The Star Online: Business
The Star Online: Business |
- Zeti says strong fundamentals needed
- MKH to gain from MRT project as its property developments are close to the rail line
- Jalan Sultan Ismail projects will unlock value in the prime location in KL
| Zeti says strong fundamentals needed Posted: 14 Oct 2012 06:10 PM PDT KUALA LUMPUR: The most pressing challenge confronting policymakers in the crisis-affected economies is to develop an optimal policy mix that will address the fiscal imbalance and impaired financial sector, and structural adjustments that will enhance competitiveness while being able to reduce the adverse impact which the policies have on the economy, according to Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz. She said while there was a general consensus that fiscal consolidation and structural adjustment were necessary to regain competitiveness and sustainable growth in the future, in the immediate term it would involve costs to the economy. As the experience in previous crises had shown, including during the Asian Financial Crisis, there were threshold levels that when breached the economy would be pushed into an even deeper recession, she said in her keynote address entitled "Growth and stability – implications and priorities for Asia" at the Institute of International Finance (IIF) Annual Membership Meeting 2012 in Tokyo on Saturday. This would in turn increase the cost of the resolution of the crisis and result in an even more prolonged period of weakness, said Zeti, adding that the concern was also the potential huge financial and social costs. She pointed out that Asian experience during the financial crisis in the late 1990s had also shown that the potential for effective results was enhanced when the policy package was comprehensive. "Financial restructuring and repair, fiscal consolidation and structural adjustments have their best chance to yield results in an environment in which there is some economic growth," added Zeti. Another challenge is how policy coordination may be improved, both within and across borders, to maximise the impact of policy measures while minimising the unintended spillovers on other parts of the economy or financial system and across borders. "Strong fundamentals in Asia will continue to support our prospects in this more challenging environment. Following the Asian financial crisis, several emerging economies in Asia have strengthened their economic and financial fundamentals, improved their fiscal and external debt positions, and reformed their banking sectors. This has yielded tremendous payoffs," she added. Zeti also said that Asia's development agenda formed a key part of the efforts to firmly anchor the future growth. First, is the further financial deepening in the Asian economies through the development of market-based and diversified channels of intermediation to support the region's economic transformation. Since the Asian financial crisis, Asia has already made significant progress in this direction, in particular, in the progress and growth of the capital markets. Across Asia, the development of the financial system also continues to be pursued with vigor. Looking ahead, she said the next phase of Asia's transformation would see a rising and more affluent middle income population. "There will also be massive investments required for infrastructure and development and for a higher contribution to growth by small and medium businesses. "This will substantially increase demand for a wider spectrum of high quality financial products and services. The strategy is also for the intensification of financial deepening in Asia to meet the increased demands of domestic investors in the management of their surplus funds," said Zeti. A large part of Asian funds are still intermediated through the global financial markets and then recycled back into Asia. This increases Asia's exposures to volatile capital flows. Second is the strengthening of financial linkages and connectivity, within the Asian region, and between Asia and other economies including other emerging economies. Asia has reached the stage of development where its further advancement calls for deeper regional integration that will result in greater capital mobility across borders, facilitated by more interconnected financial systems. As a rapidly growing region, greater regional financial integration will support the more effective and efficient intermediation of Asia's sizeable funds towards meeting the investment opportunities of the region. Zeti noted that a third imperative was the alignment of the financial sector to Asia's demographic trends. Demographic profiles vary widely across Asia and have a significant impact on economic potential of the region. For many parts of Asia, demographic developments foreshadow significant changes in consumption, health and educational patterns. Going forward, the access to financing for healthcare, education and retirement will reduce the need for high levels of precautionary savings, and thus strengthen further domestic demand in the economy. The fourth imperative relates to ongoing efforts to expand financial inclusion. Zeti said financial inclusion had been, and must continue to be, a key component of Asia's overall strategy to achieve balanced and equitable growth. "Emerging Asia has achieved remarkable progress on this front. The period of higher growth has been accompanied by lifting millions out of poverty. Asia, however, still remains the home of two-thirds of the world's poor. Therefore, much still remains to be done," said Zeti. She also said the authorities in Asia were at various stages of translating the global financial reform measures into local standards. "The implementation of global financial reforms has, however, also substantially increased the regulatory complexity associated with the proliferation of binding 'one-size-fits-all' prescriptions. "While these rules mainly aim to address the fundamental weaknesses of the global financial system exposed during the crisis, it is important not to lose sight of other critical elements of sound regulation and supervision," added Zeti. |
| MKH to gain from MRT project as its property developments are close to the rail line Posted: 14 Oct 2012 06:07 PM PDT KAJANG: MKH Bhd (formerly Metro Kajang Holdings Bhd) will derive considerable leverage from the mass rapid transit (MRT) line which runs close to its property developments and the two MRT stations that will be coming up here. The MRT project aside, group managing director Datuk Eddy Chen Lok Loi said the company was also seeing improvement in its financial figures as a result of its rebranding exercise undertaken a few years ago. "The quantum leap is waiting to happen for MKH given our strategic landbank of 500 acres to 600 acres in Kajang and Semenyih, excluding the 550 acres turnkey project in Puncak Alam, Selangor," Chen told StarBiz. The company is planning to launch properties with an estimated gross development value of more than RM5bil over the next seven years in Kajang and Semenyih, including its Puncak Alam RM135mil turnkey project from Puncak Alam Resources Sdn Bhd. Chen said:"We are targeting to launch our Puncak Alam's mixed development which will include affordable housing by year-end or early next year. "The year 2017 will be significant as our Puncak Alam project will be completed and the MRT line in Kajang will be up and running thus enhancing the value of our residential and commercial developments. "At the same time, our plantation will attainfull maturity with expected yields of between 28 and 30 tonnes per ha per year," he pointed out. MKH, which used to derive its revenue from property development and investment, has added oil palm plantation to its current core business. The plantation division will start to contribute positively from 2013 onwards. "All these years, we wanted to go into the plantation sector to balance the ups and downs characterised by the property development market," said Chen. It has a total of 15,000 ha planted as at June 2012. Harvesting area as at June this year was about 7,740ha . Its plam oil mil commenced crude palm oil production at a rate of 60 tonnes per hour and this can be upgraded to 90 tonnes in time to come, he said. He said the company's earnings momentum was also gathering pace, boosted by higher property development activities which saw its third quarter revenue for the 2012 financial year reaching RM376mil, or a 73% increase compared to the same period a year ago. Property development saw an increase to RM274.1mil from RM118.7mil for the nine-month period a year ago, representing an increase of 130% year-on-year. The key contributing projects are Hill Park Homes, Pelangi Semenyih 2, its Kajang 2 township developments and the Saveille@Melawati condominium. Its property investment division, with a value of RM216mil, contributed RM22mil revenue for the third quarter under review, reflecting a marginal increase of 2.8% compared to the same period a year ago. "This division is providing a steady income, contributing between 12% and 13% to our group profit," said Chen. MKH's third quarter net profit is expected to reach RM47mil compared to RM21mil for the same period last year, representing an increase of 124%. Property development and construction division contributed the largest segmental portion of the profit for the three quarters, at RM66mil, compared to RM12mil for the same period a year ago, reflecting an increase of 447.5% increase. "We saw a four-fold increase profit from property development and higher average rentals and lower operating costs," said Chen. Despite competition heating up with the entrance of new and bigger players in Kajang and Semenyih like SP Setia Bhd, Mah Sing Group Bhd and Sunway group, Chen said MKH's cutting edge would be its land cost, which was considerably lower than its competitors and its reputation on a home turf. |
| Jalan Sultan Ismail projects will unlock value in the prime location in KL Posted: 14 Oct 2012 06:06 PM PDT By SHARIDAN M. ALI PETALING JAYA: The redevelopment of some of the buildings in Jalan Sultan Ismail, one of the longest and main arteries in the heart of the capital, is gaining further traction to unlock the value in the prime location and meet the future demands of the Greater Kuala Lumpur. Just last week, Permodalan Nasional Bhd (PNB), which acquired the former MAS building in late 2006 for RM130mil in cash, awarded a RM673mil contract to Ahmad Zaki Resources Bhd to demolish the podium building and build a 50-storey tower hotel with six levels of basement parking. PNB also intends to refurbish the 35-storey office building on the site. And in June, Tradewinds Corp Bhd confirmed in a news report that it would demolish the Crown Plaza Mutiara Hotel and Kompleks Antarabangsa to make way for a mixed-development project, called Tradewinds Centre. It is reported that the project might cost around RM6bil. The redevelopments in Jalan Sultan Ismail is not only to further unlock the value of the land there but also to catch up with the growth and development of nearby prime areas such as Kuala Lumpur City Centre (KLCC) and Bukit Bintang. Tradewinds group chief executive officer Shaharul Farez Hassan told StarBiz that the company planned to develop Tradewinds Centre as an iconic building as well as a destination. "Key to the development will be the concept of urban and environmental harmony. "As one of the few green buildings in Kuala Lumpur, Tradewinds Centre's outstanding architecture will be complemented by a central Grand Plaza covering a large area of about one acre. This plaza will feature broad open spaces, breezy courtyards, lush landscaping and much more," he said. Shaharul said the company had consciously allocated a Grand Plaza in the centre of the development, much like to the sunken plaza in Rockefeller Centre in New York and Roponggi Hills. "The Grand Plaza would be a focal point for the public and users to enjoy the stunning environment, socialise and relax. "It can also be used for festive events such as New Year countdowns or other celebrations. "Its signature profile will greatly contribute to the overall composition of the city skyline. "Its large scale and memorable public plaza unites neighbourhoods in the urban fabric, creating a dynamic focal or meeting point that is systematically linked via pedestrian-friendly walkways and public transportation," he said. On how the multi-billion ringgit project would further unlock the value of the land, Shaharul explained that the existing buildings were conceived during a period of lesser competition. "Since then, the city and its buildings have grown to meet future demands for better quality, larger spaces and added features. "While such buildings can be retrofitted and enhanced to address competition, there are limits to such a strategy. Looking towards the future, we have made the difficult but necessary decision to totally remake this location to serve the city's needs far into the future," he said. Furthermore, Shaharul said, the plot ratio of the existing buildings was small, at about five, thereby resulting in gross under-utilisation of the potential property value. "Planned as an iconic, integrated and modern redevelopment with grade A building features, Tradewinds Centre would maximise its potential more than doubling the amount of allowable high value space," he said. Real estate consultant Rahim & Co group of companies executive chairman Senator Datuk Abdul Rahim Rahman said that in his opinion based on market demand and environment, hotels were more likely a better decision than office building as there was a oversupply of that now. "And the Government is also confident that tourist arrivals would be good. Furthermore, the hotels rates in Kuala Lumpur are more competitive that in Singapore, Hong Kong and even Jakarta," he said. As for Jalan Sultan Ismail, Abdul Rahim said it was the prime location before the development of the KLCC which was now fetching better rates. He added that Jalan Sultan Ismail was a long stretch where rental rates were RM5 per sq ft (psf) as opposed to RM8 to RM10 psf in KLCC. "Although Jalan Sultan Ismail is not the prime location anymore, it will still remain as one of the prime locations in Kuala Lumpur," he said. Nevertheless, Abdul Rahim said it might be easier to get better yields in Jalan Sultan Ismail. "For instance, if one wants to get a good apartment in KLCC area one has to pay around RM1,500 psf, but in Jalan Sultan Ismail due to its long stretch one can get a good apartment at RM800 psf, where it would be easier to get 5% to 7% returns. |
| You are subscribed to email updates from The Star Online: Business To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google Inc., 20 West Kinzie, Chicago IL USA 60610 | |
0 ulasan:
Catat Ulasan