Amanahraya REIT buys Intermark’s Vista Tower for RM455m

Amanahraya REIT buys Intermark’s Vista Tower for RM455m

KUALA LUMPUR (Sep 7): Amanahraya Real Estate Investment Trust (ARREIT) is acquiring Vista Tower, a 63-storey office building, from The Intermark Sdn Bhd for RM455 million in cash.

The office tower with two concourse levels and three basement levels has a land area of  228,948 square feet, according to a filing with Bursa Malaysia by the REIT’s management company, AmanahRaya-Kenedix REIT Manager Sdn Bhd.

The building’s net lettable area is 551,875 square feet, and the occupancy rate was 74.4% as of July 31 and could fall to 66.3% due to the non-renewal of one of the tenancy agreements upon expiry on Nov 30, said AmanahRaya-Kenedix.

It added that the purchase consideration was below the market value, estimated at about RM523 million, based on the investment method.

According to the filing, the proposed acquisition will elevate the ranking of Amanahraya REIT to among the top 10 REITs in Malaysia by total asset value (TAV), as its TAV will grow from RM1.03 billion to RM1.56 billion with the completion of the acquisition.

This, it added, will enhance the overall presence and reputation of Amanahraya REIT among the Malaysian investment community.

AmanahRaya-Kenedix said the acquisition will also enable diversification and enlargement of the portfolio of assets under its management, which is expected to benefit Amanahraya REIT in the long-term as a result of economies of scale.

The purchase consideration, it said, will be funded via a medium-term note programme with RM450 million notes issues and internally generated funds of RM5 million.

AmanahRaya-Kenedix said there is no additional financial commitments from Amanahraya REIT, except for the capital expenditure to be incurred in the course of its normal operations since Vista Tower is already established and fully operational.

The trading of Amanahraya REIT shares has been suspended since yesterday afternoon and will resume trading tomorrow.



Lendlease gets okay for construction of TRX

Lendlease gets okay for construction of TRX

PROPERTY and infrastructure group Lendlease Corp has received all the approvals to progress the Lifestyle Quarter of the Tun Razak Exchange (TRX) to the next stage and has moved into the construction phase of the development.

Australia-listed Lendlease is the joint-venture partner of TRX City Sdn Bhd in developing the Lifestyle Quarter at TRX, a 6.88ha mixed-use development.

Lendlease owns 60% of the partnership, while the remaining 40% stake is held by TRX City.

Lendlease is also the development and construction manager for the project, which has an estimated development end value of around RM8 billion.

Among the approvals received by the company include the Earthworks Plan Approval from the Kuala Lumpur City Hall that would allow it to proceed with construction at the site.

“With the approvals, works at the TRX Lifestyle Quarter comprising a new city centre retail mall, six residential towers, a luxury hotel and park are now in full swing.

“The excavation has been completed. Piling for the retail component is progressing well, with almost 500 structural piles completed,” the group announced in a statement yesterday.

With over 120,774 sq m (1.3 million sq ft) of net lettable area, the project has to date leased 26% of its retail space to include Japanese departmental store Seibu, an

upscale supermarket brand by Hong Kong-based Dairy Farm Group, and a Golden Screen Cinemas theatre.

TRX is an upcoming RM40 billion international finance and business district located between Jalan Tun Razak and Jalan Bukit Bintang.

Its master developer is TRX City, a wholly owned unit of the Ministry of Finance Inc.

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China’s CCCC to make KL its Asean hub, build tower at TRX

China’s CCCC to make KL its Asean hub, build tower at TRX


CCCC’s land at TRX is near Land Lease Lifestyle Quarter’s mall (above) there.

BEIJING: China Communications Construction Co Ltd (CCCC) intends to make Kuala Lumpur its hub for the Asean region as the port and construction group expands its footprint here.

“We will set up our regional centre in Kuala Lumpur,” CCCC vice-president Peng Dapeng told reporters at the group’s headquarters in Beijing.

He said the group was building the “CCCC tower”, a commercial building in the Tun Razak Exchange (TRX).

“We have acquired the land. We are in the midst of reviewing the project so details are scant now,” he said, without disclosing the gross development value (GDV) and investment value.

“We will have our regional head office there for Asean and some portion of the tower will be rented out,” Peng said, adding that the group currently had eight regional hubs globally.

“Malaysia is very important to us. As you can see, the contract value we have in Malaysia is the highest among other Asean countries. Currently, we have more than US$16bil (RM67.27bil) worth of on-going contracts in hand. We believe this number will be bigger in the future,” he added.

In August, CCCC’s Malaysian unit had agreed to subscribe to 15% in WCT Precious Development Sdn Bhd (WCTPD), which had earlier acquired a plot measuring 71,986 sq ft in the TRX district from 1MDB Real Estate Sdn Bhd (1MDBRE) for RM223mil.

CORE (Singapore) TRX Investment Pte Ltd, a company related to CCCC’s sister company CCCG Real Estate Group Ltd (both companies are owned by China Communications Construction Group Ltd), owns a controlling 65% stake in WCTPD. The remaining 20% is held by WCT Land Sdn Bhd.

The land was then earmarked for the construction of a proposed tower block of high-end serviced apartments with a GDV of about RM1.1bil. WCT Holdings Bhd’s unit WCT Bhd was given the letter of award by 1MDBRE  contract to undertake the construction.

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KL prime office sector to see 2.5% rent growth in next three years — Knight Frank

KL prime office sector to see 2.5% rent growth in next three years — Knight Frank

Holt: Rental growth prospects across the major cities in Asia-Pacific look positive over the next three years. (Photo by Low Yen Yeing/


KUALA LUMPUR (Oct 11): Knight Frank has forecast a 2.5% growth in prime office rents in Kuala Lumpur over the next three years, a growth rate which is ahead of the forecasts for two main cities in China — Shanghai and Beijing.

According to the global property consultancy firm’s Global Cities: The 2018 Report, KL ranked 12th highest in the Asia-Pacific rent growth three-year forecasts (end-2017 to end-2020).

Knight Frank Asia-Pacific head of research Nicholas Holt said rental growth prospects across major cities in Asia-Pacific look positive over the next three years, reflecting solid regional growth prospects translating into strong demand from a number of sectors.

“Occupiers in technology, media and telecommunications are especially likely to drive demand in many of the gateway cities, while we also expect to see more Chinese tenants active in the major markets,” he said during a media briefing on the key findings of the report.

Manila topped the list with a rent forecast growth of 19.1% over the next three years, followed by Brisbane and Singapore which have a forecast growth of 16.5% and 15.8%, respectively.

Meanwhile, Knight Frank Malaysia managing director Sarkunan Subramaniam said KL’s office rental has offered the most value among the 23 global cities in the report with an average per annum rental of US$23 psf or US$250 psm.

In terms of rental yield, Holt said some skyscrapers in KL have offered attractive yields of 6.5%, which is higher than other cities including Singapore (3%) and San Francisco (4.5%).

The report features the Skyscrapper index, which examines the rental performance of commercial buildings of over 30 storeys across 23 global cities in 2Q17.

In the Skyscrapper index, Hong Kong topped the list with per annum rental of US$304 psf or US$3,273 psm.

New York (Manhattan) and Tokyo came second and third with the per annum rental of US$162 psf (US$1,742 psm) and US$140 psf (US$1,502 psm), respectively.

Commenting on old office buildings that are losing their attractiveness to new Grade A buildings, Sarkunan noted that KL is now undergoing gentrification and property owners would need to rethink and repurpose their buildings to suit current needs in order to attract new tenants.

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BNM governor highlights imbalances in property market as significant risk to overall economy in event of shock

BNM governor highlights imbalances in property market as significant risk to overall economy in event of shock

KUALA LUMPUR (Nov 17): The imbalances in the property market pose significant risks to the overall market in the event of a shock, said Bank Negara Malaysia (BNM) governor Tan Sri Muhammad Ibrahim as he briefed the media on the country’s economic growth for the third quarter.

Muhammad explained that while financial sectors’ exposure to this space is within a comfortable level, the oversupply in some of these segments could cause negative spillover effect to the broader economy.

Among the segments in the property market that were highlighted are high-rise condominiums, office space and retail malls.

“We have raised these issues for more than a year. Exposure of financial sector within this area is within a comfortable level. But if we’re not careful, the oversupply could have a negative impact on the economy,” he said.

Muhammad pointed out that the supply-demand imbalances in the property market has increased since 2015, pointing to the decade-high of unsold residential properties, with the majority of unsold units being in the above RM250,000 price category.

“The large number of unsold properties is due to the mismatch between the prices of new launches and households’ affordability,” he added.

For office space, there are also high office vacancy rates, especially in the Klang Valley. BNM’s report shows that the incoming supply of 38 million square feet of office space could exacerbate the glut.

According to Muhammad, the office vacancy rate in Klang Valley is projected to reach an all-time high of 32% by 2021, far surpassing levels recorded during the Asian Financial Crisis.

Similarly, in the retail space, it is expected that 140 new malls will enter the market across key areas such as Klang Valley, Penang and Johor, which could worsen the oversupply moving forward.

Despite of these threats, the banking system has remained supportive of housing financing, especially for first-time home buyers. In the first nine months of 2017, RM121.6 billion of new housing loans were approved by the banks, benefiting close to 300,000 borrowers. Of this, 60% were for the purchase of houses priced below RM500,000.

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IJM Construction bags RM378m job from See Hoy Chan

IJM Construction bags RM378m job from See Hoy Chan

KUALA LUMPUR: IJM Corporation Bhd’s construction unit has secured a RM378mil contract to build an environmentally-friendly corporate office tower in Damansara Uptown, Petaling Jaya.

It said on Monday its IJM Construction Sdn Bhd was awarded a contract from Damansara Uptown Retail Centre Sdn Bhd, a subsidiary of See Hoy Chan Sdn Bhd group, for the Uptown 8 tower (pic).

“The construction of the 31-storey tower with a net floor area of about 480,000 square feet (sq ft) will commence this month and is scheduled for completion in 39 months,” it said.

Built to attain LEED Gold status and green credentials, the Grade-A office building has two levels of commercial space and 1,387 parking bays. This is equivalent to one car park bay for every 345 sq ft of office space, a provision that goes beyond the 500 sq ft-to-one-bay requirement.

“We are pleased to appoint IJM again as they understand the importance of delivering high-quality outcomes, which is a perfect fit for the Uptown 8 project,” it said.

“Uptown 8 will mark the completion of the gentrification of Damansara Uptown. The office tower will complement Uptown Residences, the Starling Mall and Somerset Damansara Uptown serviced residence, in line with our target to transform the area into a one-stop gateway to business leisure and home,” said See Hoy Chan CEO Joe Tan.

IJM Corporation CEO and managing director Datuk Soam Heng Choon pointed out Uptown 8 is another great addition to IJM Construction’s portfolio of mixed-development projects.

“We take great pride in partnering with See Hoy Chan for the past three years in their journey to transform Damansara Uptown, which is an outstanding integrated development.

“The Starling Mall and Somerset Damansara Uptown serviced residence which IJM successfully completed, and now the Uptown 8 office tower will have a significant impact in the new ‘golden square’ of Petaling Jaya,” he said.


Tech changing office space trend as price down

Tech changing office space trend as price down

  • Thursday, 12 Oct 2017

Report launched: (from left) Sarkunan, InvestKL CEO Datuk Zainal Amanshah and Knight Frank Asia-Pacific head of research Nicholas Holt at the launching of Global Cities: The 2018 Report.

Report launched: (from left) Sarkunan, InvestKL CEO Datuk Zainal Amanshah and Knight Frank Asia-Pacific head of research Nicholas Holt at the launching of Global Cities: The 2018 Report.


KUALA LUMPUR: Technology is not only creating ripples in the retail scene. Two obvious trends are emerging in the Klang Valley office space.

Landlords are seeing a flight to quality as multinational companies (MNCs) and local corporations take advantage of the availability of better grade office space at competitive rates and attractive tenancy terms, said Knight Frank Malaysia executive director (corporate services) Teh Young Khean.

The second trend is the growth in serviced office segment, or co-working space, as millennials and older businessmen and women turn to short-term office rental of a month or two.

“It is clean, easy and convenient. The people who opt for serviced office space need not get into the hassle of hiring staff or buying furniture or other utility bills. When they rent serviced office space, all that comes in a single bill. They opt for this segment of the office space to meet a short-term need before they go to the next city,” said Teh.

Teh was speaking to StarBiz after the launch of the fourth edition of Global Cities: The 2018 Report.

Changes in technology is supporting a flexible working culture, said Teh, and this has resulted in the rising popularity of the serviced office segment.

“Demand for co-working space is expected to grow across a diverse mix of industries and professions such as technology start-ups and small- and medium-scale enterprises (SMEs).”

Teh said clients are searching for good deals in the office market in order to turn this space into co-working space.

A co-working space centre may have space of between 20,000 and 30,000 sq ft. Some could be larger.

But like everything else, they are selective.

The first, said Teh, is connectivity. It has to be close to public transport with easy access to amenities. This brings to mind mixed integrated development, said Teh.

“They also like malls because everything can be found under one roof,” said Teh. They also like new buildings with large floor plates although there are times when, if the opportunity arises, they can turn a single medium-level block into an entire centre of co-working space,” said Teh, who saw this happening in Singapore and other cities.

Teh said out of the 100mil sq ft of office space in Selangor and Kuala Lumpur, about 500,000 sq ft, or 0.5%, are being used as co-working space today.

“This is growing,” he said, due in part to high grade office space available at very competitive rental rates compared with other cities in the region.

Regus, the operator of co-working space, which has 30 centres across Malaysia has signed up for space in a strata office block in Bukit Bintang City Centre


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