Rent-to-own concept proposed for PPRT flats
The Urban Wellbeing, Housing and Local Government Ministry is planning to introduce a rent-to-own concept for residents of the Harcore Poor Housing Projects (PPRT), which will enable low-income earners to become property owners. However, the concept will only be carried out after obtaining approval from the Cabinet. It will enable individuals earning RM2,500 or less to own their PPRT units after their loan applications were rejected due to not fulfilling bank conditions, being blacklisted or not having proper payslip to prove their financial standing. Minister Tan Sri Noh Omar said it was possible to create a mechanism for them to pay a monthly (rent) payment of RM200 within a stipulated period and once they complete the payment, they will get full ownership of their units. (The Malay Mail Online)
GST has not helped, says SME association
Small and medium enterprises (SME) have seen their income drop by at least 20% since the implementation of the Goods and Services Tax (GST), the SME Association of Malaysia said. Although the decline was due to several factors, such as the freeze on foreign labour in February and the weak exchange rate, which made imports less profitable, GST had compounded the situation. The poor sales and loss of income affected all sectors across the board, with many small businesses coming under intense financial pressure. (The Malay Mail Online)
Prasarana targets for landbanks for Klang Valley property projects
Prasarana Malaysia Bhd is planning to increase its landbank for more property projects across the Klang Valley, in order to increase its non-fare revenue contributions to 50% by 2020. Its current non-fare revenue is less than 10%. The firm had in the first half of the year announced a RM4 billion GDV investment for seven new developments, which is expected to contribute an additional 15% to non-fare income. Six of the seven projects will be builts based on transit oriented developments (TOD), which are integrated with the LRT and monorail systems to encourage transit ridership. (New Straits Times Online)
Boustead Ikano confident of 85% occupancy for MyTOWN Cheras
Boustead Ikano Sdn Bhd is confident that its MyTOWN Shopping Centre in Cheras will achieve a targeted occupancy rate of 85% by its opening on Nov 15. Most shopping centres open with around 75% occupancy. General manager Jo Hogsander said the company is not worried about competition from the upcoming Sunway Velocity mall, located just 800m away and also launching this year, as MyTOWN already has over 70% occupancy with secured tenants such as Jaya Grocer, GSC, Mango and Uniqlo, among others. An added boost would be the linkage to Ikea Cheras, the largest outlet mall in the country. Hogsander said despite the slowdown in the current property market and oversupply of retail space in Malaysia, there is still a need for convenient, safe shopping malls. According to reports, about 40 malls would be entering the market in Greater Kuala Lumpur by 2020. (The Star Online)
Ireka to launch six projects worth RM1.3bil
Following the cancellation of its Senawang land deal, property development and construction firm Ireka Corp Bhd, is expecting to launch six property projects over the next 18 months, with total expected GDV of RM1.3 billion. The six projects Ireka has planned are mainly spread out in Kajang and Nilai (with a small portion in Mont Kiara), including the first phase of its dwi@Rimbun Kasia project, a courtyard-style apartment project in Nilai, which has an expected GDV of RM130 million, and will be the first launch. The company is also actively bidding for local construction projects, which will contribute to the group’s earnings. (The Edge Markets)
AmProp, Grosvenor to jointly invest in Spanish real estate
Amcorp Property Bhd (AmProp) together with Grosvenor Europe Investments Ltd (GEIL) and Grosvenor Fund Management Spain, SLU (manager) have entered into a joint venture to invest in real estate in Spain. The Spanish economy recorded its first annual growth in 2014, further strengthening in 2015, and there has been rising interest in the Spanish real estate market by both domestic and international investors on the back of increasing economic activities. AmProp aims to ride on the recovery of the real estate market in Spain, replicating its business models in the UK and Japan, by committing up to €35 million (RM153.65 million) for a 50% stake in the JV. It will also leverage on the expertise and experience of the manager, which has been operating in Spain since 2000, to further diversify its international property investment and development portfolio. (The Sun Daily)
Hong Kong facing weakest real estate market in 25 years
One of the world’s priciest housing markets has seen an unexpected slump, according to first quarter economic reports. Hong Kong is suffering from dwindling retail sales and facing its weakest property market in 25 years. Another of Asia’s financial-hub, Singapore, is suffering from similar problems, despite seeing a slight economic expansion in the first quarter, according to Bloomberg. Both countries are being effected by China’s economic slowdown. “As financial centers, both cities cannot escape the geopolitical and economic forces coming out from China,” said Andrew Sheng, a distinguished fellow at the Asia Global Institute in Hong Kong, who previously worked at the Hong Kong Monetary Authority and Malaysia’s central bank. “So the slowdown will affect them both.” Still, the slowdown hasn’t kept the super-wealthy from splashing out on Hong Kong’s super-expensive residential real estate. For instance, billionaire Chen Hongtian recently spent $270 million on a house on the Peak – the highest point on Hong Kong Island. (The Real Deal)