PROPERTY COUNTRY REPORT : MALAYSIA - · PDF filevpcasiapacific.com PROPERTY COUNTRY REPORT : MALAYSIA VPC REGIONAL CONFERENCE 8 –10th May 2014 Johor Bharu, Johor 1 Conversion Rate:

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PROPERTY COUNTRY REPORT :

MALAYSIA

VPC REGIONAL CONFERENCE

8 – 10th May 2014

Johor Bharu, Johor

1

Conversion Rate:

£1 = RM5.44

US$1 = RM3.27

http://rds.yahoo.com/_ylt=A2KJke4olMdMDAkAfzmJzbkF;_ylu=X3oDMTBqdXJhdTI4BHBvcwMyOARzZWMDc3IEdnRpZAM-/SIG=1kr8s36nk/EXP=1288234408/**http:/images.search.yahoo.com/images/view?back=http://images.search.yahoo.com/search/images?_adv_prop=image&b=22&ni=21&va=historical+pictures+of+malaysia&xargs=0&pstart=1&fr=yfp-t-948&w=800&h=600&imgurl=www.globalphotos.org/kualalumpur/20090228/IMG_8964.jpg&rurl=http://www.globalphotos.org/malaysia.htm&size=196KB&name=Malaysia+Photo+G...&p=historical+pictures+of+malaysia&oid=c64fd1f49b0799e74bd8dcc629b51858&fr2=&no=28&tt=49100&b=22&ni=21&sigr=118teqfm5&sigi=11mvflj77&sigb=148s85jrq


VPC OFFICES IN MALAYSIA

vpcasiapacific.com

VPC Network of Offices

2



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CONTENT

• Economic Brief

• Property Market : General

• Sectorial Property Market

- Residential

- Offices

- Retail

- Hotel

• Conclusion

3



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ECONOMY

4

Period 2011 2012 2013 2014

Real GDP 5.1% 5.6% 4.7% 5% - 5.5%

Source: Department of Statistics and Ministry of Finance, Malaysia

• GDP expanded 4.7% in 2013, which was below the 5.6% registered

in 2012.

• Domestic demand remained the anchor for growth, expanding by

7.6% in 2013. (2012: 10.6%).

• Growth in private investment improved to 16.5% (3Q2013: 15.2%),

mainly on account of higher capital spending in the services and

manufacturing sectors.



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ECONOMY

5

Source: Department of Statistics

and Ministry of Finance, Malaysia

7%8%

25%

4%

56%

GDP at Constant Price in 2013 (RM‘ Billion)

Agriculture

Mining and quarrying

Manufacturing

Construction

Services (includeGovernment Services)

• The service sector is the largest contributor to the economy which

contributes about 56% of the GDP, following by manufacturing (25%),

mining and quarrying (8%), agriculture (7%) and construction (4%).



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ECONOMY

The resilient economic growth for 2013 is boosted by

• Strong domestic demand

• Private sector demand and improvements in exports.

• High liquidity, with banks highly capitalised and liquid.

• Higher disposable income

• Increase in Foreign Direct Investments

6



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Brief Economic Indicators

Population: 29.7 million

Central Bank Overnight Policy Rate (OPR): 3%

Base Lending Rate: 6.6%

Housing Loan Rate: 4.5% - 5.0% p.a.

Unemployment Rate: 3.2% (as at Feb 2014)

Inflation Rate: 3.4% (as at Mar 2014)

GDP Current Price: USD 301.05 billion

Malaysia International Reserves as at Feb 2014: RM427.6 billion (equivalent to USD 130.6 billion)

7



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ECONOMYFDI Inflows by Selected Host Regions Countries and Major Host Economics

8

CountryUSD Billion 2011/12

Change (%)

2012/2013

Change (%)2011 2012 2013 (est)

Cambodia 0.9 1.56 1.3 73.3% -16.7%

India 36.2 25.5 28 -29.4% 9.8%

Indonesia 19.2 19.9 19 3.2% -4.5%

Japan -1.8 1.7 2.8 198.6% 64.7%

UK 51.1 62.4 53 22.11% -15.1%

Malaysia 12.2 10.1 11.7 -17.4% 15.8%

Myanmar 2.20 2.24 NA 1.82% NA

Singapore 55.9 56.65 56 1.34% -1.15

Thailand 7.8 8.6 NA 10.6% NA

Source: UNCTAD & Central Banks



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Government Policies and Budget 2014:

Its Impact on the Property Market

• Increase Real Property Gains Tax (RPGT) according to scale below:-

• The minimum price of properties for foreigners to purchased has been increased from RM500,000to RM1 million. (Effective at 1.3.2014)

• To further increase access to home ownership at affordable prices, an estimated 223,000 units ofnew houses will be built by the Government and the private sector in 2014.

• Increase transparency in property sales price, where property developers will have to displaydetailed sales price including all benefits and incentives offered to buyers such as exemption oflegal fees, stamp duty, sales agreements, cash rebates and free gifts and prohibit developers fromimplementing projects that have features of Developer Interest Bearing Scheme (DIBS).

• Good and Service Tax (GST) will be fixed at 6% and to be effective from 1 April 2015. Sale,purchase and rental of residential properties as well as selected financial services are exemptedfrom GST.

9

Disposal PeriodBudget 2014 Budget 2013

Individual Corporate Foreigners All Category

Within 3 Years 30% 30% 30% 15%

4th Year 20% 20% 30% 10%

5th Year 15% 15% 30% 10%

After 5 years 0% 5% 5% 0%



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Government Policies and Budget 2014

• Propose to increase assessment rates in major towns.

• Propose restrictions on bulk purchase/investor club (as there is no guideline by BNM of how investor club

can operate.

• Other additional measurements imposed by the State Government

– Penang

• Foreigner are allowed to purchase apartments at the priced above RM1 million, purchase

landed properties in Seberang Prai at the priced above RM1 million and purchase land

properties in the Penang Island at the priced above RM2 million.

• A five-year moratorium for affordable homes bought below RM400,000 on the island and

RM250,000 on the mainland, and a 10-year moratorium for low and low-medium cost housing

units priced up to RM72,500.

• A 2.1% levy of the purchase price will also be imposed on the seller on the sales of properties

of land titles with restriction in interests. For properties of land titles without restriction in interest,

the seller will have to make a statutory declaration for sale of a property within 3 years after

buying it.

• Mulling 3% levy on properties purchased by foreigners.

– Johor Bharu

• Impose 2% levy on foreigners.

• Foreigners can buy properties with the current minimum price of RM500,000 until 30 April 2014.

Investors need to ink a SPA by 30 April 2014 and submit it to the state’s land department by 29

May 2014 to avoid the new measures.

10



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Economic Outlook 2014

• The economic growth will grow at 5% to 5.5% in 2014.

• Private consumption and investment activities will support growth.

• Foreign Direct Investment is expected to increase slightly.

Concerns for 2014

• Rising inflation and increasing cost of living.

• European debt crisis

• Slowing down of China economy

• Uncertainty over the US budget and raising of the debt ceiling

• Reducing purchasing power

11



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PROPERTY MARKET: GENERAL

• The property market performance in Malaysia had generally softened in 2013 as compared to a year ago.

• The volume of transactions dropped by 10.9% but value of transactions expanded by 6.7%.

• The slow down of property market because

– Central Bank tightening up on mortgage loan

– Oversupply in certain property subsectors

– Recent government measures to curb speculation in property market.

– Overbuilding by developers

12

2012 2013 % Increase

Volume of Transactions 427,520 381,130 -10.9%

Value of Transactions (RM’ Million) 142,844.94 152,372.12 6.7%



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RESIDENTIAL SECTOR 2013

• Dominate the overall property market in 2013, with

64.6% of the volume and 47.3% of the value of

transaction.

• 246,225 transactions worth RM72.06 billion registered

in 2013.

• The volume was lower by 9.7% and value was higher

by 6.3% in 2013 against 2012.

• In the primary market, new launches contracted after

experiencing 3 consecutive years of growth. In 2013, it

recorded 48,617 units of new launches into the market

compared to 57,162 units in 2012.

13



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RESIDENTIAL SECTOR IN KLANG

VALLEY in 2013

14

Existing Residential Property Supply in Malaysia, KL and Selangor:-

r

• Overall, housing supply saw a marginal growth of 1.9% in 2013.

• Housing supply saw a moderation in growth to about 1.67% in 2013 against 2012 in KL & Selangor.

• Supply of landed residential property in KL & Selangor shows a slight increase of 0.23% and 0.35%

respectively in 2013 against 2012 due to scarcity of land to develop landed residential properties.

2012 2013 Growth Rate (%)

Malaysia (Residential) 4,631,607 4,718,534 1.9%

Landed 3,249,310 3,313,892 1.9%

High-Rise 1,382,297 1,404,642 1.6%

KL (Residential)

Landed 124,460 124,747 0.23%

High-Rise 315,068 316,172 2.16%

Selangor (Residential)

Landed 761,704 778,181 0.35%

High-Rise 568,202 579,873 2.05%

Total 1,769,434 1,798,973 1.67%



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Luxury Condominiums

15

• The accumulative supply of luxury condominiums in Klang Valley was 26,816 in2013. It has been rising at an average of 30% per annum from 2008 (10,674 units)to 2013. (Oversupply in luxury condominium).

• By the end of 2014, a new supply of about 5,134 units is expected to becompleted, with 33% of the total new supply are concentrated in the KL CityCentre, followed by Ampang Hilir/U-Thant area (31%), Mont’ Kiara (22%) andBangsar (14%).

• Overall, the average occupancy rate for the existing luxury condominium in KL wasrecorded at 70% in 2013, showing an increase of 3.3% (66.7%) since 2012.

• The average price of luxury condominiums in KL stood at RM900 psf in 2013.

• The average rental value declined by 2.5% y-o-y to RM3.56 psf per month.

• Amongst the notable developments expected to be completed in 2014 includeCeleste Tower@Setia Sky Residence, 188 Suites, Six Ceylon, One@Bukit Ceylon,Suasana Bukit Ceylon, 9 Madge, Dedaun, Madge Mansion, Rimbun EmbassyRow, Tower 1 of The Elements@Ampang, One Kiara (Tower A), Arcoris MontKiara, Richmond Kiara 3, The Icon Residence@Mont Kiara, The Signature@SriHartamas and Mirage Residences.



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Location of Selected Luxurious Condominiums in Kuala

Lumpur

16

HAMPSHIRE PLACE (30-Storey)

Completed: Sept 2010

Total Units: 186

Dev. Price: RM700 psf

Current Asking Price : RM1,160 psf

PANORAMA (33-Storey)

Completed: March 2011

Total Units: 223

Dev. Price: RM1,200 psf


K RESIDENCE (50-Storey)

Completed: 2007

Total Units: 188



PARK VIEW (41-Storey)

Completed: End 2006

Total Units: 417



MARC RESIDENCE (35-Storey)

Completed: August 2007

Total Units: 635



ST MARY RESIDENCE (28-Storey)

Completed: 2012

Total Units: 657



THE BINJAI (44 & 45-Storey)

Completed: End 2008

Total Units: 171



PAVILION RESIDENCES (43 & 50-Storey)

Completed: Early 2009

Total Units: 368



PARK SEVEN (20-Storey)

Completed: Mar 2008

Total Units: 105


Current Asking Price : RM1,220psf

STONOR PARK (20-Storey)

Completed: 2006

Total Units: 71


Current Asking Price : RM960 psf

SURIA STONOR (23-Storey)

Completed: Apr 2008

Total Units: 138



DUA RESIDENCY (20-Storey)

Completed: Apr 2007

Total Units: 288



THE AVARE (41-Storey)

Completed: 2009

Total Units: 78



ONE KL (35-Storey)

Completed: 2009

Total Units: 94



THE TROIKA (38, 44 & 55-Storey)

Completed: 2011

Total Units: 229



BINJAI RESIDENCY (32-Storey)

Completed: 2007

Total Units: 100





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Location of Upcoming Luxurious Condominiums in Kuala Lumpur City Centre

(KLCC)

Four Seasons Place (65-storey)

Built-up: 1,098 – 11,900 sf

Dev. Price: From RM2,500 psf

Take-up: 65%

Launched: Jan 2013

Expected: 2015

17

Le Nouvel (43 & 49 storeys)

Built-up: 1,800 – 4,700 sf

Exp. Dev. Price: From RM2,200 psf

Take-up: NA%

Exp. Launched: Mid 2014

Expected: June 2015

Mirage Residences (25-Storey)

Built-up: 850 – 3,100 sf


Take-up: 71%

Launched: Sep 2011

Expected: 4Q2014

The Mews (38-storey)

Built-up922 – 2,623 sf


Take-up: 75%

Launched: March 2013

Expected: 2017

Tribeca (37-storey)

Built-up: 510 – 1,293 sf


Take-up: 42%

Launched: July 2013

Expected: Aug 2017

Manhattan Residen 61

Built-up: 588 – 1,285 sf

Exp. Dev. Price: From RM1,600 psf

Take-up: 60%

Exp. Launched: Mid 2013

Expected: Early 2016

The Ruma (37-storey)

Built-up: 915 – 3,692 sf


Take-up: 95%

Launched: March 2013

Expected: Q12017



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Notable New Launches in 2013:

Luxury Condominiums

18

Project Name LocationFloor Area (Sq.

ft.)

Selling Price (RM

psf)

Take-Up

Rate(%)

St. Regis Residences KL Sentral 766 – 4,253 1,600 – 2,000 65%

Four Seasons

ResidencesKLCC 1,098 – 11,900 From 2,500 65%

The MewsJalan Yap Kwan

Seng922 – 2,623 From 1,700 75%

Tribeca Jalan Imbi 510-1,923 From 1,800 42%

The Ruma Jalan Kia Peng 915 – 1,098 From 1,900 70%

KL Trillion Block B Jalan Tun Razak 963-3,101 922 – 1,560 55%

Star ResidencesJalan Yap Kwan

SengFrom 625 1,500 70%

Pavilion Hilltop Mont Kiara 1,200 – 1,830 From 900 70%

Manhattan 61 Jalan Raja Chulan 588 – 1,285 From 1,600 60%

Three 28Jalan Yap Kwan

Seng710 – 1,625 From 1,180 60%



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Average Asking Prices and Rentals of

Existing High End Condominiums

19

Asking Rental

(RMpsf/Month)

Asking Price

(RM psf)

KL City Centre 3.30 – 5.60 900 – 2,000

Ampang Hilir/U-Thant 2.20 – 3.80 600 – 1,200

Bangsar 2.70 – 4.90 600 – 1,200

Mont Kiara 2.30 – 3.60 450 - 800



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Sample of Prime Landed Residential Properties in KL

20

KL CITY CENTRE

Tijani Ukay, Bukit Tunku (Bungalow Land)

Launch Date: Dec 2012

Total Units: 110

Developer’s Price: From RM632 psf

Current Asking Price: RM741 psf

Take-up Rate: 100%

The Madge, Ampang Hilir (2-Storey)

Current Asking Price: RM790 psf

Taman U-Thant (2-Storey)


Villa Prima, Taman Danau Desa (3-Storey)

Completed : 2014

Total Units : 34

Developer’s Price : RM 848 psf

Vasana 25, Seputeh Heights (3-Storey)

Completed : 2011

Total Units : 25

Developer’s Price: RM1,100 psf


The Ara, Bangsar (3½ -Storey)

Completed : 2008

Total Units : 30

Developer’s Price: RM655 psf


Cahaya Villas, TTDI (3 -Storey)

Completed : 2013

Total Units : 26



Seri Beringin@ Bkt. D’sara (2 -Storey)

Completed : 2005

Total Units : 98

Developer’s Price: RM500 – 720 psf


Bukit Ledang @ D’sara Heights (2&3 -Storey)

Current Asking Price: RM1,000 psf

(bungalow)

Current Asking Price: RM295 – RM310 psf

(land)

Parkcity Heights (Bungalow Land)

Completed : Mid 2002

Total Units : 95


Current Asking Price : RM610-650 psf

Kenny Vale@ Kenny Hills (Bungalow Land)

Completed : Aug 2003

Total Units : 9


Current Asking Price : RM540 psf (land)

Current Asking Price : RM1,300 (bungalow)



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Residential Sector Outlook 2014

• In 2014, the landed residential sector is expected to continue to be

resilient with stable growth especially property within a gated and

guarded community.

• In 2014, we expect more affordable homes introduce in the

property market. Property near the proposed MRT and LRT

Extension Line will continue to be in good demand.

• House prices will continue to increase, driven by rising costs of

land, construction materials and labour.

• Sales of residential property to foreigners will be slower in 2014

due to the increase of the RPGT imposed on the sale of properties

by foreigners was revised to 30% for the first 5 years and the

minimum price of properties for foreigners to purchase has been

increased from RM500,000 to RM1 million.

21



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Office Sector

• Supply 2013

• The performance of purpose built office sub-sector was stable.

• The average occupancy rate in Malaysia increased slightly to 82.9% in the 2013

against 82.3% registered in 2012.

• KL City Centre contributes 70.2% of the office space, while the remaining 29.8%

comes from KL City Fringe.

• There are only approximately 7.5 million sq. ft. of office space or 9.1% are

classified as “Prime A+”

• Dual-compliant office building which consist of MSC status and certified Green

Building Index only account for 7.6 million sq. ft. or about 9.2% of the total office

space supply in KL.

22

Malaysia 204.1 million sq. ft.

Kuala Lumpur 82.6 million sq. ft.

(40.5% of national supply)



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Office Sector: Kuala Lumpur

• There were 7 new office buildings completed in 2013 which added 3.228 million

sq.ft. of Grade A office space to the existing stock. The new offices were Menara

LGB (386,000 sq.ft.), 1 Sentrum (450,000 sq.ft.), Glomac D’sara Block D (255,000

sq.ft.), Menara CIMB (609,000 sq.ft.), Menara D’ Damansara (253,000 sq.ft.), Nu

Tower 1 (259,000 sq.ft.), Nu Tower 2 (498,000 sq.ft.) and Menara Shell (538,617

sq.ft.)

23

2.9

3

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

2013 2014 2015 2016

New Supply Office Space (million sq.ft.)

New Supply Office Space (million sq.ft.)



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Office Sector: Kuala Lumpur

24

• Selected Grade A+ and Grade A office asking rentals

• Average office rents remain stable in 2013 at RM6.13 psf per month.

• Average values in KL has remain unchanged at RM838 psf in 2013.

Current Gross Rental (RM psf/month)

Menara Maxis RM10 – RM10.50

Menara Binjai RM8.50

Integra Tower @ The Intermark RM11.00

Vista Tower RM8.50 – RM9.00

Menara Petronas 3 RM12.00 – RM13.00

Menara Felda RM8.50 – RM9.00

G Tower RM8.50

Menara CIMB RM7.50 – RM8.50

The Garden North & South Tower RM7 – RM7.50

Quill 7 RM7.50



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Office Sector: Klang Valley

• Recent Transactions in 2013

25

Office Building Location Vendor PurchaserConsideration

(RM’ Million)

Selling Price psf

(RM psf)

Tower 3, Avenue 7 Bangsar South, KL UOA Dev. Bhd Pelaburan Hartanah Bhd 183 740

East Wing, The IconJalan Tun Razak,

KLTS Law Top Gloves Corp. Bhd 226 844

Menara PMIJalan Changkat

Ceylon, KLPMI Bhd

Admiral Gateway Sdn

Bhd60 577

Tower 7, Avenue 3 Bangsar South, KL UOA Dev. BhdNextnation

Communication Bhd64 894

Tower 3. Avenue 3 Bangsar South, KL UOA Dev. Bhd Marak Moden 43 1,190

Menara 238 (formerly known

as Menara Marinara)

Jalan Tun Razak,

KL

DanaHarta

Hartanah S/BKPJ Healthcare Bhd 206 599

Petronas Twin Towers KLCCKLCC Holdings

BhdKLCC REITs 6,544.336 2,048

Menara ExxonMobil KLCCKLCC Holdings

BhdKLCC REITs 454.003 1,147

Menara 3 Petronas KLCCKLCC Holdings

BhdKLCC REITs 1,300** 1,599

Menara PJDJalan Tun Razak,

KLPJD Land Sdn Bhd Able Starship 220.0 494



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Office Outlook

• Occupancy rate and rents expected to remain soft in the 2014.

• In 2014, building due for completion in KL City include Menara Hap Seng 2, Crest

Sultan Ismail, TH Tower, Menara Bangkok Bank, Public Mutual Tower, Menara

Centara, Bank Rakyat HQ, Ken TTDI and Federal Auto HQ (MBMR Tower with a

total NLA of some 3.6 million sq.ft.

• In 2014, rental yield of the office space is expected to remain challenging due to

oversupply, stiff competition and increased costs from assessments levied by local

authorities, utilities and wages. Furthermore, expected new supply of 3.6 million sq.

ft. in 2014 will keep the office rental market competitive.

• Older office buildings will be challenged as tenants relocate to newer buildings with

similar rates.

26



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Retail Sector

• The retail market saw a slight improvement as the average occupancy rate of retail centres in

KL and Selangor increased slightly to 83.2% (2012: 82.7%) and 81.7% (2012: 80.4%)

respectively.

• The cumulative stock of retail space in 2013 stands at approximately 48.682 million sq.ft. in

both KL and Selangor.

• Avenue K, located opposite of Suria KLCC has finally completed its refurbishment and received

a strong take-up, as Swedish retailer H&M occupied 35,000 sq. ft. retail space across 3 floors.

Other anchor tenants include Presto Supermarket, Fitness First, Taste Enclave, Popular

Bookstore and EMS Exhibits.

• Another revived mall, Cheras Sentral with NLA 500,000 sq.ft. has been completed with

Japanese brand Uniqlo as an anchor tenant.

• New malls completed in 2013 were Sky Park@One City Park (460,000 sq.ft.), Setia Walk

(300,000 sq. ft.) and Bangi Gateway Shopping Complex contributing 1.235 million sq.ft. in total.

27



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Retail Sector

• At Starhill Gallery, luxury French brand, Louis Vuitton, had expanded the retail floor area

from 5,000 sq. ft. to 15,000 sq. ft. and also Christian Dior from 5,000 sq. ft. to 10,000 sq.

ft.

• New luxury brands occupying The Gardens Mall are Hermes and Gucci.

• Hamleys, the finest toy shop in the world has made its first flagship store in Malaysia

and Southeast Asia at 1U Shopping Centre, occupying approximately 20,478 sq. ft.

• In 2013, 2 malls closed for refurbishment:

– Sunway Putra Mall

– PIKOM Mall Cap Square

• 2013 was a rent review year for the prime retail malls - KLCC, Pavilion KL, Mid Valley

and The Gardens Mall. Average net yield for the prime retail malls is ranging from 5.9%

to 8% in 2013.

28



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Retail Sector

Notable New Tenants in 2013

29

Malls Tenant Type Origin

Suria KLCC Carolina Herrera Fashion & Accessories USA

Pavilion Superdry

Crabtree & Evelyn

Fashion & Accessories

Specialty Store

UK

USA

Avenue K H & M Fashion & Accessories Sweden

Berjaya Time Sq. Uniqlo Fashion & Accessories Japan

Mid Valley Megamall Superdry

Cath Kidston



UK

UK

The Gardens Hermes Fashion & Accessories France

1 Utama H &M

Hamleys


Toys

UK

UK

Sunway Pyramid Victoria Secret

H&M

Burton Menswear

Specialty Store



USA

Sweden

UK



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Mall Performance in 2013

30

Mall

Average

Hypermarket/Dep

artment Store

rental rates (RM

psf)

Average Gross

Rental (RM

psf)

Max.

Rental

Rates (RM

psf)

Net Yield (%)

Suria KLCC NA NA 155.00 7.41%

KL Pavilion 8.50 21.30 92.00 6.37%

Sungei Wang Plaza 7.10 – 7.25 13.70 NA 6.67%

The Mines 3.90 8.30 NA 7.05%

The Gardens NA 13.40 NA 5.93%

Megamall, Mid Valley NA 14.30 50.00 5.95%

Sunway Pyramid NA 11.80 48.00 6.32%

Subang Parade 3.80 8.20 NA 7.92%

Lot 10 NA 9.70 NA 6.80%

Starhill Gallery NA 13.20 NA 7.0%

Average yield at 6% to 8% pa.



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Selected Upcoming Retail Malls in

Klang Valley

Name of Development Estimate NLA (Sq. ft.) Estimate Completion Year

Nu Sentral, KL Sentral 680,000 Mar 2014

Encorp Strand Mall, Kota Damansara 308,000 Mar 2014

The Main Place, USJ 21 237,000 Mar 2014

IOI City Mall, Putrajaya 1,400,000 2014

Atria Shopping Mall, PJ 450,000 2014

G Avenue 144,000 2014

Jaya Shopping Centre, PJ 270,000 2014*

D’Pulze Shopping Mall 370,000 2015

Sunway Velocity, KL 800,000 2015

Quill City Mall, KL 770,000 2016

Central Plaza@i-City, Shah Alam 1,500,000 2017

31

* Under Refurbishement



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Retail Outlook

32

• The outlook is expected to remain cautious due to increase costs from

assessments levied by local authorities, utilities, wages and slower consumer

spending and expected slowdown in tourist arrivals.

• Another 6 new developments and 1 refurbishment with a total of 3.5 million sq. ft.

are expected to be completed in 2014 in Klang Valley. In 2014, occupancy rates

and rents of retail market could come under pressure due to substantial pipeline

supply which will likely affect both rental rates and occupancies.

• REIT players will continue to be active in expanding their portfolio. For example,

Hektar REIT has recently announced that it will double its assets base of RM1.05

billion to RM2 billion this year by acquiring neighbouring malls in developing towns

with population of 150,000 to 200,000.

• New international retail players who are keen to set up stores include Lafayette

Galleria and Takashimaya.



vpcasiapacific.com

Hotel Sector

33

• A total of 25.72 million tourist arrival recorded last year, depicting a 2.76% increasing over 2012

(Tourist arrivals in 2012: 25.03 million). Tourist arrivals yielded RM65.44 billion in revenue in

2013 compared with RM60.6 billion in revenue in 2012, saw a 8% increment.

• The average occupancy rate in Klang Valley was remained stagnant at 69.3%.

• In 2013, the average room rates (ARR) for selected 4-star hotels in Klang Valley were remained

stagnant at RM220 per room. As for selected 5-star hotels in Klang Valley, the average room

rates saw a marginal increase of 2.9%, recording at RM360 per room (2012: RM350 per room),

although the following 5-star hotels achieved an ARR above RM450 per room:

– Mandarin Oriental Hotel

– Ritz-Carlton Hotel

– Shangri-la Hotel

– Westin Hotel

• Following the opening of several hotels which include The Aloft, Pullman Bangsar,

Intercontinental Hotel (ex-Nikko Hotel), The Majestic Hotel, Wolo Hotel and Premier Hotel,

together with the closure of Crowne Plaza Mutiara of 565 rooms, the cumulative supply of 4-star

and 5-star hotels in Klang Valley has increased by 1,431 rooms or (7.6%) to 20,383 rooms in

2013.



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Hotel Sector

34

Notable 4 & 5 –star hotels completed in 2013

No Hotel Name Classification No. of Rooms

1 The Aloft, KL Sentral 5-star 482

2 Pullman KL, Bangsar 5-star 513

3 Intercontinental Hotel (formerly Nikko

Hotel)

5-star 473

4 The Majestic Hotel 5-star 300

5 Wolo Hotel

(former Menara KLIH)

4-star 138

6 Premier Hotel, Jln TAR 4-star 90

Total 1,996



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Hotel Sector: Upcoming HotelsDevelopment Location Classification Rooms Expected

Completion Date

Ascott Sentral KL Sentral 5-star 200 2014

Hilton Garden Inn Hotel Puchong 5-star 255 2014

Allson Capital Hotel KL 5-star 198 2014

St. Regis KL 6-star 208 2014

The Regent KL 5-star 238 2015

W Hotel KL 5-star 150 2016

Four Seasons Hotel KL 5-star 240 2016

Clermont Kuala Lumpur D’sara Heights 5-star 312 2016

Alila Bangsar Bangsar 5-star 124 2016

Ruma Hotel KL 5-star 253 2017

Harrods Hotel KL 7-star 250-300 2018

35



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Hotel Outlook

36

• 2014 is Visit Malaysia Year but with the negative impact of the MH370incident, we may not able to achieve our target of 28 million tourist arrivalsfor 2014 especially less tourists from China is expected.

• Four 5 and 6-star hotels are scheduled to open in Klang Valley this year,bringing another 861 rooms into the market.

• The hotel average of occupancy rate is expected to remain in about 68% -70%.

• The average rental rate is expected to remain stable.

• KLIA2, the world’s largest purpose-built terminal for low-cost carriers hasobtained the Certificate of Completion. Malindo Air, Cebu Pacific Air, TigerAirways Singapore, Lion Air, Indonesia’s Mandala Airlines and Air Asia willbegin operations at KLIA2 by 9 May 2014.



vpcasiapacific.com

Outlook 2014

37

• The property market is expected to weaken due to the cooling measures

that were announced during Budget 2014.

• In 2014, the market outlook for the affordable housing segment and

residential landed property with gated and guarded are remain very

positive.

• Property transactions is expected to slow down due to the tightening credit

restrictions, increased RGPT rates and prohibition of developers from

implementing projects that have features of DIBS, etc.

• Overall, property market is expected to slow down in 2014, with price

correction.



vpcasiapacific.com 38

JOINT VENTURE

PROPERTY DEVELOPMENT

WITH FOREIGN PARTIES



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KL City Centre – Tun Razak

Exchange (TRX)

39

Developer: 1Malaysia Development Bhd (1MBD)JV Partners: Qatar Investment Authority (QIA) and The Export-Import Bank of China (China Exim Bank)Location: Jalan Tun Razak, KLProposed Types of Development: Mixed Commercial and Residential DevelopmentsEstimate Project Value: RM26 billionLand Area: 70 acresRecent Land Sales for Joint Venture : RM3,193 to RM5,502 psf (Depending to Plot Ratios)



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KL City Centre – Oxley Hotels

40

Developer: Oxley Holdings Limited (SG)

JV Partner: Malaysia Govt. Linked Fund

Proposed Types of Development: 5-star Hotel

like Jumeirah and Waldorf Astoria (hotel chain

In Dubai)

Location: Jalan Ampang, KL

Estimate Project Value: RM2.5 – RM3.5 billion

Land Area: 3.11 acres

Land Price: RM3,300 psf



vpcasiapacific.com

KL City Centre – The Mews

41

Developer: Eastern and Oriental Bhd

JV Partner: Mitsui-Fudosan Limited (JP)

Location: Jalan Yap Kwan Seng, KL

Types of Development: High-end condominium

Estimate Project Value: RM400 million

Land Area: 5,221 sqm (1.3 acres)

Unit: 256

Built-Up Area of Units: 922 – 2,623 sf



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KL City Centre – IKEA CHERAS

42

Developer: Boustead Holdings Bhd

JV Partner: IKEA (Swedish)

Location: Jalan Cochrane, KL

Types of Development: Swedish home furnishings retailer IKEA

Land Area: 11 acres

NLA: 400,000 to 500,000 sf



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KL - KLIA Mitsui Outlet Park

43

Developer: Malaysia Airports Holding BhdJV Partner: Mitsui Fudosan Limited (JP)Location: Kuala Lumpur International Airport (KLIA)Types of Development: Japanese specialty stores, food and beverages and entertainment facilities as its complementary components based on strong themed attractions like Knowledge and Attractions, Prime Time Complex and World Food Expo and amusement parkGross Development Cost: RM 335 million Land Area: 50 acresNet Lettable Area: 46,300 sqm (498,373 sq. ft.)



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Penang– IKEA Batu Kawan

44

Developer: Aspen Vision Sdn BhdJV Partner: IKEA (Swedish)Location: Bandar Cassia, Batu KawanTypes of Development: Ph. 1 - 30 acres for IKEA store and shopping mall, Ph. 2 – 45 acres for shopping mall and Ph. 3 – 170 acres mixed development Land Cost : RM483.9516 millionLand Area: 99.15 ha (245 acres)



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Penang– GEMS International

School

45

Developer: Tambun Indah Sdn Bhd Long Term Tenant: GEMS International School (Dubai)Location: Pearl City Township, PenangTypes of Development: International SchoolProject Value: RM38 millionEstimate Completion Date: 2015Land Area: 8 acres



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Penang – Hull University

46

Developer: PKT Logistics Group

JV Partner: University of Hull (UK)

Location: Batu Kawan, Penang

Types of Development: University

Estimate Completion Date: 2017

Land Area: 5 acres



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Penang– Premium Outlet

47

Developer: PE Land Sdn BhdJV Partner: Genting-Simon Property Group (USA)Location: Bandar Cassia, Batu Kawan, PenangTypes of Development: Premium Outlet Mall, 300 rooms hotel, and mixeddevelopment.Gross Development Value: RM1 billionLand Area: 40 acres



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Pahang – Genting Premium Outlet

48

Developer: Genting Holdings Bhd

JV Partner: Genting-Simon Property Group (USA)

Location: Mid Hill Awana, Genting Highlands, Pahang

Types of Development: Premium Outlet Mall



vpcasiapacific.com

Pahang – China-Kuantan Industrial Park

(MCKIP)

49

Developer: SP Setia Bhd, Rimbunan Hijau Group and Pahang State Government

JV Partner: Qinzhou Jingu Investment Co. Ltd (China)

Location: Kuantan, Pahang

Types of Development: Industrial Park

Project Value: RM10.5 billion

Land Area: 607 ha



vpcasiapacific.com

Iskandar Malaysia (IM) – Country

Garden

50

Developer: Kumpulan Prasarana Rakyat Johor

JV Partner: Country Garden Holdings Co. Ltd (China)

Location: Danga Bay, Johor

Types of Development: Country Garden Township

Gross Development Value: RM18 billion

Land Area: 57 acres



vpcasiapacific.com

Iskandar Malaysia (IM) – Danga

Bay (Greenland Group)

51

Developer: Iskandar Waterfront Holdings BhdJV Partner: Greenland Group (Shanghai Based Developer)Location: Danga Bay, JohorTypes of Development: Mixed Development including hotels, high-end residential towersGross Development Value: RM2.2 billionLand Area: 5.58 ha



vpcasiapacific.com

Iskandar Malaysia (IM) –

Motorsports City

52

Developer: UEM Land Holdings Bhd

JV Partner: FastTrack Autosports Pte Ltd (SG) : Peter Lim

Location: Nusajaya, Johor

Types of Development: Racing Circuit

Development Cost: RM200 million

Land Area: 109.2 ha



vpcasiapacific.com

Iskandar Malaysia (IM) – Hao Yuan

Investment Pte Ltd

53

Developer: Iskandar Waterfront Holdings BhdJV Partner: Hao Yuan Investment Pte Ltd (SG)Location: Danga Bay, JohorTypes of Development: Tallest tower in Peninsular Malaysia, high-end residential, commercial and retail properties.Gross Development Value: RM8 billionLand Area: 37 acres



vpcasiapacific.com 54

THANK YOU



Documents

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