SUNRISE Bhd (6165) plans to launch two new property projects worth some RM1.5 billion in Kuala Lumpur over the next four months.

Executive chairman Tong Kooi Ong said Sunrise will launch 28 Mont' Kiara, a 41-storey tower featuring 460 units of condominiums, each ranging from 3,000 sq ft to 4,000 sq ft, this December.

Early next year, it will launch Solaris KL, two 30-storey towers with 550,000 sq ft of office space on Jalan Sultan Ismail.

Sunrise has done the foundation for 28 Mont' Kiara and hopes to start construction in December, completing it in three years.
He said work on Solaris KL will start early 2010 and the project will be ready in four years.

"We believe the market will do well next year. We are confident of sales because of the location and features of the properties," he said after a shareholders' meeting in Kuala Lumpur yesterday.

Sunrise has applied to obtain the Green Mark certification for Solaris KL, which is issued by the Singapore government and awarded to buildings that are environmentally friendly.

Its 11 Mont' Kiara is the first local residential project to receive the Green Mark. Solaris on the Park, a mixed development in Mont' Kiara, which is yet to be launched, has also won the Green Mark.

Tong is optimistic Sunrise will do well with unbilled sales of RM860 million, which will underpin its earnings for the next two years to 2011.

Most of the unbilled sales or sales that have yet to be booked into its accounts were from higher margin products in Mont' Kiara.

Last year, Sunrise made a net profit of RM156.2 million on revenue of RM803.9 million.

Among the projects Sunrise will launch in 2010 are Solaris on the Park, and a RM1 billion residential project in Richmond, Canada.

Sunrise will launch a mixed development project on 0.6ha of prime land opposite the Petronas Twin Towers where Wisma Angkasa Raya now sits in 2011.

"We have done a market study in terms of the various composition of properties, whether it would be a hotel, a condominium or an office block, with retail space. We have decided what we want. We are at the stage of appointing architects now," Tong said.

The 24-storey Wisma Angkasa Raya, which is around 30 years old, is Kuala Lumpur's first high-rise office building. Sunrise paid RM179 million for land and property last year.

Thinkproperty.my has reported an unusually high number of new listings after the 2010 Budget announcement as well as a high number of price cuts for properties on sale

The reintroduction of a real property gains tax (RPGT) from January 1 next year appears to have triggered a rush to sell properties but agents said it will be very tough to beat the deadline.

Thinkproperty.my, a website that lets people advertise their properties for free, said it has seen an unusually high number of new listings after the 2010 Budget announcement.

There have also been a high number of price cuts for existing properties that are on sale. However, it did not provide detailed numbers.

Last Friday, Prime Minister Datuk Seri Najib Razak said the RPGT will return next year at 5 per cent after it was scrapped in 2007.
But agents think it is just a knee-jerk reaction. Property consultant Sharizal Supian said a property deal takes between three and six months to complete, which means it will be very hard to beat the January 1 deadline.

The RPGT has not been well-received as many think it would halt the growth of the property market.

Thinkproperty.my chief executive officer Asim Qureshi believes the re-introduction of the tax has been a year or two too soon.

"We need some of the feel good factor to gain momentum and this tax can only slow down that momentum.

"Furthermore, I believe that having a tax exemption for property owned for a certain number of years would be better as the tax would target property speculators," he said in a statement.

Asim said Malaysia is increasingly seen as an international property hot spot and the RPGT will somewhat undermine that view.

However, he thinks that at 5 per cent, the reintroduction has been gentle and it may not significantly disrupt the market.

"In terms of opportunity, it will be a good time to buy in the secondary market from now until year-end which is where the tax will have its most direct impact," he said.

Emkay Group chief oper ating officer Peter Teh has a different take. He thinks that any sudden surge in sales in the next few months would be mainly due to a recovering property market.

He said the tax will not deter serious home buyers. "They are also not really buying now but over a few years and they will not fell the pinch as it will pass through in the next coming years."

Property developer Land & General Bhd (L&G) (3174) expects 90 per cent of units in its two commercial towers in Bandar Sri Damansara, Selangor, to be snapped up by June next year.


Dubbed "8trium", the commercial development comprises a two-storey 100,000 sq ft retail podium and 260 units of office suites contained in two blocks.

The development has a gross development value of RM160 million and makes up 90 per cent of L&G's unbilled sales.

"Tower 2, which was officially launched this July, is over 90 per cent sold. Meanwhile, 30 per cent of Tower 1, which was launched 10 days ago, has been taken up," L&G managing director Low Gay Teck told reporters after the 8trium groundbreaking ceremony yesterday.

The project is slated for completion by the first quarter of 2012.
The developer is also looking to develop another 16.18ha in Bandar Sri Damansara.

"We have submitted the necessary documents for the approval of the relevant authorities for a residential development there," said Low.

L&G is also in talks with landowners to pursue land deals in the Klang Valley, for either residential or commercial developments.

"We don't have a target landbank size, but what we look for is valuable land. Our business direction is to consider areas that are sought after," he said.

The land purchase will be financed via bank borrowings and cash reserve.

L&G also has undeveloped land in Sungai Petani and Johor.

TA Global Bhd, set to become Malaysia’s fifth biggest listed property group, plans to double the number of hotels it owns in five years, adding to a portfolio that includes the Radisson Plaza in Sydney and the Westin Melbourne.

It wants to build at least two hotels in Kuala Lumpur and make acquisitions in overseas markets from London to Canada, said Alicia Tiah, managing director and co-founder of its parent company, the Malaysian brokerage TA Enterprise Bhd.

“Definitely we want more. We want to develop our own chain. I want to buy hotels in gateway cities like London,” she said in an interview in Kuala Lumpur. “But some are not cheap, some too big, some too small, it takes time to get the right fit. I want people to show me what they have.”

TA Enterprise, whose shares have more than doubled this year, folded all its property assets into TA Global which will be listed on the Kuala Lumpur stock exchange on November 23 to tap a resurgent stock market. The FTSE Bursa Malaysia KLCI Index has gained 44 per cent so far this year.
TA Global, which now owns four hotels, is being spun off into a separate listing to realise its value and help it expand. The group spent about RM756 million (US$225 million) from December to August to buy the Westin Melbourne hotel, the Swissotel Merchant Court hotel in Singapore and the Coast Whistler Hotel in Canada, taking advantage of depressed prices during the global recession.

The acquisitions will triple hotel revenue at TA Global next year, Tiah said, without giving the current figure.

“A lot of hotels were going for below their replacement costs,” she said. “We managed to get great assets at a time when things were so gloomy.”

Good Timing

TA Global will have a market value of RM2.4 billion when it’s listed and will be ranked the fifth largest property group, HWANGDBS Vickers Research Sdn Bhd said in a September 29 report.

“The timing is quite good to list,” Tiah said. “We have accumulated great assets.”

TA Global, which has total assets valued at RM2.4 billion, has lined up more than RM6 billion of property development projects from now till 2012, said Tiah.

The company also owns the 24-story Terasen Centre, an office building in Vancouver, Canada, and Menara TA One, a 34-story office in Kuala Lumpur.

By listing the property unit, TA Enterprise will be “unlocking the hidden value” of its property assets, ECM Libra Capital Sdn Bhd said in a report yesterday.

TA Global will raise RM230 million from the share sale. It also owns offices in Kuala Lumpur and Canada. TA Enterprise will retain a 57 per cent stake after the listing, said Tiah.

“We have a good stream of income, good time, bad time, it will be there,” she said, referring to the hotels. “I love hospitality, you can up the rates,” as opposed to office buildings where rates are fixed by contracts, she said. -- Bloomberg

Property development and investment firm Low Yat Group expects to earn RM55 million in rental income from its Rivercity project over the next five years after it raises prices following a refurbishment.


Rivercity, located at Batu 3, Jalan Ipoh, in Kuala Lumpur, features eight 1- to 3-storey warehouses and shop-office blocks, built in the 1940s.

The properties are being given a RM7 million facelift, slated for completion by December, its deputy general manager for property development Leow Sian Hiong said.

After the refurbishment, Low Yat will increase rental rates to between RM4 and RM8 a sq ft from RM2 to RM4 a sq ft currently.

"We are refurbishing the properties to enhance the appeal of Jalan Ipoh and transform the area into a vibrant lifestyle hub.
"We may (further) raise rental rates after the fifth year, but it will depend on the market situation," Leow told a media briefing in Kuala Lumpur yesterday.

One of the three-storey shop-office blocks has been redeveloped into a seven-storey office building. It is home to Low Yat and Asia Pacific Land (AP Land) Bhd, which has moved out from Empire Tower in Jalan Tun Razak.

Low Yat, set up in 1947, is a substantial shareholder of AP Land, which has an integrated development worth nearly RM1 billion next to Rivercity.

Leow said the remaining seven blocks at Rivercity will comprise food and entertainment outlets, home furnishing concept stores, showrooms, beauty and wellness outlets, and electrical and electronics as well as telecommunications centres.

There will also be a 25,000 sq ft supermarket, which will boost Rivercity's current occupancy of 50 per cent to almost 90 per cent by the first quarter of next year.

Leow said Rivercity will be positioned to meet the taste and needs of the growing population of more than 300,000 families, students and business community within its 5km radius.

Meanwhile, Low Yat's development plans for next year include taking its flagship brand, Fairlane Hospitality, global.

Its real estate management firm, Fairlane Hospitality Sdn Bhd, offers hospitality services to the group's serviced residences such as Bintang Fairlane Residences in Bukit Bintang, Kuala Lumpur, and plans to expand overseas. - btimes.com.my

THE government has called for bids to upgrade Carcosa Seri Negara, a 97-year old boutique, city hotel and heritage building that was once home to Frank Swettenham, the highest ranked British representative to the Malay States.


It will be closed for renovation from January 1 2010. However, the property would will keep its name. Bids must be in by October 29 this year.

"We are inviting fresh ideas (for the property)," Nurulhakeem Hasim, the principal assistant secretary from the Property and Land Management Division of the Prime Minister's Department said in a briefing on Thursday.

The Request For Proposal (RFP) document highlighted that the proposer must bear all upgrading costs and pay a monthly rental.
The developer/operator must also propose a profit sharing deal with the government.

The government wants bids from candidates with strong financial standing, wide experience and recognition in hotel and resort management and one with a chain of hotels/resorts in Malaysia and abroad.

The applicant should own a hotel brand and have a proven administrative and management track record.

Some 17 people attended the briefing, including representatives from Swiss Garden, Impiana Group, Johor Corp, Peremba, Landmarks Bhd and MITC Ancasa Hotel Melaka.

Those present told the Business Times that they were surprised that advertisements only appeared in the Malay dailies last week.

They also lamented on the short time frame to prepare the proposal. Moreover, no financial details were given as to the past performance nor rental for the lease.

According to Nurulhakeem, renovations will be done in two phases. The first phase involves upgrading and developing the existing product while the second phase will be managing and operating the hotel.

The hotel, work on it that started in 1904, was completed in 1912. It is essentially divided into two, the seven-suite Carcosa and the six-suite Seri Negara. The two blocks sit on a 1.62ha site near Taman Tasik Perdana.

The Carcosa was originally the private residence of Frank Swettenham, the highest ranked British representative to the Malay States, while the Seri Negara was for his guests.

This designated heritage site is owned by the Government and was taken on a 20-year lease by Landmarks Bhd in 1989. This lease ends on December 31, 2009.

Landmarks operated the premises until five years ago, when General Hotel Management Group was brought in, in 2004, as a guardian for the heritage site.

Meanwhile, the period for which the hotel will be closed, will depend on the extent of work that was proposed.

The developer must propose the duration of the lease based on the return on investment anticipated after the upgrade.

An interested party said that since all the investment will come from the private sector, unlike previously when the government paid for all the renovation and refurbishment, the investment amount has to be practical.

Nurulhakeem indicated that certain terms on government's usage of the facility may be incorporated. It is however unclear, if the some 365 years of free nights available to the government will continue under the new contract.

Sunway City Bhd (SunCity) is looking at a strong recovery from the dampened sales inflicted by the global financial crisis and plans to move on with its planned property projects both locally and abroad.


According to SunCity managing director for property development Ngian Siew Siong, the local property market had not been too badly impacted by the global crisis and it should recover quite fast.

“Demand for property is a function of economic growth and, with the country’s economy expected to bounce back next year, property demand should also move in tandem with the higher market confidence,” he said.

For the fourth quarter ended June 30, SunCity’s property sales showed a strong rebound of 120% to RM88mil from RM40mil in the previous quarter.

The stronger sales were mainly due to improving consumer sentiment and the launch of the “Triple Z Series” promotion in April.

Sunway SPK Villa Manja’s semi-detached residences showed a stronger take-up with RM57mil sales during the quarter compared with RM8mil in the preceding quarter.

However, year-to-date revenue was down 16.8% to RM1.09bil compared with the previous corresponding period while earnings before interest and tax dropped 7.8% to RM331.1mil.

Property development earnings, which dropped 39.6% year-on-year due to lower sales and construction progress, were the main culprit. For the current financial year, SunCity will be changing its financial year-end from June 30 to Dec 31.

To further boost its RM743mil unbilled sales, which will provide more than a year’s earnings visibility for the company, SunCity is planning over RM1bil in new launches next year.

The projects include Sunway Velocity in Jalan Peel, Sunway-SPK townhouses, South Quay condominiums, and Sunway Damansara zero-lot bungalows.

Ngian said the company would be using its cash reserve of close to RM450mil to expand its land bank in the Klang Valley as well as in China and India. “Land prices have come off from their previous highs and we are actively looking to make some value buy.”

SunCity would also be launching its India and China projects next year.

“We have already done our homework and feasibility studies on both countries and we like what we saw there. There is a growing middle-class population and the higher purchasing power is translating into greater demand for housing,” Ngian said.

With a population of 1.3 billion in China and 1.2 billion in India, the two countries make up 40% of the world population. The sheer size and growth prospects were very attractive, he added.

For its maiden project in China, SunCity has partnered with Sunway Holdings Bhd’s subsidiary, SunwayMas Sdn Bhd, and Shanghai Guanghao Real Estate Development Group Co Ltd for a mixed high-rise development in the central business district of Jiangyin New Harbour City in Jiangsu Province.

The 39:26:35 joint venture to develop the RM492mil project will be launched in mid-2010. The Sunway Guanghou Jiangyin project will have 1,172 medium-end condominiums and some specialty shops on about 17 acres.

“We believe our maiden project in China will be our platform to secure other future property projects in this high growth country, especially in tier-two cities,” Ngian said.

In India, SunCity’s maiden project, Sunway Opus Grand in Hyderabad with a gross development value of RM1.17bil, is also targeted for launch next year.

The 35-acre project will comprise 2,423 medium-range condominiums priced from RM193 per sq ft.

Ngian said India was still a very young country as far as progress in property development was concerned, and SunCity’s expertise in project design, quality and management capability had opened up immense opportunities to play a bigger role in its property market.

Its preferred cities include Hyderabad, Bangalore and Pune. Hyderabad tops the list as its growth is fuelled by the information technology and biotech industries.

Besides a huge demand for quality housing, Grade-A commercial properties are also in short supply in India. - thestar