector which rendered the US economy the way it is today.

l Assistant news editor Thean Lee Cheng finds these “cash rebates” very attractive, but instead of giving rebates, why not just price the property lower?  - The Star