Iskandar Malaysia trivia 4

By 2015, Singaporeans can use their CPF Medisave for medical treatment at Gleneagles Medini Hospital. Photo: Courtesy of Global & Capital Development.

Did you know? Medini is the site where the Rapid Transit System (RTS) interchange station will be located at, connecting to Singapore’s MRT system via the Tuas-West Extension by 2018. A Bus Rapid Transit (BRT) system will connect the Lifestyle, Business and Living zones once the population of Medini reaches a critical mass. http://eepurl.com/LxXPT

Iskandar Malaysia trivia 3

Meridin by the Mah Sing Group is located in a Grade ‘A’ site in Medini, Nusajaya, Johor.

Did you know? There are other incentives that you can apply if you are looking to live, work and play in Medini, Iskandar Malaysia. Called the ‘Medini Incentive Support Package’, foreign knowledge workers are exempted from RPGT when they dispose their land and properties in Medini until 2015 and 2020 respectively. Click the link here to find out more.

Concerned with Malaysia’s New RPGT scheme? Don’t be. Here’s why

Exclusive investment opportunity to grab Iskandar units at low entry price

Meridin by the Mah Sing Group is located in a Grade ‘A’ site in Medini, Nusajaya, Johor.

There are many confusions surrounding the new Budget 2014 measures announced in October this year by the Malaysian government. To allay your concerns, I am organising a talk in partnership with Mah Sing Group, on the 8th January 2014 at TripleOne Somerset. To ensure you have a seat at my exclusive talk, please email me at investorsclub@khaliladis.com or sign up via the link here

‘Get It Right Iskandar’ book acknowledgement

The book is now available online at http://www.getitright-iskandar.com for S$21. It will be available at all good book stores in Singapore in a few weeks time for S$21. For more information, please visit http://www.getitright-iskandar.com.

Although writing has always been my interest since young, I never thought that one day I will be writing a book on property, let alone forge a career in real estate. In fact, I stumbled upon it by accident. There are many people whom I would like to give special thanks to when I first started writing at 24-years-old which subsequently led me to a career as a property journalist and now, in the business of real estate. I would like to thank Uncle Halim and his family for the love, support and opportunities given to me. I would not be where I am today if not for his family’s help.

Presenting our ‘Get It Right Iskandar’ book to Deputy Prime Minister and Minister for Finance as well as my MP at Jurong GRC Tharman Shanmugaratnam as a token of appreciation for his help when I was first starting out as a journalist.

In addition, I would like to thank my MP Mr Tharman Shanmugaratnam, Deputy Prime Minister and Minister for Finance for his kind assistance when I first started out.

Throughout my journalism career, I have met many wonderful people who have given me inputs that have helped me acquire knowledge on the regional property market. Without them, writing this book would not have been possible. Special thanks to Hazeline Hoo at Weber Shandwick Kuala Lumpur, Q Akashah at Ogilvy Singapore, Mr Jeff Foo at the Institute of Estate Agents, Jules Kay at Property Report South East Asia and Marsha Tan at Iskandar Regional Development Authority (IRDA).

I would also like to thank Lisa M at iProperty.com Singapore for inviting me to speak at the numerous property talks and expos. Special shout out to Stuart Chng and Darren Ong at EastLivingGroup for their huge support. Last but not least to Getty Goh for the opportunity to co-write this book with him.

Investment hotspots in Iskandar and Melaka

Christ Church Melaka is one of Melaka’s iconic landmarks.

I have been incredibly blessed in my career as a property journalist to cover the Malaysian property market across different states. In my course of work, I have had the privilege to interview and pick the brains of some of the top decision makers in the industry.

While property prices in Malaysia are relatively cheaper compared to Singapore. There are some inherent risks. At the top of many investors’ mind at the moment is the impending outcome of the general election expected to take place on 5 May this year. Many investors, who are unsure how the property market will pan out, are adopting a ‘wait-and-see attitude’. “Should the opposition wins, what will happen?” they ask.

Like every investment that you are considering, you should do plenty of research and understand the product that you are investing in. I have seen investors who adopt the herd mentality – they go in when they see the market is hot, they retreat when others tell them the market is riddled with risks.

At the same time, I have also seen investors who went into Iskandar back in 2006 when there was still not much confidence in the property market and their properties have appreciated threefold. Now, we see a lot of interest among Singaporeans after they see CapitaLand and Temasek are now in Iskandar. Had they known there are hotspots back in 2006, they would have equally benefited from the property market, rather than be driven by fear that Iskandar is a ‘buyer’s beware market’.

Likewise, Melaka is an up and coming investment destination where there are still good deals in the market as property prices there are still very affordable. Yet, there are investors who are unsure about the property market and its potential.

In my property talk tomorrow, I will be sharing with you my research, insights and property knowledge covering the Malaysian property market since 2008. While the burning question on many investors’ mind is the outcome of the general election, I hope you are able to make a critical analysis on both property markets based on my sharing session tomorrow as well as your own research. Details of my property talk can be found below:

Iskandar Malaysia gains traction post Najib’s visit

(L to R) Managing Director of Iskandar Waterfront Sdn Bhd, Tan Sri Lim Kang Hoo; Menteri Besar of Johor, Y.A.B Dato’ Haji Abdul Ghani Othman; Prime Minister of Malaysia, Datuk Seri Mohd Najib Tun Abdul Razak; Prime Minister of Singapore, Mr. Lee Hsien Loong; Head of South East Asia, Temasek, Mr. David Heng; and President & Group CEO of CapitaLand Limited, Mr. Lim Ming Yan at the signing ceremony of Heads of Agreement between CapitaLand, Iskander Waterfront and Temasek at Danga Bay Convention Centre. The signing ceremony was witnessed by Prime Ministers of Singapore and Malaysia and Menteri Besar of Johor. Pictures: Courtesy of CapitaLand.

When Malaysian Prime Minister Datuk Seri Mohd Najib Tun Abdul Razak came to Singapore on an official visit in February this year, he more than just renewed bilateral relations with Prime Minister Lee Hsien Loong.

In fact, both countries achieved historic economic milestones with the announcement of the high-speed rail network from Singapore to Kuala Lumpur as well as the largest joint-venture project in Malaysia by Temasek Holdings, CapitaLand Malaysia Pte Ltd and Iskandar Waterfront Sdn Bhd.

The investment sum, at RM811 million or approximately S$324 million, is considered a feat as it marks CapitaLand’s first direct large scale township investment and development in Malaysia.

This has helped spur confidence and buying activities across the causeway in Iskandar Malaysia.

Kenanga Research, a research firm in Malaysia, said the warming bilateral ties and policies friendly to foreign investment have helped draw in investments.

“Developers with large exposure in Iskandar Malaysia have seen strong investor interest since December 2012. This follows news flow of rising foreign investments and the proposed JB-Singapore Rapid Transit System (RTS) by 2018, which would be positive for property prices,” its research cites.

CIMB Research also gave an upbeat assessment on Iskandar Malaysia where it states that UEM Land’s involvement and upper hand in choosing its joint venture partners in Nusajaya has allowed Iskandar to reach its tipping point in 2012 .

Agreeing, invited speakers at the recently concluded Asia Pacific Real Estate Convention & Expo (APRECE) organised by the Institute of Estate Agents (IEA) said the excellent bilateral ties is a win-win situation for both countries.

“The excellent bilateral relationship between the two Prime Ministers who are very keen to promote trade and investments in the two countries can only lead to economic prosperity,” said Kumar Tharmalingam, chief executive officer at Malaysia Property Inc (MPI).

Noting that Singapore offers Iskandar Malaysia direct access to the international market, Tharmalingam said this has helped Malaysia achieve record investments.

“Because our relationship with Singapore is so good, the Japanese and Chinese are thinking, if Singapore were to invest in Iskandar it must be good because Singapore does not make decisions lightly. Because of that, we have a flood of Chinese and Japanese investors in the country. In fact, it has never been in this volume before, not for the last ten years,” he said.

Mohamed Ismail of PropNex said Singaporeans are taking cues from the excellent bilateral relationship as a good time to invest.

“I think we are probably at our peak in terms of bilateral relationship and confidence with Temasek and Khazanah taking stakes across each other’s border and trying to develop projects for the betterment of both countries. This is where Singaporeans suddenly see a need, probably that they are losing out something. Coupled with the cooling measures, it has become restrictive for those buying their second properties. Those who believe in the fundamentals of property investment suddenly want to look at Iskandar as a possible option,” he said.

(L to R) President & Group CEO of CapitaLand Limited, Mr. Lim Ming Yan; Prime Minister of Singapore, Mr. Lee Hsien Loong; Prime Minister of Malaysia, Datuk Seri Mohd Najib Tun Abdul Razak; Managing Director of Iskandar Waterfront Sdn Bhd, Tan Sri Lim Kang Hoo; and Head of South East Asia, Temasek, Mr. David Heng tossing Yu Sheng at Danga Bay Convention Centre. Pictures: Courtesy of CapitaLand.

Burying the hatchet

While analysts note the current warming bilateral relations, this was never the case in previous years.

In fact, diplomatic relationships between both countries were often strained under the Lee Kuan Yew-Mahathir administrations leading to much discussions about possible MRT links to Johor Bahru in the 80s which never materialised.

On top of that, crime and safety issues in Johor Bahru as well as cases of errant developers who did not follow through on their projects, have greatly deterred investments.

As a result, both cities never had the opportunity to reach their full potential in terms of economic co-operation by leveraging on each other’s strength – Johor offers plenty of cheap labour, abundant land and natural resources while Singapore is an economic powerhouse.

In 2005, under the leadership of Abdullah Badawi, there was a change in direction from the Malaysian government when it mooted the idea of Iskandar Malaysia so as to enjoy the economic spillover from Singapore.

However, it was only in 2009, when Prime Minister Datuk Seri Mohd Najib Tun Abdul Razak took over that Iskandar Malaysia started to gain traction.

A joint-ministerial committee was formed by to look into enhancing connectivity by developing the Rapid Transit System (RTS).

Subsequently, the historic land swop deal was concluded leading to joint-venture projects between Temasek Holdings and Khazanah Nasional at One Marina and DUO in Singapore as well as Afiniti Medini in Nusajaya.

Following that, Singapore investments started to pour in, most notably from billionaire investor Peter Lim, CapitaLand, Raffles Education, Ascendas and UOB Kay Hian.

“If we focus on the residential sector, we have witnessed a frenzied pace of people flocking to Iskandar and this is because things are becoming a little bit more clearer although Iskandar has been talked about since year 2006. Today, when one goes across, it is like unbelievable infrastructure is being put in place, the highways and things like that. Many developments are already in different level of stages. These have given Singaporeans a level of confidence to see these are for real,” said Mohamed Ismail.

“I think Iskandar will be a new hinterland for Singapore. As the two governments progress to a more seamless exchange of people from both countries, it is only a matter of time that every Singaporean and every Malaysian living in Johor will have automatic pass card to go in and out of Singapore if you are working in the country. It means that access will be cheap. You don’t have to fill up a form anymore. That will happen because that is the only way businesses can grow,” said Tharmalingam.

(L to R) President & Group CEO of CapitaLand Limited, Mr. Lim Ming Yan; Prime Minister of Singapore, Mr. Lee Hsien Loong; Prime Minister of Malaysia, Datuk Seri Mohd Najib Tun Abdul Razak; Managing Director of Iskandar Waterfront Sdn Bhd, Tan Sri Lim Kang Hoo; and Menteri Besar of Johor, Y.A.B Dato’ Haji Abdul Ghani Othman viewing the A2 Island, Danga Bay architectural model. Pictures: Courtesy of CapitaLand.

A new waterfront city

With CapitaLand Malaysia’s largest committed investment in Malaysia, a new waterfront city is set to rise on A2 Island in Danga Bay.

Occupying 71.4 acres of net land, this premier waterfront residential community will comprise high rise and landed homes with a central waterfront hub with a marina, shopping mall, F&B outlets/restaurants, serviced residences, offices and recreational facilities.

“Given the close proximity and the strong bilateral ties between Malaysia and Singapore, and the increasing investor confidence in Iskandar Malaysia, CapitaLand finds this a compelling investment opportunity in a new upcoming development region. With the site’s strategic location – close to Johor Bahru city centre and accessible via the newly constructed Coastal Highway; with the Singapore-Malaysia Causeway to its east and just 29 kilometres away from Legoland and EduCity in the west, we are confident that the development will be attractive and well received by the market,” said Lim Ming Yan, president and group CEO of CapitaLand Limited.

The project with an estimated total gross floor area of 11 million square feet, is expected to be developed in phases over a period of ten to 12 years.

CapitaLand said its project is expected to generate a total gross development value of approximately RM8.1 billion (equivalent of S$3.2 billion).

Inherent risks

Despite the friendly relations and record investments pouring into Iskandar Malaysia, analysts say investors should go in with their eyes open.

One area of concern is price appreciation and if this is sustainable.

“I am not trying to pour cold water in an excitement that is taking place. We have witnessed condominium properties in Iskandar which was going for about RM400 to RM500 per sq ft five years ago. Today, they are launching at RM1,200 to RM1,300 in a similar area. The prices have gone up twofold. One of the key fundamental is all capital appreciation is a by product of rental yield. The rental can only continue to move up because of strong demand for rental,” said Mohamed Ismail.

He also adds there appears to be a demand supply mismatch.

“Though Iskandar Malaysia’s plan is very broad and macro in terms if what it wants to attain, in terms of businesses moving in, I am concerned with the industries growth and pace versus the industrial development supply. When there is a mismatch – that means industries take sometime to sink its root and grow. Only when industries and businesses grow, you will attract a pool of talent,” he said.

With this, Ismail said buyers need to be able to hold their properties for the long-term.

“A danger will take place, where you are forced to sell a property where there are not enough buyers, and the property prices that you bought will come down. The property that you had bought may become a liability and a nightmare,” he said.

Others said the price appreciation is only fair but there are options for those who have been priced out from the market.

“If you want to live in Iskandar, it is like you are living in Kuala Lumpur City Centre. You have to pay the RM1,000 per sq ft. However, you can very well live away in Shah Alam where it is only RM200 per sq ft. You cannot grow an area with a fantastic infrastructure with high quality design and features and still say I want it cheap. There are still alternatives,” said Tharmalingam.

Estate agents encouraged to broaden horizons

With the challenging property market in Singapore, coupled with excellent bilateral relations between Singapore and Malaysia, events like APRECE can only bode well for cross border investments.

“With the various cooling measures, even the consumers are a bit concerned about buying local properties. If there are other alternatives overseas, they will go for it,” said Jeff Foo, president of the IEA.

Foo said he hope real estate salesperson will enhance their knowledge and professionalism by expanding their horizon.

“Everybody is going global. We want to let real estate agents be exposed to other markets in the international arena. Don’t just focus on the local market but also other regional markets. APRECE will provide agents passport to the international arena,” said Foo.

This article was first published in Property Buyer

Puteri Harbour Family Theme Park officially opens

Themed Attractions and Resorts managing director and CEO Tunku Dato’ Ahmad Burhanuddin at the opening ceremony. Photo: Darren Ong.

Following hot on the heels of LEGOLAND MALAYSIA’s opening in September this year, Iskandar Malaysia welcomed its second tourism attraction yesterday.

Costing RM110 million (US$36 million), Themed Attractions Malaysia said Puteri Harbour Family Theme park had already attracted some 35,000 visitors, including those from Singapore and overseas.

“The opening the Puteri Harbour Family Theme Park is an achievement as we have successfully clinched internationally renowned brands and cartoon characters that are popular and recognised in the whole world. We have also not forgotten Lat’s Place which represents our local brand to place it in the same standing as these international brands,” said Themed Attractions and Resorts managing director and CEO Tunku Dato’ Ahmad Burhanuddin referring to Hello Kitty, Bob the Builder, Barney, Angelina Ballerina, Pingu and Thomas and Friends.

“I am confident and I believe our goals to make Iskandar Malaysia a competitive region and a high income economy by 2020 will be achieved. The rapid developments that we see today are proof that the economic transformation programmes (ETP) that have been planned by the Malaysian government is coming to fruition. In my opinion, these projects must continue to ensure our aspirations are achieved,” said Johor Menteri Besar Datuk Abdul Ghani Othman, representing Prime Minister Datuk Seri Najib Tun Razak.

Johor Menteri Besar Datuk Abdul Ghani Othman showing Lego model of the High Court.

The theme park, located in the narrowest Straits of Johor to Singapore, is part of the Malaysian government’s broader plan to encourage investments within Iskandar Malaysia and to enjoy the economic spillover from Singapore.

More things to do in Iskandar

Puteri Harbour Family Them Park was launched with a big bang. Photo: Darren Ong.

For decades, the Malaysian state of Johor had been bypassed by Singaporeans and expatriates from Singapore for the more established city of Kuala Lumpur, where many perceive it to be the hub of commerce and entertainment.

By 2013, Puteri Harbour is set to be buzzing even more with the opening of Trader’s Hotel and CapitaLand’s Puteri Harbour Ascott Somerset.

Already, investors have snapped up condos within the vicinity such as Imperia which was priced at around RM650 per sq ft and is now fully sold.

More property launches are expected ahead with the commencement of ferry services to and from Singapore at the Puteri Harbour CIQ Facility.

Ferry services are expected to commence by November next year.

Khalil Adis with celebrated cartoonist, Datuk Lat. Photo: Darren Ong.

“Personally I would really like to go at least once just to check it out,” said Adlina Majid, a teacher and a self-confessed Hello Kitty fan, whose parents frequent Johor Bahru for grocery shopping.

Datuk Ismail Ibrahim, chief executive of Iskandar Regional Development Authority (IRDA), said  a total of 20,000 employment opportunities have been created to date.

“The spillover effect to tourism, business and others will also be significant and I urge investors to see this potential and grab the opportunity now,” said Ibrahim.

In July, Ibrahim revealed that Iskandar Malaysia has secured RM10.67 billion (US$3.4 billion) worth of a new committed investment.

The property sector alone has recorded RM29.80 billion (US$9.5 billion) worth of investments.

Iskandar Malaysia is expected to surpass the RM100 billion (US$37.73 billion) dollar mark by 2013.

Investors head north with new loan curbs

Central bank’s move to ensure a more sustainable property market makes Iskandar Malaysia more attractive now among Singaporeans and expatriates.

via Investors head north with new loan curbs.

Investors head north with new loan curbs

Central bank’s move to ensure a more sustainable property market makes Iskandar Malaysia more attractive now among Singaporeans and expatriates.

Impiana Nusajaya Resort Apartments located in Nusajaya, Iskandar Malaysia.

Property prices in Singapore are showing no signs of abating causing the Monetary Authority of Singapore (MAS) to impose new loan guidelines to prevent a further spike in property prices.

On 5 October, the MAS announced several restrictions to ensure a more sustainable property market.

These include a maximum loan tenure capped at 35 years and lower loan-to-value (LTV) limits for those taking loans beyond 30 years or whose loan period extends beyond the retirement age of 65-years-old.

In the latter, the LTV will be 40 per cent for those with one or more outstanding residential property loans and 60 per cent for those without.

“MAS’ move is part of the Government’s broader aim of avoiding a price bubble and fostering long term stability in the property market,” the MAS said in a statement.

MAS’ move will now make United Overseas Bank (UOB) new 50-year mortgage loan redundant.

Experts say they welcome the MAS’ new guidelines as it may cause Singaporeans to commit beyond their financial means.

“I think it is good that the government tried to put a lid on loan tenure. This is to ensure Singaporeans do not over spend on properties. Without such controls, it is inevitable that some Singaporeans would try to maximise their loans and stretch themselves. So it is prudent for the government to put such controls in place,” said Getty Goh, director at Ascendant Assets Pte Ltd.

Rising property prices

Figures from the Urban Redevelopment Authority (URA) showed that the Private Property Index (PPI) surged by 0.4 per cent in the second quarter to reach an all time high of 206.9 points.

Meanwhile, the HDB Resale Price Index (RPI) increased by 1.3 per cent to reach a record high of 194.0 points in the quarter.

This is despite the various cooling measures in place since 2010.

Even post the Additional Buyer’s Stamp Duty (ABSD) imposed in December last year, this has not deterred foreigners from buying properties.

Fuelling demand are low interest rates, high liquidity and Singapore’s reputation as a safe investment haven.

Revised loan quantum causing Singaporeans to invest elsewhere

With the loan quantum now reduced to 40 per cent for those wanting to buy a second property, some Singaporeans and expatriates are heading across the causeway where property prices are still affordable.

“The new reduced loan guidelines mean that my option is reduced. I will have to be more selective in my property buying option,” said Jace Moore.

In addition, Moore got as much as 80 per cent loan.

Moore recently bought a condominium unit in Nusajaya, Iskandar Malaysia, just 15 minutes drive away from the Second Link.

“The reason why I bought a unit at Impiana Nusajaya Resort Apartments is because the entire area complements each other. Nusajaya, as a whole concept, is very attractive. You are moving into a village which is self-sufficient, with EduCity, Medini Financial District and LEGOLAND MALAYSIA. You do not get that in other areas,” he said.

By 2018, Nusjaya will enjoy enhanced connectivity to Singapore once the Rapid Transit System (RTS) is in operation by 2018.

This article was first published in Property Buyer