MAH SINGâ€™S DYNAMIC DUO
GST - ITS IMPACT ON PROPERTY INDUSTRY KDN PP 18181/04/2013 (033492)
R2_COVER 40.indd 2
OCT 2016 RM7.50(WM) RM9.00(EM)
I D EAS
All Eyes On The BUDGET
KK Chua, Editor-in-Chief
Editor-in-Chief KK Chua firstname.lastname@example.org Writers Fara Petial Avinash Sagran Natasha Gideon CREATIVE
s we head into the fourth quarter of 2016, all eyes will be peeled on the tabling of BUDGET 2017 by our Prime Minister, Dato’ Sri Najib Tun Razak, on 21st of this month. Malaysians from all walks of life are hoping for more good news in this year’s announcement, especially so in hoping for better stability and progress in the market. In our Main Feature, we recap at the implementation of Goods and Services Tax (GST) back in April 1st 2015 and find out what are the effects and its impact on the property market, and to make out what we can expect in the future. Mah Sing Group Bhd’s father-son power team, Tan Sri Dato’ Sri Leong Hoy Kum and Lionel Leong, gave their take on being a renowned, responsible developer, endeavouring current challenging times and how they derive success while maintaining their work life balance. Our focus for Developer of the Month is BRDB Developments Sdn Bhd, famous for their work in Bangsar, and the iconic The Troika in KLCC, amongst many others. Find out what Mr Edwin Yang, CEO of BRDB Developments, has to say on page 27 as he provides an exclusive insight of BRDB’s pipeline, including their exciting new projects in Pakistan and in London! This month, we take a look at a prestigious growing township and great area of investment,
Setia Alam. Our Senior Writer, Fara, went to town as she gets the scoop of the thriving developments, as well as identifying up-andcoming future developments there. Do check out the latest transactional prices in Setia Alam and find out if that’s the ideal location for you. From Setia Alam, we move on to SkyWorld, a prominent quality developer on pg. 38 onwards. Get to know not one, but TWO, of their latest developments featuring Bennington Residences@SkyArena, and SkyLuxe On The Park@Bukit Jalil. Both developments are located in prime locations, so read on to find out what they have to offer! COURTS is better than ever. Find out what Tim Luce, the Chief Operating Officer of Courts Asia Limited and Acting Country CEO of Courts Malaysia, has to share as he highlights his 20 years of retail experience, and what are his plans for COURTS as he talked to us about the past, the present and future of COURTS in Malaysia. School holidays are near, and we have the perfect article for you. Our new writer, Felicia, gives you the TOP FIVE Cafes in Puchong check out on pg. 57 onwards if you’re a foodielover. Just like you, our fellow readers, we are hoping for a brighter 2017. And just like you, we are persistent in making things better now, and beyond!
Creative Director Sarah Tan email@example.com Designer Irman Hakim BUSINESS DEVELOPMENT General Manager Janet Loh +6012 205 0911 firstname.lastname@example.org Andy Fam +6012 601 9938 email@example.com Hagenz Choo +6012 371 8831 firstname.lastname@example.org Iris Gan +6012 799 6685 email@example.com Wei Yeen, Chong +6012 927 2863 firstname.lastname@example.org
Armani Media Sdn Bhd (1032085-H) No. 32-3, Jalan Pekaka 8/4 Seksyen 8, Kota Damansara 47810 Petaling Jaya, Selangor Tel : +603 6156 3366 Fax : +603 6156 3399 PRINTER Percetakan Osacar Sdn Bhd Lot 37659, No. 11, jalan 4/37A Taman Bukit Maluri Industrial Area Kepong, 52100 Kuala Lumpur, Malaysia ENQUIRIES
www.youtube.com/Property Insight Malaysia
Property Insight Malaysia
Although every reasonable care has been taken to ensure the accuracy of the information contained in this publication, neither the publisher, editors, writers nor employees or agents can be held liable for any errors, inaccuracies and/or omissions. The contents of this publication do not constitute investment advice. It is intended only to inform and illustrate. No reader should act on any information contained in this publication without first seeking appropriate professional advice that takes into account their personal circumstances. We shall not be responsible for any loss or damage, whether directly or indirectly, incidentally or consequently arising from or in connection with the contents of this publication and shall not accept any liability in relation thereto. The views by our contributors expressed here are their personal opinions and do not necessarily reflect Property Insight’s views. The publisher does not endorse any company, organisation, person, investment strategy or technique mentioned in this publication unless expressedly stated otherwise. The publisher does not endorse any advertisements or special advertising features in this publication, nor does the publisher endorse any advertiser(s) or their products/services unless expressedly stated to the contrary. All rights reserved. No part of this publication may be reproduced in any form or by any means, including photocopying and imaging without the prior written permission of the publisher.
38 PERSONALITY OF THE MONTH
10 COVER STORY
Father and Son Duo Propels Mah Sing Group Bhd Forward Two generations bringing property development in Malaysia to greater heights
GST Implementation & Property Industry
One year has passed – What has changed and how much did the property industry contribute to total GST payment?
Tim Luce: The King of the Court
Being the biggest of its kind across South East Asia, COURTS has accumulated a brand, a name, buying power as well as great talent and experience
INVESTOR NEXT DOOR
Trials and Tribulations
Dato’ Ong Theng Soon’s journey to becoming a property developer
The Next Gen
Everything in one place
This trend is seeing a surge in the market as residential properties are usually significantly lower than residential new-builds
Converting Residential Property to Commercial Property
Property Valuation Methods
What are the things property valuers look at when valuing your property?
DEVELOPER OF THE MONTH
Keeping it Classy with BRDB
All of the developments done by BRDB have one thing in common; class and sophistication in design
Where the grass is always greener
Bennington Residences : The Perfect Solution
SkyWorld does not just provide homes, SkyWorld creates a concept of living better known as Sky Living
SkyLuxe On The Park
Luxury living in the skies overlooking the greens of Bukit Jalil
All Turning Points Led To Property Investment
In three years double digit amount of property
Sustainably Inspired Thin & Bold Style!
Furniture with timeless elegance and stylish design to create the perfect living lifestyle
DESTINATION - FOOD
INTERNATIONAL MARKET - Vietnam
Vietnam Property Market Remade
Rich Debt, Poor Debt
Ways To List Your Room For Homestay Or Short Term Rental Other Than AirBnb 70 Check Out Your Paymaster
NEWS & EVENT
MBI INITIATES PROJECT TO REVITALISE TAMAN ALAM PERDANA
ome owners of Taman Alam Perdana’s Arcadia residential development in Puncak Alam heaved a sigh of relief as completion plans for their dream homes are now back on track. This comes after the Selangor state government successfully resolved the development’s decade long issues and delivered on its commitment to revitalise the homes as well as transform Alam Perdana’s emerging township as a whole. The Selangor state government, through Menteri Besar Selangor Incorporated (MBI Selangor), will be collaborating with property developers LBS Bina Group Berhad (LBS) and Worldwide Holdings (Worldwide) who have stepped forward to revitalise and complete the vacant Taman Alam Perdana homes.
SAMA-SAMA EAT PLAY BOND AT TROPICANA
ropicana is the developer behind 4 developments within Klang Valley which will see 20 traditional games in each development and over 50 games as whole to be hosted for 4 consecutive weekends in a row, from the last weekend of September
to mid-October. These traditional games will be made available through its Eat.Play.Bond-themed ‘Sama-Sama’ campaign at Tropicana Heights on 24 and 25 September, at Tropicana Aman on 1 and 2 October, at
Tropicana Metropark on 8 and 9 October and at Tropicana Gardens on 15 and 16 October, which she hopes will bring back some of those simple pleasures to family.
SDB REGISTERS COMMENDABLE PERFORMANCE DESPITE CHALLENGING PROPERTY MARKET
or its financial year ended 31 March 2016, SDB posted net group profit of RM43.09 million (2015: RM66.9 million) on the back of a turnover of RM216.56 6 | OCTOBER 2016 www.propertyinsight.com.my
million (2015: RM400.5 million). The previous year’s stronger results stemmed from fair value adjustment of properties which had amounted to
RM24.26 million, as compared to the revaluation surplus of properties of RM2.5 million chalked up during the year under review.
www.propertyinsight.com.my SEPTEMBER 2016 I 7
NEWS & EVENT Price growth by word region
KNIGHT FRANK LAUNCHES GLOBAL HOUSE PRICE INDEX Q2 2016
Annual % change to Q2 2016
MIDDLE EAST 10.9%
NORTH AMERICA 7.6%
SOUTH AMERICA 5.9%
EUROPE 3.9% ASIA PACIFIC 2.0% AFRICA 0.6% RUSSIA -3.3% Source: Knight Frank Research
Investment Volumes in Asia
US$ billion, develoment sites US$10 million 500
KNIGHT FRANK LAUNCHES PRIME ASIA DEVELOPMENT LAND INDEX
night Frank, the independent global property consultancy, launched the Q2 2016 Global House Price Index* which increased by 4% in the year to June 2016. The index monitors and compares the performance of 55 mainstream residential markets around the world. The overall aggregate index has followed a similar narrative, consistently recording 4% annual growth, or thereabouts, for the last two years.
Source: Real Capital Analytics, Knight Frank Research
night Frank, launches the Prime Asia Development Land Index for H1 2016. The index derives the price of prime residential (apartment or condominium) and commercial (office) development land in 13 major cities across Asia. Results for H1 2016 saw development land investment volumes in Asia match the level registered in the corresponding period last year. Prices of residential sites in the region increase at a slower pace of 1.9% in H1 2016, down from 2.8% in the preceding six months. Price growth of office land, however, picked up speed to 2.2% from 1.9%. With state-owned enterprises purchasing land aggressively, China saw a 6.0% year-on-year increase in volumes. Cross-border land investment volumes in Asia fell by 11.5% year-on-year.Tokyo registered the largest increase in the residential index in H1 2016 at 16.8% increase – significantly higher than that of the runner-up Shanghai(9.6%); whilst NCR registered the lowest at -9.9%. For prime office index, Bengaluru tops the chart at 6.1% increase in H1 2016, whilst Singapore sits at the bottom with 4.4% decrease.
MINISTER OF FEDERAL TERRITORIES OFFICIATES GROUND BREAKING CEREMONY OF M101 SKYWHEEL
ang Berhormat Dato’ Seri Tengku Adnan Tengku Mansor, Minister of Federal Territories together with Yang Berbahagia, Hj. Mohd Najib Nordin B. Hj. Mohd., Executive Director (Planning) Kuala Lumpur City Hall accompanied by M101 Entity Sdn. Bhd. (M101) founder Yang Berbahagia Dato’ Seth Yap Ting Hau officiated the ground breaking ceremony of M101 SkyWheel, a two tower stateof-the-art development with the highest Ferris-wheel in South East Asia designed by Studio F. A. Porsche.
8 | OCTOBER 2016 www.propertyinsight.com.my
10 | OCTOBER 2016 www.propertyinsight.com.my
FATHER & SON DUO PROPELS MAH SING GROUP BHD FORWARD Two generations bringing property development in Malaysia to greater heights BY: AVINASH SAGRAN
ah Sing Group Bhd is one of Malaysia’s leading property developers with an impressive portfolio of developments, including high-rises and landed residential developments, commercial centres and niche industrial parks. The diversity of its offerings highlights its skill in planning and developing properties with different components and complexities. With 46 projects spread throughout Malaysia’s property hotspots, namely the Klang Valley and Greater Kuala Lumpur, Johor Bahru (Iskandar Malaysia), Penang Island and Kota Kinabalu, Sabah, Mah Sing’s success lies in its formidable team. It is their hard work and dedication that has transformed Mah Sing into what it is today. THE FAMILY EXPERIENCE Tan Sri Dato’ Sri Leong Hoy Kum believes that in order to grow exponentially, Mah Sing has to be professionally managed, which is why he has a core team of loyal, skilled and experienced staff. “As a father, I am very heartened to see that my children are willing to learn and
train themselves up to be the leaders in the company. Succession planning is indeed very important as we are here for the long term. We have been around for 22 years and we want to leave behind a good legacy,” he says. Having given all three of his children the freedom to decide on what they want to do with their careers respectively, Tan Sri Leong mentions, “I am very glad that all three of them decided to join the Mah Sing family. I place the same level of expectations on them as I do on my staff. They know that work is work and personal time for the family is time spent at home. In managing these expectations, I believe that a successful business and a healthy family life can be achieved.” Lionel Leong Director of Group Strategy and Operations, shares that he found his passion in property development. He was persuaded by the exposure of Mah Sing’s growth plans and the strong foundation that his father has built the company on. “I lean on the existing learning curves to guide my decision-making. When
I joined Mah Sing, I learned that property development was not something that you could learn from the books. Property development is a commercial activity that requires an entrepreneur to entrust field specialists to come together to develop and market the property,” says Lionel. “At Mah Sing, we go beyond building properties as we strive to create a memorable experience for all our stakeholders – from our business partners, shareholders and buyers,” he adds. LIONEL’S JOURNEY Many developers have taken a rather traditional approach, from the implementation stage to marketing the end product. As a relatively young person in this industry, he says that the biggest challenge is to combine new and old practices into one feasible working methodology in line with Mah Sing’s business strategies.” As the Director Of Group Operations & Strategy, Lionel feels it is important that proper consideration be given to any approaches that would appeal to the right target market. When introducing something new, he says, “We must have sound reasoning backed www.propertyinsight.com.my OCTOBER 2016 I 11
COVER STORY by proper market analysis. Such innovative exploration is evident with Mah Sing’s advertisements having taken a lifestyle approach. Even its exhibition booths are innovatively designed to attract visitors following themes such as the 1950s diner and Monopoly. Lionel believes in an emotionally appealing lifestyle marketing approach to effectively connect with genuine buyers. Tan Sri Leong says that all his children are very hands-on in all aspects of the business - be it in land acquisition to or designing and marketing the project. He mentions that Lionel in particular, was attracted to join the company as he believes that he can contribute positively and continue to bring Mah Sing to even greater heights. Lionel himself believes that when it comes to succession planning, the trend is moving towards a more institutionalised framework, which is not so heavily reliant on ‘the key man’ or ‘founder’. “Business owners should provide strategic direction and make high level decisions while the day-to-day operations should be executed by the team. “We are very proud that Mah Sing’s entrepreneurial spirit is coupled with professional management. I am very grateful for the guidance given by the core team at Mah Sing. So, even if I had to take over the business one day, I believe any individual who is more capable than I am should be the right person to be empowered to drive the company.”
The biggest challenge is to bridge the ‘new’ and the ‘old’ practices into one feasible working methodology in line with Mah Sing’s business strategies.” - Lionel Leong 12 | OCTOBER 2016 www.propertyinsight.com.my
A TRUE ICON IN DEVELOPMENT AND DELIVERY Tan Sri Leong believes that the competition among property developers here in Malaysia is very high, and this is a good thing. Through healthy competition, he believes Mah Sing will be able to push itself to be better and grow stronger. Mah Sing’s Iconic Series developments have indeed transformed the KL Skyline. This series of innovative developments are known for their revolutionary designs and exceptional quality and have enjoyed excellent take-up rates. There are four Iconic Series developments. The first is Icon Tun Razak: with its dynamic and seamless design flow known as the “wave”, accentuating the overall image of the surrounding area
while signifying the forthcoming business opportunities. The second relates to Icon Residence in Mont Kiara with its state-of-the-art architecture, featuring a 3-dimensional lattice of terraces, gardens and living spaces. The third is M City, conceived with thematic hanging gardens spanning over 4 acres, and strategically located at Embassy Row, Jalan Ampang. Last but not least, Icon City in Petaling Jaya is situated at the intersection of LDP and the Federal Highway. It features extraordinary architectures and alluring landscapes, built within a sustainable environment for a healthy life-work-andleisure balance. Mah Sing takes pride in producing developments of exceptional quality. Buyers purchasing homes from Mah Sing, will likely stay there for a considerable duration of their lives, opines Tan Sri Leong. He says each development goes through stringent quality assessments as nowadays, quality is no longer an extra consideration but a given. Lionel agrees saying that the long term sustainability of the Mah Sing brand is achieved when it can deliver “great products at market driven prices over and over again”. “By going the extra mile, we are willing to spend more time in crafting the right value proposition for our customers at a
fair price point to ensure that investors of our properties can make a decent return on their investment,” he affirms. “We have also intensified our marketing efforts to focus on offering specific and targeted campaigns catered to the demands of the market. We are able to do this as we have current projects at various cycles and pricing points, to suit different buyers”. “As a premier lifestyle developer, Mah Sing continues its efforts to ensure pleasant and memorable customer experiences at all points of contact – from handing over the unit at the point of Vacant Possession, right down to managing customers’ feedback for continuous improvement in its products and services,” he adds. SURGING AHEAD IN 2016 Tan Sri Leong, being a seasoned industry veteran acknowledges that “property is a cyclical industry”. “We support the market’s needs for affordable housing with our attractive pricing, with 50% of this year’s planned residential launches priced below RM500,000. Overall, 89% of our planned residential launches are priced below RM1 million, with 68% priced below RM700,000. “We are committed towards supporting the nation’s initiative in building more
acquirable homes for the rakyat. One of our affordable housing projects is Rumah Selangorku at M Residence 2@Rawang which comprise two blocks, featuring 488 units with built-ups starting from 850 sq ft. The units, offering 3 bedrooms with two car park bays, are priced from RM170,000.” Back by further plans to intensify efforts, Mah Sing is well-positioned to reach its sales target of RM2.3 billion from its upcoming launches in 2H2016 by exploring different marketing approaches. The focus will be on offering specific and targeted campaigns catered to the demands of the market. As of 30 June 2016, the Group‘s cash and bank balances amounted to RM895.3 million. Mah Sing also recorded a net gearing ratio of approximately 0.06 times this quarter, which is well below the internal target of 0.5 times. The Group’s RM31.7 billion remaining gross development value (GDV) and unbilled sales is expected to support eight to nine years of revenue growth. (with RM27.5 billion in remaining GDV and approximately RM4.2billion in unbilled sales). The Group will continue to adhere to its prudent financial policy of maintaining a healthy net gearing ratio and ample liquidity. This will ensure it remains flexible to respond to land acquisition and investment opportunities as they arise. www.propertyinsight.com.my OCTOBER 2016 I 13
Lionel believes there will always be a genuine demand for homes as the population grows. However, the market today he notes, is getting more selective in their selection. “At Mah Sing, we will continue to work towards being a preferred developer of choice as we do our very best to deliver great products that improve the quality of life. “Lifestyle, accessibility and emotional values are key drivers in capturing the young demographics today who look for properties that will offer them a lifestyle they are comfortable with. The younger generation is also more receptive towards brand novelty as reflected in the products they buy.” Despite the challenging sentiments, the market is still confident in Mah Sing as Macquarie’s top 10 picks for Malaysia, according to the cited report:“Mah Sing is our top pick in the Malaysian property sector. Mah Sing has placed itself well in the market to capture the first home buyers and upgrades at affordable pricing points. Not only is Mah Sing pricing it right, it is also hugely exposed in the Central Region.” By ensuring that their biggest asset, which is their staffs, distinguished as the cream of the crop, they are provided 14 | OCTOBER 2016 www.propertyinsight.com.my
with ample training and development opportunities. Mah Sing was awarded Malaysia’s Best Employer Brand Awards 2016 for two consecutive years; HR Asia for Best Companies to Work For In Asia 2013; the Asia Responsible Entrepreneurship Awards 2015 - Investment in People; and the Asia HRD Awards 2014 for Contribution to the Society. WHAT’S NEW AROUND THE NEIGHBORHOOD? This year, Mah Sing will be completing various developments including M City, Icon City’s residential towers, SoVo, Gourmet Street, 30 Jewels and MSC Tower in the Central Region. It will also complete its developments in Southbay Plaza in Penang island, and Block A of Sutera Avenue’s Lifestyle Shop-Offices in Kota Kinabalu, Sabah. Affordable homes still sees strong demand, evidenced by the 100% take up of 404 units of Cerrado Residential Suites Tower A with a starting price of RM357,000. The recent launch of Tower B of Cerrado also saw overwhelming response. The group plans to launch Tower C and D of Cerrado Residential Suites towards the end of the year. D’sara Sentral, Sungai Buloh representing the launch of its final serviced apartment block will feature a total of 197 units with built-ups ranging from 781 sq ft onwards. Units are indicatively priced from
RM603,000. The Group also saw a high take up rate of 92% during the launch of 120 units of Lakeville Residence’s final tower in Taman Wahyu. Meanwhile Caspia, M Residence 2@Rawang launched 2-storey Linked Semi-Detached with built up size from 2,205sq ft. While Ferringhi Residence 2 saw a 84% take up from 120 units launched. To encourage ownerships of affordable homes, Mah Sing teamed up with Bank Simpanan Nasional (BSN) under the Youth Housing Scheme for Cerrado Residential Suites and Greenway@Meridin East. The scheme offers young married couples 100% loans for property priced below RM500,000, and an additional 5% of Mortgage Reducing Term Assurance (MRTA) or Mortgage Reducing Term Takaful (MRTT). Buyers will also be given a RM200 per month government disbursements for 2 years and 50% stamp duty exemptions. Greenway link homes in Meridin East Johor saw an 85% take up from 492 units launched. WORK LIFE FAMILY BALANCE When he is not thinking about work, Tan Sri Leong says he thinks of his family. “Although work is a big part of my life, I believe in a balanced work lifestyle and spending quality time with my family. This is how I balance my lifestyle. I love to travel, to experience what the world has to offer and to learn from it.
“My travels are also my inspiration and I especially love to travel with my family. I tend to favour travelling to countries where I can view architectural marvels, both historical and modern. Santorini in the Mediterranean inspired one of our projects, - Icon Residence.” Lionel mentions he sees his father from time to time in the office, but the conversation they have in the office is strictly work-related. “We have to set a good example for the rest of the team. Even though we are a family, professionalism is something we cannot compromise regardless of the background we are from. “The company is only able to progress when the people who are managing the business are very serious about displaying a high level of work ethics in the company. There is only so much time we can be productive in any given working day,” says Lionel. Having said that, Lionel jokes that although lunch hour during weekdays is used “for family bonding”, they still talk about work whenever they can. The dynamism between father and son, prompted with strong work ethics and innovative strategies to stay ahead of the competition, is also infused with passion to build quality living for the masses. These are the qualities that will continue to catapult Mah Sing to greater heights many years to come. www.propertyinsight.com.my OCTOBER 2016 I 15
GST IMPLEMENTATION & PROPERTY INDUSTRY One year has passed – What has changed and how much did the property industry contribute to total GST payment? BY: FARA PETIAL
t has been more than one year since the implementation of Goods and Services Tax (GST) in Malaysia. How much has the implementation of GST affected the property industry, especially the investors? Property Insight talks to the Director General of Customs Malaysia, Dato’ Sri Khazali Bin Hj. Ahmad to figure this out. Q: HOW HAS THE PROPERTY INDUSTRY ADJUSTED TO THE IMPLEMENTATION OF GST? A: The property industry has adjusted well to the implementation of GST. We have the Real Estate and Housing Developers’ Association Malaysia (REHDA) to represent the developers, Master Builders Association Malaysia (MBAM) for contractors, as well as the Building Materials Distributers Association of Malaysia (BMDAM) that have been in constant consultation with the Ministry of Finance (MOF) and Royal Malaysian Customs Department (RMCD) since 2005 regarding the development and implementation of GST in Malaysia. The views of all these players were considered in the development of the GST model in Malaysia. There were many changes and review especially in the property developer industry to accommodate the views of REHDA and to
OCTOBER 2016 www.propertyinsight.com.my
ensure that GST would be friendly to the business. These changes sometimes lead to certain adjustments which the industry have to adjust from time to time. Despite all these, RMCD takes measures to ensure that the businesses can adjust well to the implementation of GST. We are now entering the fourth quarter of 2016 and second year of GST implementation since its inception on the 1st April 2015. It continues to show a convincing performance in terms of revenue collection, control and enforcement, and positive cooperation received from the taxpayers as well as the rakyat. Given the pre-registration period of three months prior to the implementation date, we had 72,974 GST registered persons from the property industry on 1st April 2015. This figure is made up of both property developers and contractors. The figures have now grown to 7.3% by the first year of GST implementation to a handsome figure of 78,268 as at the 1st June 2016. This show that more and more property players are now aware of their responsibility to register. The complexity of the property sector and the varied GST treatment may cause the industry players to take time to understand the correct treatment and declaration
of their tax liability. Some may neglect in paying GST when they are liable to do so or at the same time may miss out on valuable GST credit opportunities or worst case, may even over-claim their input tax credit. This is evidenced in the delay in GST return submissions and incorrect declaration of the return especially in the initial period of the implementation. In terms of GST return submission, we have seen the growth of compliance among the mandatory registered players, probably due to their size, proper accounting records and the engagement of 1,761 tax agents and consultants. Meanwhile there are still rooms for improvement for the voluntary registrants who are from amongst the smaller property players. The compliance rate for the property developers and contractors is very high. From 1st April 2015 until 1st June 2016, more than 90% property registrants have submitted their GST return (GST-03 Form) on time. While we do note that some of these treatments still require time to mature as evidenced in other GST/VAT (Value Added Tax) implementing countries, we are fortunate that the GST literacy programme has improved tremendously with the help of various tax agents, the industry related
The Government has provided enough platforms for the players and their consultants to channel their GST enquiries. We have a call centre with 45 agents to answer your calls at 1-300-888-500, additional help desks at headquarters level, SMEs (Subject Matter Experts) to answer technical and specific industry related issues, on-line taxperts help, and walk-in counters to assist walk-in enquiriesâ€? - Khazali Bin Hj. Ahmad
www.propertyinsight.com.my OCTOBER 2016 I 17
business associations and the ongoing hand holding sessions organised by the RMCD. Entities like REHDA, CTIM, CIDB and the big 4s are some of the helping hands, to name a few. RMCD has organised 1,235 seminars or hand holding sessions to assist property players and 4,541 seminars for the public on the GST treatments for the industries. These entities have assisted the property players to file their taxable returns accordingly and to make enquiries to the authority on behalf of their clients to ensure that their GST treatment and interpretations of the GST laws are in accordance. The Government has provided enough platforms for the players and their consultants to channel their GST enquiries. We have a call centre with 45 agents to answer your calls at 1-300-888-500, additional help desks at headquarters level, SMEs (Subject Matter Experts) to answer 18 |
OCTOBER 2016 www.propertyinsight.com.my
technical and specific industry related issues, on-line taxperts help, and walk-in counters to assist walk-in enquiries. Q: WHAT ARE THE MISCONCEPTIONS OF GST AND HOW IT AFFECTS PROPERTY PURCHASERS? A: The biggest misconception about GST is overall spike of prices of goods and services. The Malaysian a property sector was expected to see a massive hike in property prices with the introduction of GST. This misconception would then slacken the property purchases sentiment, thus causing a drop in property demand. Whether the drop in the demand is in reality caused by the GST introduction or by some other factors is yet to be proven. It was claimed that the major component of inputs of property developers do not attract SST (Sales and Services Tax). However, under the GST regime which
is a broad based tax, all inputs such as construction materials and services are being taxed in the creation of final product. Even though residential property falls under an exempt rated goods, such treatment effected the input tax recovery by the developer. In order to retain their margin, the higher prices of these materials and services will be incorporated into the sale price of the residential property. Subsequently, this additional cost will be borne by the buyer. This misconception is baseless and speculative. Attitudes of some developers who are taking advantage of the situation worsen the scenario. As the country is now giving attention on the issues of hike up on property prices, the society are aware on the fact that they need to pay more on their purchase. Thus, some irresponsible developers are taking the opportunity to inject in some increment on their profit
in the business supply chain under the SST regime could actually result in bigger tax costs. The study showed that the hidden SST of 5% has increased to 8% and 10% increased to 18%. The study concluded that, if all factors remain the same, the effect of GST on residential properties is very minimal i.e. between 0.5% to 2.05%. It is expected that this impact will further decline and will not cause the prices to increase by more than 2%. The impact is so minimal, if any. Amongst other factors which will reduce the GST impact on the price of residential properties includes: • The recent falling of oil prices will lead to a reduction of transportation cost which is one of the major cost, component of materials. • The reduction of transportation costs will lead to a chain effect of further
price reduction of main construction materials such as steel, cement and sand. • The price of steel was significantly down in tandem with the falling world prices of steel. • Even though the biggest cost component is the land for residential and no GST is imposed on residential land. If we consider other market conditions, residential property prices may even fall after taken into account of GST. Property developers should pass on the cost savings to the property purchasers. Therefore, the implementation of GST should not be blamed for the increase of property prices. From the simulation and empirical study performed by RMCD, GST is not a cost to the business and if there is any unreasonable price hike, the provision
margin through the GST implementation. Q: IT IS SAID THAT GST HAS INCREASED THE COST OF PROPERTY DEVELOPMENT, WHICH ACCORDINGLY INCREASED THE PURCHASING COST FOR HOME BUYERS. WHAT’S YOUR COMMENT ON THIS? A: Before the implementation of GST, any supply of property is not subjected to SST. However, some of the cost component for the property development are subjected to 5%, 6% and 10% of SST. The SST incurred in the acquisition of the materials and the services for the development is not recoverable and will be embedded to the selling price of the property. RMCD has conducted an empirical study on the price of residential properties comparing the effect of SST and GST ceteris paribus. We found out that the effect of tax cascading and compounding www.propertyinsight.com.my OCTOBER 2016 I 19
MAIN FEATURE of price control and Anti-Profiteering Act 2011 may be invoked to penalise the offenders. Despite GST, the factors of demand and supply, inflation and currency rate are the influential factors on the spike of property price. Q: WHAT ARE THE IMPACTS OF GST ON AN INVESTMENT HOLDING COMPANY? A: Generally, the nature of business for an investment holding company is investing in shares, buying and selling, properties or holding a number of properties in the company and generating income through rental, interest and dividend. Investment holding companies that generates income via buying and selling, renting and leasing of the commercial property activities are required to register for GST and if its annual taxable turnover exceeded RM500,000 thresholds. Upon registration, they are required to charge GST and account for the output tax incurred in the course of or furtherance of the business and subsequently claim input tax accordingly. However, if the investment holding company is making both exempt and taxable supply, they need to apply apportionment method to recover the
OCTOBER 2016 www.propertyinsight.com.my
residual input tax incurred. Input tax which is wholly attributed to an exempt supply (supply of residential property and agriculture land) is not claimable. Q: HOW MUCH DID THE PROPERTY INDUSTRY CONTRIBUTE TO TOTAL GST PAYMENT? A: For the year 2016, the department is expected to contribute up to RM54 billion in government revenue collection and RM39 billion is expected to be collected from GST. Property industry is one of the main contributor for RMCD revenue. Currently, there are 78,268 GST registered companies from property industry. Our statistical analysis reveals that although the property industry contributes a significant
amount of payable taxes, concurrently, this industry also claims a substantial amount in terms of input tax. Overall, the property industry contributes approximately 10% of the GST net revenue. To achieve the 2016 projection, RMCD will strengthen the enforcement efforts along with GST compliance campaigns to advise the property industry to declare and account for the GST on their business transactions accurately. CONCLUSION The hike in property prices is not necessarily caused by GST, as a matter of fact, property developers should pass on the cost savings to the property purchasers. This could ease the burden of home buyers especially our younger generations.
CONVERTING RESIDENTIAL PROPERTY TO COMMERCIAL PROPERTY This trend is seeing a surge in the market as residential properties are usually significantly lower than residential new-builds BY: NATASHA GIDEON
www.propertyinsight.com.my OCTOBER 2016 I 21
amous spots in town such as SS2, Petaling Jaya and Jalan Telawi, Bangsar are known for their rows and rows of houses being turned into business centres or even boutiques. The bridal shops along SS2 all used to be houses, but due to it’s strategic location, and the trend of converting, these spots are now open for businesses and attract a good number of customers. But what is the process of doing so and can it even be done? Conversion of land can be applied by owners if they wish to change the land usage or land classification in order to have better bank-able value, or prior to development purposes. Conversion will only be approved upon fulfilling certain conditions. PROS AND CONS This trend is seeing a surge in the market 22 | OCTOBER 2016 www.propertyinsight.com.my
as residential properties are usually significantly lower than residential newbuilds due to the saturated commercial market. However, there are cons to having go through this process. You have to think of all the additional costs incurred, renovations and alterations done. Most of your costs will go into hiring skilled workers competent enough to comply with work standards for a residential standard. If you are renovating or extending a shop front then you would normally be required to apply for regular planning permission. In addition to that, if you are looking to convert a commercial property in a market town, it may be that the fascia of the building must be kept to look the same as those in the surrounding area, due to a covenant. This could impact the cost of the project if specific materials are required to undertake the work.
For managing partner of PDI Design & Associates, Dato’ Tan Su Cheng says his property was renovated from a two storey building to three and a half storeys, around 3,000 sqft to a whopping 11,000 sqft off the main road in Bangsar. “It was really an easy process, I did not encounter any hiccups along the way, in fact it was very smooth,” shares Tan. However, other negatives that must be considered, such as whether there is a school close by, or the noise that you may be subjected to if the property is situated close to pubs, clubs, bars or takeaway shops. If there are already some residential properties nearby, you may even want to knock on a few doors and find out how the residents find living in the area. The waiting game, if you have weighed all of the above factors up and still feel that converting a commercial property is the right move
for you, there is one final consideration; available time. Many local authorities have in place a policy whereby they will only consider changing the use of a property from commercial to residential title, if the owner can prove that there is not a market for it in its current state in order to satisfy the local authorities’ requirements. THE NITTY GRITTY Cafe owner, Effendy Nazri of Grind22, changed the residential title of his shop. He shares some insights. “The owner has to take full responsibility to obtain the Approval Permit, planning plans, Architecture plans, Monitoring and Evaluation (M&E) engineering plans for submission,” says Effendy. “The process usually takes around 60 to 90 days depending on how fast the authorities process the documents. And if you’re planning on converting your property, it will set you back around RM 25k to RM 50k, depending on the structure, size and commercial category used which can be either kindergartens, show units or common businesses,” says consultant Maxim from Maxime City Consultant.“The whole process for PDI Design & Associates took around a year for everything,” shares Tan. The possible quota of area allowed is dependent on the nature of business, so that needs to be researched thoroughly beforehand. “The first few hiccups that we had were pertaining the auditing, planning, and when we had to submit all these to Bomba. Then there was the building part, which requires workmanship from those who have experience. Don’t hire cheap labour for the sake of saving costs. Spend more for a better result, be it a runner or an agent, or even a consultant,” Effendy advises. “The more help you get from people with connections and experience means a faster process for you,” adds Effendy. While there are many pros to converting your piece of property to a commercial one, there are many factors to be taken into consideration whilst doing so, not just for the residents surrounding the area, but also for the sake of your future customers as well. However, it is not a trend that will die off soon, in fact, more and more people are moving towards opening coffee shops and show rooms in residential areas.
“The more help you get from people with connections and experience means a faster process for you” - Effendy Nazri
PROCEDURE FOR LAND CONVERSION: Fill up applicable forms made available at Land Office or Registry office i.e • 2 copies of form 44C application through section 124 (1) a and C of NLCor • 3 copies of form 7D application through section 124A or • 3 copies of form 12D application through section 204D or • 3 copies of form 12A and 2 copies of form Schedule 1 application thourgh section 197 and 96 of NLC • Surat Wakil should be registered at High Court and Land Office if the presentation done by third parties. • 7 copies of Layout Plan and Pre computation plan as certified by Planning Dept. • 15 copies of Key Plan, Location Plan, Site Plan prepared by Registered Planner • A copy of Development Proposal as required by JPBD • Official Search of Title • Receipt of Quit Rent effective year of assessment • Original copy of Title • A copy of company’s statutory declaration • A copy of Memorandum of association or articles of association 1.0.2: PAYMENT FOR LAND CONVERSION: 22.214.171.124 FOR SECTION 124 (1) A AND C Less than a Hectare RM 50.00, A hectare to 10 Hectares RM 100.00, More than 10 hectares RM 100 for every exceeding 1 hectare
126.96.36.199 FOR SECTION 124 A Less than 10 hectares RM 100, 10 hectares to 50 hectares RM 300, More than 50 hectares RM 500
188.8.131.52 FOR SECTION 204 D RM 15 for every title document
184.108.40.206SECTION 197 AND 76 Less than a hectare RM 50.00, A hectare to 10 hectares RM 100.00, More than 10 hectares RM 200.00
220.127.116.11 : FROM RESIDENTIAL TO: Commercial =10% of CMV Source : Section 124, National Land Code 1965, Department of Director General of Lands and Mines, Ministry of Natural Resources and Environment
www.propertyinsight.com.my OCTOBER 2016 I 23
PROPERTY VALUATION METHODS What are the things property valuers look at when valuing your property? BY: FARA PETIAL
eal estate appraisal, property valuation or land valuation is the process of developing an opinion of value (usually market value) for real property. Real estate transactions often require appraisals because they occur infrequently and every property is unique â€” especially their location, a key factor in valuation, unlike corporate stocks, which 24 | OCTOBER 2016 www.propertyinsight.com.my
are traded daily and are identical. Appraisal reports form the basis for mortgage loans, settling estates and divorces, taxation, and so on. Sometimes an appraisal report is used to establish a sale price for a property. But in the form of layman language, how does valuer actually value your property? Is it really subjective? Property Insight discusses the topic with a few key opinion
leaders in the industry. HOW DO YOU VALUATE? The director of Laurelcap Sdn Bhd, Stanley Toh says he looks at property valuation from an economist point of view, rather than science or art. â€œThe main factor that would define the value of a property is the demand and supply. Therefore, we
must look at what are the factors that drive the demand and supply. Valuers do not determine the market but we just report the number, the best estimation we can find. There is of course a general rule of thumb that we have to follow in valuation.” On the other hand, the managing director of VPC Alliance (Malaysia) Sdn Bhd, James Wong says “The common methods of valuation are the Comparison Method, the Income Method and Cost Method. Valuer will inspect the subject property and will take note of the property details during inspection such as building condition, structure, structural faults, rooms and layout, fit outs, fixture and fittings, any improvements, measuring the floor area (if required), etc.” According to Wong, there are a lot of factors to take into consideration, such as: • Location and accessibility, surrounding developments and infrastructure availability • Type of renovation particularly for extended portion of the house, does the owner obtain any approval from the Local Authority. • Tenure of either leasehold (remaining
• • • • •
period of how long) or freehold Current occupancy rate Land area and floor area Building conditions and finishes Monthly rental Planning approval, planning restrictions, zoning, density or plot ratio and title land use for development land valuation. Land terrain for development land valuation Caveats or encumbrances over the
property “After considering the characteristics of the property stated above and latest transactions, the valuer will then assess and determine market value,” Wong adds. The master trainer from PropertyMethod.com as well as an avid property investor, Dr. Ong Kian Leong defines property value as (market value) + (added value) – (discounted value). What does this exactly mean? Toh defines market value in general as
Market value = (potential annual income)/(capitalisation rate of property in the same market) Capitalisation rate = (average annual income)/(average property value) Added value = potential increase in value due to value added renovation/extension Discounted value = potential loss in value due to damages, risks, alteration, etc. Potential annual income – potential rental or other income generated by the property Average annual income – average rental income derived from stamp duty of tenancy agreement registered with inland revenue authority (HASIL)
www.propertyinsight.com.my OCTOBER 2016 I 25
FEATURE “The estimated amount for which an asset or liability should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.” Ong describes renovation and extension as the functional fixtures, for example, built-in kitchen cabinet, built-in wardrobe, flooring, additional wall/door for study room, etc.; functional extension, patio, terrace, car porch, additional bedroom/ kitchen/bathroom, etc. Damage, risk, alteration is the structural damage to the property (roof, foundation, wall, etc.) such as knocking down of door, wall, room, etc. DISPARITY IN PROPERTY VALUATION Variation in all the factors mentioned above is particularly the delay effect in data gathering process to update capitalisation rate, states Ong. Some owners do not understand why there is such a different value between two identical units. Toh explains, “For example, owners think that if they put RM500,000 in their RM1 million property, so they should have a property priced at RM1.5 million. But from an agency’s point of view, if they get a buyer that needs to choose between a RM1.5 million and RM1 million that is not yet renovated, the buyer would probably go for the RM1 million property because he can do the renovation himself. The buyer probably would not pay for RM1.5 million. We can’t put the cost into the value. Value is what’s reflected in the demand and supply, and the price that buyer is willing to pay, rather than what is your cost. You can build KLCC in the middle of jungle somewhere but no one will buy it, so there’s actually no value in it.” “There is also factor called the nonqualitative effect. Let’s say I have two identical units - One unit I rent to the bank, one unit I rent to hardware shop – a single proprietor, chances are if I want to sell the unit at the same price, which will be taken up faster? It’s the bank unit cause the tenant profile is stronger. In that sense there is a sense of premier which will be instilled to the property value,” Toh adds. Wong says, “Valuation is both an art and science, which is why a valuation by a qualified valuer is based on his experience, value judgement and knowledge of 26 | OCTOBER 2016 www.propertyinsight.com.my
property values and market in the locality. Property valuation are normally reflective of the market value of the property in the locality. Valuers are professionally qualified and required certain years of post-qualifying experience, before they can become Registered Valuers. Hence, valuers will normally be able to provide a fairly accurate assessment of the market value of the property.” ADDING VALUE TO YOUR PROPERTY From Ong’s point of view, an investor can add value to the property by increasing the quality of being rentable (potential annual income), increase added value (renovation, extension, and other fixed items), and reduce discounted value. Toh elaborates, to add value of the property, one must go back to the basic – increase whatever factors that people like in order to increase the demand of the property. “For example, a well-maintained condominium unit would be a better place to stay, so if there are two same units of condominium, but the one well-maintained will fetch a higher value.” “Other factor is the change of used to a
better return. For example, a corner or semi-d factory turns into a showroom, naturally it has commercial value rather than just a normal industrial unit. Use of land also plays a big role, for example changing from residential to commercial land,” says Toh. CONCLUSION For financing of their housing loan, buyers going to the bank for a loan will invariably want a higher value so that they can get the maximum loan. Hence, valuers play a role to advise the bank on the actual market value of the property. Property valuers are the custodian of the property wealth of the country. Banks are guided by property valuation before they approve a loan to the customer. Corporate buyers seek the opinion of valuers on the value of the property before they buy the property. For public listing and other corporate exercises, valuers are sought to provide an independent advice on the value of the property to protect the interest of minority shareholders. Valuation is also important to secure the maximum loan available, to maximise selling price of property, to shorten waiting time to sell property.
DEVELOPER OF THE MONTH
KEEPING IT CLASSY WITH
All of the developments done by BRDB have one thing in common; class and sophistication in design BY: NATASHA GIDEON
www.propertyinsight.com.my OCTOBER 2016 I 27
DEVELOPER OF THE MONTH
angsar was not a hotspot, neither was it business central when BRDB first started out there in 1964. In fact, for the most part, Bangsar was a plantation. 50 odd years on, it is a hustling and bustling city and a hotspot for both commercial and residential properties and much can be said about BRDB’s influence in KL’s very own Upper East side of town. Later on, after much accolades, the household name has spread its wings to areas like Kajang, Serdang and Johor. As of lately, BRDB have even broaden their horizons beyond Malaysia and have built a 400-acre golf and residential resort all the way in Lahore, Pakistan. We spoke to Edwin Yang, CEO of BRDB to talk about the company’s past, present and future. His calm, yet attentive demeanor reflects upon the work ethic, the design and the company objective in one smile. A good leader, is reflective of its company, and that can very well be said for BRDB. PILLARS OF SUCCESS BRDB strictly follows its own three innovation pillars which are uplifting aesthetics, embracing the cosmopolitan lifestyle, and paying close attention to design. “We believe in providing not just a piece of property, but people investing in ‘Dolce Vita’, heedless pleasure and luxury,” says Yang. “We prefer bringing forth the bespoke factors in property development. Sure, we sacrifice certain profits, but we invest that amount in quality,” he adds. All of the developments done by BRDB all have one thing in common; class and sophistication in design. These can be seen along the posh roads of Bangsar, and the well-known ultra-luxurious residential development, Troika smack in the middle of the city. “We don’t have to make it a point to create high-class developments,
“We prefer bringing forth the bespoke factors in property development. Sure, we sacrifice certain profits, but we invest that amount in quality” - Edwin Yang 28 | OCTOBER 2016 www.propertyinsight.com.my
instead, when we create a product, we pay more attention on the details and we do take pride in it,” Mr Yang says as he beams with pride. The product outcome generally becomes classy and high-end due to the diligent work and their sharp eye. “It’s more of ‘what would I be comfortable in?’ or ‘what would I buy for myself?’ when we design these developments. That’s our way of keeping the interest of buyers,” he shares further. Yang adds that just about anyone can do luxury developments, but only a few have the passion for it that would then reflect on the brand.
already means we cut down on profit, with the additional 10% Bumiputera quota, that’s another chunk of properties unsold, or are difficult to sell.” For the time-being BRDB have developments in the international market, among those being a golf resort in Pakistan, Defence Raya Golf Resort which sees a GDV of RM3 billion, as well as future projects such as their latest
condominium in Wollongong, Australia. All these developments help BRDB during these tough times as the economy within Malaysia as the profits compensate for the way things are locally. “What we are doing is also looking for projects in Australia for future projects. Our strategy is taking advantage of the saturation, we go to where the locals are because Australia does not allow selling
FACING STRONG CURRENTS Like any developer, the economy has taken a toll on BRDB but they do not seem defeated, in fact, they have new developments on the rise. “We understand the sensitivity of the market, so we know what buyers are going through. What we can do is offer value for money properties from our well-placed land banks, and an eye for detail and luxury,” he honestly replied. The other problem faced by developers besides not being able to sell their products is the fact that the Bumiputera quota makes it even more difficult. “When developers build affordable housing, it www.propertyinsight.com.my OCTOBER 2016 I 29
DEVELOPER OF THE MONTH
properties to be sold to foreigners. The supply-demand imbalance in the suburbs is something we are looking into,” shares Yang. DIVERSIFYING IS KEY BRDB Developments are prepared, and have been well-prepared for what the economy has in store for the nation. The key to their continuous success includes diversification – globally. “Coming up with products is easy, just create a supply that satisfies the demand, however even then it has been difficult. What we do is we diversify and ensure our cashflow is positive,” Yang explains. BRDB will be coming up with six units of luxury apartments in Lowndes Square, London but at the same time, a few projects locally like the 4-acre of land in Bandar Puteri Puchong, or locations like Tamansari which is selling at mid-range, 30 | OCTOBER 2016 www.propertyinsight.com.my
from as low as RM280 psf for a 3-storey garden terrace home. “In order to survive, we have to diversify. Otherwise when the market tumbles, there won’t be any supporting products to tide through the tough market,” Yang says. ADAPTING TO THE TIMES With rising land prices and development costs, the property trend is heading towards smaller, more compact living and affordable homes within. highly-dense developments targeting the ‘Gen-Y’ market whom are now taking their turn buying property. “However, we believe that there will always be a niche market for high end and luxury developments,” shares Yang. “I feel like we should move away from the mould we’re so used to, like the use of dry walls which is light-weight instead of the regular brick and mortar for internal walls in developments. We could also easily use
precast walls, which is not labour intensive. It offers design flexibility, time savings and improved profitability,” he adds, speaking on how the property development industry could change for the better. HOLDING FORT The overall look and feel of the BRDB office, as well as the developments by BRDB Developments is a prime example of the management that runs it, from the planning to the execution. Yang claims it is a serene and comfortable space to work in. “Everyone does well when you support each other. I want to work in a peaceful environment so I can head home with a smile on my face. Everyone here is respected and commended for the job they do and it’s a healthy environment to be in,” he says with pride. As a leader, and the person that helms this prestigious company, Yang believes human relations is the key to success. “Being in this business, it’s really a balancing act of everything. But when everyone is happy, life becomes easy for all. I want to be able to come to work in a calm and inviting environment. As a boss, I have to be reasonable, all else will fall perfectly into place,” he says as he ends the interview.
www.propertyinsight.com.my OCTOBER 2016 I 31
SETIA ALAM Where the grass is always greener BY: FARA PETIAL
32 | OCTOBER 2016 www.propertyinsight.com.my
etia Alam is a new township located in Shah Alam, Selangor, Malaysia. It is accessible via Setia Alam Highway from the New Klang Valley Expressway (NKVE) since the interchange was opened on 14 July 2006. Setia Alam is also accessible from the Federal Highway and Klang via Jalan Meru. This township is developed by SP Setia Berhad Group. The township is an integrated development spanning over 4,000 acres (16 km2) of land. It falls under the jurisdiction of the Shah Alam City Council (MBSA) which had placed restrictions on the establishment of entertainment outlets such as pubs, discos and lottery business. According to the Head, Sales & Marketing of SP Setia Group, Norlina Mohd Noor, “Setia Alam is the realisation of a vision of creating and giving value. This self-contained, sustainable township with affordable homes for people from all walks of life, has become one of the most desirable addresses in the Klang Valley because people recognise not only the unique living experience but also the investment value it provides.” She explains that the vision would have remained a dream if not for a number of important success factors: A Location with Tremendous Potential. Identifying a suitable site was crucial. Therefore, the 4,000 acre site in the Klang Valley, within driving distance of major urban centres like Kuala Lumpur, Petaling Jaya, Shah Alam and Klang, as well as destinations like Kuala Lumpur International Airport, the Low Cost Carrier Terminal and Port Klang offered a great many possibilities. A Total Development Philosophy. The Setia Alam development master plan was created in line with SP Setia’s LiveLearnWorkPlay total development philosophy. This holistic
TRANSACTIONS OF LANDED RESIDENTIAL PROPERTIES IN SETIA ALAM (2015) Type
Typical Land Area (sq ft)
ESTIMATED BUILT-UP AREA (SQ FT)
TRANSACTED PRICE RANGE(1) (RM per unit)
TRANSACTED PRICE (RM per sq ft)
1,081 - 1,263
455,000 - 655,500
398 - 580
1,244 - 1,646
530,000 - 748,000
409 - 511
1,289 - 2,028
500,000 - 862,000
311 - 475
1,625 - 1680
1,362 - 2,745
570,000 - 940,000
323 - 529
1,090,000 - 1,150,000
471 - 487
2,050 - 2,111
808,000 - 825,000
391 - 394
780,000 - 905,000
313 - 363
1,680,000 - 1,740,000
596 - 617
1,647 - 1,650
1,270 - 1,400
710,000 - 810,000
514 - 579
2,366 - 2,417
1,238,000 - 1,280,000
512 - 539
1,500,000 - 2,220,000
652 - 783
2,076 - 2,542
1,700,000 - 2,030,000
799 - 867
3,412 - 4,208
1,757,000 - 1,988,000
414 - 468
3,918 - 8,288
2,315 - 8,866
1,580,000 - 5,600,000
495 - 991
3,498 - 8,288
2,427 - 9,889
2,133,900 - 6,050,000
610 - 879
Source : KNIGHT FRANK RESEARCH / JPPH
www.propertyinsight.com.my OCTOBER 2016 I 33
AREA FOCUS approach gave SP Setia the confidence to design a development master plan for the entire site instead of breaking it up into smaller parcels. This scope allowed the developer to introduce many new concepts, models and products that would enhance the quality of life offered by Setia Alam. Turning Challenges into Opportunities. The planning team led by the architect saw that the inherent weaknesses of the site could be turned into advantages: • The main artery connecting the NKVE to Jalan Meru was aligned with the gas pipeline reserve; • Locating the commercial development along the TNB reserve to enhance their visibility from Jalan Meru • Four interchanges were proposed to facilitate traffic flow; • Products were selected to suit the terrain and add value. WHERE PEOPLE LIVELEARNWORKPLAY NOW AND IN THE FUTURE Setia Alam is a monumental achievement, states Norlina. “At 4,000 acres, Setia Alam is one of the biggest township developments in the Klang Valley. What is more significant is the magnitude of the transformation this project has initiated – from turning a piece of land categorised as undevelopable into one of the most sought-after townships in Klang Valley to raising the development and economic status of the entire area.” As a self-contained and integrated township, Setia Alam offers all the essential features for nurturing a wholesome, vibrant community for people from all walks of life in line with our LiveLearnWorkPlay development philosophy. In fact, the township is the first SP Setia project to embody the LiveLearnWorkPlay philosophy in its entirety. SETIA CITY RESIDENCES Setia City Residences is the first high-rise luxury service apartments project which is located next to Setia City Mall. With only 780 units across three towers on a 5.7acre freehold site, this serviced apartments development aims to offer a living experience akin to living in an exclusive resort from the moment one enters the lobby lounge via the private residents’ porch. Standing at 34-storey tall with only 10 units per floor, Setia City Residences offers 34 | OCTOBER 2016 www.propertyinsight.com.my
an unparalleled combination of privacy and spaciousness. The units come in four welldesigned floor plans that range from 858 sq.ft. to 1,221 sq.ft. and are suitable as a home, a holiday home, or an investment. Choice selections of 2 to 3+1 bedroom units are specially designed to offer optimum functionality. The price of the property starts from RM584,000 onwards. The extensive resort-style amenities
include 50-metre lap pool, tropical gardens, floating river, wading pool, outdoor sunken Jacuzzi and Qi Gong/Yoga Lawn. A tennis court, Gym Spiral Skyway and a fitness centre give residents plenty of choices when the time comes for a little exercise. Setia City Residences ground floor will also have retail space. If that’s not enough, there are even more shopping options just a short walk away – Setia City Mall, Setia
Setia City Residences by SP Setia
Precinct 17 Setia Alam
RECENT AND UPCOMING LAUNCHES IN SETIA ALAM / NEARBY LOCALITY Project Name
TYPICAL LAND SIZE (SQ FT)
BUILT-UP AREA (SQ FT)
SELLING PRICE (RM)
1,300 (20 X 65)
2,240 (32 X 70)
1,300 (20 X 65)
1,170 (18 X 65)
Anggun Kirana (Phase 1)
2,520 (28 X 90)
1,300 (20 X 65)
1,170 (18 X 65)
Carra (Tower C)
Setia City Residences
858 - 1,221
799 - 867
3,412 - 4,208
414 - 468
3,918 - 8,288
495 - 991
3,498 - 8,288
610 - 879
Source : KNIGHT FRANK RESEARCH / JPPH
City Convention Centre 1 and 2 as well as Setia City Park.
Hijauan Enklaf by PKNS
HIJAUAN ENKLAF A real estate negotiator from Megaharta Real Estate, Kenny Ng who specialises in Setia Alam area elaborates that “SP Setia is not the only property developer in Setia Alam. Various others have since entered the scene, mostly joint ventures with Perbadanan Kemajuan Negeri Selangor (PKNS) has its landed homes and bungalow lots.” PKNS built luxury bungalows in Alam Nusantara, Setia Alam, Shah Alam – Hijauan Enklaf that features 19 exclusive units of landed, freehold, three-storey bungalows and semi-detached properties. Hijaun Enklaf is developed with a vision www.propertyinsight.com.my OCTOBER 2016 I 35
Hijauan Enklaf by PKNS
The Forum by Sunsuria
Suria Hills by Sunsuria 36 | OCTOBER 2016 www.propertyinsight.com.my
to utilise and recycle untapped natural resources, the project comes with rainwater harvesting elements and passive shading control complete with perfect finishing and an effective contemporary design that encourages natural ventilation to reduce the reliance on air-conditioning. Hijauan Enklaf is also constructed with sustainability in mind; seen through the water efficient fixtures alongside the environmental and user-friendly materials that went into its construction. With such a visionary approach to its projects, homeowners can enjoy sustainable luxury while utilising natural resources and preserving mother nature. SURIA HILLS & THE FORUM Ng adds, “Another developer, namely Sunsuria has developed Seventh Avenue business hub and upcoming Forum 3, a 3-storey mall with 61 retail shops and 172 office units.” Suria Hills associates prestigious and exclusive lifestyle – a hillside living with scenic landscape and panoramic views of Setia Alam and Bukit Cherakah forest reserve, a well-balanced community living between nature and build forms. On the other hand, The Forum is a mixed integrated development consisting of a street mall, retail arcade office tower and residential towers. “The Forum combines the experience of traditional shop office retail and dining (protected from the elements) and the lifestyle of retail mall shopping. The integration of open circulation corridors with elevated pedestrian walkways for the shop offices enhances accessibility and shopping interaction. The integration of all these components in one seamless connection is the epitome of living and working in one development,” says the marketing manager of Sunsuria Berhad, William Lim. The Forum is essentially divided into two phases. The first phase consists of a semienclosed street mall flanked by traditional 2-storey shop offices with separate office suites at the second level. The second phase consists of a 2-storey retail arcade with an office tower and 2 blocks of service apartments sitting on top. The ‘heart’ of the development that link the two phases is the Forum. As the word indicates, it is a community space which is intended to be dedicated to the surrounding community.
ECO ARDENCE “Besides Bandar Setia Alam, the other major on-going projects near the land are Bandar Bukit Raja and recently planned project by EcoWorld Development, Eco Ardence. It is an integrated mixed-use development project and will be launched in 10 phases within eight years,” says Ng. Ng adds, “When EcoWorld is nearby, it will indirectly increase the value of landed property in Setia Alam. It is also confirmed that EcoWorld is going to add a few more accessibilities, building more roads connecting to Bukit Raja industrial area. It will make the different to the area.”
• • • • • •
Setia City Mall Phase 2 Setia City Convention Centre 2 (just completed) A medical centre 2nd international school (The Peninsular School) 1 National Institute of Health (1NIH) under Ministry of Health More office towers next to SP Setia HQ and Top Glove tower
It is an open secret that Setia Alam has a lot to offer for the investors out there. With all the other developers that are coming to the area and its neighbourhood, Setia Alam is definitely complemented with all the key factors you are looking at – developments, accessibility and even amenities. The upcoming LRT Bandar Utama-Klang Line will also improve and complement the area!
INVESTMENT VALUE “With the existing development of Setia Alam as a township and the amenities available as mentioned in Q3, we believe Setia City Residences is a good buy and can generate good return,” says Norlina. Lim speaks on behalf of commercial property, “For The Forum, the price appreciation is ranging from 5 to 7% based on proven track record.” In the pipeline and under construction to be completed in next three to four years to complement Setia City Residences are:
Eco Ardence by EcoWorld
AGENTS SPEAK ADELYN WONG, Real Estate Negotiator, Reapfield Properties (Klang) Sdn Bhd Since the interchange was opened, Setia Alam continue to grow and develop to position itself as Malaysia’s first eco township and integrated green city centre. Ample green parks for community activities, ample amenities and security features like single entry, wide roads, natural barriers, Industrial-free zone development was the key that attract home buyers to live here and boost the property market. Price too have appreciated and comparable to areas such like Damansara, Petaling Jaya and Kuala Lumpur. The current commercial centre houses a mall, convention centres, a city park, corporate towers, SOFOs, serviced apartments, upcoming hotels, a medical centre, a police station, a transportation hub, educational hub, auto city and National Institute of Health make Setia Alam has no short of amenities and really reflect the tag line of LIVE LEARN WORK PLAY!
KENNY NG, Real Estate Negotiator, Megaharta Real Estate Setia Alam township is located on the fridge of Shah Alam & Klang and out of this a portion of land was earmarked for Setia Eco Park, Malaysia first eco-themed township. Setia Alam is well known for delivery homes within communities that offer holistic living where residents can LiveLearnWorkPlay. Setia Alam is well connected via several major highway, accessible via Setia Alam-NKVE link and in near future the proposal new link road to Seksyen U10, would allow access to the upcoming DASH highway. Setia City the township 240-acre commercial hub, home to SP Setia’s new corporate headquarters, international award winning Setia City Mall, Setia City Convention Centre, Setia City Park. Other future development such as 1 National Institute of Health Complex, medical center, service residence and hotel. Apart from this, Tenby International School will be joined by SEGi International School, Medical Center and an upcoming offshore campus for The Peninsula School from Melbourne.
www.propertyinsight.com.my OCTOBER 2016 I 37
kyArena is almost a class of its own when it comes to urban design that is bold and innovative, with a 9.4 acre multi-facility sports complex in the blueprint to create an exciting lifestyle for its residents and their family. The balance of live, play and work are now given a whole new meaning, and the skyline of Setapak transforms with this 28-acre integrated development. With a swanky name like Bennington Residences @ SkyArena, SkyWorld talks about whatâ€™s truly behind their new developments. Bennington Residences is unique as it is part of the only integrated development in Setapak that is dedicated to health and wellness. Earlier this year, SkyWorld launched Bennington Residences Block B and the take up has reached 70%, which is why they have decided to launch Block A, this month, October of 2016. The dual-key concept units have been the best sellers so far as it is more appealing for those whom want forever homes or those buying as an investment. EMBRACING AN OPPULENT LIFESTYLE Bennington offers tranquility for those who need their daily retreat from the concrete jungle, while delivering its promise of serenity through its 2-acre rainforest themed gardens and it is Malaysiaâ€™s first 3-storey SkyGym. If heavy exercise is too much, head down to the 120-metre panoramic infinity loop pool for a few laps while overlooking a breathtaking scenery. When you are done with that, you can head up to the rooftop SkyTheatre to unwind.
BENNINGTON RESIDENCES : THE PERFECT SOLUTION SkyWorld does not just provide homes, SkyWorld creates a concept of living better known as Sky Living BY: NATASHA GIDEON
38 | OCTOBER 2016 www.propertyinsight.com.my
Bennington Residences is up to date with the latest trends for more affordable units and are offering five different unit sizes and layouts. Every home at Bennington Residences features a generous lanai space that allows the living spaces to look out to the spectacular views of the landscaped greenery within the SkyArena development, and the sweeping views of the city beyond. If that is not enough, they also have dual key units, adding to the list of the impressive high-value infrastructure systems they offer. DELIVERING A HOLISTIC HOME Let us delve more into the highlight of these facilities like the automated RM2.5mil waste-management system which will transport garbage via indoor and outdoor load stations to a central waste-handling facility (CWHF). This system ensures smooth rubbish disposal in a streamlined and efficient manner management and to ensure a hygienic environment. Located 7 km away from KLCC with many amenities nearby and public transportation, Bennington Residences takes the cake for resort living in the city. BALANCED LIVING, WORK AND PLAY Another pulling factor from an investment stand point, Bennington Residences@ SkyArena is located in the only integrated development in Setapak that consists of residential, commercial and a 9.4 acre multi-facility sports complex. Residents can enjoy the 42 facilities and a 2-acre rainforest SkyPark for a minimal maintenance fee. Other unique facilities include a Sky Hub, equipped with conference room, office suites as well as work stations for a nontraditional office feel. For more information on Bennington Residences @ SkyArena, head on to their website at www.skyarena.com.my.
PROJECT DEVELOPMENT DETAILS Project Name: Bennington Residences @ Skyarena Type of Development: 2 towers of 40 storey Condominium with 7-storey carpark podium Title Particulars: Lot. 17899, Jalan Ayer Jerneh, Mukim Setapak, Kuala Lumpur, Malaysia Land Tenure: Leasehold Land Use: Residential Land Size: 2.69 acres / 10,878 sqm GDV: RM437 million Estimated Completion: 2019 Location: Setapak Amenities 1. 7km away from KLCC and located nearby to established amenities, such as TAR University College, Setapak Sentral Mall, Wangsa Walk Mall, Hypermarkets (Aeon Big, Giant & Jaya Jusco), banks, restaurants and entertainment outlets 2. Minutes away to Columbia Asia Hospital, KPK Tawakkal Specialist Hospital, Kuala Lumpur Hospital, Ampang Puteri Hospital Accessibility 1. Via major highways - DUKE and soon DUKE 2, MRR2 and Jalan Genting Kelang 2. Proposed direct access from Jalan Genting Kelang to Jalan Ayer Jerneh 3. Jalan Ayer Jerneh links to DUKE Highway (to and from Petaling Jaya) 4. Road widening to 100 ft along Jalan Ayer Jerneh 5. 3km away driving distance to Wangsa Maju LRT station Built-up Area: 1,092 sqft to 1,716 sqft Facilities 1. Rainforest Lounge (G Floor) • Lounge • Reflective Pool • Water Cascade • Rainforest Terrace • Boardwalk
• • •
Function Hall Child Care Centre Sundry / Laundry
E – Deck (Level 8) • Infinity Loop Pool • Wading Pool • Jacuzzi • Pool Deck • Wet Deck • Casual Deck • Lianas Grove • Swing Corner • Hammock Nook • Meditation Garden • Hanging Garden • Garden Gym • Reflexology Garden
Sky Hub (Level 18) • Conference Room • Service Corner • Reception / Entertainment Lounge • Work Stations • Office Suites
Sky Park • Open Exercise Terrace • Sky Theatre • Interactive Lawn
Security Features 1. 4-tier security • Car Park Entrance & Exit with Boom Gate • Entrance to dedicated Residence Car Park Area • Entrance Lift Lobby • Lift access to dedicated floor only 2. 3. 4.
CCTV Intercom Guard Patrol System
www.propertyinsight.com.my OCTOBER 2016 I 39
SKYLUXE ON THE PARK Luxury living in the skies overlooking the greens of Bukit Jalil BY: FARA PETIAL
o you want to be on top? If you do, then you should consider buying the up-and-coming project by SkyWorld Development Sdn Bhd – SkyLuxe On The Park! SkyLuxe On The Park, as its name suggests, sits on a 1.85-acre of freehold land, surrounded by the 80-acre Bukit Jalil Recreational Park, opposite the 165-acre 18-hole Bukit Jalil Golf & Country Resort. The project is located on the matured Bukit Jalil area, where future residents will be spoilt for choice when it comes to facilities, amenities and its great connectivity to all the major seven highways. The man behind this masterpiece – founder of SkyWorld Development Sdn Bhd, Datuk Ng Thien Ping says, “As a community and city builder, we aspire to transform the city skyline and provide the ultimate ‘sky living’ experience within a sustainable environment. SkyLuxe On The Park embodies all our strengths – featuring luxury sky living experience surrounded by the recreational park and adjacent to the golf course. Seated on prime freehold land with excellent connectivity and amenities, purchasers will be spoilt for choice. Todate, we are pleased to receive such encouraging response, recording over 78% take-up. We are very grateful to our customers continued trust and confidence towards our company.” SKYLUXE ON THE PARK’S DISTINCTIVENESS The chief operating officer of SkyWorld, Lee Chee Seng shared the technical aspects of SkyLuxe On The Park, “This development was planned according to SkyWorld’s three strengths, which first one of them is the strategic location. It is being built on a mature enclave thus effectively ensure good capital appreciation value.” The location also complements SkyLuxe On The Park as an integrated sky living 40 | OCTOBER 2016 www.propertyinsight.com.my
experience – surrounded by an abundance of amenities and facilities on top of overlooking the lush greeneries. There are a lot of nearby shopping centres, including the future Bukit Jalil City and Paradigm KL UOG. The project will be a walking distance to Pavilion through the link bridge in the future year – 2020. SMK Bukit Jalil, Lai Meng Girl’s School Bukit Jalil, Lai Meng Primary School and Bukit Jalil Sports School are approximately 3km away from the project. Other than that, the International Medical University (IMU) is only 2.8km away from SkyLuxe On The Park, 10km away from Puchong Medical Specialist Centre, while there are also choices such as Sunway Medical Centre and Sime Darby Medical Centre that are less than 20km away. SkyLuxe On The Park is also a walking distance to Awan Besar LRT Station. However, if you prefer driving on your own, SkyLuxe On The Park is surrounded by several major highways, namely Bukit
Jalil Highway, Damansara-Puchong Highway (LDP), Shah Alam Expressway (KESAS), Kuala Lumpur Middle Ring Road 2 (MRR2), Maju Expressway (MEX), KL – Seremban Highway, Sungai Besi Highway and Smart Tunnel. CONCEPTS & DESIGNS Lee explains, “We based SkyLuxe On The Park’s design on a tree because the main highlight surrounding the project is a park. We did think about building an iconic building but it would not have suited the environment.” Inspired by the lush flora and fauna, the building offers nature’s habitat facilities such as maze garden, water cascades entrance statement, spider web themed facilities podium, playweb, cantilevered gym, ulam terrace (urban farming – to promote more greens), infinity pool with floating cocoon, a pavilion garden, a picturesque garden, herb and BBQ deck. All units also come with square layout
Bukit Jalil. The exercise attracted more than 5,000 interests and registrants!
to maximise space usage and efficiency, while selected units come with bespoke balconies for that added connection to the outdoor view. Each unit includes bathroom fittings, kitchen cabinets and counter tops, hob and hood as well as a fridge. The best part is that most units come with an additional locker – sizable enough to put in a bicycle or golf set, while selected units comes with four car parks. Lee adds that about RM6.5 million is being invested in the landscaping of SkyLuxe On The Park to ensure there are enough green spaces within the development. The project’s eco-friendly features include inverter lifts, rainwater harvesting units and a dedicated recycling centre. Hence, SkyLuxe On The Park is aiming to become a Green Building Index provisional certified development. In terms of the safety and value-added
security features, SkyWorld installs multitiered security system, intercom system, electric fencing, CCTVs, 24-hour security, guard tour system and fire protection system. Just like other developments by SkyWorld, SkyLuxe On The Park is also certified with CONQUAS – a quantitative measure of the overall quality of a building’s workmanship during the various stages of construction. It acts as an important health scan to check the general workmanship standard of a builder for its project. SkyLuxe On The Park offers 447 units of residences with built-up ranging from 661 sq.ft. to 1,224 sq.ft. and priced from RM600,000 to RM1 million (RM760 average psf). On end May 2016, SkyWorld started the online registration exercise to spur interests for the highly anticipated SkyLuxe On The Park condominiums at
CSR INITIATIVE By the fourth quarter of 2016, SkyWorld will embark on its Corporate Social Responsibility (CSR) initiative to upgrade the 80-acre Bukit Jalil Recreational Park – repainting of the 10 Little International Gardens and planting of 100 matured trees at strategic locations. Once completed, SkyWorld will unveil the improved recreational park aimed to cultivate wellbeing and provide a better park seating for the Bukit Jalil communities and the public at large. To register and experience more on SkyLuxe On The Park, please visit www. skyluxe.com.my PROJECT DEVELOPMENT DETAILS Project Name: SkyLuxe On The Park, Bukit Jalil Developer: SkyLuxe Development Sdn Bhd (A member of SkyWorld Development Group)
Type of Development: 2 Towers Serviced Apartments • 477 units (44-storey for each Tower) • Tower A: Total of 225 units • Tower B: Total of 252 units GDV: RM411.6 million (Estimation) Land size: 1.85 acres Land Tenure: Freehold AMENITIES Highways • Bukit Jalil • KL-Seremban • KESAS Highway • MRR2 • MEX • Sungai Besi • LDP LRT • • •
Awan Besar Bukit Jalil Sri Petaling
SPORTS & RECREATION • Bukit Jalil Recreational Park • Bukit Jalil Golf & Country Resort • Bukit Jalil National Sports Complex SHOPPING MALLS • Upcoming Pavilion 2 Mall • Upcoming Paradigm KL OUG • Endah Parade • The Mines • Giant Hypermarket EDUCATION • International Medical University (IMU) • Bukit Jalil Sports School • Sekolah Kebangsaan Bukit Jalil • Asia Pacific University (APU) • Lai Meng Kindergarten & Primary School SKYWORLD PROPERTY GALLERY: Jalan Jalil Perkasa 4, Bukit Jalil, 57000 Kuala Lumpur
www.propertyinsight.com.my OCTOBER 2016 I 41
PERSONALITY OF THE MONTH
42 I OCTOBER 2016 www.propertyinsight.com.my
PERSONALITY OF THE MONTH
TIM LUCE :
THE KING OF THE COURT Being the biggest of its kind across South East Asia, COURTS has accumulated a brand, a name, buying power as well as great talent and experience. BY: NATASHA GIDEON
f you lived in the 90’s, either as a young adult starting off life in the city, or just started a family you would be familiar with the consumer electronics and furniture retailer, COURTS. COURTS is your one stop go-to store for all things homely which makes it a stand out from the rest which is why it has been doing so well for the past 27 years it has been operating here in Malaysia, from 64 stores nationwide. A good establishment is always run by great example, laid out on strong foundations. We spoke to recently appointed COURTS Group CEO for Singapore, Indonesia and Malaysia, Mr. Tim Luce, whom used to be CEO for COURTS Malaysia. Luce is a father of two children whom enjoys the balance of business, travel and fitness, which seems like an overwhelming amount of responsibilities and leisure to juggle, but always possible for the go-getter from Australia. SOFA, SO GOOD Luce is not the only new face in COURTS, especially after recently being assigned as Group CEO, COURTS itself has gone through some re-branding to adapt to the everchanging market. “Times are tough and everyone is taking the hit, but we’ve been around for 30 years and that’s long enough to go through many different cycles for us to figure out how to go by it,” says Luce. “After the Goods and Services Tax was introduced on April 1st 2015, many cooling measures were implemented and that was expected, so it became difficult to reinvent and rebrand ourselves each time the market shifted.” shares Luce, “What we did was, instead of the brand, we recreated products that were adaptable to the market and buying trends. When lifestyles change, so do trends, and that’s when we change with them,” he continues. The store environment was recreated as well, so now it is friendlier and has more of a modern feel. The make-over for COURTS includes a relaunching, new uniforms and even a new brand ambassador. Being a destination store means it attracts more customers because if it’s one-stop-shop concept, especially with over 8,000 products. The products are now built, and sold based on their functionality and innovation, to suit customers’ demands. As of 2015, COURTS now has 64 stores with 10 being renovated, and to maintain standards of quality, they have closed down underperforming stores as well. RISING ABOVE THE REST COURTS has been able to sustain itself in Malaysia, having thrived since 1986 because of the approach they took when targeting their buyers. “We have options, so for many www.propertyinsight.com.my OCTOBER 2016 I 43
PERSONALITY OF THE MONTH households they are able to afford for purchasing furnitures, and not to mention our electrical appliances and electronics all in one roof. You can buy whatever you need all here in one shop, so we serve good service and convenience,” Luce says with pride. The store also has a huge number of loyal customers due to their quality as well as the flexi-payment plans they have always been known for. Being the biggest of its kind across South East Asia, COURTS has accumulated a brand, a name, buying power as well as great talent and experience. “We invest on good relationships and quality products that allows people to afford their own lifestyle,” says Luce. INVESTMENT TALK We asked the CEO himself if he had any tips or trends on furnishing properties for investors. “Each person has a different style they like, so to target a larger audience, use a more minimalistic approach. Add
44 I OCTOBER 2016 www.propertyinsight.com.my
PERSONALITY OF THE MONTH
When lifestyles change, so do trends, and that’s when we change with them” - Tim Luce
on other elements later on, more detailed pieces to create uniqueness. Times are changing, even the television can be a centre piece,” he advises. Luce also says to treat all products as center pieces as every piece delivers a different purpose to the consumer. The best thing about COURTS is that they provide a plethora of options, including local products with international designs. The quality is maintained as much as the prices are, catering to a range of different buyers. From major orders to customisation, all their stores provide these services. “Furniture is just like clothing, trends change and we have to follow suit, and we have to cater to a huge range of buyers. Our classic range won’t change, because well-it’s classic, but for other products, there’s no one size fits all range, it’s all up to the buyer. So it’s important to remember there’s no right or wrong,” shares Luce. He also adds that more people are buying for smaller spaces, which is a trend that reflects on the market in general. COURTING THE BUSINESS For longevity in the business, Luce says great relationships not only need to be forged with customers, but also with suppliers and all those involved. All this alongside a good standard of quality control, proper internal policies in order to set a good benchmark to provide good services and to be ahead of their competitors. With 64 stores across the nation, in all states, COURTS plans to open up to 70 stores and to broaden their horizons, to be a retailer across South East Asia, which is not impossible seeing the momentum they are at now. When you provide for the people, and you cater for them, it is difficult not succeed. www.propertyinsight.com.my OCTOBER 2016 I 45
INVESTOR NEXT DOOR
TRIALS AND TRIBULATIONS
Dato’ Ong Theng Soon’s journey to becoming a property developer THE EARLY DAYS Dato’ Ong’s foray into the property industry was purely by chance. Upon his return from the United Kingdom after receiving his law degree, circa 1998, he applied for a position at a local legal firm as a litigation lawyer – this, being his life-long ambition since younger days. When he first started his tenure at a law firm back then, it was a relatively huge firm, with over 10 lawyers and 30 supporting staffs. The main scope of work was litigation, predominantly in insurance litigation. As a legal assistant, he was assigned with drafting his opinions to many of their insurance clients, preparing court papers and appearing for trials and hearings. His best efforts and energy were poured into his work for two solid years, benefiting from a steady and fixed income with interesting travel perks. Then he came to realize this In terms of work culture, this law firm was like any other corporations of its size - it was a typical corporate rat-race cycle. He didn’t see much progress in terms of his personal well-being. He was a bachelor with a fast- dwindling bank account, still living in a small, rented abode in a medium cost apartment, and he was still driving his old but faithful Proton Saga to work. This is not what he had signed up for; life was not as rosy as he would have thought. SELF-REALIZATION, DETERMINATION, AND A LITTLE BIT OF LUCK Words of wisdom and positive encouragement from his father spurred him to start his very own legal practice. He added that was also the most significant stage of his life – quipped “I met and married my lovely wife, who was my prime motivator and supporter.” 46 I OCTOBER 2016 www.propertyinsight.com.my
INVESTOR NEXT DOOR
In order to build more quality homes with affordable pricing, we need to constantly identify more suitable lands for future developments in the Klang Valley.” - Ong Theng Soon
Not long after which, he was introduced and directed to a potential partner, and they hit-off immediately to start their own legal practice. After a couple of years however, the business partnership dwindled due to indifferences in priorities and personal expectations. Nonetheless, they parted amicably and went on their separate ways. Lady Luck did not abandon the determined soul, as it was around this time he was introduced to a CEO of a very established and successful property development company - Sunrise Berhad. This CEO was a vastly experienced developer and a seasoned investor to his credit. His passion in the property industry is tremendous and prompted Dato’ Ong to learn more about property investments. Thereafter, having read many books and articles on property industries, he soon developed a keen interest in property investment, with terms like ‘passive income’ and ‘return of investments’ being his prime reminders or key notes! TWIST OF FATE “Why don’t you invest in our projects?” One fine day, he was thrown a query by none other than the Sunrise CEO. Although he was prepared and ready, but being typical Malaysian, a certain “tarik harga” mindset lingered and whereby he was hoping for more discounts, hence he delayed in reply to him. Dato’ Ong’s reply then was “I would like to consider first, because I don’t have the funds at the moment”.
Due credit needed to be given to the Sunrise CEO as he was utterly tenacious! He’d continuously approached Dato’ Ong with that same question; before Dato’ Ong could come out with any more excuses, he’d quickly lists and points out the many advantages of the project. Key selling points such as low down payment, high preapproved loan margin (up to 90%), interest free loans during its construction period, all legal fees borne by the developer and even free service-charge for two years were repeatedly drilled into Dato’ Ong’s mindset, and he was completely overwhelmed by the points given by the CEO. To top it off, Dato’ Ong was reassured, that all properties sold by the CEO’s company had a consistent track record of at least 40%-50% appreciation upon delivery of vacant possession, and a rental income of 10% per annum; seeing it he was very determined to make the sale. Drawn into persistency, lo and behold, Dato’ Ong was sold due to the CEO’s persistence, and paid the deposit for his first property located in Mont Kiara. After all, having bought this property from the CEO’s company, Dato’ Ong also received some legal work from him, thus consoled himself that his legal fees will take care of any deposit. A ‘win-win’ proposition was achieved for both parties nevertheless.
him most, was the fact that it had also appreciated in value. With a smile on his face, Dato’ Ong said his phone was flooded with calls from agents purportedly representing prospective purchasers even before the project was completed. He sold the first property for 30% above the purchase price; with his initial investment being only 10%, thus theoretically, he had made a 300% return of investment (ROI)! He expressed excitedly that he had not seen so much money in a long time, and that was his own first property investment success, and from then on he got hooked with the property industry. Not long after, the next property investment venture was purchased in Mont’ Kiara, also from Sunrise Berhad. Dato’ Ong and his wife were relentless as they teamed up and ventured all out in this exciting turnaround! Upon the handover of the properties invested by them, it always enjoyed an appreciation of 30-40% and a rental return of 8% per annum. That was in the years between 2002 and 2008. It was a strategy Dato’ Ong employed for all his investments since his first successful foray in property investment. He had invested in over 10 properties within a short period, which saw a handsome margin of appreciation and rent returns each time.
SHOW ME THE MONEY! Three years later, the property he bought was completed, and he was happy with the quality of workmanship. What impressed
EMBRACING CHANGES AND MAKING BOLD DECISIONS A bleak property market outlook in 2008 hit the company hard, but having been www.propertyinsight.com.my OCTOBER 2016 I 47
INVESTOR NEXT DOOR inspired by his family’s own business endeavors, Dato’ Ong was more than eager to switch tactics and seek better alternatives. The rise of material costs soon escalated the price of properties. For example, the first property costs RM400 per sq.ft. in the year 2004. By year 2008-2009, the developer had adjusted their selling price to RM700 per sq.ft. Again this was from a direct result of a marked spike in the cost of building material globally. As developers increased their prices, the return of investments had also been drastically reduced, and so did the rental returns. So a question Dato’ Ong asked himself, “How can I continue to acquire properties and still enjoy the same returns as I did for my first property”? It was impossible given the current state of the economy. Therefore, he began looking for partnerships with more established developers who are consistent in delivering quality products with competitive pricing to the market. Technically, by positioning himself as a property developer, Dato’ Ong had control over the type of properties to sell. This decision allowed him to acquire greater knowledge within the property industry and further strengthened his networks. In December 2013, in a partnership with *Binastra Land Sdn Bhd, an established and reputable KL-based developer under the helm of Dato Sri Michael Tan, a 3.5 acres of freehold land was acquired on
Old Klang Road, Kuala Lumpur, under a new company called Country Grove Development Sdn Bhd. It was located right next to Dato’ Lee Chong Wei’s Sports Arena. PROVIDING CITIZEN-SHIP After acquiring the land, a high end residential project named “CitiZen@ Old Klang Road” (“Citizen”) was launched in October 2015. The project has a gross development value (GDV) of RM488 million, consisting 711 units of serviced apartments in three blocks of 37-storeys each. The units feature 2 and 3+1 bedroom layouts. The 2-bedroom option has a builtup of 852 sq.ft, while the bigger units range from 1,092 to 1,133 sq.ft. Construction of Citizen is underway and have reached level 9 of the building. Prices of the units are selling at an average of RM600 per sq foot. To-date that project has seen 85% converted sales, with most of the buyers being young couples, small families and up-graders from landed properties in Taman OUG, Taman Desa and Puchong. We hope to hand-over that project by the first quarter of 2018. The success of CitiZen is no doubt attributable to many factors such as a suitable location, favourable sales package, reasonable pricing (targeted towards mass market), great potential for price appreciation and the generous facilities
included. Therefore, due to the tremendous success of CitiZen, CitiZen 2, the sequel to CitiZen, will be launched by the middle of 2017. Located adjacent to CitiZen, CitiZen 2 will feature over 820 units of serviced apartments. The exact layout and size of the units are currently being finalized but they will be designed specially with the young urban professionals in mind. THE VISION Spurred by the consistent success of the property development efforts, Dato’ Ong was more motivated than ever to provide quality properties for everyone to purchase. He continued to constantly identify more suitable lands for future developments in the Klang Valley as part of his vision - to build quality homes with affordable pricing with hopes that everyone can own a property to go home to.
*Binastra Land Sdn Bhd has completed various projects, including Seri Titiwangsa Condominium, Prestig16 @ UEP Industrial Park, Megah 18 @ Bukit Jelutong, Avenue 32 Phase 1 and 2 and The Pac @ Bukit Serdang, all of which are in Klang Valley.
PROPERTY INVESTMENT PROPERTY 1 Location
Market value (2016) RM800,000 Price psf
Rental per month
48 I OCTOBER 2016 www.propertyinsight.com.my
Market value (2015)
Rental per month
THE NEXT GEN
Everything in one place BY: FARA PETIAL
irdaus & Associates Property Professionals (FAPP) is currently rising to the occasion with its full range of property consulting services which includes property valuations, real estate agency, property management, market research, retail leasing and consultancy. To dig its successful secrets, Property Insight talks to FAPP’s founder and managing director Sr Firdaus Musa, director Tunku Dato’ Adj Prof Sr Dr Fauzi Tunku Dato’ Abdul Malek Al Haj and director Sr Faiyaz Ahmad Maruf. Tunku Fauzi focuses more on the real estate agency while Sr Faiyaz leads the property management department. ABOUT FAPP The firm was established during the recession period of the late 1990s, with Sr Firdaus’ full determination to capture the consulting market on its upturn. From a small niche outfit, FAPP has grown into a multi-faceted practice with a plethora of property solutions to cater the current property needs. Sr Firdaus emphasises the application of innovation and information technology in his firm, in order to deliver superior property information solutions and determined to mould trusting and long
lasting relationships with its existing clients while forging new ones. In addition to that, FAPP is affiliated with a London based niche property consultant known as Smyth & Noble where FAPP reciprocates business and clients. WHAT MAKES A GOOD PRACTITIONER? Integrity is very important in being a good valuer, explains Sr Firdaus. “For a valuer, it is important to have virtue in doing the job. It’s because for example, in terms of loan purposes, we have to separate ourselves from the client’s interest and we must directly liaise with the banks in determining the value. We must protect the interest of the bank.” Sr Faiyaz adds, “A valuer must have sufficient information and data to back up his opinions, instead of deciding it based on speculation and hearsay.” As for the real estate agents, Tunku Dato’ Sr Fauzi says “We have four registered real estate agents and a full set of real estate negotiators. It is an ongoing training for our team, it never ends. Sr Firdaus and I both are qualified trainers so we train the team ourselves. I personally teach my team more than the real estate knowledge, I teach them on the protocol and public relation skills as well. It is very crucial for an agent www.propertyinsight.com.my OCTOBER 2016 I 49
to know how to address people and how to speak, because the first impression always matters.” Then, how do you define a good property management firm? As one of the industrial leaders, Sr Faiyaz elaborates that there is a standard procedure that needs to be followed in managing a property. “Other than the standard procedure that governs the practice, there is also the Strata Management Act to be adhered too. We at FAPP mainly focuses on condominium and gated-guarded property. Up to this point of time, you can find registered property management firms from The Board of Valuers, Appraisers and Estate Agents Malaysia (BOVAEA). If you deal with the registered property management firm, and if the property management treats you wrongly, you can report it to BOVAEA. If you deal with the unregistered one and if something goes wrong especially misappropriation of funds, you are at their mercy.” DETERMINING THE VALUE How does a property get valued by the valuers? There are a lot of different methods to look at, and different methods will definitely give you a different (but still in the same range) of numbers. FAPP has its own market research department which is managed by Sr Firdaus himself. Sr Firdaus says, “Our market research department will have 50 | OCTOBER 2016 www.propertyinsight.com.my
the data collected according to the type of property. We also refer to the property market reports and obtain the transaction data from National Property Information Centre (NAPIC). On top of that, our team members will periodically go around the area to check on the location, and do the analysis of the movement of the property prices. We also research on the asking prices.” Why is there such disparity in property valuation? Tunku Dato’ Sr Fauzi explains, “We are involved with the valuation at that point of time, and we cannot predict what will happen on the next day. You cannot tell us, ‘My property is going to worth RM3 million in three years’ time’, because how do you know? It’s a snapshot for what it is today.” “The scarcity for the type of property can also increase the value even if there are no transaction been done – even if there is nobody selling, but there are buyers waiting. We have to look at the area and examine what should be the level. If there are a lot of requests on a certain type of property to a real estate agency, that will definitely shoot up the price. Comparative method works for every valuation; it is actually the best method in relying market evidence. Other than that, there are other methods for different type of properties. When you do a development, we use the residual valuation method to see the profitability or arriving at the land value. There is also property
that generates income for the owner, for example a hotel. Hotel is a business, so it very much depends on the profit, hence, that is why we use Profits method for this,” includes Sr Faiyaz. Tunku Dato’ Sr Fauzi adds, “Two of the same petrol stations are not of same value. It also depends on the location – if one in Serdang and another in Subang Jaya, which one will have more value and profit? It’s also the same with McDonald’s outlets – the same size, same units but different value based on location.”
“There is also the Cost method which is normally used for special properties such as schools, hospitals, airports, etc. Then we have the Investment method – people who own the property for investment purposes especially office buildings and shopping centres.” says Sr Faiyaz. FUTURE OF FAPP It is better to choose FAPP to refer to if you are deciding to buy a property. Why is that? If you go to a real estate agency, they do not have the data to support and convince
you. But here at FAPP, you can also get property valuation services on top of the agency services. This will increase the chances of you buying the best property for your investment. “Now we have a few branches in Klang Valley, and one in Ipoh. Going forward, we would like to open a branch in each state members, in ASEAN region and ultimately go for international level,” desires Sr Firdaus. Sr Firdaus concludes by advising that people are still buying in this current
property market as they still have the capital but being extra cautious instead. “Investors should do a lot of market research based on their preferences. What is the type of property that you want to buy? Is it for rent or for flip? For the current market, I don’t think flipping is a good investment strategy. You may want to buy a property that you can rent out. Check out the property that you want to buy, spend time to go around the area before deciding to buy it. Always have in mind a good rental strategy and potential capital appreciation.” www.propertyinsight.com.my OCTOBER 2016 I 51
ALL TURNING POINTS LED TO PROPERTY INVESTMENT In three years double digit amount of property BY: AVINASH SAGRAN
corporate career for 27 year old Adrian Ng might not come as a surprise since he has always been a hard worker with strong academic background. Armed with bachelors in accounting, one might think that Adrian has a relatively conservative risk appetite. Over the past three years Adrian has ventured into property investment, his journey through this process was indeed calculated but it was also coupled with passion and determination to obtain financial freedom.
52 | OCTOBER 2016 www.propertyinsight.com.my
TURNING POINTS There were three turning points in his life, which led to him being a property investor. Firstly a chance encounter of his dad’s book ‘Rich Dad Poor Dad’, upon reading this book he decided to change his mindset on enriching himself with more knowledge on financial education. After several endeavors with network marketing companies and Internet business, Adrian was left with three digits on his bank account and things looked bleak. Then came the second turning point, a book
once again reignited his interest on financial freedom and this time by reading Faizul Ridzuan –WTF: 29 Properties before 30. The book inspired him, but property investment did not immediately take off. His most significant turning point came at the end of 2012, needing a financial reboot he read the book by Dexter Lim and Kam Wei Tsung – Start from 0! 3 years to 10Million Property Portfolio. After reading the book he and his then girlfriend Ruth Mak paid whatever remaining money left to attend the seminar. It ignited the fire
ROOKIE INVESTOR in Adrian to pursue property investment despite not having any prior knowledge, contact and very low capital. Adrian told himself “Search for the right deal first, think later. Once you’ve found the right property, the money will come.” GETTING THE BALL ROLLING Right after attending the seminar, Adrian set appointments almost everyday to view properties. He joked that initially he was worried his poor Mandarin skills would be a problem in negotiating with agents. His research paid off as within two weeks, he found and purchased his first property 20% below market value and with 6% yield in Bandar Sunway. He purchased the property using creative financing techniques he had learned. Soon after bought his second property six months later and has steadily accumulated double digit of properties over the last four years. Adrian has purchased all his properties for minimum of 15% below market value. “The current market might be challenging but equipped with adequate knowledge and crunching down the data and numbers you can make an informed purchase. Most of the time, a property may not fulfill all your criterias but if seven or eight out of 10 is fulfilled, it is quite safe” He says. STEP BY STEP ACTION 1. Research and study as many resources as possible 2. Conduct self-assessment by setting goals based current levels of commitment 3. Shortlist three to five areas within 30-45 mins then further shortlist into subareas 4. Simultaneously decide which type of property you want to purchase 5. Aim for positive cash flow “Property investment can be rewarding but it can also be unforgiving if you make a bad purchase driven by hype that can take years to recover therefore go through the shortlisting process thoroughly. When you get the first ball rolling the second ball will be easier because the base is already there.” Adrian says. He stresses that for rookies out there, youth is your biggest advantage as you can start early. He encourages people to take the first action. He tells everyone to trust your instinct if you are having doubts and to make sure
you face realities of property market. The current market is tough with many incoming supply of high end condos facing low rental yield. Do not get trapped by the hype or promise of buying without doing thorough research. A simple strategy of purchasing medium cost apartment or condos for capital appreciation and adequate cash flow is not sexy but is often a safe strategy. MANAGING IT ALL “Choosing the right tenant is a process you have to get right from the beginning by not rushing and screening tenants thoroughly to save time consuming problematic followups. Gut feelings sometimes is all that you need to tell you whether the tenant is go or no,” he says. Adrian has strong support from his wife and has bought properties together with several partners and work together as team therefore he says managing everything is not burdensome. He advises people with over 20 properties to pass on to a property manager, as that would free up more
time for them to solely focus on finding properties. DO IT YOUR WAY! “I believe it is still time to buy granted buyers conduct thorough research and the figures makes sense. If you are comfortable with one strategy, duplicate it and be a master of that technique. While some may amass a large diversified property portfolio consisting of shops, land, condos, retail lots, I suggest for beginners start by purchasing apartments between around RM200,000 to RM500,000 with good cash flow. The conservative plan would be suitable for those with RM3,000 to RM5,000 salary range.” “With abundant of primary units coming up, buyers have to be more selective on projects and be very clear on your investment gameplan. Many don’t realise there are still several undercon projects reasonably priced, opportunities are there as long as it fit with your criterion and you put in the effort to find them,” he adds.
www.propertyinsight.com.my OCTOBER 2016 I 53
SUSTAINABLY INSPIRED THIN & BOLD STYLE!
Furniture with timeless elegance and stylish design to create the perfect living lifestyle BY: AVINASH SAGRAN
54 I OCTOBER 2016 www.propertyinsight.com.my
double-dose of awesome personalities; one with the passion for contemporary arts , the other with killer sense of fashion and style that bound to turn heads. The co-founders of Thin & Bold Kent Lim and Esther Ng transcend their art and style aesthetics to the furniture they sell. The touch of furniture in a space creates the necessary ambience to evoke any type of genre or mood. Kent began his practice soon after completing his studies on Interior Architecture at London Metropolitan University. His work emphasised on space, line and form, and likes the idea of merging the essentials to a good design product, giving the contemporary style its zest and fizz. He ventured by himself with an online furniture company that imported products to the Malaysian market. That served as his first foray into the furniture industry. To distinguish themselves in the industry they collaborated on the actual process of sustainable furniture
The experience of purchasing home décor is a journey; Seamlessly delivering high quality products is our key value as we want to ensure our customers enjoy the best services whether be it an order placed online or at our showroom”
- Esther Ng is also provided, so it allows Thin & Bold’s delivery team to safely & meticulously assemble your purchases at your preferred spots. If you’re wondering what to do with your unwanted pieces of furniture, Thin & Bold offers a free removal service to help remove your old furnitures and donate it to PJ Charm. To top it off, there’s a free return policy, which allows you to return any piece of furniture within 14 days after delivery if it does not fit the space. And lastly, despite being an online brand, Thin & Bold is also showroom ready; giving you an opportunity to personally touch and experience the furniture you needed to see before purchasing.
design and production, as well as branding and marketing. GOING DIGITAL WITH QUALITY SERVICES Kent discussed that the major obstacle furniture businesses face is the availability of space in prime shopping areas or luxury shopping malls. He says by having a hybrid model, which is an online store with showroom by appointment they can offer much better services to their customers in many aspects: sales advice, design consultation, stock availability delivery and after sales service. Online branding is transforming businesses globally. By having an online presence, Thin & Bold capitalises reference through word-of-mouth largely
through social media postings. Esther mentions, “The experience of purchasing home décor is a journey; Seamlessly delivering high quality products is our key value as we want to ensure our customers enjoy the best services whether be it an order placed online or at our showroom.” Thin & Bold offers a list of complimentary services called ‘The Perfect 6’. To start off, they provide free home styling consultation; from completely redoing an entire space or just finding little touches to complete the look, no project is too big or too small, and best of all, there is no obligation to purchase anything. They also provide free door-to-door deliveries to anywhere within the Klang Valley. Free installation service
SUSTAINABLE WOOD Thin & Bold takes great pride in understanding oak and teak in all its complexity. By selecting the best quality and most environmentally responsible manufacturer, they can produce exceptionally quality products. The upland Burgundy region of France has cool climatic conditions with forests that produce harder, heavier timbers. The French Oak has distinctive grain patterns and a beautiful pale colour, while their Teak comes from the plantation in Jogjakarta. The integrity of Thin & Bold’s product is in stark contrast to much of the other Oak and Teak furniture in the market, which comes from smaller, less mature trees that are inferior in strength and are not managed sustainably. All Thin & Bold collections have a table with unique 100%. PEFC (The www.propertyinsight.com.my OCTOBER 2016 I 55
Programme for the Endorsement of Forest Certification) & FSC (Forest Stewardship Council) certified wood. RECYCLED METAL Solid metals are used in the Thin & Bold designs. The use of specialist workshops enables the mixing of materials, which aids in the engineering of designs and enhances the aesthetics. A particular favourite of Thin & Bold is utilisation of recycled, sand cast iron. This involves the collection of old engine blocks, obsolete machines and disused machinery equipments. The material is melted over 1500 degrees in a furnace before being set in a carefully crafted sand mold. Thin & Bold like to produce items such as cast iron table legs with a raw, organic spirit that combines beautifully with the uses of solid oak and teak. ONE OF A KIND Esther mentions “All our products are one-off designer pieces; hence we don’t touch base in customisation.” A unique proposition by Thin & Bold is that they spend time educating customers on the story of the products they offer from the material used, how they were made, what inspired the designers to create such design. Kent adds, “The true identity lies in every piece of the furniture being made individually and the appreciation for the piece they purchase.”
56 I OCTOBER 2016 www.propertyinsight.com.my
Kent believes good furniture designs are timeless and a good interior designer can easily mix and match according to the current trends. He mentions, “We are inspired by the established trends we pick up from overseas. Different brands carries different identity for their furniture, and that does give us a good vision on how one piece of furniture can last for decades and still looking great and exquisite today.” THE FINE FINISH Home furnishing is very much like fashion trends. It’s an industry where a design varies through age and time. According to Kent the current trend in Malaysia is modern contemporary though largely it all depends on the preference of individual buyers. Thin & Bold offers solid wood, which could be said, is hardly in trend but it is a timeless piece, which could be incorporated in any of the home decor category. Trust the style guru Esther when she says “It fits perfectly with any kind of fabrics, carpet, rugs, tiles or lightings. Plus I guess everyone would love to have a little bit of nature in his or her home. It is good Feng Shui too, you know?” The beauty of nature, solid hardwood makes good quality home products fittings, which will last of decades whilst easy to maintain. Not forgetting the natural smell of the aromatic scented wood brings calm and relaxation when one is back home from a hectic day.
THIN & BOLD TIPS 1. Always take as much time as possible when it comes to renovating and choosing the right furniture. 2. Research and pinterest all types of style and design from around the world and get ideas from there. 3. Always mix and match your furniture with the right choice of soft furnishings to create the desired look. 4. Remember to research the quality of furniture’s you are purchasing 5. Go for it, style is subjective it is how you decide to work it.
DESTINATION - FOOD
CAFÉ LIFESTYLE BY: FELICIA SOON
LE POLLIDOR CAFÉ Located in the middle of Bandar Puteri, Le Pollidor Cafe is a stylish contemporary café, which provides visitors with a nice view via their full length glass windows. Le Pollidor Café menu introduces western cuisine to the café scene. There are the breakfast menu (big breakfast, eggs benedict, etc.), tea time set for two (sandwiches, pastries, cakes, and tea), finger foods, desserts (sundaes, parfaits, brownies, panna cottas). For main course meals, there are salads, soups, pasta, pizza, steaks, burger, etc. or Asian delights such as various types of noodles and rice dishes. As for beverage, there are caffeinated (hot, iced, ice-blended), non-caffeinated (milk, cocoa, etc.), milkshakes, mocktails and many more. Indeed this is a café where you will be spoilt for choice with their many selections of meal courses.
hen one thinks of café, we think of hot steamy lattes, palm trees, vibrant colours and all the cool people. To most Malaysians, this is not something new to us, as café lifestyles have become a hype in today’s society, as social groups gather to indulge in coffee culture and ‘chilled out’ ambiances. More often than not, you will come across on Instagram, creative mugshots of a carefully crafted beverage presented in a way where you will feel the need to indulge in it too. Coffee culture dates us back into history, and is described as a social atmosphere or a series of associated social behaviors that depends heavily upon coffee as a social place for bringing people together. Interestingly, cafés are where most people spend most of their time before going on to the next activity or ending their day. The formation of this culture around coffee and cafés dates us back to 14th century in Turkey. Coffeehouses in Western Europe and the Eastern Mediterranean were traditionally social hubs, as well as artistic and intellectual centres, which bring us into what we are familiar with today – the Cafe Evolutions. Here’s our take on the five in Puchong cafés that you should visit.
Address: 2-1A, Jalan Puteri 2/5, Bandar Puteri, 47100 Puchong, Selangor, Malaysia Opens: 10.30am-10pm (Closed on Mondays)
www.propertyinsight.com.my OCTOBER 2016 I 57
DESTINATION - FOOD
Address: The Cube, 11, Jln Puteri 7/13A, Bandar Puteri, 47100 Puchong, Selangor, Malaysia Opens: 10am-11pm
MANGOSIX COFFEE & DESSERT Mango Six was initially a massive brand in Korea where many Korean series were film ed at their outlets. It has now landed in Klang Valley, serving premium desserts and coffee. Their take of menu caters nicely to the Malaysian community as we Malaysians love to indulge in local tropical fruits such as mangoes even while dinning in a cozy urban environment. On top of their localised menu, Mango Six is also renowned for their concept and wood structure bench built up with clear menu board along with some merchandise at the front.
GROUND EATERY Ground Eatery definitely has a whimsical charm. The concept of reaching for the sky with a striking décor makes it the closest thing to a tree-hugging café. Ground Eatery’s unique brings the café lifestyle to a different, more sophisticated level in comparison to other usual hipster joints. The café is also complemented by a fun menu of Dino Eggs (a redo of Scotch eggs, 58 | OCTOBER
with runny-yolk eggs wrapped in pork mince), braised pork belly in mantou and pasta turned creamy-wet with mentaiko and a soft poached egg. Address: 56,, 30, Jalan Puteri 1/2, Bandar Puteri Puchong, 47100 Puchong, Selangor, Malaysia Opens: 12pm-11pm daily
TIPSY BREW O’COFFEE TiPsy Brew O’Coffee, located in the center of Setia Walk (Block C - Ground Floor), is a noticeable cafe with brick walls and a clear glass entrance that one could peer into to view the beautiful and cozy environment inside. The café was completely design around the love for coffee with three different brewing methods used to brew single origins here, including siphon, hand-drip, and French press. They also serve cold brew coffees too which come in cute glass bottles, with four different flavourings: Latte, Americano, Mocha and Caramel. TiPsy Brew O’Coffee also serves both western dishes like chicken chop and sandwiches, and Malaysian favourite such as mee rebus. For deserts, there are mille crepes, cheese cakes, chocolate cakes, red velvet, cupcakes, pies, and soft puddings in jars. Address: Block C, Setia Walk, C-07-G, Persiaran Wawasan, Pusat Bandar Puchong, 47160 Puchong, Selangor, Malaysia Opens: 11am-11pm (Closed on Mondays)
PORCUPINE PLACE The story behind Porcupine Place is as compelling as its food where British-based surgeon Wen Huey leaves the medical profession, returns home to Malaysia & meets Swiss-trained chef Jon Ng while they are both working at a French restaurant in KL. Located at Puchong’s Setiawalk complex, Porcupine Place’s food evokes a genuine quality of playfulness & fun. French toast comes in bite-sized chunks of cereal-coated brioche, convenient to dunk into delicious kitchen-made citrus curd. Porcupine Place is a trendy looking café that emits a friendly family vibe. Its interior layout includes cute soft toys for children to cuddle and play around with. Address: B-3A-G Setiawalk, Puchong, Selangor, Malaysia Opens: 10.30am-10pm daily
For more information and booking, visit www.southernrockseafood.com Southern Rock Seafood Kitchen 32-34 Jalan Kemuja, off Jalan Bangsar, 59000 Kuala Lumpur Phone: 03 28562016 or 012 385 0266
www.propertyinsight.com.my OCTOBER 2016 I 59
THE OPTIMISTIC PROPERTY TREND IN MALAYSIA T
he property market in Malaysia has been the talk of the town for quite some time, as the weak sentiment towards the market has created a state of â€˜wait-and-seeâ€™ approach among buyers. However, many are still hopeful of the market in terms of longterm investment, as the market is foreseen to perform better in the coming years. There are several factors which influence
the market slowdown, as well as reasons on why property investment in Malaysia is still an interesting option.
OCTOBER 2016 www.propertyinsight.com.my
To get a clear understanding of the current property market, check out the infographic:
This article is contributed by PropertyGuru.com.my, Malaysiaâ€™s leading property site
www.propertyinsight.com.my OCTOBER 2016 I 63
INTERNATIONAL MARKET: VIETNAM
VIETNAM PROPERTY MARKET REMADE V
ietnam came into the spotlight in 2005 when it was on the verge of joining the WTO. The over-optimistic boom was driven largely by FDI instead of domestic growth, particularly in the trade, tourism and property sectors. This drove housing prices on a rampage at 110% growth YoY in 2009. However, pit soon came crashing down, with over a span of four years saw prices corrected by as much as 40% as investor-enthusiasm waned. Buyers and developers defaulted on loans and banks were crippled in the process, leading to an inability to support businesses which led to further economic distress, abandoned projects and spates of bankruptcies. The State Bank of Vietnam had to absorb the impact of $8b of non-performing loans to stem losses. THAT WAS THE FIRST WAVE As the dampening theory states, the first run tends to be irrationally exuberant, followed by inevitable correction. Any subsequent uplift tends to be clouded by skepticism (once bitten twice shy as they say), but usually done with better fundamental support. In late 2014, sensible government policies and free trade agreements helped bolster wages, encouraging the middle class growth and driving rapid urbanisation across Vietnam. Armed with a better understanding of the market, foreigners invested with a lot more caution and at a more moderate rate. Such sensibility resulted in residential prices rebounding by as much as 15% in a single year. So where does the Vietnam market stand today? Is it ready for the influx of foreign investors in terms of stability, manageability and returns? Let’s take a closer look at some of the factors that should give us clues as to whether Vietnam’s market is ready.
60 | OCTOBER 2016 www.propertyinsight.com.my
ECONOMY The Vietnamese economy is experiencing strong growth on multiple fronts. Domestic consumption is expected to increase at a rate of 20% per year, and GDP growth is one of the highest in the region, achieving 7% in Q4 2015 alone. The growth was fuelled not just by the textile industry, which the country is so known for, but also the IT, tourism, automotive, medical devices and high-technology manufacturing for global brands such as Samsung, LG Electronics, and Intel. The country has signed free trade deals with major economic blocks of the world, including the US and Canada, the EU and the Russian Federation via a further agreement with the Eurasian Economic Union. Experts are expecting the Vietnamese economy to continue its 7% growth path for several more years to come. INFRASTRUCTURE Vietnam is looking to invest an estimated $48 billion from 2016 through to 2020, focusing mainly on improving the country’s transportation infrastructure covering roads, railways and waterway systems. The country will have to seek funding from the private sector due to constraints on the state budget. According to a report by the Bank for Investment and Development of Vietnam, over 68% of the roads in Vietnam need to be rebuilt or upgraded. This represents significant potential for growth and employment. DEMOGRAPHICS Over the last 20 years’ the household size in Vietnam has dropped from 4.7 in 1995 to 3.6 in 2014. Rural-urban migration increased from 20% to 34% in the same period, while agriculture as a proportion of total GDP continues to fall. Vietnam has
the fastest-growing middle class across Southeast Asia and that is expected to triple again from 12m in 2012 to 33m in 2020, fuelling the growing consumer market. PROPERTY MARKET From a macroeconomic point of view, Vietnam is definitely one of the rising stars in Asia, and this may seem to be a great opportunity for foreigner investors. However, there remains significant obstacles that will continue to challenge potential investors. The 50-year lease is clearly unattractive with unclear processes for renewal, thus explaining the muted reaction from foreign investors. Repatriation of profits (capital gain when sold or rental income) remains unclear. Hence, for investors with neither commercial nor kinship ties to Vietnam, it is a major roadblock. Furthermore, a current lack of legal documentation to clarify relevant procedures hinders the practical implementation of the new laws. Unlike locals who purchase housing with
DESTINATION - INTERNATIONAL INVESTMENTS
Image Courtesy : www.thetravelzealot.com
their savings, foreign-purchasers use bank loans with a substantially lesser cash outlay. Currently, banks can only offer mortgages on Vietnamese properties when there is property title insurance, which is yet to be available in Vietnam. Such uncertainties and inefficiencies are discouraging foreign investors, thus we have yet to see significant interests in Vietnam, especially when opportunities are abounding in more developed countries with clearer policies and more competitive returns. In addition, and clearly the symptoms of an immature market, we are seeing developers and investors violating laws of investment and construction, be it deliberately or due to a lack of transparency. Regulations on collateral, unsecured loans
and housing sales were not complied, leading to complicated disputes. The lack of professionalism among developers and credit organisations have also allowed the use deposits and credit for the wrong purposes. CONCLUSION As Vietnam continues to enjoy economic growth and maturing towards a developed
market, investors will have to be strong hearted. We are positive about the housing market, no qualms about that. We are just unclear that it is one in which foreign property investors can safely invest and profit from as the (pardon the pun) pho~bia of risks faced by investors could be significantly huge as well. With such challenges yet to be overcome, are the returns worth the risks?
ABOUT THE CONTRIBUTOR Jeremy Chan graduated from Mudoch University, majoring in Finance. He started his career with Hospitality Asset Management Firm before joining RunningStream International. As a Portfolio Manager, he assists his clients in optimizing their real estate investment portfolio strategically while adjusting their risk exposure.
www.propertyinsight.com.my OCTOBER 2016 I 61
urchasing a residential property is an important decision. It comes with a motive always but it would not be far from either for own use or for investment. Conventionally, one of the simplest ways of investment is to own a property and let it out. However, it is not as simple as it sounds as that landlord might chance to meet the â€˜tenant from hellâ€™ who brings troubles.
64 | OCTOBER 2016 www.propertyinsight.com.my
These troubles are not limited to unable to collect rental from the tenant, disastrous condition left over at the end of tenancy and more. These are the main reason that some house owner refrain themselves from out let their vacant property. Letting a property requires a whole different school of knowledge. People tend to see the investment of this kind as
a passive income but unless you have a property manager, it would be better to be proactive, personally involve from choosing tenant to handover at the end of the term in order to prevent undesirable incident. Choosing a tenant may be cumbersome, but the first impression of the tenant is important in the sense of it might give you the rough idea of his personal hygiene and
behaviour for you to filter for the desire tenant. It is also possible to set ‘Student Only’ or ‘Female Only’ kind of requirements in the advertisement. There is no issue of discrimination because ultimately, the landlord has the final say in whether to let the property to the person. Also, landlord is not obliged to respond to every call. Legally, an advertisement is at best an invitation to
treat only. Different issue could be arisen when the tenant is from a different background. For instance, a foreigner might have the issue of difficulty in collecting rental and it is impossible to enforce if they are out of Malaysia. On the other hand, a student generally will take care less of their hostel with offen a tendency of throwing parties and gatherings every now and then. Fret not! There are ways to combat these landlord’s horrendous nightmares. Keywords are Bargain, Creative and Inspection. The bargaining stage is the best time to put things upfront. Try to put yourself in the tenant’s shoes and make the tenant understand your concern. With the establishment of mutual understanding, it does not only build a good landlord-tenant relationship but also ease the possible future arrangement with the tenant. For example, allow the tenant freedom to do whatever reasonable in the premise, and not to fear that they might throw a party or whatnot if they restore the condition thereafter. It is a win-win situation where tenant get to do whatever they want and you get to preserve the condition of the property. Be creative. Think of any way that can motivate the tenant to assist in preserving the property. Timely reward to the tenant with rebate/discount on rental in the event they are able to achieve your request is one way that can motivate the tenant to act in landlord’s favour. The events could be based the cleanliness of the property, usage of the utilities or other matters that the landlord think is important. However, the same trick might not effective on different tenant. A small amount of monetary reward can be motivated to a student but it will
not have the same effect to some of the working adults. As for difficulty in collecting rents from foreign tenant, it can be solved by simply alter the payment scheme as quarterly or biyearly since when they are normally here in Malaysia at a fixed tenure limited by visa, they should have allocated a budget for accommodation. Inspect, inspect and inspect. There is no other shortcut to ensure your property is in good shape but to constantly check on it. To enable landlord to do inspection with reasonable notice is a common clause in a tenancy agreement. The tool is here and it is up to the landlord whether to utilize it. Capitalising on the latest technology, the ‘LIVE’ feature of the Facebook could be a handy tool for inspection. Just build a reward around it. Bear in mind, there is no such thing as standard tenancy agreement. Tenancy agreement comes into picture when the landlord and the selected tenant had both agree on the terms stated upfront during the bargaining stage. Hence, penning down every single thing is essential, put in every clause that it can protect your interest because that is the only proof of the relationship between you and the tenant. Be serious, pinpoint and explain the clauses to the tenant especially, those that are crucial to you during the signing of tenancy. Your seriousness is to show to the tenant that this is not just another agreement that he can treat it lightly. It is not as easy as drinking a glass of water but certainly not an impossible task. Extra effort is required to maintain your property when it is not in your control most of the time.
ABOUT THE CONTRIBUTOR Chris Tan is the Founder and Managing Partner of Chur Associates, Advocates, & Solicitors. He is deeply involved in the real estate industry, and is now the honorary Legal Advisor for FIABCI Asia Pacific Regional Secretariat on regional concerns.
www.propertyinsight.com.my OCTOBER 2016 I 65
RICH DEBT, POOR DEBT -PART 1
hat is debt? Both the layman and business dictionary defines debt as something that someone gave permission to borrow, but with the condition to repay back. From a business dictionary perspective, a debt is usually taken to make a large transaction that they could not afford under normal circumstances. When it comes to organisations around the world, debt is an engine. The use of debt in an organisation’s financial structure creates financial leverage that can multiply yield on an investment, provided returns generated by the debt exceed its cost. Because the interest paid on debt can be written off as an expense, debt is normally the cheapest type of long-term financing. So looking at this, is debt a good thing? Does it put you in a better position or worse? Does debt make you richer or poorer? The 66 | OCTOBER
answer to this is…‘it depends!’ There are many types of debt. And there are many reasons why people choose to be in debt. People may incur debt because of an emergency, a large purchase made earlier, to improve one’s lifestyle or even as a mode of investment. That’s right; people and organisations use debt to grow. POOR DEBT In the world that we live in today, our cost of living seems to be outpacing the earning power from our pay cheque. In spite of this, we have seen a tremendous increase in lifestyle expenditure. The unfortunate part of this culture is that it has created a lot of debt, which makes people poor. Let’s take the credit card as an example. An average of 40% of customers today revolve (never pay credit card spending
in full every month) on their credit cards. This has grown from only 25% more than a decade back. When you spend beyond your means and revolve unnecessarily, you are paying as much as 18% on annual interest. Personal loans are another form of new age credit facility which offers attractive and easy cash access with no security pledged or charged. Many have been attracted to the sudden access of a large volume of cash that can be used for any reasons desired. This is another form of lending that creates an after effect of possibly one week of pure enjoyment, and up to 5-7 years of painful commitment. Credit card and personal loan debt are two of the most expensive debts in the market. Here’s a comparison of the interest rate based on the ELR (effective lending rate):
Personal loan: 16%-24% Credit card: 15%-18% Car loan: 7%-8% Mortgage: 4.5%-5.0% People who get stuck in expensive debt like personal loan and credit card will become poorer and poorer. This is how you may continue to be poor: You get continuously stuck in an expensive debt trap • Your debt continues to pile up with no way to get out of it • You are trying to have it all but have no financial roadmap • Your money is being spent faster than it is being used to make more money You continue to ignore big debts • You continuously pay debts after which you incur more debts • You buy items that depreciate in value You put today’s happiness before future financial freedom • You incur debts that give you short term happiness but do not grow your wealth for the future • You invest in other things instead of yourself You are spending too much on housing • This refers to your own house. You invest heavily on your house whereby the lifestyle expenditure exceeds the current market value of the property According to Robert Kiyosaki, author of ‘Rich Dad, Poor Dad’, wealth is measured in time. If you were to lose your job today, how long can you afford to live at your current standard of living? If it’s three months, then you are ‘three months wealthy’. Your income becomes largely irrelevant. In short, a poor debt is basically using your future to pay for your past and your past remains the past; not generating anything for your future.
property is potentially worth RM1.2 million. B: John buys the same asset for RM1 million, and after three years, he can also potentially sell it off for RM1.2 million and make a handsome profit of 20%. He too has the cash to pay the entire asset of RM1 million in cash and decides not to take a mortgage for it. Who is the smarter investor? Who makes more money? Who is financially more resilient? Here are some observations to ponder: • Amanda only used RM100,000 to make RM200,000 over three years. • John, on the other hand, used RM1 million to make RM200,000 over three years. • Amanda has RM900,000 remaining in her bank account for emergencies. She can also continue to invest when the opportunity arises. • John does not have this advantage. In simple terms, your RM100,000 investment has given you a return of RM200,000 over three years. Doesn’t that make more financial sense? Amanda has successfully leveraged her way for higher gains. Many of us are aware that property is one of the safest forms of investment to make money over time. But it only makes sense if the initial cost of investment is minimal, such as a low down payment on a property, while the benefit of appreciation and capital gains are based on the total value of the property. WHAT IS LEVERAGE? By definition, leverage is any process that compounds risk. In the context of investing, leverage is the process of using borrowed
money (someone else’s money) to make money. A mortgage is a cost-effective way of borrowing. Interest rates on mortgages are the cheapest form of borrowing available in the market simply because the loan is secured against your property. You are essentially using other people’s money (the mortgage) to purchase something (property) which increases in value over time. You are now boosting your wealth with effective returns, just as in the example of Amanda and John. Amanda successfully boosted her wealth by forking out only 10% of the asset value which gives her a return of 200% after three years (her initial down payment of RM100,000 makes a profit of RM200,000). Let’s look at it from a financial security standpoint. While there is a certain sense of security that comes from paying off your mortgage, there is security too in having cash in the bank because you have a mortgage on your home instead of paying it all in cash. Life is fraught with rainy days – from car breakdowns to illness and job loss – and every one of them is costly. You’ll be in a much better position to weather economic storms with a mortgage than without, assuming you have put money aside. This money would also become handy in times of need and is not locked in your investment. Taking up a mortgage and freeing up existing cash flow also has another benefit. You may come across a future opportunity. If a once-in-a-lifetime business opportunity arises, would you be able to take advantage of it if your money has gone to pay off your mortgage or to purchase a property without a mortgage? You might be saving a great deal of money by avoiding payments on the mortgage interest, but that might pale in comparison to how much you can make in a business venture or even a new property investment opportunity.
RICH DEBT Let’s look at how a debt can actually make one richer. Imagine this: A : Amanda buys an asset worth RM1 million. She has the cash to pay the entire asset but she choses not too. She took a loan that finances 90% of this asset. Her capital outlay is only RM100,000. After three years, her
ABOUT THE CONTRIBUTOR Gary Chua runs workshops to educate people on latest winning formulas to stay ahead in these trying times! Please go to www.smartfinancingco.com to get the latest updates on upcoming events. He always welcomes feedback and valuable sharings. Please feel free to drop him an email at email@example.com or connect via social media at Facebook.com/Garychualw
www.propertyinsight.com.my OCTOBER 2016 I 67
WAYS TO LIST YOUR ROOM FOR HOMESTAY OR SHORT TERM RENTAL OTHER THAN AIRBNB
irBnb’s website has a tool to help homeowners gauge their expected weekly income and according to this, the country’s chart-toppers are those in Langkawi who can make RM2,801 (S$939.2) a week, followed by those around Malacca’s Jonker Walk (RM2,495 a week), according to AsiaOne news report. Close behind are Penang home-shares in Tanjung Tokong (RM2,494) and Pulau Tikus (RM2,449). In Bukit Bintang in Kuala
OCTOBER 2016 www.propertyinsight.com.my
Lumpur, they can expect to earn RM1,676 weekly, while those near Taman Pelangi in Johor Bharu can expect RM2,287 a week. This alone has shown why it is time for you to join in the booming business and earn extra income from your property. But asides from AirBnb, there are several other online platforms that work wonder, for those who wish to list their properties or extra rooms as short term rental or homestay rooms for travellers in the
market. Here are some of them: 1. BOOKING.COM Priceline Group (Nasdaq: PCLN) who owns and operates Booking.com™, is the world leader in booking accommodations online. Each day, over 1,000,000 room nights are reserved on Booking.com. The Booking.com website and apps attract visitors from both the leisure and business sectors worldwide.
STRATEGY With free registration to list your property and 24/7 multilingual assistance from the company, you can easily list your property and score high chance of getting guests to increase your revenue. To start your listing in Booking.com, click here now! 2. HOSTEL HUNTING.COM Hostel Hunting is the online marketplace for student accommodation, a startup headed by Loke Weng Leong, Keek Wen Khai (better known as Khai), Joey Lim and Marcus Low. It is currently the fastest and easiest way to find and book a student room. Providing thousands of verified rooms from hostel owners/operators and educational institution, this website is particularly useful for those who stay nearby universities or colleges, and seeking students as tenant for their extra rooms as well. According to The Star report, Hostel Hunting is not involved in the tenancy agreement between the tenants and landlords. It is important that both parties post genuine information on their properties and profiles and they also have to reach a mutual agreement for a room to be booked.
Australia, Germany, England, Canada, Mexico, Spain, Italy, and more. Interestingly, it doesn’t have to be a house up for listing in VRBO. According to its website, acceptable rental properties include houses, condos, and villas, as well as barns, boats, bungalows, cabins, castles, chalets, chateaus, cottages, estates, mansions, yachts, and yurts, and other structures travellers may want to rent for their whole vacation. 5. DURIAN PROPERTY One of the local websites that are popular for properties in rent, first hand, secondary and auction markets, you can post free ads in this website for free and tap into its network of real estate agents, developer, locals who are looking for properties to rent as well. 6. iBILIK Possibly the local property listing website with largest market share in Malaysia, iBilik.my also offers short term rental listing to the public now. By listing your place and get approval within two working days, the team in iBilik.my will handle the promotion, online booking, and payment collection of your property, while you just sit back and wait
for guests to place bookings for your unit. The steps on how to list your property for short term rental can be found here. 7. HOMESTAY.COM Homestay.com is an accommodation marketplace designed to connect guests to local hosts in over 150 countries and Malaysia is definitely one of them. One of its unique features is that the website has its own video chatting tool which allows guest and host to communicate even before the booking. By creating account in its website and complete your profile with as much as information as possible, you will be able to start hosting these travellers from all around the world and make extra income as well as new friends too. Homestay business is expected to be overtaking hotel business in the near future and if you are smart enough to benefit from this trend, you should be looking at ways to redecorate the extra rooms of yours and boost your income from listing it for travellers. However, it is utterly vital that you check out the terms and conditions upon signing up for this business to avoid any unwanted inconvenience that could jeopardise your properties and finance.
3. RENTALS BY TRIPADVISOR Powered by TripAdvisor.Inc, an American travel website company providing reviews of travel-related content, TripAdvisor’s Rentals will allows you to gain exposure to over 350 million TripAdvisor travellers a month for higher possibility of getting your property booked. Owners pay a booking commission of 3% (excl. value added tax). The booking commission is retained from the rental cost you’ve set up on your account. The steps are as easy as listing your property on other websites and you will receive payments from the company 24 hours after the guests start their holiday. 4. VRBO FROM HOMEAWAY VRBO can offer you exposure to more than 44 million travellers per month through its international network which includes 25 sites around the world, including three of the top vacation rental sites in the United States, as well as France, Brazil,
ABOUT THE CONTRIBUTOR Shen Ooi is a senior content writer at CompareHero, Malaysia’s online financial comparison portal. The company seeks to increase financial literacy in Malaysia by providing free, transparent and detailed product comparisons for credit cards, personal loans and broadband plans.
www.propertyinsight.com.my OCTOBER 2016 I 69
CHECK OUT YOUR PAYMASTER Never feel desperate to rent to someone you instinctively feel uncomfortable with, first impression always counts
nfortunately, most businesses at some point will experience a bad customer, and property investment is not immune to this. However, there are ways to try to reduce the possibilities of this happening, and in my experience the best prevention is through comprehensive tenant referencing. This can be undertaken yourself or by property negotiator. The first part of the screening is to check a tenant’s rental history through current and previous landlord references. If you are in any doubt, or have difficulty obtaining a reference, it is possible to request to visit a tenant’s current rental property to check the standards. Checking that a tenant can afford to rent your property is vital. This means looking at their latest three months’ bank statements and actually checking and analysing how they run their account. Look to see if there are any returned payments. Are they overdrawn? Identify the rent payments going out every month and ensure they are regular. Check that any monies they claim to be receiving are being credited to their account. Get their latest three pay slips or housing benefit payments and check these against their bank statements. Is the money they claim they are receiving being paid into the same bank account? If not, ask questions why. Never be afraid to talk about money - unless they demonstrably have the income needed to pay the rent on your property, you should not take the risk of allowing them to move in. Get a full financial picture of their situation. Understand what credit cards or loans they have. Carry out a credit check and ensure they have a good history by asking for their CCRIS report. 70 I OCTOBER 2016 www.propertyinsight.com.my
If not, ask them why - question them about any financial issues they have had in the past and how they were resolved. Check with their employers if any changes may be made to their working arrangements in the next twelve months. Understand who in their network may help them financially if they run into trouble. Make sure you take a deposit to cover at least two months rent preferably three. Ask questions, request proof and analyse their set-up. Never feel desperate or pressurised to rent to someone you instinctively feel uncomfortable with, or who does not bode well. A vacancy is always preferable over a bad tenant, as an empty property is unlikely to cost you as much as the latter. If in any doubt about an applicant, do not proceed. Choose your customers wisely and protect your business interests through thorough and prudent screening. The last point, if any tenant that comes knocking on a last minute, it’s a clear big NO for me. In other words, if the tenant wanted to rent your unit urgently as in a day or a week before, it just shows how poorly they manage their situation whatever the reasons given.
ABOUT THE CONTRIBUTOR KK Chua is the strategic advisor & managing director of Armani Media. He is also a registered real estate agent and an investor with more than 10 years of experience in the industry. He can be contacted at firstname.lastname@example.org
MISSED AN ISSUE? Call (03) 6156 3366 to order
PERSONAL PARTICULARS Name: ________________________________________ Mr / Mrs / Ms / Dr: _____________________________ Occupation: ___________________________________ Mailing Address: _______________________________ ______________________________________________ Postcode: ______________ State: _________________ Email: ________________________________________ Tel (HP): ______________ (Office): _______________ Start my subscription from: _______________(mth/yr) I wish to subscribe for 12 issues at RM75 (West Malaysia) I wish to subscribe for 12 issues at RM94 (East Malaysia) I wish to subscribe for 12 issues at RM240 (Singapore) PAYMENT METHOD: I enclose a cheque No. ________________________ made to the name of Armani Media Sdn Bhd. Direct transfer to Maybank Account No: 5127 5451 2282 (Armani Media Sdn Bhd) (Fax or email transfer slip to email@example.com) MAIL THE SUBSCRIPTION FORM TO: Armani Media Sdn Bhd (1032085-H)
No 32-3, Jalan Pekaka 8/4 Sec 8, Kota Damansara 47810 Petaling Jaya, Selangor, Malaysia Tel : +603-6156 3366 Fax : +603-6156 3399 or Email : firstname.lastname@example.org
NOTE: Please allow 3 to 4 weeks for delivery of your first issue. Receipt will be sent upon request only. Suspension and cancellation of subscription is not allowed.
Price includes GST
SURGING FORWARD 2017 : THE GAME PLAN
5-6 11 2016 09am-08pm VENUE
SETIA CITY CONVENTION CENTRE Register tickets at www.prism.my
A SELF-CONTAINED CITY NEARBY THE UPCOMING BANDAR MALAYSIA
ATTRACTIVE INVESTOR PACKAGE AVAILABLE
• 7km Away From Bandar Malaysia • Walking Distance To LRT Station
SHOW UNIT IS AVAILABLE FOR VIEWING
• Excellent Connectivity With Highways • Mature Township With Complete Amenities • Ready Population Catchment
6016 - 411 5828 603 - 9173 9933
N 3.103069, E 101.714177 WWW.QUEENSVILLE.COM.MY
SALES GALLERY Level 6, Tower Block, Plaza Dwitasik, Jalan Sri Permaisuri, Bandar Sri Permaisuri, 56000, Kuala Lumpur
Published on Oct 1, 2016