‘Firms should buy more land, build less’
The current soft sentiment in Malaysia’s property market and an influx of project supply are among the factors that require developers to change their business strategies. Developers with strong financing should look at buying land as an investment, holding it for future development or flipping it at a higher price during boom time instead of building more houses, say analysts. This could create a healthy market for the real estate future as currently there is a mismatch in the demand and supply of houses. New supply far exceeds demand. Developers with holding power should do more landbanking now as they may be able to get valuable plots at reasonable prices. (NST Online)
Homebuyers urged to turn to sub-sale market
As property prices increasingly escalate beyond the reach of many would-be homebuyers, experts are urging them to turn their sights to the secondary market, where homes in Kuala Lumpur priced up to RM200,000 are still available. These properties are better for the budgets of younger folk — especially city dwellers, as prices of sub-sale units are often cheaper than their primary market counterparts. In addition, secondary or sub-sale homes are ready to be occupied, have easy access to facilities such as shops, and the buyer can also deal directly with the original owner if there is damage to the house during the buying and selling process. (The Edge Markets)
EPF substantial shareholder in Eco World Development
The Employees Provident Fund (EPF) has emerged as a substantial shareholder in Eco World Development Group Bhd with a 5.012% stake. The property company announced that the EPF had bought 374,600 shares on Feb 14. The purchase saw its shareholding cross the 5% stake when it held a total of 147.584 million shares. (The Star Online)
UEM Edgenta 4Q profit jumps 20 times, declares bumper dividend
UEM Edgenta Bhd announced a special dividend of 18 sen per share — together with a second interim dividend of five sen per share in respect of its financial year 2017 — after its fourth-quarter net profit jumped about 20 times following the disposal of its entire stake in Opus International Consultants Ltd (OIC) last year. Its net profit for 4QFY17 surged to RM324.81 million from RM16.49 million a year earlier. For the full FY17, UEM Edgenta’s net profit spiked 422% y-o-y, while revenue grew 34%. (The Edge Markets)
Philippines’ Ayala Land now owns 72.3% of MCT
Philippines’ Ayala Land has raised its stake in property company MCT Bhd to 72.3% when it launched an unconditional mandatory takeover offer when it emerged with 50.19% following a corporate exercise. To recap, following several share purchases between April 2015 and January 2018, Ayala Land emerged as a major shareholder of MCT with a 50.19% stake and firmly indicated its control of the local property developer. Ayala Land is the biggest property developer in the Philippines. (The Star Online)
JAKS, Star Media at loggerheads over project delay
A more than two-year delay in completing the Pacific Star Business Hub by JAKS Resources Bhd has been cited as the reason for Star Media Group Bhd to call on a RM50 million bank guarantee for the project. The project was expected to be completed in 2016. JAKS has accused Star of preventing the completion of Tower A under the project by the agreed Feb 15 deadline, while a source close to Star pointed out that Tower A is not the only component that has yet to be developed, with the remaining commercial and residential parts of the project also behind schedule. The development comprises five towers: two commercial blocks and three serviced apartment blocks. (The Edge Markets)
Datuk arrested in affordable housing scam
A 52-year-old Datuk has been detained in connection with an affordable housing scam, involving over RM13.6mil in losses. 16 police reports were made between 2014 and 2017, involving two cooperatives. The suspect’s modus operandi is to offer contracts to contractors to build affordable homes nationwide. The victims would pay between RM300,000 and RM2.3mil for a performance bond and sign a JV agreement, which supposedly guaranteed them projects nationwide within 18 months. However, the victims never received instructions to commence with construction work. (The Star Online)
