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Buyers taking more time to
make up their mind
23/12/08 NST
The Malaysian market for commercial property, particularly for en bloc
deals, is still active but buyers are taking more time to decide, a senior
official of a property company said.
The global economic downturn has made buyers more cautious but recent events
of aborted deals do not reflect a drastically changing market.
In November, IOI Corp Bhd scrapped a deal to buy Menara Citibank in central
Kuala Lumpur for almost RM600 million, citing concerns about the economy.
"At this point, we don't even feel that everything's slow. It's business as
usual right now.
"In fact, we are still hiking rentals and people are taking it. It's not
doom and gloom," he told Business Times in a telephone interview. He
declined to be named due to company policy.
Developers like Glomac for instance, are still in talks with local and
foreign parties who are keen to buy properties, sources said.
A slowing economy also changes the profile of potential buyers as those
interested to buy and rent the space may worry about the take up.
It is learned that Glomac approached agencies like Perbadanan Nasional Bhd,
a body responsible for the development of Bumiputera entrepreneurs, and Bank
Rakyat, Malaysia's biggest cooperative bank.
These are for properties that have yet to be built and in some instances,
local authority approval has yet to be given.
Last year, Glomac made its maiden en bloc deal when it sold Glomac Tower, a
yet-to-be-completed property near the Petronas twin towers, for RM577
million.
Other developers like I-Bhd and Mah Sing Group Bhd are also still in talks
with interested parties for en bloc sales.
In July, I-Bhd said it has received enquiries from South Korean and Middle
Eastern investors for its luxury serviced residence The Peak@KLCC, which is
worth about RM500 million.
In June, Mah Sing said it was 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, KL.
It wants to conclude the sale of at least one block by the year-end, group
managing director Datuk Seri Leong Hoy Kum had said.
Each block could go for "over RM100 million", he said.
Malaysia's economy is officially targeted to grow by 3.5 per cent in 2009,
the slowest since 2001. The Kuala Lumpur Property Index, which tracks the
performance of property stocks, fell 50 per cent so far this year.
Its fall was worse than the broader market's 39 per cent decline in the same
period. |
