Posts Tagged ‘IskandarLand’
Or a property from him or live in his state? Remember Iskandar is named after his dad.
In Malaysia, the Johor royal family is infamous for ruling with an iron fist and is the only one of the nine royal families that controls its own army.
Malaysian media outlets claim that before he was sultan Ibrahim shot a man dead in a nightclub in the 1980s but charges were not laid because of royal immunity laws.
The immunity laws were changed in 1993 after a series of controversies surrounding Ibrahim’s late father, Iskandar. Dubbed the “Killer King”, Iskandar allegedly beat a golf caddie to death and maimed his brother after the caddie laughed at him for missing a shot in 1987.
During Malaysian parliament in 1993, politician Shahidan Kassim alleged that Ibrahim had also committed a number of crimes including raping a woman in 1990 at a disco. Shahidan also said Ibrahim had punched a taxi driver and kicked a policeman in his genitalia in an incident in 1986. Ibrahim was also accused by Shahidan of striking a judge in a mosque in 1991 for mispronouncing his father’s name and kicking an assemblyman the same year.
At least six individuals have been arrested since December for insulting the Sultan via social media. A 19-year-old was this week sentenced to a year in jail for insulting the Sultan.
Whatever, someone living in Perth really hates him.
Young Johor royals are getting noisier as the Federal govt ignores them and the noise could keep affecting us further.
The Crown Prince of Johor warned in an interview published on Oct 16 on a footie website (I kid you not) that the state has every right to secede from Malaysia if it finds a breach to the terms agreed upon its membership to the Federation of Malaysia
Four months ago, his younger brother Idris Sultan Ibrahim had also posted a warning on Instagram that the southern state may secede from Malaysia if the conditions upon which Johor had joined the Malaysian Federation are violated.
In the post, which was later deleted, he issued a reminder that the Johor government had joined the Malay Federation in 1946 on several conditions. These included: making Islam the religion of the state, the state’s absolute right over water and land issues, and the state royal house to have its own armed forces.
Remember the hike in the toll rate by M’sia last yr that took the S’pore govt by surprise (Ah Loong and Najib had a love-fest juz before the announcement)? S’pore matched this hike after waiting a few months. From Oct 1 last year a round trip rose from a few dollars to S$13 (the collapse of the M$ has reduced this recently by a little). Result? Less S’poreans do their shopping in Johor. The hikes cut the cost advantage significantly if one travelled by car. There are allegations that the prices of vegetables rose too because lorries have to pay the levy. Bus prices went up by as much as 50%, it seems.
The story I heard then from very reliable M’sian sources was that the Federal govt hiked the rate (knowing S’pore would follow) to cause problems for the sultan of Johor. It seems it wanted to send him a message not to try to grab power. There was a big row when a bill was introduced in the Johor legislature giving the sultan, in his own right, the power to appoint the head of a Johor state land agency. By convention such appointments are by the sultan acting on the advice of the chief minister.
The bill was then amended so that the head was appointed by the sultan acting on the advice of the chief minister.
The rise in the toll made life a lot harder for businesses that depended on S’poreans crossing over to spend their money on cheaper goods and services. This is not good for Johor and the royal family. And there is the added bonus of making Chinese voters repent: the MP of a large part of Iskandar is the DAP’s Lim Kit Siang, the hero of the M’sian Chinese.
But as the latest actions of the younger royals seem to indicate, royalty in Johor are still upset with the Federal govt and who can blame them*? They are trying to take advantage of the 1MDB issue and the PM’s fight for political survival
Meanwhile Johor businesses continue to suffer.
The continuing row adds further pressure to property prices in Iskandar which is facing a glut of supply https://atans1.wordpress.com/2015/05/24/iskandar-prices-off-a-cliff-already-stabilising/.
It seems the Chinese developers are already having second tots about the projects they announced so confidently earlier this year and late last year https://atans1.wordpress.com/2015/01/24/how-many-waterfront-cities-will-eventually-be-built/ . Johor royalty is involved in many of these Chinese projects.
Expect more noise from the young royals which will in turn affect property values in Iskandar. Who wants to buy property in a state threatening secession?
LKY got it about right when he asked why invest in Johor where the rules can suka suka be changed overnight?
*Despite another hike** in April this year https://atans1.wordpress.com/2015/04/11/iskandar-developers-must-be-desperate/. S’pore hasn’t followed.
**Yet to be implemented I forgot to add. (Update at 1.30pm)
Nah remember the supply
When a PAP minister (think Lawrence Wong) voices concern over oversupply there, cybernuts who infest TRE (like rats and bugs infest Bukit Batok and suicides inhabit Bedok Reservoir) should be buying Iskandar properties since they always say “PAP always wrong. But then they got no money, and have no access to credit. Even ah loongs avoid them.
Buy Klang Valley :
Klang Valley, in particular, is preferred because of the upcoming KVMRT and LRT lines, and potential KL-Singapore high-speed rail project, which will end at Bandar …
More importantly, the strong population growth potential in Greater KL and Klang Valley – a possible 40 per cent increase to 10 million by 2020 – offers more sustainable demand for properties, it added.
And Penang instead
Err both Oppo areas.
(Above courtesy of MayBank via CNA)
Sultan of Johor will not be happy. MayBank executives (esp analysts) should avoid JB. Neither will UMNO be happy even though most of Iskandar is in a DAP consituency (MP Lim Kit Siang: he and his son came down to see LKY when the DAP won Penang. Got kow tow meh?)
Caution advised on IskandarLand
The property oversupply situation in Iskandar Malaysia, Johor, is “likely to get worse before it gets better”, said Maybank Investment Bank’s research … report, with property values in an increasingly crowded development space possibly declining over the medium term.
In a research note … (Apr 14) urged investors to be cautious about the region, noting that property transactions and prices in Iskandar have been dropping.
The value of property transactions in Johor had fallen by 33 per cent quarter-on-quarter in the Q4 2014, underperforming the country (-7 per cent) and other major cities such as Kuala Lumpur (-12 per cent) and Penang (8 per cent).
Property prices in Johor were also weaker than that of other cities, with the House Price Index (HPI) contracting 1 per cent quarter-on-quarter. In contrast, property prices in the whole of Malaysia dropped 0.2 per cent …
Residential and commercial property transaction values plunged 42 per cent and 43 per cent on-quarter in the fourth quarter 2014, respectively, compared to the 4 per cent dip by industrial properties.
“The latest statistics reaffirm our view that industrial properties are a better investment choice in Iskandar due to the relocation of small medium enterprises (SMEs) from Singapore and its relatively limited supply as compared to residential and commercial properties,” …
OVERSUPPLY AN ISSUE
… Malaysian developers have scaled back their launches and shifted their product mix to avoid direct competition with Chinese developers, and have lowered sales expectations for their projects at Iskandar.
“Judging from the number of approved high-rise projects, the Iskandar property market could be hit by too much supply of high-rise mixed development projects if there is still no coordinated planning and control – this will induce price volatility,” Maybank analyst Wong Wei Sum …
“The oversupply situation will be exacerbated by the huge incoming supply in 2015/2016, where units under construction have risen 18 per cent year-on-year in 2012 and 2013, respectively.”
“AGGRESSIVE” LAND GRAB BY CHINESE DEVELOPERS
… raised concerns about “aggressive landbanking activities” by Chinese developers in the already-crowded Iskandar region.
“Without coordinated planning and control, this could aggravate the oversupply situation and induce price wars, especially in the high-rise mixed development segment.”
For instance, Shanghai-based Greenland Holdings Group recently expanded its foothold in the space with the acquisition of a 128-acre freehold land in the south of Bandar Baru Permas Jaya. This was after its first purchase of 14 acres of land in Danga Bay in 2014. The company is also looking to acquire about 1,200 to 1,400 acres of industrial land near the Tanjung Langsat Industrial Complex, according to Maybank.
“If this materialises, Greenland will emerge as one of the largest land owners in Iskandar with a total landbank of 1,342 acres and it would pose strong competition to the local developers,” the report said.
RECLAMATION PROJECT PRESENT “HIGH ELEMENT OF RISK”
… it is “cautious” over “massive land reclamation” in Iskandar.
Reclamation works spanning 3,425 acres for the Forest City project has been given the green light from the Development of Environment. The development will spread over a 30-year period, and will consist of four man-made islands reclaimed in four phases.
“The execution and planning of such reclamation projects is complex, especially Forest City, and carry elements of risk and uncertainty. Hence, developers’ financial positions are paramount; else we may see projects being abandoned or price wars initiated to clear inventories or reduce sales risks by the developers,” …
“More importantly, the failure of any of these projects could erode buyers’ confidence and perception on Iskandar.”
… it remains cautious on property exposure in Iskandar, instead preferring developers with exposure in the Klang Valley and Penang.
Last Saturday, a freesheet published a puff piece on why it’s good to live in Iskandar and commute, and why it’s a good investment. No mention was made of the huge hikes in the tax on driving to and fro.
A day or two later M’sia again hiked it’s vehicle entry fees: by $7.25 I think. We know what the policy here is don’t we? S’pore with match the increase.
Rumour is that M’sian federal govt hiked fees last year, to warn the sultan of Johor not to to seize executive power in the running of Johor.
Will we be seeing Iskandar property ads in the freesheet?
Several fish farmers told the BBC that rapid development in the western part of the strait in Johor, the Malaysian state closest to Singapore, was one of the factors affecting the water quality.
“The plankton bloomed this fast because the nutrient content in the sea is so high. And where are all these nutrients coming from? Land reclamation in Malaysia,” said Frank Tan.
[Err these guys must be shell shocked by the losses, deaths and stench; water from Western Johor I.e. Iskandar can’t flow East because of the Causeway]
But tiny Singapore has also reclaimed parts of its northern coast, and dammed up estuaries in the northeast to create reservoirs. It has pumped millions of dollars into the fish farming industry to boost its domestic food security.
Latest government figures show there are now 117 fish farms in waters surrounding the island, spread out over 102ha – twice the amount of space compared to a decade ago.
Typical of the PAP administration under Ah Loong: one part messes up the sea in the NE by damming estuaries and reclaiming land, another promotes fishing farming in area. Looks like more work for Grace Fu’s cordinating unit? She will be bitching* for more pay?
Btw the BBC reporter, Tessa Wong, was formerly from ST. Shows that ex-ST journalists can be fearless, objective after they leave ST. Until I read the BBC piece, I didn’t understand how bad the situation had become because our constructive, nation-building media focused on the dead fish and the losses to the farmers, not on the wider ecological and environment situation.
Oh and M’sia can tell us to bugger-off if we complain about M’sian land reclamation etc affecting S’pore. It can, rightly say, “If you can damage yr environment by yr reclaimation and other projects, why can’t we?. Not as though you guys are doing right by the environment.
*In January 2012, she expressed concerns over the planned 36-37% income cuts for ministers, saying that if ministerial pay was further reduced in the future, it would “make it harder for anyone considering political office”
Funny people M’suan developers. They miss fears of a property glut in Iskandar http://business.asiaone.com/property/news/housing-glut-worries-over-johors-mega-projects saying that the Chinese from China (not S’pore) will buy the properties.
Well there is a very influential group of Malays in UMNO (the top dog in the ruling National Front) that has a problem with local Chinese. They’d freak out over an influx of real Chinese buyers living in Johor. They are likely to view such buyers as a fifth column for the Chinese enclave off Johor>
And for the developers to assume that the potential buyers are clueless about the racial tensions is an assumption too far.
After all neither the PRC developers nor their M’sian partners have good reputations for reliability. And then there is the issue of escalating tolls. I heard an interesting story that M’sia raised its tolls (which led S’pore to follow) because the federal govt wanted to send a message to the sultan of Johor to behave. Remember the row when there was an attempt to extend his executive powers? There was a plan to allow him personally senior officials of a Johor state agency invvolved in land development.
The latest is on the east side of Causeway http://business.asiaone.com/news/new-jb-waterfront-city-facing-spore
Here’s a good ST graphic of the various projects
All built on sand: an interesting take on the importance of sand http://www.harvarddesignmagazine.org/issues/39/built-on-sand-singapore-and-the-new-state-of-risk
Next stop Selangor?
LKY’s Operation Trojan Horse” of owning M’sia via the DAP is coming thru? Huat Ah!
Let me explain. Sometime back, I pointed out that S’poreans own Iskandar. True the Johor state govt and federal govt are messing us up. Even Johor’s royalty is joining in. But at least the founding father of the DAP is now MP of much of Iskandar.
And his son, Penang’s chief minister now says, Penang is vying to become the next hub for Singapore companies’ regional expansion, with the state government open to more opportunities for bilateral partnerships, its Chief Minister Lim Guan Eng said on Tuesday (Oct 14).
“We are putting ourselves on the map – that Penang is open for business, and you can set up your plants here at very attractive rates,” said Mr Lim, who was in Singapore to unveil BPO Prime, a S$500 million mixed-use development project led by Singapore investment giant Temasek Holdings and Penang Development Corp (PDC) – the state’s development agency.
“We can complement the role played by Singapore. We have a technology and electronics cluster, and I believe you should use our core competencies in manufacturing to grow your services sector. The key is convergence,” he said.
“Singapore’s investment into Penang jumped from RM61 million (S$23.8 million) to RM622 million between 2012 and 2013. We feel there is room to grow – and what better way to grow than working together? That’s why we have asked Temasek to come in, not just as an investor but also as a player,” …
BPO Prime and Penang International Technology Park (PITP), the two Penang projects outlined in a memorandum of understanding that Temasek and PDC signed in May, will have a total development value of about S$4.4 billion.
The developments will be funded via a joint venture that is 49 per cent owned by Temasek.
BPO Prime will break ground in the first half of next year and construction will take two to three years. When completed, it will offer 1.6 million sq ft of residential and commercial space. The commercial element will focus on business process outsourcing.
“Penang’s outsourcing sector saw more than a 20 per cent increase in revenue last year. BPO Prime is a priority project that is part of the state government’s plans to transform Penang into an international outsourcing hub,” Mr Lim said.
Penang can be a sound alternative for Singapore companies to expand in Malaysia at a time when all eyes are on the nearby Iskandar region, said Mr Philip Yeo, chairman of Economic Development Innovations Singapore (EDIS), the project’s master development manager.
“I’m looking for skilled workers, in which case Penang has a better advantage … Iskandar is near enough – but I’ll go where the skill is,” Mr Yeo said, citing his own experience as a chairman of aerospace component manufacturer Accuron, which is planning to grow its workforce of 800 to 1,000 in Penang.
“I believe talent will be a strong selling point for Penang, where spaces such as BPO and PITP will be ideal for high-end activities from Singapore and elsewhere,” he said. CNA
Btw, it’a fact that Penang became a DAP state, the xchief minister came down to S’pore to brief LKY. He said so in a seminar I attended.
Maybe, S’pore’s hegemony over Iskandar and Penang is the real reason why LKY’s Merger radio talks were reprinted. A subtle joke that he’s having the last laugh.
Bad news travels in pairs.
Last week, Reuters reported
Amid growing anxiety over a glut of high-rise residences in Malaysia’s Iskandar, a mega waterfront township project there appears to have hit a snag.
The Business Times understands that CapitaLand, South-east Asia’s largest real estate developer, recently sought a six-month extension on the launch of its 900-unit high rise condominium, which is the first phase of a S$3.2 billion ($2.52 billion) Danga Bay project, which spans some 28 hectares on a man-made island.
It seems that it had some problems with Johor state authorities. If TLC can have such problems, what about yr ordinary, not connected S’porean property buyer?
Then BT on 30 September carried a story reported that thanks to PRC developers and buyers, S’poreans buying to rent in Iskandar are screwed.
A looming housing glut in Iskandar Malaysia may weigh down rental yields in the economic zone, with homes being left empty.
The warning this time came from Malaysia’s national organisation of developers, the Real Estate & Housing Developers Association (Rehda).
FD Iskandar, president of Rehda, noted that some 30,000 homes could be completed by 2016 or early 2017 in Iskandar.
If these are mainly sold to buyers outside Malaysia and Singapore, “then you will see that these units will be empty and once they are put up for rent and there are so many units available, that will put pressures on rental yields”, he said.
Malaysia’s federal government is “actually looking seriously” at this issue … But land administration in Malaysia lies within the authority of the state government.
In the past 12 to 18 months, the deluge of homes launched or in the pipeline by China developers, including Country Gardens and Guangzhou R&F Properties, has stoked concerns over a looming housing glut in the Iskandar region, which encompasses an area of more than 2,000 square kilometres in Johor.
“… developers from China launching a few thousand units at one go,” Mr Iskandar said, adding that Malaysian or Singaporean developers would typically have 400-600 units in one project.
Most of the buyers of these Chinese projects come from mainland China, he observed. “…concerns about these residential units being empty.”
Wonder why land is being reclaimed in the Johor Straits? S’poreans it seems love waterfront properties. So waterfront properties are being created. And this is adding to the supply of land in Iskandar, where there are already problems for S’poreans what with Johor and Federal taxes and restrictions.
The fixation over waterfront properties in the Iskandar region, which has led to frenetic land reclamation, is threatening to undermine the prospects of the growth corridor launched in Johor eight years ago.
Iskandar Malaysia’s value proposition – polished further by its proximity to Singapore – remains intact, but may not do so if development there is left unchecked.
At 2,217 square kilometres, Johor state’s southern development corridor is thrice the size of Singapore; in sports parlance, that is about the size of 400,000 football fields. (BT report last week).
Meanwhile the development caravan keeps on moving: now to Batu Pahat. Property being built to attract S’poreans further North.
Reminds me of what the bandit chief in the movie Manificent 7 said, “If God didn’t want them sheared, he would not have made them sheep.” He was talking of the farmers he was stealing from at regular intervals: he was harvesting them at regular intervals..
He could be referring to S’poreans who keep on getting fleeced in Johor.
Me, I’d rent there, if I wanted to live in a bungalow, and rent my property here.
Juz better than Guatemala City, Caracas in Venezuela and Joeburg in South Africa. All v v violent places.
So LKY was NOT wrong in the 90s, in his analysis of JB! He was WRONG to apologise. Strange our constructive, nation-building not praising his foresight. Err maybe, he no longer considered constructive, nation-builder?
BTW JB is the capital of Iskandar . LOL
Iskandar flip flops agaim. When it started, notwithstanding its attempts to get local biz to relocate, it was telling the Arabs that it wanted to be another s’pore. The arabs wisely dids not buy into the BS. So it started trying its luck with SMEs and TLCs. Now …
Iskandar Malaysia is set to focus more on attracting higher-value manufacturing companies, in a move that may result in some lower-end Singapore businesses having to look for an alternative overseas destination where they can shift some of their operations as they grapple with higher costs and manpower constraints at home.
Mr Ismail Ibrahim, the chief executive of the Iskandar Regional Development Authority (IRDA), told TODAY in an interview that the special economic zone is shifting away from activities dependent on cheap labour.
“For the manufacturing sector, we are moving Iskandar Malaysia towards higher levels of the value chain. We want to see more of what we term as technology-intensive manufacturing activities and less of the low-cost kind of industries,” he said, adding that this has always been part of the IRDA’s planning.
Ten years ago, Mr Lim — the owner of a Singapore food manufacturing company — purchased two industrial land plots across the Causeway, with the hope of shifting some of his operations to Johor Baru’s low-cost environment. He has yet to make that move as, after crunching the numbers, there is not a strong financial case.
“Iskandar is also facing issues of a manpower shortage and rising costs. Last year’s introduction of minimum wages and Goods and Services Tax are just part of it,” Mr Lim, who asked to keep his identity and the name of his company private, told TODAY. “The fact that Iskandar doesn’t have a free port also matters to a food company like us, because imported materials and exported products will be tariffed. Or we can go through Singapore’s ports — and fork out just as much for the cross-strait transport costs.”
The CEO’s comments come as anecdotal evidence suggests that some Singapore manufacturers do not see a compelling reason to move operations to Iskandar.
Singapore remains the biggest foreign investor in Iskandar, having committed a cumulative RM11 billion (S$4.23 billion) to the area as of January, showed data provided by the IRDA. This forms a key part of the RM133.07 billion overall investment that the region has attracted so far, of which RM47.82 billion has been committed to the manufacturing sector.
However, a closer look at the data reveals that although the overall investment amount has been increasing, the proportion of foreign investment in Iskandar has been steadily shrinking, from 55 per cent of the total in 2008 to 35 per cent currently, suggesting a slowdown in overseas interest.
Last yr M’sia and Johor shot themselves and investors by imposing levies, restriction on property buyers in Iskandar.
This blog has been always sceptical about the rhetoric of govt co-operation on Iskandar. If both govts can work in training in skilled workforce, Iskandar will be a success. But they still on talking about co-operation.. But taz something.
Singapore has offered to help train a skilled workforce to meet the growing need for workers as the Iskandar Malaysia project takes off.
“As Iskandar thrives, we can expect also to need more people to be trained for the jobs to be created – and so I also talked about vocational training and Singapore helping Malaysia to upgrade its vocational training for workers who can work in Iskandar,” Prime Minister Lee Hsien Loong told reporters yesterday after his annual “retreat” meeting with his Malaysian counterpart Najib Razak.
In a joint statement, both leaders acknowledged the importance of a skilled labour force in boosting socio-economic development. They welcomed the ongoing talks between the various agencies of the two countries on collaboration in vocational training.
Speaking of the win-win gains for both Singapore and Malaysia in cooperating in Iskandar at a joint press conference, Mr Lee said: “The great advantage of Iskandar Malaysia is that it’s across the Straits of Johor, and that means that you can tap on what Singapore offers in terms of infrastructure, in terms of services, in terms of industrial base.” 8th April BT
“The government has underestimated the impact of high business costs on our future economy,” said Inderjit Singh (Ang Mo Kio), urging the government to set up a cost competitiveness committee to tackle the root causes of soaring costs before SMEs and MNCs relocate with jobs in tow. He also asked the government to reverse its land divestment policy, which he deems a key reason behind high industrial rents.
Companies are facing a “triple whammy” of rising rents and utility bills, growing wage costs, and a shortage of workers, said Mr Singh, himself a businessman. And this “chronic” cost issue does not affect SMEs alone. “The top management of some large MNCs here … have expressed their serious concerns about the unrelenting increases of the cost of doing business coupled with the unavailability of workers,” he said.
Iskandar’s industrial parks are a “huge threat”, he said. If Singapore’s SMEs are forced to move to Johor, MNCs may follow their SME suppliers and subcontractors. “The exodus may be larger than we imagine … We risk hollowing out our economy in the future, and I would like to sound an alarm that we are close to the tipping point.”…
Though he acknowledged that PIC and PIC+ would help with topline revenues growth, Mr Singh said: “We are just trying to do too many things too fast, and this is hurting many companies.”
Both he and nominated MP R Dhinakaran, who is also managing director of Jay Gee Group, pointed to rising industrial and commercial rents as a key culprit of the high costs of doing business in Singapore.
Citing Association of Small and Medium Enterprises president Kurt Wee’s comment at BT’s Budget Roundtable that rents rise as much as three-fold when leases are renewed, Mr Dhinakaran said: “In this economic climate, rental increases of this magnitude will be fatal for a large number of SMEs.”
Both Mr Singh and Mr Dhinakaran also linked the high rental costs to the government’s land divestment policy. “JTC was a landlord for 18 per cent of industrial property some 10 years ago, but today manages only 3 per cent of the market. This is a huge shift, and the government lost the ability to influence rental prices resulting in developers and investors making the money,” said Mr Singh.
“We have to reverse this policy, even if it means the government having to buy back some of the Reits. In any case, the biggest Reit players are government-linked entities like Mapletree and CapitaLand,” he added.
Denise Phua (Moulmein-Kallang) felt that certain cost increases – the restoration of CPF contribution rates for older workers, higher progressive wages for low-income earners and cost hikes due to tighter low-skilled foreign manpower policies – are justified, with “strong rationale”.
But she also said that business rents need “the touch of the State”, and asked the government to consider “cooling measures, especially for business rents”.
BT 5 March
Given that Ascendas (a GLC) is the biggest player in the industrial land arena: why do you think when the govt says this?
The government will intervene if it sees evidence of collusion or the abuse of market dominance by any landlord – including real estate investment trusts (Reits), said Minister of State for Trade and Industry Teo Ser Luck … in Parliament … calls for help with climbing business costs (and in particular, the affordability of business space) have grown louder both in and outside of Parliament in recent months.
Reits – some of which were formed after JTC and HDB divested space to private owners – have been blamed for shorter lease renewals and sharper spikes in rentals.
“We know that it has come up as an issue, many of you have raised it. We will monitor it,” said Mr Teo.
At the same time, he noted that “Reits are not necessarily the leading players in the rental space market, because they currently only own about 13 per cent and 16 per cent of retail and industrial rental spaces respectively. Like any other landlord, they have to compete in the rental market to attract tenants and cannot charge excessive rents”.
Mr Teo also said that rents for space are likely to moderate in the medium term, as the government has released a “significant amount of land”.
Over the next three years, about 145,000 square metres of new shop space will be completed each year. Over the same period, an average of 500,000 square metres of multiple-user factory space will come on-stream each year.
For the former, that represents more than double the average annual demand for such space in the last three years; for the latter, it is just under double.
(BT 7 March)
Silicon Valley S’pore style?
Entrepreneurship will also receive a boost, since by the end of this year, JTC will open two more blocks to incubate start-ups, as part of a cluster called JTC LaunchPad@one-north.
“It’s our answer to Silicon Valley,” said Mr Teo.
Yesterday’s ST carried pages and pages of ads for a project in IskandarLand.
This reminded of a BT story earlier this yr which reported:Singaporeans make up a hefty 74 per cent of foreigners who have snapped up its properties – a figure that surpasses all the other foreign buyers combined.
Looks like the developers want even more S’poreans. Remember the previous Sultan warned about foreigners taking over Johor when IskandarLand was proposed many yrs ago?
Might as well send SAF over? I’m sure the DAP MP there would have no objection. His heloo is one LKY. When his son became Penang’s chief minister, son made a trip to S’pore to see LKY and son.
Oh and without us, Iskandar would be a ghost town like this in China:
One could well surmise that the year 2013 was when Iskandar Malaysia – the country’s first economic growth corridor – finally came of age in a big way.
The mega-project, which turned seven last November, reported some encouraging numbers as far as its investments were concerned, although some investors are treading with caution after the government announced measures to cool speculation in the region’s red-hot property market.
Iskandar Malaysia, a 2,217 sq km region in southern Johor, is three times the size of neighbouring Singapore.
As at Oct 31 last year, Iskandar Malaysia had attracted RM129.4 billion (S$49.8 billion) in committed investments – 44 per cent of which has been realised so far – putting it on track to meet its lofty targets of RM383 billion by 2025 and GDP of US$93.3 billion.
This goal, said Malaysian Prime Minister Najib Razak in a recent speech, must be achieved in order to transform Iskandar into an international metropolis.
Ismail Ibrahim, chief executive of Iskandar Regional Development Authority (IRDA), expects Iskandar Malaysia to secure RM22 billion in investments this year, beating the RM21 billion in 2013.
Singapore is still by far the biggest investor in Iskandar Malaysia, accounting for 16 per cent of its total foreign investment as at June last year.
Singaporeans from all walks of life are sitting up and taking notice of developments up north, their curiosity piqued after several household names in the Singapore corporate scene pumped big money into Iskandar Malaysia – a telling sign of the level of confidence in the project’s staying power and viability.
Last February, Temasek Holdings and CapitaLand signed a deal with Iskandar Waterfront Holdings to build a S$3.2 billion township in Danga Bay, featuring luxury condominiums, shopping malls and bungalows.
Temasek and its Malaysian counterpart, Khazanah Nasional, are also jointly developing two wellness projects in Medini with a total development gross value of RM5.2 billion.
Medini is a mixed-use urban development that will feature a lifestyle and leisure cluster, a logistics village, a creative park and an international financial district, among others.
Many other Singapore firms are also striking while the iron is still hot. Last month, Iskandar Waterfront Holdings sold 15 ha of seafront land in Danga Bay for RM1.6 billion to Hao Yuan Investment, which is planning a RM8 billion development featuring, among others, peninsula Malaysia’s tallest tower.
In October 2013, Singapore billionaire and former remisier king Peter Lim unveiled plans for his RM5.5 billion Vantage Bay project that will include twin towers and is set to become one of the tallest condominiums in Malaysia.
But it is Iskandar’s property market that is getting the most attention, especially from Singapore-based investors.
According to developer UEM Sunrise, Singaporeans make up a hefty 74 per cent of foreigners who have snapped up its properties – a figure that surpasses all the other foreign buyers combined.
Most of these Singaporeans are people who either travel to Johor often for business or those who want a weekend home, according to UEM Sunrise CEO Wan Abdullah Wan Ibrahim.
UEM Sunrise is the master developer of Nusajaya, which is Iskandar Malaysia’s administrative capital and billed as the region’s crown jewel.
Overall, the greater number of investors flocking to Iskandar Malaysia has helped push home prices up considerably. The cost of bungalows at UEM’s East Ledang development, for instance, has surged 44 per cent on average in the resale market since 2011.
Interestingly the BT story played down the problems that developers and potential buyers are facing regarding the new rules for foreigners.. ST says, DEVELOPERS in Malaysia’s red-hot development region Iskandar are still struggling to understand the country’s new property curbs, some three months after they surprised the market.
They are not the only ones. Phones have been ringing off the hook at the sales offices of some popular property projects.
Potential buyers, particularly foreigners, have been desperate to seek clarity on how the new rules affect them or if they do.
“We were given sketchy guidelines on the new rules with lots of disclaimers, which means many of these rules are still being tweaked,” said an executive from a firm with a major development in booming Iskandar, three times the size of Singapore.
But Malaysia is taking steps to prevent its own real estate inflation from emerging as well as appeasing locals who complain that they can barely afford to own a home.
In his Budget speech last October, Mr Najib – who is also the co-chairman of IRDA – doubled the minimum amount foreigners must spend on property and raised the capital gains tax to 30 per cent on homes they sell within five years.
Just how these latest rulings will impact the property market in Iskandar Malaysia remains to be seen, especially coupled with Johor’s decision to impose a new tax of 4 to 5 per cent on foreigners who buy property – both commercial and residential – in the state to curb speculative fervour.This is a big step up from the current rules which require foreigners to pay a one-off fee of RM10,000 regardless of the property’s value.
BT keeps on plugging Medini:
Medini, meanwhile, could be seeing more investment in the coming years, with the zone exempt from the higher 30 per cent property gains tax.
In fact, Medini – home to a new Legoland theme park and hotel, and Britain’s famous Pinewood Studios – has been exempt from property gains taxes since day one as part of the plan by IRDA to drive more investments there.
Looking ahead, the year 2014 could prove to be an even more monumental one for Iskandar Malaysia, should two major initial public offerings (IPO) be launched as planned.
Medini is looking to raise some RM2.5 billion when it eventually goes public. Iskandar Waterfront Holdings, meanwhile, was on track for a US$300 million IPO in the first quarter of this year, but has since delayed it to the end of 2014 to gauge the impact of the numerous property cooling measures.
From the government’s perspective, it will do all it can to ensure Iskandar Malaysia remains vibrant and attractive to both local and foreign investors, Mr Najib said last month.
“The federal government is committed to ensuring the success of Iskandar Malaysia and we are working with the Johor government, the private and public sectors, and the people of Johor to ensure the economic region’s growth,” he said.
“It is vital to ensure that projects are successfully completed on time and within budget to build investor and public confidence in Iskandar Malaysia and attract more investments. This will generate a momentum that will bring about multiplier effects and sustainable economic activities,” he said.
— While Horizon Hills surrounds a golf course and is luxurious by Malaysian standards, homes cost far less than in Singapore. Four-bedroom houses in the 1,200-acre (487-hectare) development, popular with expatriates, are advertised online at $270 per square foot, compared with the $503 per square foot asked for a four-bedroom public-housing flat in Singapore’s central Bishan district.
(http://www.bloomberg.com/news/2013-11-19/singapore-property-boom-fuels-malaysia-spillover-bubble.html)And property in Iskandar will only get cheaper:
At the same time, overseas developers are expected to be more cautious about land transactions as more punitive taxes could lead to higher landholding costs, said RHB Research.
CBRE data indicates that foreign buyers account for 54 per cent of total high-rise residential sales (by developers) in Nusajaya, and 39 per cent in Johor Baru and major suburbs.
But the new 30 per cent RPGT (real property gains tax) on foreigners who gain on disposals within the first five years of acquisition is likely to “wipe out short-term foreign speculators to a certain extent”, RHB observed in a real estate report dated yesterday. (Friday’s BT)
Related posts: https://atans1.wordpress.com/tag/iskandarland/
JOHOR is planning to impose a 2 per cent levy on foreign buyers across all segments of the property market and the secondary market in the southern Malaysian state from May.
The rate is lower than the 4 per cent to 5 per cent mooted earlier, but will still amount to more than twice the current RM10,000 (S$3,895) fee foreigners pay to buy properties in the state. Since foreigners are required to purchase units valued at RM1 million and above, the RM10,000 fee was at most a one per cent levy.
The levy comes on top of the Malaysian government’s recent measures to cool the property market. (BT on 13th November)
Crime in Johor, and the authorities’ denial attitude: http://www.bbc.co.uk/news/magazine-24924283
And it has been reported that Johor is considering changing its weekend from Saturday and Sunday to Friday and Saturday. Not exactly S’porean and investor friendly is it?
What Iskandar repeated shows is that there is a reason for the huge price gap between properties in Johor and S’pore. The issue for buyers is whether the lower prices there compensate for the risks they are assuming.
Trumpets pls for this recent post on Iskandar.
M’sians Double confirm now that S’poreans kanna screwed by the M’sian govt Budget measures and Johor’s proposed
Malaysia’s Iskandar Waterfront delays IPO on gov’t property steps -sources
* Postpones listing to Q4 2014, a year later than initially planned
* Concerned measures to rein in property prices will slow demand
* Not immediately clear if delay will impact Johor metropolis development
This story came out juz after a BT article on 4 November 2013, a few hours before the above appeared:
Jubilee: An interesting Iskandar play
THE property rush across the Causeway in the past couple of years has seen prices in Iskandar Malaysia double or even triple. Despite talk of a bubble, investors unwilling to jump onto the buyers’ bandwagon can still take bets on property developers themselves.
Jubilee Industries Holdings – formerly loss-making plastic injection mould producer JLJ Holdings – appears poised to be the latest intriguing Iskandar play on Singapore Exchange.
A proposed reverse takeover (RTO) announced in mid-October will see Singaporean businessman Dennis Ng inject Tenderside Ventures, a subsidiary of his Malaysian property development company Jewelstone Properties, into Catalyst-quoted Jubilee.
The deal gives a well-connected and established family a foothold in a listed entity in Singapore.
Mr Ng is executive director of United Malayan Land (UMLand), of which his father, Ng Eng Tee, is deputy chairman and also executive director.
When will S’poreans realise that property is cheap in Johor for a gd reason? The rules are suka suka changed after S’poreans bot into the latest BS. But first some predictions:
— The infrastructure promised for Iskandar will remain that: a promise. Ask the S’porean investors who bot into the BS over the promised east coast developments near Pasir Gudang. They are still waiting, after 20 myrs. Meanwhile the BS caravan moved on to Iskandar.At first, S’poreans were sceptical, but finally succumbed to the BS, after the Arabs refused to buy into Iskandar’s tales of wealth. https://atans1.wordpress.com/2010/09/19/iskandarland-getting-desperate/,
— Now the caravan will move further north, along the corridor for the high-speed train.
S’poreans get fleeced, and suffer in silence, the caravan moves on. ” If God didn’t want them sheared, he would not have made them sheep,” the bandit chief in the Magnificent Seven.
Malaysia’s Budget 2014 means more expensive homes for foreigners with higher taxes and a doubling of the minimum price of properties to RM1 million (S$391,000).
The most severe measure is a 30% real property gains tax (RPGT) that will be levied on gains on property disposed within three years, Disposals within four and five years are to be taxed at 20 and 15%, respectively. And at 5% in the sixth and subsequent years for non-citizens. These taxes are, it seems, higher than anticipated. Currently, the RPGT rate for property disposals within two years is 15%, while the level for disposals between two to five years is 10%. Note that Medini in the Iskandar special economic zone is now more attractive to investors as it is exempt from taxes.So if got property there, can relax until further notice: this is M’sia. In M’sia foreigners get shafted. In S’pore. locals get screwed.
Add to this the tax that the state of Johor plans to levy*, and S’poreans who bot properties in Iskandar hoping to make $ will not be too happy. Future buyers will be deterred too.
Would like to draw attention that most of Iskandar is in a DAP-controlled constituency. DAP’s heloo is one LKY.
Now these measures mean UMNO-dominated govts at the Federal and Johor will make sure voters and S’poreans repent. Hehehe.
TRE once wrote: Some issues are beginning to surface as highlighted in a recent Business Times article which said that investors are not getting assurances in black and white on issues like land zoning, mortgage loan quantums and Bumiputra employment quotas, among others.
Foreigners investing in Iskandar might do better if they can understand that most policies in Malaysia are instituted by politicians of the day. When the politician leaves, a new policy replacing the old one is to be expected. When doing business in Johor, one has to factor in such risks.
Remember that Putrajaya, the state administrative capital of Malaysia, is still struggling after more than 20 years in the making. When Iskandar was mooted in 2006, authorities were confident about getting funds from Middle Eastern investors. Obviously, that plan didn’t work out and the focus is now back to Singaporean investors.
Interesting to see the u/m projects reported by BT yesterday go ahead:
[U]nits of three local firms – Tat Hong Holdings, Boustead Singapore and CSC Holdings – have set up a joint venture with AME Group to develop land in Iskandar Malaysia.
Boustead will own 35 per cent of the joint-venture firm, named Tat Hong Industrial Properties Sdn Bhd (THIP), through its unit BP Lands, for a paid-up capital of RM3.5 million (S$1.4 million).
The Johor-based AME Group, which has a division that specialises in real estate development, will also own 35 per cent. It will do so through its unit AME Land Sdn Bhd for the same amount in paid-up capital.
* There are plans to impose a tax of 4 to 5% on foreigners who buy property in the state Today reporter earlier this month, Johor’s State Housing and Local Government Committee Chairman Abdul Latiff Bandi said yesterday that the new tax would likely be implemented by the year-end or early next year, in a bid to control property prices and foreign ownership, the New Straits Times reported. The levy would apply to both commercial and residential properties. Under the current policy, foreigners fork out a one-off payment of RM10,000 (S$3,910), regardless of the value of the property. The state government will also look into barring Malaysians who purchased property from selling their units to foreigners.
They will have problems getting cheap FTs there. Cheap FTs are what they want: https://atans1.wordpress.com/2013/08/17/sccci-sme-survey-proves-lkys-point/
This is what BT reported on 26 August 2013:
Small and medium enterprises (SMEs) of Singapore looking to move into Iskandar Malaysia may have to wait up to three years before they can access a steady pipeline of manpower there.
However, even as the region looks towards Singapore’s vocational institutions to meet their skilled labour needs, the authorities there may import foreign manpower in the short term to help SMEs from Singapore.
In an exclusive interview with The Business Times, Syed Mohamed Syed Ibrahim, the president and CEO of Iskandar Investment Berhad (IIB), said that Singapore companies should still give Iskandar a chance despite the manpower challenges there.
“My message to the Singapore SMEs is that I will definitely still tell them to come because labour is something that we can easily procure from the market if the need is immediate – whether local or foreign,” he said. However, if the SMEs are looking towards the medium term for suitably skilled labour, then they should wait for up to three years for the institutions within Iskandar to help create this pool.
Note that the CEO is in no position to promise SMEs that he can get them cheap labour they demand. M’sian businesses have to resort to illegal FTs because the govt is pretty strict in allowing FTs in.Recent crackdown http://www.bbc.co.uk/news/world-asia-23931833
It is not like the govt here.
And then there is a minimum wage in M’sia which M’sian SMEs are complaining about.
Finally, M’sian petrol prices have gone up. Still want to move?
First HSBC’s results and now StanChart’s result show that regional economies are slowing down
Example Singapore, where first half income fell 3% and profits dropped 12% (not reported by our constructive, nation-building media).
Other Asean round-up news
And here’s the third confirmation. Indonesia’s exports are dropping, GDP growth is slowing and inflation is rising.
Forget about India, China, Thai or Indon markets
Think frontier markets: like Vietnam, Cambodia. Laos and Burma are coming too
And here’s a plug for M’sia
Another Lion Air air crash since May (then into sea) this year: now into into a cow
And UOB recently set up a unit offering loans to Chinese companies looking to move into the region, including in renminbi
Indons love their Blackberries (still): now they can transfer money to one another using their Blackberries. Maybe some rich Indon should save RIM, Blackberries’ manufacturer.
The BTS Group, a Thai elevated-railway operator, is looking to raise at least US$1.5 billion through an I.P.O. of its infrastructure fund, “which would make it the country’s largest-ever I.P.O.,” WALL STREET JOURNAL
Iskandar getting desperate: want our SMEs. One time, see our SMEs no ak. Only wanted MNCs, TLCs and Arabs.
Malaysian billionaire Quek Leng Chan, who owns 75% of the HK-listed Guoco Group, offered to take the company private for about US$1.1 billion, WALL STREET JOURNAL
Indonesia’s increased piousness has led to a demand for the services of Islamic or Sharia banks: growth is at 40% a year.
In the report*, called Emerging Trends in Real Estate Asia Pacific 2013, Singapore fell to third place in the rankings, losing the top place it held for the last two years to Jakarta. “The main issue in Singapore is a glut of new supply that’s arrived just as financial sector firms have been shedding headcount,” said Mr Colin Galloway, ULI’s Research Consultant and the author of the report.
Jakarta is seen by the 400-over industry experts surveyed for the report as the best bet, especially in the retail and office segments. Its jump to the top from its previous mid-table position has been driven by strong investor interest tied to the country’s economic growth. “It’s really boom times in Indonesia now,” said one of the surveyed developers. “The demographics look good, it’s a country as big as America in terms of headcount and corruption seems to have been at least partly reined in.”
Singapore may face further competition in attracting real estate investment as it may lose out to countries offering better yields across the region, such as emerging and frontier markets like Cambodia and Myanmar, the report said.
Thai coup coming? An analyst speculates.
S’pore minister endorses Iskandar.
*According to a report co-published by PricewaterhouseCoopers (PwC) and the Urban Land Institute (ULI).
Looks like project promoters are scrapping the bottom in search of investors.
First it was the Arabs and Temasek and its TLCs and other S’porean GLCs. Then any foreigner, even SMEs from S’pore.
Now it is any M’sian company. Another grandiose M’sian project bites the dust.
Much of the early effort was focused on attracting investors from the Middle East, especially for the Medini financial hub, where major investors include Mubadala Development, the Abu Dhabi government investment company; Aldar Properties, an Abu Dhabi real estate developer; and Kuwait Finance House, a Kuwaiti bank.
But after Damac Properties, one of the biggest real estate developers in Dubai, pulled out of Puteri Harbor, a waterfront and marina project in Nusajaya, Iskandar Investment changed tacks [sic]. NYT article
Glad that TLC and GLCs are not investing here then, if Arabs refuse to invest why shld we? Temasek has a j/v with Khanazah to do something but it is early days yet.
As is traditional whenever there is a new M’sian PM, there is a love fest wayang between the two countries for the media and public. Then reality sets in.
Both leaders also discussed bilateral co-operation in the joint iconic project in Iskandar Malaysia.
They agreed that Khazanah Nasional and Temasek Holdings will form a 50-50 joint venture company to undertake the development of the iconic wellness township project in Iskandar Malaysia.
The project will involve the participation of private sectors from both countries.
Both leaders said they look forward to the launching of the project within a year.
Let’s hope this doesn’t become another Soochow Park fiasco. I remain sceptical abt the Iskandar project because it seems more of the same, “Buy land from us because we are doing great things” that emerges from Johore every few yrs.
I do not get the impression (and I’ve attended several high-powered seminars) that the Malaysians are spending money putting up the core buildings. Contrast this with what S’pore usually does when it builds industrial parks in S’pore.
S’pore is going abt developing a data park, which shows the difference between how S’pore does things from Iskandar. S’pore is planning to put up six buildings (120,000 square metres) and allowing companies that want to build facilities to do so. Iskandar from all that I’ve seen wants to sell/lease land for companies to develop the banking. wellness, IT and education hubs. The only places in Iskandar Land that does this is in places where MMC (a M’sian listco) is building logistics hub: Senai (air) and Tanjung Pelepas (sea).
When will the Malaysians learn that since the Dubai crisis, the selling land/ leasing model doesn’t work any more?
Get serious, do what S’pore Inc does successfully in S’pore,Vietnam (SembCorp’s projects) and India (Ascendas’ projects).But money where yr mouth is.