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MRT may cost over RM36.6bil


PETALING JAYA: The cost of building the mass rapid transit (MRT) transport system, which is scheduled to begin construction in six months, may swell beyond the projected RM36.6bil as developers and residents have begun lobbying on the proposed locations and types of stations.

Business leaders want the MRT stations to be located close to the centre of commercial activity, in some cases where they have projects or plan to build one, but residents living near or adjacent to the proposed lines have voiced objection against the MRT tracks being built above ground and want the lines and stations to be underground so as to avoid congestion and noise pollution issues.

At the heart of the matter is the alignment of the MRT line, particularly where it should go, where it should stop, and lobbying have begun to have more than 9.5km of the first phase of the 60km Sg Buloh-Kajang line constructed underground.

The entire MRT line is estimated to run a total of 150km at a cost of RM36.6bil. Other lines will be added later. All these lines, together with the existing Star, LRT and Komuter rail will form part of the country's Urban Transport master plan.

At the session with business communities, developers who own shopping malls and commercial developments were lobbying for the line and station to be located at, or as close to their commercial properties as possible.

“We are willing to adopt' a station,” said a source from Uptown's See Hoy Chan Sdn Bhd over the telephone. The company is a different entity from See Hoy Chan Holdings Group which built Bandar Utama and the highly-popular 1 Utama mall. The owners of both companies are cousins.

Uptown's See Hoy Chan is planning to develop the second phase of what is already a densely populated commercial area in Damansara Utama popularly known as Damansara Uptown.

The company plans to build several blocks of offices and serviced apartments on 12 acres. That site is currently being used as a car park.

Damansara Uptown has a working population of about 30,000. Once the 12-acre commercial project is completed, the number will swell by 20,000 to 50,000.

Over in Kuala Lumpur, the Low Yat group is lobbying for the line to be located close to its commercial properties in downtown shopping area Bukit Bintang, in the heart of the Golden Triangle of Kuala Lumpur.

But not all business communities share a common stance. Some fear commuters would use existing parking space at commercial and shopping complexes for using the MRT instead of going shopping.

See Hoy Chan Holdings would like to get in touch with resident associations in the PJ North area to lobby for the line to go underground from Kota Damansara to Bandar Utama station.

“The station can be located below Central Park in Bandar Utama if the line is constructed underground. That location can be turned into a transport hub to serve the vicinity,” said See Hoy Chan Holdings director Datuk Teo Chiang Kok.

“Most of the lines and stations in countries with MRT are located underground. The communities in Kota Damansara, along Persiaran Surian, Bandar Utama and neighbouring residential areas are already there. To build elevated lines over what is already a densely populated area would bring about negative impact on the entire area,” he said.

At the same dialogue, Sunway Damansara resident association representative Ngian Siew Siong appealed to Land Public Transport Commission (LPTC) to have the line go underground in the Kota Damansara area. LPTC is planning for a station to be located at Dataran Sunway, a highly congested area during peak hours. Ngian is also Sunway City Bhd managing director (property development).

Contrary to LPTC's views that the MRT system will boost property values, Ngian said that “the visual impact and the noise level over Persiaran Surian and the vicinity will affect property value there.”

“The MRT line is massive and noisy.”

“The various communities are already in existent. Where will the park and ride facilities be located? Do not look at just the alignment, consider having the line underground and having integrated connectivity,” Ngian said. Under the proposed Sg Buloh-Kajang line, 20% of the 9.5km will be underground.

LPTC CEO Mohd Nur Ismal Kamal said the cost would be five to 10 times higher on a per km basis if the line were to go underground, depending on geological conditions.

See Hoy Chan's Teo Chiang Kok said the area comprised laterite and building an underground line will only cost three to four times more.

Earlier, explaining the Government's rationale to build the system, LPTC general manager Amiruddin Maaris said the MRT would have 50% more carrying capacity than the LRT line and will also be 50% wider. One car train carrying capacity is equivalent to three buses, or that of 177 cars.

“It will ease congestion,” he said.

The MRT system is expected to create 130,000 jobs and bring about a huge multiplier effect from its construction and operation. But the vision to bring out the flavour of KL metropolis, which to many, remains dormant because of the lack of public transport and connectivity, Amiruddin said.

Although tendering is expected to begin in April, the alignment can still be tweaked to accommodate the views of the public.

“This is just the proposed line. We will have other sessions to hear the public's views,” said Mohd Nur.

Said a public transport specialist: “Let us learn from the mistakes of the Light Rail Transit and the Star line.”

By The Star

 

M’sia-S’pore deal leads to property openings


The station site at Tanjong Pagar has the greatest redevelopment potential

PETALING JAYA: The recent historic agreement between Malaysia and Singapore to settle the long-standing railway land issue which runs through Singapore to Malaysia will open up property development opportunities in Singapore and Iskandar Malaysia not envisaged before, a property consultant said.

According to DTZ Research in its latest report, the warmer bilateral relations, and smoother and cheaper transport system arising from the agreement will give a boost across all property sectors in Iskandar Malaysia.

“With a proposed mass rapid transit (MRT) line linking Johor Baru city centre to Nusajaya, there will be a tendency for a shift in value towards Nusajaya as more newer physical developments take place and the cost of using the Second Link becomes more competitive,” the report added.

For Singapore, judicious land allocation has always been an integral part of real estate planning and development given its limited land size. The reversion of the railway land will thus enable the authorities to amalgamate the track land with adjacent sites and bring about more optimal use of the land.


Brian Koh says the railway agreement has unfolded a new chapter for Malaysia and Singapore.

DTZ Malaysia executive director Brian Koh said the railway agreement had unfolded a new chapter for Malaysia and Singapore and both countries can co-build a new growth story that resembles the Hong Kong-Shenzhen Metropolis model.

However, unlike Hong Kong and Shenzhen which are both under one country, a lot more co-operation and government involvement is needed between Singapore and Malaysia to overcome two distinct economic and legal systems and build trust and co-operation, while pursuing their respective national and economic objectives.

“The degree of success of Iskandar Malaysia will be partially determined by political co-operation with neighbouring Singapore as well as by economic factors,” Koh said.

More skilled and semi-skilled migrants from other parts of Malaysia may be attracted to reside in Iskandar Malaysia to take advantage of the employment opportunities in Singapore through daily commute without having to pay for the high residential cost of living across the causeway.

“Demand for homes from foreign buyers, particularly Singaporeans, is envisaged to improve due to the higher confidence level in Iskandar Malaysia from the warming bilateral ties,” he added.

In the office sector, there is potential for a shift of low-end commercial service activities, namely back office processes, from Singapore into the Johor Baru central business district to take advantage of cost arbitration, given the widespread use of the English language and the general availability of mid-level executives in Johor.

The retail and hotel sectors will also benefit from the higher tourist flow into Johor, while more industrial and logistics investments can also be expected from Singapore.

DTZ head of South-East Asia Research Chua Chor Hoon said that among the returned railway land in Singapore, the railway station site at Tanjong Pagar had the greatest redevelopment potential given its size and the government's plans for this district.

While the rest of the returned land are unlikely to be developed anytime soon, one area that is likely to see some earlier new developments will be at Bukit Panjang where a MRT station would be ready in 2015, providing some impetus to develop the vacant land around it.

The once sleepy Tanjong Pagar area is perking up with newly completed and pipeline offices, hotels and apartments. Higher rents and prices are being achieved and more investors are becoming interested in the area.

“The Spottiswoode area just north of the railway station may be totally rejuvenated as the old existing residential developments are prime candidates for redevelopment,” Chua said.

By The Star

 

SP Setia wins Penang convention centre deal

SP Setia Bhd, the country's largest developer by sales has won a RM300 million project to build and operate the Penang International Convention and Exhibition Centre (sPICE), Bloomberg reported, citing an email statement from the Penang Chief Minister Lim Guan Eng.

Last Thursday, Business Times reported that the property developer was the front runner and on the verge of winning the job.

Securing the project should bode well for SP Setia, which posted sales of RM1.74 billion and a net profit of RM251.81 million in the year ended October 31 2010.

The project aims to create a "Penang People's Park" that includes the country's first subterranean sPICE, a 2.83 hectares public park on the rooftop, a refurbished and upgraded Penang International Sports Arena (Pisa), a refurbished and upgraded Aquatic Centre and a four-star hotel with retail outlets and a spacious parking lot.

The project will be developed through a public-private partnership agreement between the Penang Municipal Council (MPPP) and developer SP Setia Bhd's unit Eco Meridean Sdn Bhd.
On September 3 2010, SP Setia had bought 2 ordinary shares of RM1.00 each in Eco Meridian Sdn Bhd, resulting in the private company becoming a wholly owned unit of SP Setia.

Financing for the Penang project will see MPPP injecting some RM50 million, through a combination of land and cash, while Eco Meridean will finance the rest.

The proposed sPICE, which initially came with a RM50 million priceline, has been mired in controversy ever since Lim proposed it.

One of the concerns raised was that the project would incur huge expenditure, which could result in the council becoming insolvent.

Lim, however, claimed the council could save some RM25 million from the refurbishment, repairs and upgrading work on Pisa and the Aquatic Centre and that Eco Meridean will pay RM13.5 million for land to build a four-star hotel to complement sPICE.

This means that the net sum of MPPP's investment in the project would be RM11.5 million.

Work on the project is expected to start within three to six months' time and will be completed in three years.

By Business Times

 

Facility for London property purchases

MALAYAN Banking Bhd (Maybank) is anticipating a take up of RM60 million within the next six months for its latest mortgage facility "Overseas Mortgage Loan Scheme" being offered for those purchasing properties in London.

"This is in view of attractive property valuation in London and overseas buying interest to peak before April 2011 when the new 5 per cent sales tax is imposed for properties above STG1 million (RM4.84 million)," Maybank deputy president and head of community financial services Lim Hong Tat said in a statement yesterday.

The key features of the mortgage scheme include repayment in ringgit, high margin of financing of up to 85 per cent, flexible repayment and long tenure of up to 30-years or 70-years of age, whichever is earlier.

The facility will be offered in the form of term loan, overdraft or a combination of term loan and overdraft, he added.
The ringgit mortgage facility will finance completed or under-construction residential and commercial properties in London Zone 1 to Zone 3, covering prime locations such as the City of London, Westminster, Knightsbridge, Kensington and Chelsea.

Maybank's mortgage facility makes it the first Malaysian bank to offer Malaysians a local mortgage loan facility in ringgit for purchase of property in London.

By Bernama

 

Synergy Property eyes Asia-Pacific prospects

SYNERGY Property Development Services Pte Ltd, a leading project management company based out of Bangalore, India, is eyeing growth opportunities in Asia-Pacific, especially Malaysia.


Sankey Prasad ... ‘Our association with Blackstone provides us the expertise of looking at projects that are attractive from an investment perspective.’

Chairman and managing director Sankey Prasad says Malaysia is one of the few countries in the region that remained resilient during the global financial crisis.

“Malaysia showed a lot of stability during the global recession. If you compare with many other markets, this country showed a lot of character and did not suffer any electric shocks of the crisis,” he tells StarBizweek in an interview.

“That's a sign of a good and stable market,” Sankey says, adding that Malaysia's resilience throughout the crisis has allowed the country to remain competitive.

“I think Malaysia has learnt a lot from its mistakes.”

Sankey started Synergy in early 2003 with just 40 people, and the company has since employed more than 600 people, with a resource pool comprising architects, engineers and project management personnel.

Synergy has offices in India (Delhi, Mumbai, Pune, Hyderabad, Trivandrum and Bangalore), Dubai and Malaysia.

On the local front, the company operates in Kelana Jaya, employing a team of 25 people.

The company offers complete project management consultancy, delivering support and design services through all phases of the development process of a real estate project. It also provides turn-key solutions.

In 2008, Blackstone Real Estate Partners, an affiliate of the Blackstone Group (a leading investment and advisory firm), acquired a 35% stake in Synergy.

“Our association with Blackstone provides us the expertise of looking at projects that are also attractive from an investment perspective,” says Sankey.

“We adopt a holistic approach that provides a single point of contact in every stage of the project, starting from inception to project close-out. This approach is practical in giving a detailed outline of the working procedures,” he adds.

Synergy also offers a management information system which is essentially a web portal that allows its customers real-time updates on projects that are being carried out.

“The portal can be accessed anywhere and at any time. Using the Internet, our clients can become aware of any issues,” Sankey says, adding that MIS is developed to create more transparency for its customers.

The company has delivered over 60 million sq ft of projects consisting developments within the retail, information technology, hotels and hospital sectors.

Its clients include Tata, IBM, Goldman Sachs and Deutsche Bank.

Having done projects for clients globally, Sankey says Synergy is constantly looking for opportunities, especially within the Asia-Pacific region to help boost its business.

“In the pipeline, we're looking at large projects. We've got associates and clients that are looking for opportunities in Asia.”

Synergy made its foray into Malaysia in 2007, when it became the project manager for MKN Embassy Techzone, a freehold information and communications technology (ICT) business park in Cyberjaya.

The project is developed by MKN Embassy Development Sdn Bhd, a joint venture between EMKAY Group of Malaysia and Embassy Group of India.

Synergy deals with the pre-construction phase of the project, keeping tabs on the development cost and ensures that it is on schedule.

On a personal note, Sankey says Cyberjaya, despite its potential, has not grown to become “what it should have been.”

“Cyberjaya has the right infrastructure and the dream ingredients but in the past four years that I have travelled to Malaysia, it has not grown as aggressively as it has been portrayed.

Perhaps there needs to be more aggressive marketing on Cyberjaya,” he says.

Sankey also says Synergy has recently been appointed project manager for the development of luxury villas at Bandar Enstek, Nilai, in Negri Sembilan.

The villas are part of a larger project being developed by a consortium that includes Enstek developer TH Properties Sdn Bhd, Ascenteus Holdings Sdn Bhd and Indian developer, Davanam Constructions.

Sankey says ground breaking for the project is expected within six months.

Synergy has also secured the right to become project consultants for the development of two international schools one each in Kuala Lumpur and Johor Baru.

“We will reveal more when the time is right,” he says.

Given Malaysia's growth opportunities, Sankey says Synergy is looking to secure “big” projects.

“We want to take on more niche projects as we also price ourselves that way. We don't do any run-of-the mill jobs.”

Asked about the challenges in Malaysia, Sankey says getting construction materials is a common issue.

“Because our jobs are pretty niche, most of the materials that we require are difficult to obtain locally and require importing.”

On the global front, Sankey says Synergy is cautious about its expansion plans, but adds that the company is looking to offer its services in Mauritius, Indonesia and the Philippines.

“We don't want to go berserk and go everywhere. We need to evaluate the market first and get the right project before we think about expanding into a new market.”

By The Star

 
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