Southgate Commercial Centre @ KL

[haze]

Mah Sing to develop commercial centre in KL
By Chong Jin Hun
jinhun@nstp.com.my


July 28 2007


MAH Sing Group Bhd will develop some RM256 million worth of commercial real estate on its newly-bought land in Kuala Lumpur, capitalising on the shortage of offices in the area.
The two freehold parcels with a combined area of 2ha opposite Wisma Mah Sing along Jalan Sungai Besi were acquired from Nichii Fashion Sdn Bhd for RM52 million or RM250.90 a sq ft, the company said in a statement yesterday.



Mah Sing's planned "Southgate Commercial Centre", its third commercial job in the Klang Valley, may be partially retained by the developer.



It includes a medium-rise office tower, and a retail portion. The multi-storey shop offices, and duplex office suites will have built-ups from 12,000 sq ft.



A 1,750 sq ft office floor, is priced from an indicative RM650,000, or RM371 a sq ft. The project, to be sold on a strata basis, is due for completion in three years.



"There is demand for commercial properties in Kuala Lumpur due to higher rental yields, and potential capital appreciation.



"We may sell or keep some (of Southgate's commercial units)" Mah Sing group managing director Datuk Leong Hoy Kum told Business Times.



Rentals for commercial units in Kuala Lumpur may yield up to 12 per cent in annual returns, double the estimated six per cent for residential entities, according to Leong.



Mah Sing's latest land purchase, its second so far this year, came a month after it spent RM115.8 million for 35ha in Penang.



Earlier commercial projects by the company, also a plastic products maker, include the "The Icon"- branded offices at Jalan Tun Razak, and Mont Kiara.



Mah Sing had on Thursday sold one of the two planned towers for The Icon at Jalan Tun Razak for RM174.4 million to Koperasi Permodalan Felda Bhd. It will lease back the building from the buyer.



"The enbloc-sale agreement enables Mah Sing to immediately lock in significant amount of property sales, therefore, improving its future earnings visibility," SJ Securities Sdn Bhd analyst Chaw Sook Ting said in a note.



Mah Sing's first quarter to March 31 2007 net profit rose 20 per cent to RM17.9 million or 10.6 sen a share from a year ago. Revenue grew 52 per cent to RM141.6 million.



SJ Securities rates Mah Sing shares an "Overweight" with a target price of RM3.12 based on a forward price-earnings ratio of 16 times.



Mah Sing shares dipped 0.9 per cent or two sen to close at RM2.26 for a market capitalisation of RM1.4 billion yesterday.



The stock's price had so far this year gained 75 per cent compared with the broader market's 24 per cent rise.


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[johnsonooi]

haha rendering please......

[nazrey]

Mah Sing plans RM256m project
Updated : 27-07-2007
Media : The Edge


KUALA LUMPUR: Mah Sing Group Bhd plans to undertake a RM256 million project, called Southgate Commercial Centre, along Jalan Tun Razak.

It announced on July 27 that the project would be build on 1.92-ha freehold land which it was acquiring for RM52 million or RM250.90 per sq ft from Ninchii Fashion Sdn Bhd.

Mah Sing group managing director Datuk Leong Hoy Kum said the company was targeting corporate and high-end customers, including professionals, investors and entrepreneurs for the Southgate Commercial Centre.

¡§With the prime address and easy accessibility, law firms, consultancies and advertising agencies are just a few of the professions which could set up office here,¡¨ he said. It was also seeking to attract niche boutiques and specialty stores.

Southgate Commercial Centre, modelled after the Xintiandi success story in Shanghai, was conceptualised as an integrated commercial and leisure hub and is expected to be completed in three years.

With its Southgate Commercial Centre, Mah Sing has 14 development projects with a total gross development value (GDV) of RM3.726 billion.

Together with its unbilled sales of RM430 million as at March 31, 2007, the total GDV of RM4.156 billion would ensure earnings visibility for the company for over seven years.

Southgate Commercial Centre was the company¡¦s third commercial development in Kuala Lumpur after its Grade A office development in Jalan Tun Razak and its integrated lifestyle development offering office suites enclosed by a resort style plaza in Mont¡¦ Kiara.

[pedang]

Mah Sing land buy seen as favourable

By CHAN CHING THUT

PETALING JAYA: Mah Sing Group Bhd’s recent acquisition of land fronting Jalan Sungei Besi is seen as a favourable move as relatively large tracts of commercial land for development near the Kuala Lumpur city centre have become scarce.

The property player will turn the 4.76-acre site into Southgate Commercial Centre, with a gross development value of RM256mil.

The company told Bursa Malaysia last week it expected good response for the project, due to shortage of well-planned and modern business parks in Kuala Lumpur.

CIMB Research analyst Terence Wong said although the acquisition price of RM52mil, or RM251 per sq ft, was not cheap, it was reasonable due to the strategic location and recent rise in value of the city’s commercial properties.

“We like the innovative concept that Mah Sing has in mind (which is modelled after Shanghai’s major tourist attraction Xin Tian Di) and we believe there will be many takers for such properties,” he said in a report.

Wong raised Mah Sing’s earnings forecasts for financial years ending Dec 31, 2008 (FY08) and FY09 by 10% to 15% as contribution from Southgate would be significant and flow through from FY08 to FY10.

“We increase our target price from RM2.71 to RM3 as we continue to value it at the sector average calendar year 2008 price-to-earnings ratio of 16 to 17 times.

“The stock remains a ‘buy’ and re-rating catalysts include further value-enhancing land bank acquisitions and accelerating earnings growth,” he added.

Citi Investment Research analyst Penny Yaw said the price of the land was “fair” as RM250.80 per sq ft was within the range of some smaller land parcels transacted in 2006 around that area.

The project will be launched by year-end and Citigroup expects maiden contribution to kick in next year.

“Assuming revenue of RM54.8mil and RM85.8mil for FY08 and FY09 respectively, and an earnings before interest and tax margin of 35%, we have increased earnings per share (EPS) for FY08 and FY09 by 14.8% and 19.7% respectively.

“In line with upward revision in earnings, we have raised our target price to RM3.10 based on 18 times of EPS for FY08,” she said.

Standard & Poor’s said taking into account Mah Sing’s new developments (including the sale of one block of The Icon to Koperasi Permodalan Felda Bhd), its 2008 net profit projection was enhanced by 10.9% while this year’s numbers remained unchanged.

[haze]

[SEED]

i like it!

[rizalhakim]

[SEED]

i wonder wat kinda store will open there? furniture and electrical store? maybe more caffes, restaurents and gym..

[rizalhakim]

Mah Sing: All components in Southgate for sale
BY Jeeva Arulapalam Published: 2008/01/27


The developer has received enquiries from buyers in Singapore, the Middle East and the UK for en bloc sales of the main corporate building and Apex block under its Southgate development



PROPERTY developer Mah Sing Group Bhd says all components of its RM256 million Southgate Commercial Centre on Jalan Tun Razak, Kuala Lumpur, are for sale.

Mah Sing will continue to sell its developments and only retain properties for investment when it decides to set up a real-estate investment trust, said deputy chief operating officer Andy Chua.

He said the group has received enquiries from buyers in Singapore, the Middle East and the UK for en bloc sales of the main corporate building and Apex block under its Southgate development.

"The price range for the corporate building varies from RM700 to RM750 per sq ft with lettable area of 218,000 sq ft," he told Business Times in an interview.

The Apex block will be priced between RM600 and RM650 per sq ft for lettable area of 90,000 sq ft.

The three remaining blocks of the development, namely Vox, Vivo, and Verve, will offer 226 office suites and 63 retail lots.

Prices for office suites (range from 592 to 1704 sq) start at RM430 per sq ft, while prices for retail lots (535 to 2095 sq ft) begin from RM800 per sq ft.

The group, through its wholly-owned subsidiary Jastamax Sdn Bhd, bought two freehold parcels with a combined area of 2ha opposite Wisma Mah Sing from Nichii Fashion Sdn Bhd for RM52 million last July.

Inspired by Xintiandi in Shanghai, Southgate is an integrated commercial and leisure hub that will commence development next month and will be completed 36 months thereafter.

Southgate is Mah Sing's third commercial development in Kuala Lumpur and expected to rejuvenate the surrounding areas including Pudu, Sungei Besi and Loke Yew.

"We will have exciting gourmet restaurants and alfresco cafes to create that ambience of sitting down and having a drink under the stars," said Chua.

[rizalhakim]

Originally Posted by rizalhakim

Mah Sing: All components in Southgate for sale
BY Jeeva Arulapalam Published: 2008/01/27


The developer has received enquiries from buyers in Singapore, the Middle East and the UK for en bloc sales of the main corporate building and Apex block under its Southgate development



PROPERTY developer Mah Sing Group Bhd says all components of its RM256 million Southgate Commercial Centre on Jalan Tun Razak, Kuala Lumpur, are for sale.

Mah Sing will continue to sell its developments and only retain properties for investment when it decides to set up a real-estate investment trust, said deputy chief operating officer Andy Chua.

He said the group has received enquiries from buyers in Singapore, the Middle East and the UK for en bloc sales of the main corporate building and Apex block under its Southgate development.

"The price range for the corporate building varies from RM700 to RM750 per sq ft with lettable area of 218,000 sq ft," he told Business Times in an interview.

The Apex block will be priced between RM600 and RM650 per sq ft for lettable area of 90,000 sq ft.

The three remaining blocks of the development, namely Vox, Vivo, and Verve, will offer 226 office suites and 63 retail lots.

Prices for office suites (range from 592 to 1704 sq) start at RM430 per sq ft, while prices for retail lots (535 to 2095 sq ft) begin from RM800 per sq ft.

The group, through its wholly-owned subsidiary Jastamax Sdn Bhd, bought two freehold parcels with a combined area of 2ha opposite Wisma Mah Sing from Nichii Fashion Sdn Bhd for RM52 million last July.

Inspired by Xintiandi in Shanghai, Southgate is an integrated commercial and leisure hub that will commence development next month and will be completed 36 months thereafter.

Southgate is Mah Sing's third commercial development in Kuala Lumpur and expected to rejuvenate the surrounding areas including Pudu, Sungei Besi and Loke Yew.

"We will have exciting gourmet restaurants and alfresco cafes to create that ambience of sitting down and having a drink under the stars," said Chua.

Mah Sing project draws foreign interest

By RACHAEL KAM

MAH Sing Group Bhd, which is actively involved in commercial developments, is in talks with three potential foreign buyers for en bloc sale of two of the five blocks in its Southgate Commercial Centre in Kuala Lumpur.

It has begun talks early this month with buyers from London, Singapore and the Middle East, who are keen to purchase the seven-storey 900,000 sq ft Apex Block.



The company has also started to approach buyers for the en bloc sale of the main block called Corporate Building, an eight-storey building with 218,000 sq ft built-up area. It fronts Jalan Tun Razak/Jalan Sungei Besi.

The Corporate Building and Apex have a floor plate of about 26,000 sq ft and 16,000 sq ft respectively

The freehold development's five blocks are called Corporate Building, Apex, Vox, Vivo and Verves.

Deputy chief operating officer Andy Chua said the company had yet to decide who would be the buyer.

“Talks are still going on. We will accept the best terms. We are not in a hurry to close the deal, as we are still fine-tuning.

“We hope to firm up the development plans, layout, concept and specification of the project by Chinese New Year,” he told StarBiz.

Chua said there were many corporate investors, including REIT funds and financial institutions, who had shown interest in the Corporate Building.

He said the company had not firmed up the selling price for both blocks but the Corporate Building might be selling at RM700-RM750 per sq ft while Apex at RM600-RM650 per sq ft.

The Corporate Building and Apex block have a floor plate of about 26,000sq ft and 16,000 sq ft respectively.

Its other three blocks has a total of 226 office suites with built-up area from 592 to 1,704 sq ft and 63 retail lots with built-up area of 535 to 2,095 sq ft. The office suites are priced from RM430 per sq ft while the retail lots are from RM800 per sq ft.

Chua said a selling point of the project was that it would be an eye-catching building and that a company could put up its corporate name in front.

Southgate was opened for registration for a month from mid-January and would be launched in March.

Chua said Southgate would be ideal for smaller companies that did not need big office space. Hence its office suites are targeted at companies like consultancy, architectural and advertising firms.

“Previously, small and medium-sized companies could only lease a property in the city centre because all buildings are office towers and they could not afford to buy office towers,” he said, adding that it was better to own an office instead of renting and be subjected to fluctuations in rental rates.

“Rental rates will go up very high if the leasing market is good. This would cause problems when a company is forced to move its office elsewhere that has cheaper rental,” he added.

The 4.76-acre Southgate, with a gross development value of RM256mil, was inspired by the Xintiandi development in Shanghai. It is conceptualised as an integrated commercial and leisure hub, incorporating creative workspaces, food and beverage, and retail lots.

The first and second floor of Southgate commercial blocks will be the retail lot and the third to fifth floors are office suites. The last two levels are duplex suites.

Chua said the modular layout enabled buyers to buy more than a unit and mix and match them to suit their office needs. Besides ample parking bays at two basement levels, there is also parking at the ground level.

Mah Sing is confident that its lifestyle product differentiation for Southgate would ensure good sales and rejuvenates the surrounding areas.

[rizalhakim]

Developer counts on Southgate

MAH SING Group Bhd foresees good response for its contemporary European-designed Southgate commercial properties in view of the high demand and short supply of commercial properties in Kuala Lumpur.

Deputy chief operating officer Andy Chua said the commercial market is facing a shortage of supply and the demand for good office space, especially in Kuala Lumpur, was “very high”.

“This is because ultimately for a business, people still prefer to set up offices in the city centre,” he told StarBiz, adding that new office buildings in Kuala Lumpur were fetching very high prices.

For example, he said, Menara YNH was sold for RM1,230 per sq ft, Glomac tower for RM1,120 per sq ft and Bumiputra Commerce building for over RM700 per sq ft.

“All these commercial properties were sold very fast through en bloc sales,” Chua said, adding that Mah Sing saw a lot of potential for purchasers to buy Southgate units at a reasonable price from RM430 per sq ft for an office suite.

The company is confident that purchasers would enjoy good appreciation when Southgate is completed in about three years.

“We are looking at yields of 8% and above,” he said.

Mah Sing, Chua said, could no longer benchmark itself locally but internationally as many foreign investors were coming to Malaysia.

“The architecture or properties that we offer to foreigners must be of international standard,” he said, adding that it would focus more on contemporary and cutting-edge architecture, which would add value to its commercial properties.

Besides Europe, the company also does research and gets ideas from countries like South Korea, Japan and Australia.

Chua said commercial properties were going to be a competitive market as there were many developers like Glomac, Bandar Raya Development and Malton who were also getting into this segment.

The commercial properties in Kuala Lumpur were beginning to look good because the prices still lacked behind residential properties, he said, adding that prices of residential properties in Kuala Lumpur City Centre (KLCC) had hit more than RM2,000 per sq ft.

He said many developers were looking for commercial land in good locations thus mixing up their traditional portfolio of residential properties.

“Our business model has always been in fast turnaround. We only acquire land in strategic locations,” he said.

He added that the company did not mind paying a premium for these land because it wanted good sales and to launch a project within the shortest time possible, normally within six months.

On its plans moving forward, Chua said Mah Sing targeted its commercial projects to contribute 50% of its revenue by 2009.

The commercial contribution would come from projects in Malaysia, Vietnam, India, Middle East and China.

“We are actively sourcing for development land in these countries. There are talks going on now for some joint ventures, outright purchase and mergers with our local partners in Vietnam, India and the Middle East.

“We hope to secure some projects by the first half of this year,” he said.

[rizalhakim]

Mah Sing net profit rose 24.1% to RM81m
by Yong Yen Nie
Email us your feedback at fd@bizedge.com


KUALA LUMPUR: Mah Sing Bhd’s net profit for the year ended Dec 31, 2007 (FY07) rose 24.1% to RM81.13 million, underpinned by contribution from more projects it had launched over the year.

Revenue rose 15.7% to RM573.37 million from RM495.63 million, while earnings per share fell to 14.82 sen from 17.03 sen. It proposed a first and final dividend of eight sen per share less tax.

Mah Sing said yesterday its 15 projects, which are located in prime locations in the country, had contributed to earnings. It also has impending projects, including the Southbay Penang and Southgate Commercial Centre.

Going forward, it was confident the focus in the lifestyle medium- to high-end residential market and commercial segments, besides its turnaround business model, would continue giving positive results in FY08.

Additionally, Mah Sing would also seek en bloc sales opportuntities for its remaining commercial projects, such as the Southgate Commercial Centre in KL and Southbay City in Penang.

For the fourth quarter, the group’s net profit rose 18.02% to RM20.37 million from RM17.26 million, mainly due to more launched projects, while revenue fell 10.33% to RM120.4 million from RM134.27 million a year earlier.

[rizalhakim]

Southgate beckons to investors & buyers:
Mah Sing Group's latest offering fuses business with pleasure

Conceptualised as an integrated commercial and leisure hub, Southgate is the Mah Sing Group's latest development in the Kuala Lumpur City Centre (KLCC).

Inspired by Shanghai's Xintiandi, Southgate is expected to be completed in 3 years' time. It comprises of 5 blocks, with the main Corporate Building facing Jalan Tun Razak and the Apex Block facing Jalan Dua. The remaining 3 blocks - Vox, Vivo and Verve - are located within and connected via an atrium space.

The office suites range from 592 square feet to 1,704 square feet and retail lots from 535 square feet and 2,095 square feet. Brilliantly blending work and play, Southgate is envisaged to be one of the most coveted business and retail addresses in the heart of the Kuala Lumpur's vibrant city centre.

Southgate is yet another testimony to Mah Sing's pride in its reputation as a premier lifestyle developer. The Group continues to innovate on its projects, to add value to them.

For further enquiries, kindly contact to Mah Sing Group’s Sales & Marketing division at 03-9221 6888.

[rizalhakim]

Southgate Commercial Centre:
A thriving commercial hub at the nucleus of modish trends

In an era where lifestyle has become an important indicator of reputation and image, having the right business address is a vital factor that determines your business stature. The prominence of a business address is a measure of success in the eyes of your competitors and customers alike, even more so with an equally sophisticated appearance and functionality to match.

Southgate Commercial Centre is one of the last few available and highly sought after freehold developments in Kuala Lumpur that is poised to set your business apart. Featuring ultra-modern European themed design, Southgate boasts flamboyance with its gleaming glass façade that adds a touch of classiness to the outlook while allowing good natural light saturation. Southgate was inspired by the Xintiandi development in Shanghai, an integrated centre with a fusion of creative work spaces, food and beverage, and retail lots. It offers not just a trendy appearance but innovative space practicality for businesses that relate to chic lifestyle trends such as alfresco cafes, designer boutiques, unique retail stores, etc. Southgate comprises five blocks in all. The main Corporate Building which is an 8-storey building fronts Jalan Tun Razak and the Apex Block, a 7-storey building faces Jalan Dua and offers build up areas of approximately 230,250 sq. ft. and 89,362 sq. ft. respectively. Both these blocks are intended for enbloc sale.

The three other blocks aptly named Vox, Vivo and Verve are encapsulated within the main Corporate Building and the Apex Block buildings and are linked by an atrium. These are made up of 226 units of office suites with built-up areas ranging from 587 sq. ft. to 1,712 sq. ft. and 63 units of retail lots with built-up areas ranging from 535 sq. ft. to 2,187 sq. ft. Apart from that, there are ample parking bays (1116 bays) in the large carparks for the utmost convenience of the tenants and customers. Additionally, a bridge will be linked from Southgate commercial centre to Wisma Mah Sing to provide more parking bays.

Southgate is indeed an excellent investment for prices starting from at only RM430 per sq. ft. for an office suite and RM800 per sq. ft. for the retail lots. Comparatively, other commercial developments within the vicinity of the same prime urban area are priced between RM700 and RM2,000 per sq. ft.



Voix Block


Vertex & Vivo Blocks

A business address that resonates distinction
Located within the bustling prime business district of Kuala Lumpur, the development offers exceptional accessibility and connectivity to and around Kuala Lumpur City Centre via a web of linkage roads and highways. This distinctive landmark commercial centre in the midst of an integrated commercial and leisure hub is situated along one of the major arteries of the Kuala Lumpur city centre, Jalan Tun Razak. This makes it a ‘natural traffic magnet’ due to its prominent visibility that draws the attention of approximately 500,000 cars driving through every day. Sited at the main Southern gateway leading into Kuala Lumpur via the KL-Seremban Highway and accessed from the West via the Federal Highway, the development is at an excellent vantage point. It is also directly accessible via Jalan Sungai Besi while Jalan Dua connects to Jalan Chan Sow Lin and Cheras. Jalan Tun Razak and the BESRAYA Highway flows into the City Centre while Jalan Istana shortens the distance to Petaling Jaya and Shah Alam. Travelling to the suburbs is made easy via the SMART motorway tunnel which provides a faster and more convenient travel alternative. With the existence of such unparalleled accessibility and a dire demand for such a reserved address, Southgate is destined to afford high capital appreciation and attractive rental yields.

Developed by Mah Sing Group Berhad, a renowned developer known for their inspiring premier lifestyle developments such as The Icon at Jalan Tun Razak and The Icon at Mont’ Kiara, Southgate is targeted at corporate and high net worth customers such as local and international corporations, law firms, advertising agencies, professional consultancies, banks, restaurants, sidewalk cafes and bistros, niche boutiques, specialty stores or even showrooms just to name a few. With the lack of integrated commercial centres such as this, Southgate would become a one-stop thriving commercial hub and a bustling hive of activity.

Mah Sing Group Berhad’s unique brand of product differentiation that is prominently translated into the Southgate Commercial Centre, is in tandem with Kuala Lumpur City Hall’s (DBKL) Structure Plan to transform Kuala Lumpur into a world-class city by the year 2020.

The Southgate Commercial Centre offers investors and business operators the opportunity to own their very own commercial property at this attractively affordable price which will in the long-term prove to be a smart investment and cost saving as rental rates continue to rise. This would eventually cause problems as rentals become a burden to bear and businesses are forced to relocate to cheaper and inconvenient locations away from the city centre.

Come visit the First Preview of this astounding development at Mah Sing Headquarters @ Sungai Besi, Kuala Lumpur on 15 March 2008 (Saturday) and enjoy early bird promotions! For more information, kindly contact 03-9221 6888 or visit www.southgate.com.my.

[rizalhakim]

Mah Sing’s Southgate project block 80% sold


KUALA LUMPUR: MAH Sing Group Bhd has received good response to its Southgate Commercial Centre project in Kuala Lumpur, with 80% of the Vivo block taken up.

“To cater to the strong demand, the group will open the Vox block for sale during the three-day launch (June 13 to 15) at Wisma Mah Sing,” the group said in a statement.

Vox comprises 90 standard and duplex office suites as well as 16 lifestyle retail lots.

Group managing director Datuk Seri Leong Hoy Kum said: “With Kuala Lumpur City Centre less than 10 minutes away, there is robust demand for well-planned niche commercial developments that provide a good business climate.

“We are targeting corporate as well as high net worth customers, including professionals, investors and entrepreneurs as Southgate is suitable for different business ventures.”

The statement said the group was poised for another profitable year, with 14 projects in prime locations – nine in the Klang Valley, four in Johor Baru (Iskandar Malaysia) and one in Penang.

[rizalhakim]

[rizalhakim]

[pedang]

Mah Sing in talks to sell two Southgate blocks

By Adeline Paul Raj Published: 2008/06/24



The developer is negotiating with foreign buyers for the sale of the Southgate blocks at over RM100 million each, says its chief

MAH Sing Group Bhd is in talks with several foreign parties for an en bloc sale of two of its five blocks of buildings at its Southgate commercial development in Sungai Besi, Kuala Lumpur.

The mid-to-high-end property developer is targeting to conclude the sale of at least one block by the year-end, group managing director Datuk Seri Leong Hoy Kum said.

Each block could go for "over RM100 million", he said.

"We are actually negotiating with these foreign purchasers. We have strong interest from the Middle East - such as the United Arab Emirates and Qatar - and also from a neighbouring country," Leong said, declining to elaborate.



Southgate, Mah Sing's third commercial development in Kuala Lumpur, should be completed in 2011 and is expected to breathe new life into the surrounding areas such as Pudu and Loke Yew.

The group, which also does residential developments, has a sales target of RM560 million for 2008 and plans to launch RM706 million worth of properties this year.

Mah Sing plans to eventually raise its selling prices for new property launches that have yet to be built, given rising building material prices which have resulted in higher construction costs.

"The sooner the buyer commits now, they may enjoy more attractive pricing. But eventually, we will have our prices increased in tandem with the construction cost increase," he said.

He pointed out that construction costs, just prior to the fuel price increases in Malaysia, have gone up by between 20 per cent and 25 per cent.

Mah Sing, which had a healthy cash balance of RM130.7 million as at end-March this year and a low gearing level, is also looking to expand its landbank.

"We are planning to buy more land in the Klang Valley, Penang and Johor, but we are not in a hurry as the land must be able to fit well into our quick turnaround business model," Leong said.

Leong is "selectively bullish" on the local property sector for this year and 2009, and sees growth for branded developers' medium-to-high-end residential and commercial projects in good locations.

The group, which has yet to venture abroad, is also scouting for opportunities in regional markets such Vietnam, China and India.

In Vietnam, for instance, it would be interested in doing a mixed development project with a local partner, he said.

[rizalhakim]

Mah Sing sees RM560m sales


It is selectively bullish about property sector in 2008 and 2009

KUALA LUMPUR: Mah Sing Group Bhd targets RM560mil sales out of RM706mil worth of properties to be launched this year, as it is “selectively bullish” about the property sector in 2008 and 2009, managing director Datuk Seri Leong Hoy Kum said.

Despite rising inflation and fuel prices, its sales and launch targets were on track, with the group raking RM116mil in sales and RM201mil in launches for the first quarter, he said.

“The group’s focus on customer-centric homes and value investments has resulted in strong sales for both the group’s residential and commercial projects,” he said after the company AGM yesterday.

Leong said the group had been closely monitoring the increase in building material prices over the past year and had been building ahead of schedule to lock in construction costs.

On rising fuel prices and inflation, he said good property companies with innovative products and the flexibility to adjust to current market needs should emerge stronger.

“Things may not be all that bad for the property sector. Not only are the banks in good shape, households are not over-extended. The ratio of household debt to gross domestic product in our country is very low compared with countries like Britain and the US,” he said, adding that the group would be able to maintain its performance.

Mah Sing reported a 24% year-on-year increase in net profit to RM81.13mil. For the first quarter ended March 31 its net profit jumped 25% to RM22.31mil.

It has 584 acres of land bank left with a total gross development value (GDV) of RM3bil and unbilled sales of RM1bil as at March 31.

On its Southgate Commercial Centre, Leong said it had seen a strong take-up of RM40mil during its private preview for the Vivo block.

The recent launch of the Vox block also saw about RM78mil sales or 70% of available retail units and office suites sold. It is talking with some foreign parties to sell en bloc two of the five blocks.

“We’ve nine months to build the car park. This would be a window period for the rising cost of construction materials to cool off,” he said. He however noted that if costs kept rising, future launches would inevitably be more expensive.

Mah Sing’s residential properties also saw strong sales. For example, the first phase of Hijauan Residence in Cheras is 99% sold while launched units in Kemuning Residence in Shah Alam is 75% sold. Launched units in Sierra Perdana in Johor Baru also saw take up of 71% in sales value.

[rizalhakim]

Mah Sing slashes sales target by almost half for FY08
by Racheal Lee Mei Nyee
Email us your feedback at fd@bizedge.com


KUALA LUMPUR: Mah Sing Group Bhd is targeting much lower sales of RM560 million for its financial year ending Dec 31, 2008 (FY08) after a remarkable FY07 in which sales exceeded RM1 billion.

The higher sales in FY07 were mainly due to several en-bloc sales of grade A office blocks at Icon Jalan Tun Razak and Icon Mont’ Kiara, totalling RM734 million. This year, however, the company is only targeting one en-bloc sale — an office block at the five-acre freehold development Southgate Commercial Centre, valued at at least RM100 million.




“We are in talks with several potential foreign buyers from Thailand, Indonesia, in the Middle East and Singapore, for the en-bloc sale of two of the five blocks in Southgate. The deal is expected to be closed by year-end,” said its managing director Datuk Seri Leong Hoy Kum, adding that only one of the two blocks identified would be sold.

He said the development of the commercial centre would be completed in 2011.

Mah Sing plans to launch new phases at six projects nationwide, valued at RM706 million, this year. In its first quarter ended March 31, 2008, it launched RM201 million worth of properties and chalked up RM116 million sales.

“We would be able to maintain our performance going forward. We still have unbilled sales of RM1.08 billion for the next two years,” he told reporters after the company’s AGM here yesterday. The company has 14 projects on hand — nine in the Klang Valley, four in Johor Bahru and one in Penang.

Leong said the company would continue its strategy of acquiring each year parcels of land at the three locations that could fetch gross development values (GDV) of RM600 million to RM800 million. Currently, it has a landbank with GDV of RM4 billion.

“We have yet to start any construction deals overseas, but we are exploring opportunities in Vietnam and China. We are looking for middle- and long-term mixed development construction projects with quick turnaround, via joint ventures,” he added.

Mah Sing uses industrialised building system (IBS) to shorten the turnaround time of its projects. In addition, it has set up a specialised material sourcing team to get the best pricing and bulk purchase discounts with suppliers and contractors, in mitigating increased building material prices. Bulk purchase is said to help the company save 5% to 10% in material costs.

“We predicted last year that oil prices would continue to increase. Therefore, we put forward some construction projects within our affordability, so as to complete them with lower prices. Some construction (projects) have reached their tail-end, and will be sold at the old cost in the coming year,” Leong said.

“For new projects, we will raise the construction fee in line with the commodity prices. Eventually, we have to pass some costs to the buyers,” he added. Materials and labour account for about 50% of Mah Sing’s gross development cost. Mah Sing shares closed one sen higher yesterday at RM1.46, with 1.03 million shares transacted.