Iskandar to become Malaysia’s Shenzhen

news-johor-iskandarmalaysiaproperties--e1499135195993.original

With the backing of Singapore and Malaysia’s governments, Iskandar is anticipated to transform into a thriving production and technology hub just like what happened to China’s Shenzhen, Hong Kong’s neighbour, reported The Financial Times.

Prime Minister Najib Razak said Malaysia, particularly Iskandar, can have a mutually beneficial relationship with Singapore, similar to New Jersey’s close ties with Manhattan.

Ravi Menon, the Head of the Monetary Authority of Singapore (MAS), has also proposed that the city-state and Iskandar be considered as a single economic zone that would give investors an “integrated production and services base” in the ASEAN region.

3Policymakers see the possibility of businesses being co-located in Iskandar and Singapore,” said Singapore Management University Associate Professor Eugene Tan.

“We just don’t have the land here and Iskandar is close enough for companies to have manufacturing there but the finance and R&D in Singapore.”

In fact, some Singapore companies have already relocated a portion of their operations in Iskandar. For instance, a firm involved in machine tools reconditioning transferred its workshop to a hangar in the Malaysian region.

“Our sales office is 30 minutes from here, in Singapore. There’s a lot of walk-in customers and we can bring them here to test the machines,” said its Manager Angela Pang.

“Our rental in Singapore was going to expire and this is cheaper,” she noted, explaining that the rental cost of commercial space in the city-state is more expensive than those in Iskandar by about three times.

However, real estate investments in Iskandar have recently plummeted due to worries over a supply glut of residential properties.

In the year to March 2017, overall property investment there plunged to only US$86 million compared to US$1.4 billion during the corresponding period in 2013.

“The drop in volumes between now and 2013 is highly noticeable,” noted Real Capital Analytics Director for Asia Pacific, Petra Blazkova.

“Our view is that it stemmed from an imbalance between the supply of land or property and demand from real estate investors.”

One major factor behind the oversupply is the fact that China’s Country Garden is building a massive development on four reclaimed island off the coast of Johor.

Known as Forest City, the US$100 billion development is forecasted to have a population of 700,000 people in about 20 years.

However, Beijing’s restrictions on money outflows has affected the apartment sales in the project as most of its buyers are from China. The developer even closed down its sales galleries in the country and is planning to attract other buyers from other nations.

Iskandar Regional Development Authority’s (IRDA) CEO Ismail Ibrahim also admitted that there is a “temporary” oversupply of homes in the region. Nevertheless, he is confident that the excess units will be eventually absorbed by the market as Iskandar’s economy is anticipated to flourish.

Among top properties in Iskandar Malaysia are:

1. Meridin Medini

2. Meridin SOVOs

Image sourced from Iskandar Properties

 

Iskandar needs a further 500,000 new homes

BY NELSON BENJAMIN

JOHOR BARU: Iskandar Malaysia still needs about 500,000 new homes to cater for an estimated three million-strong population by 2025.

Iskandar Regional Development Authority chief executive officer Datuk Ismail Ibrahim said the state only had about 700,000 homes presently.

“Iskandar Malaysia is growing at an annual rate of 7% to 8% and we expect the population to grow from 1.45 million in 2005 to 3 million in 2005.

“This population will need a total of 1.2 million homes,” he said during a special media briefing here.

He added that while there was a slowdown in the property sector in Iskandar, he did not expect it to last long as there was a need for new homes.

“As for capital controls imposed by China, so far none of the China-based developers are affected as construction is ongoing.

“These are big-time and long-term investors,” he said, adding that these China-based companies were not here to buy land and flip it for profit.

Ismail added that even with the 20,000 to 25,000 homes being developed by the Chinese, the state was still in need of more houses.

However Ismail reiterated that the property sector was not among the sectors being promoted in Iskandar Malaysia.

He expressed optimism that the property sector would bounce back and said that there was huge demand for homes priced between RM100,000 to RM350,000.

“So far Iskandar Malaysia is growing on track,” he said, adding that this was despite the uncertainties globally.

He added that Iskandar Malaysia was growing much higher than the national average of 4.5% to 5% annually.

Malaysia clinches 20th spot in Global Competitiveness Report

KL-Competitiveness

Malaysia’s ranking in the Global Competitiveness Report 2014-2015 improved as it took the 20th spot, up from last year’s 24th position, reported the media.

Despite being the country’s best position so far, Malaysia Productivity Corp director-general, Datuk Mohd Razali Hussain said the government plans to continue to intensify efforts in the pillars of labour market efficiency, macroeconomic environment and technological readiness.

Notably, macroeconomic environment posted a drop of “six places to 44th position from 38th last year. Our area of concern is the government budget balance and general government debt,” said Mohd Razali.

“On technological readiness, Malaysia declined nine places to 60th position from 51st previously.”

He said MPC plans to propose the creation of task force to improve Malaysia’s technological readiness.

Among the initiatives that will be intensified include international Internet bandwidth, mobile broadband subscriptions per 100 population as well as fixed broadband Internet subscriptions per 100 population.

On the labour market efficiency pillar, which climbed from last year’s 25th position to 19th, Mohd Razali revealed that the government will continue to intensify initiatives to promote women’s participation in the labour force.

Notably, 52.4 percent of the country’s entire female population are working last year.

“We will hold discussions with various ministries and agencies to improve Malaysia’s position in the three pillars, as well as, hold more engagements with the business community,” he added.

The Global Competitiveness Report, which is based on the Global Competitiveness Index, was introduced in 2004 by the World Economic Forum.

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories emailfarahwahida@propertyguru.com.my

Johor industrial recorded RM14.9bil investment

JB-300x147

According to Johor Menteri Besar, Datuk Seri Mohamed Khaled Nordin, between January and May this year Johor recorded RM14.9 billion in industrial investment.

He said the statistics, issued by the Malaysian Investment Development Authority (Mida), put Johor in first place, followed by Sarawak and Pahang in second and third places, respectively.

As revealed by local media reports, the total has also surpassed the total investment of RM14 billion recorded last year.

“This shows that investors, both local and foreign, continue to be interested in investing in Johor and make the state the choice investment destination,” Khaled said.

He added that the strong investment figures show that Johor is a prosperous and peaceful state with all the necessary infrastructure, factors that help attract businesses to the state.

“The state government will ensure the continuity of this positive elements in its efforts to make Johor the choice destination for investors. We will also continue to focus on promoting investment opportunities,” Khaled said.

He was speaking at the opening of the state-level exporters forum organised by the Malaysia External Trade Development Corporation (Matrade).

The forum is one of Matrade’s initiatives to encourage local companies to expand their businesses internationally and serves as a platform to engage entrepreneurs and exporters on issues and problems related to international trade.

 

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email farahwahida@propertyguru.com.my

High Speed Rail (HSR) project to drive new industries

KL-SG-High-Speed-Rail-300x168

The Kuala Lumpur-Singapore high speed rail (HSR) project could help create many new industries and breathe life into towns, according to MKH Bhd Managing Director Tan Sri Eddy Chen.

For instance, it can help transform Seremban into a tech valley or regional headquarters for biotechnology firms due to its proximity to research and training centres, while Malacca’s tourism industry could benefit from the fact the visitors don’t have to drive once the HSR is completed.

Day trips will become spontaneous and visitors will have more to spend in Malaysia.

But to achieve this, long long-term planning is a necessity, he said, citing how Japan used its Shinkansen (high speed rail) to open new integrated towns along its route. Moreover, there would be a need for more hotels, malls and location logistics services, he said.

Meanwhile, the upcoming Sungai Buloh-Kajang Mass Rapid Transport (MRT) has boosted the land prices in Kajang from RM7 to RM8 psf to RM17 psf.

“It does not seem to matter to them that the MRT is scheduled for completion only in 2017. The MRT has helped to close the gap between the city and Kajang,” said Chen, who is also the President of Malaysia Shopping Malls Association.

“We are seeing Kajang apartments now selling between RM400 and RM500 psf. These are prices at Mont’Kiara and Seri Hartamas,” he added.

 

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email farahwahida@propertyguru.com.my

 

Signs of property bubble noted

bubb-300x214

A leading U.K. organisation has said a bubble may be forming in the Philippines property market, although while the fast-increasing rate of household lending has raised alarms in both Thailand and Malaysia, it does not necessarily think it is problematic in the latter two countries.

The Centre for Economics and Business Research (CEBR) said in its quarterly report commissioned by the Institute of Chartered Accountants in England and Wales (ICAEW) titled Economic Insight: Southeast Asia, said: “Strong growth underpinned by low interest rates in the Philippines is stoking fears of a property bubble in Manila.

“Inflation is relatively low and economic policymakers are keen to maintain rapid growth; however, property prices in Manila’s financial district, already at a record high, are projected to rise 8 percent this year.”

CEBR also cited an International Monetary Fund (IMF) warning of a domestic asset price bubble, which includes real estate.

The think tank also noted how Southeast Asian countries have showed rising consumption, and over the past four years, the largest economies “have shown a clear trend of putting aside less as they spend more”.

Rising consumption, the report stated, highlights the risks of promoting lending.

It also noted a “striking similarity” in the present situation in Southeast Asia with what transpired during the 1997 Asian Financial Crisis.

In particular, it spotlighted on how investors have again been turning emerging markets, such as those in Southeast Asia, in search for higher yields, with interest rates in the region still better than those in advanced economies.

“A property bubble is often linked to a rise in household debt as it expands the collateral of would-be borrowers, a pattern evident in the U.S. and U.K. property markets in the run-up to the global financial crisis,” the report said.

Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg

Foreign investments to change Johor’s landscape, says Sultan

Jul 4, 2014

Sultan-Johor-TheStarDCDM1

The Sultan of Johor has welcomed the entry of more foreign investments into the state, which he said would not only change the landscape of Johor but also provide economic benefits and job opportunities for the people.

Notably, Johor’s Sultan Ibrahim Ismail Sultan Iskandar has consented to officiate at the groundbreaking ceremony for the Princess Cove project in Tanjung Puteri that is being developed by China-based developer R&F Properties Co. Ltd, reported Bernama.

Sultan Ibrahim said the project is poised to become a landmark that the people could be proud of in Johor Baharu.

“I am thankful to R&F Properties as the company has the confidence in the investment potential in Johor Baharu. It is hoped that this investment would generate profits to the company,” he said.

Located opposite Singapore’s Woodland immigration complex, Princess Cove is within close proximity to the Johor Causeway. It is set to be a new landmark in Johor Baharu, similar to what Petronas Twin Towers is to Kuala Lumpur.

The project will feature twin skyscrapers, with one boasting a five-star hotel while the other with a grade A office tower.

The entire development is set to be completed in five phases until 2022.

Specifically, the first phase involved the development of 15 blocks of luxury condominiums with 3,200 units and a three-storey shopping that is slated to be completed in 2017, said R&F Properties Director-General, Sales and Marketing, Fairus Cheung.

Listed on the Hong Kong Stock Exchange, R&F Properties acquired a 46.94ha of sea-fronting prime land for RM4.5 billion, in a deal that involved the Johor royalty.

The groundbreaking ceremony was also attended by Johor Menteri Besar Datuk Seri Mohamed Khaled Nordin, Tunku Mahkota of Johor Tunku Ismail Idris, R&F Properties Chairman Li Sze Lim and its Chief Executive Zhang Li.

Image Source: thestar.com.my

 

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email farahwahida@propertyguru.com.my

The content of this website is made available for informational purposes only. This website does not provide specific legal or investment advice.