Nov 2011 issue 17

FACILITATING & PROMOTING INVESTMENT FOR MALAYSIAN REAL ESTATE | www.malaysiapropertyinc.com

COVER STORY CITY OF MILLIONAIRES

NEWSFLASH

pg4SPOTLIGHT

PROPERTY ABOVE RM1 MILLION BY STATE & SECTOR, 1H2011>> Read more

GRAPHICALLY SPEAKING

ZOOMING IN ON PROPERTY REGISTRATION

>> Read more

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pg7

pg9

CROSS-BORDER QUERIES

LOOKING FOR INVESTMENT

>> Read more

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pg6pg5

SUSTAINING GROWTH THROUGH RETAIL TOURISM

>> Read more

MALAYSIA AT MIPIM ASIA 2011

>> Read more

SPECIAL REPORT

INVESTORPREFERENCES

Heading towards the creation of another major Malaysian city>> Read more Courtesy of Ipohworld.org

STEERING MALAYSIA’S “MICE” MARKET

>> Read more

IN A NUTSHELL

DECODING KL’S ECONOMIC RESILIENCY

>> Read more

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Perak takes its name from the silvery colour of the rich tin deposits for which it is renowned. Ipoh, the state capital of Perak, is known historically for its tin-mining activities. “City of Millionaires” is one of its nicknames referring to the vast fortunes made during the mining era.

The world’s tin industry collapsed in the 80’s and forced the once-bountiful state to look into diversification of its economic activities by developing value-added, resource-linked manufacturing industries as well as boosting its services sector.

CITY OF MILLIONAIRESHeading towards the creation of another major Malaysian city

by Hazrul Izwan

COVER STORY 2

from Brazil, will invest RM4 billion to build an iron ore distribution centre in Teluk Rubiah, Perak by 2015.

On the property front, Perak is expecting a delivery of around 10,000 new residential units in 2011, up from 4,582 in 2010. According to the National Property Information Centre (NAPIC), delivery of new units has ranged between 6,000 – 9,000 units from 2007 onwards. Strong domestic demand has driven property price growth at an increase of approximately 15% over the past year.

More than half of the launched units are situated in the Kinta district where its capital, Ipoh City is located. Ipoh is situated approximately 200km or two hours drive to the north of Kuala Lumpur on the North-South Expressway. Kinta district’s sales performance in 3Q’11 rose by 2.4% to 21.7% compared with 3Q’10. Another improvement worthy of note is the gradual decrease in overhang from 30.8% in 2007 to the current range of 24.9%-27.8%.

(continued next page)

According to FDI Markets, Perak

(Manjung) was selected as one of the Top 20 Target Cities for FDI

2006-2011 across the oil, coal and natural gas

sector.

2006

2007

2008

2009

2010

10

8

6

4

2

0

-2

-4

-6

-8

-10

Legend: Perak Penang

Perlis Kedah

Figure 1: GDP growth of Northern States in Malaysia, 2006-2010 (%)

Source: Department of Statistics, Malaysia

10.0%

5.7%5.4%

4.5%

In 2010, Perak’s GDP grew by 5.7% last year, a robust growth just second to Penang state. On the foreign direct investment (FDI) side, the Perak Government was able to induce more than RM1.43 billion worth of projects for new investments and RM0.22 billion for expansion projects. Perak’s mining reputation from the past clearly benefits in positioning them amongst the world’s top mining companies for consideration.

According to FDI Markets, Perak (Manjung) was selected as one of the Top 20 Target Cities for FDI 2006-2011 across the oil, coal and natural gas sector. Vale SA, the world’s largest iron-ore producer

Kota Kinabalu

Johor Bahru

Kuala Lumpur

Ipoh

Penang

Kuching

Brunei

Singapore

Thailand

Indonesia

?

COVER STORY 3

(from previous page)

One of the prominent local projects is The Haven Lakeside Residences, a project surrounded by 280-million-year-old limestone hills and a pristine 4-acre running lake at the foothill, currently operated by Best Western International Hotels. The project consists of three 26-storey luxury condominium blocks with sizes ranging from 968 sq ft - 2,852 sq ft and penthouses of over 3,000 sq. ft. The take up rate for tower 1 and 2 was impressive, with more than 50% local buyers and the remaining made up of buyers from Singapore, Hong Kong, United Kingdom and the Middle East. Through MPI’s Malaysia Property Exhibition in Jakarta, Indonesia last month, tower 3 has received continuous sales enquiries and requests for site visits. At a minimum intrinsic value of RM600 psf, The Haven expects to generate returns of 6% per annum for the first three years.

The National Physical Plan forecasts Ipoh’s population to reach 1.09 million by 2020. Moving forward, the state government is implementing hard and soft infrastructure improvements on several fronts. Increased accessibility has been taken into account with the potential upgrading of Ipoh’s Sultan Azlan Shah Airport from domestic to international standards with more inter-country direct flights in the future.

In conjunction with Visit Perak Year 2012, the state government could leverage on this

promotional opportunity to promote Perak as

an attractive property investment destination

In conjunction with Visit Perak Year 2012, the state government could leverage on this promotional opportunity to promote Perak as an attractive property investment destination.

Figure 2: Sales Performance in Kinta District within 3,6 and 9 months , 3Q’11

Source: NAPICNote: ND = no data

Location: Kinta District 3Q ‘10 3Q ‘11

Within 3 months 19.3% 21.7%

Within 6 months 27.0% ND

Within 9 months 50.3% ND

With the focused activities of state promotional agencies such as InvestPerak, potential business investors are also introduced to business-friendly incentives such as possible reduction on land premium and selected tax exemptions. The state remains confident that spill-over effects from FDI will have an indirect impact on property sector growth especially in the residential and commercial sectors.

For more information about investment opportunities in Perak and northern economic corridor, write to:

Hazrul Izwanhazrul@malaysiapropertyinc.com

4Q’0

7

3Q’0

8

3Q’0

9

3Q’1

0

3Q’1

1p

6,000

5,000

4,000

3,000

2,000

1,000

0

35

30

25

20

15

10

5

0

Source: NAPICNote : p = prelimanary data

Legend: Units Launched (RHS)

Overhang rate (completed units)

Figure 3: Number of Residential Units Launched and Overhang Rate in Perak, 4Q’07-3Q’11p

(%)(units)

26.2%

30.8%

Further positive outcome can be achieved by tying in the planned activities with promotion of Tourism Malaysia’s Malaysia My Second Home (MM2H) programme. As of September this year, more than 1,300 participants of this long stay visa programme have also purchased a property in Malaysia, amounting to a total transaction of RM1.28 billion since 2007.

SPOTLIGHT 4

STEERING MALAYSIA’S “MICE” MARKET

Zulkefli Hj. Sharif is currently the chief executive officer of the Malaysia Convention & Exhibition Bureau (MyCEB), a non-profit organisation established in 2009 by the Ministry of Tourism. MyCEB’s key role is to brand and position Malaysia as a preferred destination for business events in the region.

Prior to this position, Zulkefli has held various positions with Tourism Malaysia across different divisions. This includes international marketing, promotional support, research, more than 10 years with the Conventions Division and a 4-year stint as Director of Tourism Malaysia in Stockholm, Sweden.

Property Quotient (PQ) caught up with him recently to gain insight on MyCEB’s initiatives and how growing business tourism will influence the property market especially the hospitality sector.

PQ: MyCEB has made its mark to further strengthen Malaysia’s business tourism industry since 2009. How has the Malaysian MICE market evolved over the years, especially in Kuala Lumpur?Zulkefli: The business tourism industry in Malaysia has grown rapidly and positively over the years due to the smart partnerships and collaborative efforts between MyCEB, relevant government bodies, stakeholders and industry players. As provided in the Economic Transformation Programme (ETP) Roadmap, the industry was recognised as one of the Entry Point Projects (EPP) to establish Malaysia as a leading business tourism destination.

Malaysia and Kuala Lumpur’s strong track record and reputation in hosting successful business events with record attendances, including the 18th World

Congress of Accountants in Kuala Lumpur 2010 (6,000 delegates),the 18th World FIGO Congress of Gynecology and Obstetrics 2006 (8,300 delegates) and the Perfect Travel China Incentive Conference 2007 (8,500 participants) have opened up a plethora of opportunities for Malaysia to attract international meetings to the country.

The recent launch of International Events Unit (IEU) by MyCEB is expected to further contribute to the nation’s economic growth by attracting more international visitors to Malaysia. This specialist unit is expected to contribute RM427 million in incremental Gross National Income (GNI) by year 2020.

PQ: Malaysia ranked as one of the top 10 meeting destinations in Asia Pacific according to the latest International Congress and Convention Association (ICCA) report, what is the success story behind the achievement and what is the next step towards improving Malaysia’s ranking at the global stage?Zulkefli: Malaysia’s success in becoming a major player in the business events arena in the region is very much dependent on the collaborative efforts between the government and industry to bid for and secure business events as well as to facilitate successful events when they are being hosted in the country.

The introduction of MyCEB’s Industry Partner Programme (IPP) further galvanises Malaysia’s competitive position in the global business tourism market. Cooperative programmes across the country, providing business opportunities for partners and to increase Malaysia’s success rate in securing international business events are also being implemented.

PQ: In your opinion, what is the main component that should be incorporated in property development in order to raise Malaysia’s global competitiveness as an international meetings destination?Zulkefli: It has to be more purpose-built convention and exhibition facilities of international standards, built based on clients and delegates needs and requirements. These facilities must be built in a strategic location, well served by hotels, transportation, retail outlets. This would definitely raise Malaysia’s global competitiveness as an international meetings destination. For example, the Kuala Lumpur Convention

Centre which is located in the integrated precinct of Kuala Lumpur City Centre with ample accommodation options and infrastructure available within walking distance .Plans are in place to build purpose built facilities in Sabah and Penang which will provide meeting planners multiple destinations within one country. This will create an added incentive for regional business events to return to Malaysia.

PQ: To what extend do you think that the growing MICE market in Malaysia will influence the property market?Zulkefli: The growth in business events activities in Malaysia would mean a need for a wider range of accommodation to cope with the rising demand. The multiplier effect will be a boost for the property market especially in the hospitality sector.

A big factor to be considered by hotels is the forward-bookings that apply to business tourism. MyCEB with its industry partners has successfully bid for and secured conventions for Malaysia between now until 2016 and is currently bidding for business events up to year 2020. This represents potential business in the high-yield sector for accommodation owners. The securing of medium to long term business helps create investor confidence in the market.

Business and major events also help fill low season gaps in market. Part of MyCEB’s objective is to spread these events across the year.

(continued page 7)

by Hazrul Izwan

SPECIAL REPORT 5

Tourists with a penchant for shopping are coming to Malaysia in droves. Visitor exports are expected to generate RM62.4 billion in revenue this year. Datuk Dr James Dawos Mamit, Malaysia’s deputy minister of tourism, reports that Malaysia’s tourism sector is projected to generate RM124.7 billion or 15.8% of gross domestic product (GDP) in 2011.

sia’s tourism retail towards positive growth. The 173,000 square feet premium outlet is strategically located near the Senai International Airport situated within the Iskandar Region, about three hours from Kuala Lumpur.

Boasting 70 outlets in the first phase with planned future expansion of another 60 outlets, a water park, a 2,000-room hotel and an international convention centre in the second phase, Simon Property Group is successful in persuading luxury designer brands to play a part in the first Premium Outlet megastore in Southeast Asia. Leveraging on its close proximity to both Malaysian and Singaporean shoppers, this is also expected to attract a wider set of tourists from the neighbouring Lion City.

by Afiq Syarifuddin hand-in-hand with the investments made by various industry players into the tourism sector, totalling an estimated RM15.2 billion for the year 2011.

Stuart Tomlinson, Visa’s Malaysia Country Manager, reveals that Malaysia’s key sources of affluent tourists are coming from the emerging market set, with recorded average monthly income of RM13,691 (approximately USD4,416). Based on the findings from a global survey commissioned by Visa, the Visa Global Travel Intentions Survey 2011 reveals that 30% are from China, 26% from India and 8% from South Africa, followed closely by tourists from the United Arab Emirates.

Tourism Malaysia officials have also mentioned that Middle-Eastern tourists constantly mark Malaysia as their shopping haven during their summer holidays. This positive outlook for the next two years is seen as a competitive advantage for Malaysia within the Southeast Asian countries. Tomlinson also added that Malaysia can enhance its value proposition to these economic contributors by offering special experiences. This can be done through constant and sustainable investment in terms of hospitality and retail infrastructures to ensure that tourists’ demands and expectations on service levels, food and tourism product quality are met.

With the official opening of Johor Premium Outlet in early December 2011, this joint-venture between international retail giant Simon Property Group Inc and Malaysia’s conglomerate Genting Group further encourages the path of Malay-

SUSTAINING GROWTH THROUGH RETAIL TOURISMAffluent segment waiting to be tapped

2001

2003

2005

2007

2009

2011

2021

f

120

100

80

60

40

20

0

35

30

25

20

15

10

5

0

Source: WTTCNote : f = forecast

Legend: Foreign visitor exports (LHS)

Foreign tourist arrivals (RHS)

Figure 4: Tourist Arrivals and Receipts to Malaysia, 2001-2021f

(million)(RM’000)

According to the Malaysia Travel & Tourism Economic Impact 2011 report, published by the World Travel & Tourism Council, travel & tourism contribution to Malaysia’s GDP is forecasted at 5% yearly growth for the next 10 years. In constant 2011 prices, this will translate to RM203.6 billion in GDP contribution by 2021. This strong performance goes

Figure 6: Travel & Tourism’s Direct Contribution to GDP by Selected Countries, 2011

Source: WTTC

Figure 5: Malaysia: Travel & Tourism’s Direct Contribution to GDP, 2011

Source: WTTC

Leisure spending45.8%

Foreign visitor spending

Domestic visitor spending37.3%

Business spending54.2%

Rank Country Direct Contribution(USD’million)

2 China 166.73

11 Australia 44.70

12 India 34.01

14 Indonesia 25.31

17 Thailand 20.48

21 Malaysia 18.27

World Average 15.68

34 Singapore 9.32

39 Phillipines 7.18

INVESTOR PREFERENCES 6

by Chan Tze Wee

for new locations, service providers across the real estate value chain, government authorities and of developers from across Asia. A quick glimpse at the attendance list includes the likes of Aedas, Blackstone Group (HK), Camsing Global, Citic Capital, Deka Immobilien GMBH, EADS France, GE Capital Real Estate, Kohn Pedersen Fox Associates and many more.

A unique feature of MIPIM is the breadth of country or location positioning that is evident through pavilions from the Northern Caucasus, Gold Coast (Australia) and Incheon Free Economic Zone, amongst others. Undeniably, MIPIM provides a glimpse into the high level of competition for investments demonstrated by the scale of activities organized by the participating companies and local authorities. An example is the presence of the mayor of Taichung (Taiwan), presenting a case on the future development plans of the city. The French Minister for Urban Affairs, Maurice Leroy, was also present to update MIPIM Asia delegates on the Greater Paris project and invited international developers to pitch for Paris’ largest urban renewal project to date.

With the attention received from VIP’s such as the Hong Kong Government’s Secretary of Development during the official VIP Tour, coupled with the positive sentiments on Malaysia expressed by Hong Kong major developer Cheung Kong Holdings and China-based funds such as Gaw Capital, this recognition supports MPI’s future plans to position Malaysian real estate within the corporate real estate investment arena.

For detailed coverage of MIPIM Asia 2011, visit http://www.mipim.com/en/mipim-asia/

Marché International des Professionnels d’Immobilier (MIPIM) has been held annually in Cannes, France for the last 12 years and Hong Kong for the last 5 years. At the cost of €1,050 per delegate, this trade show attracts the attention of investors, exhibitors and service providers with an eye to potential large-ticket real estate deals from across the Asia Pacific region.

This year, a collective Malaysian effort was featured through a country pavilion at MIPIM Asia, highlighted by the developments and opportunities available from Sunway Berhad, Multimedia Development Corporation, UOA Development, Cyberview, IJM Land and the Selangor State Development Corporation (PKNS). The pavilion also played host to Malaysian delegates who attended from Sime Darby Property, MRCB and Iskandar Investment Berhad. The range of investment opportunities included those for hotel operators, retail operators, assets for direct acquisition as well as development joint ventures across various real estate sectors.

Being within an event with the largest concentration of corporate investors in Asia Pacific, Malaysian projects were featured amongst a diverse mix of investors from institutional funds, investment managers, corporate end users, hotel groups, retailers scouting

MALAYSIA AT MIPIM ASIA 2011

Figure 7: MIPIM Asia 2011 Summary Profile

Source: MIPIM

Summary

Total no. of visitors 1,808

Total no. of companies visited 698

Total no. exhibitors 105

Total no. of countries represented 42

(74% from Asia, 17% from Europe, 5% from North America, 3% from Pacific and 1% from Africa/Middle East)

A unique feature of MIPIM is the breadth of country or location

positioning that is evident through pavilions

from the Northern Caucasus, Gold Coast

(Australia) and Incheon Free Economic Zone,

amongst others

The pavilion garnered the attention of both first time enquiries as well as those following up on the latest developments in Malaysia. While the former confirms the point that awareness of Malaysian companies and real estate opportunities could do with higher exposure and stronger positioning, the follow up enquiries are evidence of effective engagements from the past.

One developer received renewed attention from an investor that they have met in a previous occasion but did not initially express interest. The Iskandar region received serious queries from both Japanese and Chinese companies, a product of the region’s strong profile built up from past branding activities as well as coverage of developments in the international press.

NEWSFLASH 7

The World Bank’s Doing Business Report is one of the consistently published reports that measures countries against pertinent areas and associated costs for businesses making cross border entry into markets. According to the 2012 report, Malaysia ranked 18th worldwide, an overall improvement from 21st position previously.

Malaysia ranked highest in the areas of getting credit, protecting investors and trading across borders. On the flipside, the areas where major improvements are needed were also identified. The 3 key issues are matters dealing with construction permits, getting electricity and registering property.

Detailed examinations of the process of property registration are as follows:

1. Form 14A is the official document for registration or transfer of property ownership. This is issued by all Land Offices across Malaysian states.2. According to PEMUDAH, current practice shows that the manual registration process from submission

ZOOMING IN ON PROPERTY REGISTRATION Towards further alignment with international standards of measurements

to approval stage takes between 3 – 25 days and online registration between 2 – 11 days.3.This timeframe does not include the mandatory submission of Sale & Purchase Agreement, adjudication of Form 14A for stamp duty, valuation of property, payment of stamp duty and stamping of Form 14A.

Essentially, the Doing Business Report measures the “Registering Property” process across all countries by tabulating total days taken to undertake all the mandatory procedures and document submission related to the registration or transfer of titles. With this, the total number of days for the completion of this process in Malaysia is 56 days. In comparison, PEMUDAH’s classification of “Registering Property”, which only covers the single stage process of online or manual registration through the Land Office, falls between 2 - 25 days.

Nevertheless, PEMUDAH’s role as the government taskforce with a mandate to address bureaucracy issues in business-government dealing has significantly improved existing lagging procedures. In fact, Malaysia’s ranking in registering property jumped from 86th position in 2010 to 60th in 2011, attributable to the reduction of numbers of days taken to process registrations. Other improvements have been undertaken by relevant government agencies to increase access and transparency. This includes the online availability of cadastre information online and

(from page 4) PQ: As a closing statement, what is the MICE market outlook for 2012?Zulkefli: Based on the ICCA report 2001-2010, international association meetings are continuing their upward progression, especially in the Asia/Middle East region – where meetings have increased by 113 percent, from 814 (2001) to 1,737 (2010). This trend is likely to continue.

The outlook for 2012 is very promising. MyCEB and its industry partners have secured over 70 international and regional conferences for the period 2012-2016, with 88,000 delegates and RM950 million in economic impact.

In view of the growth in Malaysia, educating and encouraging local associations to bid for their international counterpart’s congresses through the MyCEB annual association support programme is vital. The programme to be

ding for their counterpart international events.

For more information about MyCEB, visit http://www.myceb.com.my

Event Location Number of Delegates

25th World Gas Conferences Kuala Lumpur 3,500

7th Triennial Meeting of the Commonwealth Dental Association

Kuching, Sarawak 2,000

14th Congress of the International Society for Peritoneal Dialysis (ISPD) 2012

Kuala Lumpur 2,000

10th International Scientific Conference of the Royal College of Obstetricians and Gynaecologists

Kuching, Sarawak 1,600

Royal Australasian College of Surgeons Annual Scientific Congress (ASC) 2012

Kuala Lumpur 2,000

9th World Congress of Chinese Medicine Kuching, Sarawak 1,000

launched by year end (2011) are designed to help make locally-based organizations aware of the professional support and in-kind assistance that is available to organisations which are considering bid-

Source: MyCEB

Figure 9: Highlights of upcoming business events, 2012

2008

2009

2010

2011

2012

160

140

120

100

80

60

40

20

0

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0

Source: Doing Business Report

Legend: Time (days) (LHS)

Cost (% of property value ) (RHS)

Figure 8: Time taken (days) and Cost Involved for Registering Property in Malaysia, 2008-2012 Cost

(%)Time

(days)

electronic filing of complaints, which can potentially expedite the process of enforcing property-related contracts such as tenancy agreements or SPAs. Moving forward, alignment with international standards of measurements or classifications is one way to further improve the proceduralshortfalls that influence the foreign investor’s market entry into Malaysia.

For more information about PEMUDAH’s initiatives, visit http://www.pemudah.gov.my

IN A NUTSHELL 8

by Afiq Syarifuddin

mance has experienced less contraction than its neighbours such as Singapore, Thailand and Hong Kong. Bank Negara Malaysia recently announced 3Q2011 Real GDP growth at 5.8%.

Growth performance aside, urbanisation is central to Malaysia‘s aspirations to become a high-income economy by 2020. This will be driven primarily by the preparedness of the various Malaysian cities to continuously attract and absorb inflow of rural migration. By addressing various fundamentals towards the enhancement of the city, a transition for Kuala Lumpur into a smart city is not a tall order into the near future.

The MEM highlights several issues to be addressed. The first involves maintaining a good balance of workforce with varying expertise. Cities must have a vibrant and knowledge-intensive economy. This requires a combination of high value-added services and an available workforce with the abilities to perform more complex tasks across different levels of production.

mentation, more weight would be put on preventive development planning practices rather than short term problem-solving.

In line with continuing efforts, the government has been channelling private investment growth towards improving Malaysia’s investment climate. The MEM, however, noted that subsidies rationalisation and fiscal consolidation have been delayed albeit services sectors liberalisation in Budget 2012. The MEM also cautioned that it is essential for government disbursements for the ETP programmes to be expedited, ensuring continuous and sustained GDP growth throughout the current economic uncertainties.

The MEM also suggested further policy implementations in areas such as:

• Landuseenhancement• Zoningpolicies• Buildingcodesincentivesforprivate vehicle use• Suburbanhousingchoices• Fueltaxes• Strictervehicleemissionstandards; and• Congestionpricinginmajorurban centres

The full Malaysia Economic Monitor is available from http://www.worldbank.org

With the world’s current population at 7 billion and increasing, great cities compete with each other on countless fronts – resources, knowledge workers, investment inflows, connectivity and most importantly, human traffic. As a natural progression from being the nation’s capital city, Kuala Lumpur is the logical hub that has been strategically singled out by the government’s Economic Transformation Plan (ETP) to be nurtured into one of the world’s noteworthy cities.

The World Bank’s Malaysia Economic Monitor (MEM) released in November 2011, themed Smart Cities, reported that Malaysia Real GDP grew by 6.0% and 2.5% in 1Q and 2Q of 2011 respectively. On a quarter-on-quarter (seasonally-adjusted annualized) basis, this is a considerable slowdown from the 9.2% growth experienced in 4Q2010. Nevertheless, Malaysia’s growth perfor-

DECODING KL’S ECONOMIC RESILIENCY Preparing Kuala Lumpur towards the path of a smart city

In terms of urban centre planning, sustainability and inclusiveness is needed to improve overall quality of life. Connectivity within Malaysian cities can be achieved through enhanced public transformation system and efficient integration in city-centre developments. Advance education practices, reduced crime rate and lesser congestion are the software improvements that will in turn attract and retain talents – locally and from abroad.

The MEM drew similar comparisons between Kuala Lumpur and Los Angeles, implying that Kuala Lumpur and other Malaysian cities need to rein in sprawl and move towards a more compact urban form to ensure effective resources management. This could come in the form of active development planning procedure and positive environmental actions. With careful city zoning imple-

Figure 12: GDP growth, Inflation rate and Unemployment rate, 2007-2012f

Source: The World Bank Report

2007

2008

2009

2010

2011

f

2012

f

10

8

6

4

2

0

-2

Legend: GDP (RHS)

Inflation Rate (RHS)

Unemployment rate

Unemployment rate

4.0

3.8

3.6

3.4

3.2

3.0

2.8

(%) (%)

(Non-seasonally adjusted)

(Seasonally adjusted)

Figure 13: Population density in the built-up part of metropolitan areas (people/hectare)

Source: Bertaud (2004), The World Bank

Bangalore

Barcelona metro

Beijing

Jakarta

Singapore

London

Bangkok

Kuala Lumpur

Los Angeles

0 50 100

150

200

Malaysian cities need to rein in sprawl and

move towards a more compact urban form to ensure effective

resources management

GRAPHICALLY SPEAKING 9

PROPERTY ABOVE RM1 MILLION BY STATE & SECTOR, 1H2011

Total Value = RM7.03 billion

1,200

1,000

800

600

400

200

0

Residential

Commercial

SELANGOR

KUALA LUMPUR

PENANG

JOHOR

Analysis on average price (RM) per unit and growth rate in 1H2011 compared with 1H2010

Selangor Kuala Lumpur Penang Johor

Residential 2,175,175 6.4% 2,231,567 (4.9%) 1,776,521 0.09% 2,138,857 8.4%

Commercial 2,542,975 (49.5%) 2,701,252 (9.2%) 1,830,477 (20.8%) 3,672,987 27.4%

Industrial 4,222,052 (11.8%) 3,731,615 42.6% 6,483,076 133.9% 3,334,268 21.4%

Development 3,864,539 46.7% 25,819,042 100.1% 4,498,936 7.7% 12,147,233 239.3%

Industrial

Development

120

100

80

60

40

20

0

Residential

Commercial

Industrial

Development

400

350

300

250

200

150

100

50

0

Residential

Commercial

Industrial

Development

1,400

1,200

1,000

800

600

400

200

0

Residential

Commercial

Industrial

Development

1.9%

0.8%

11.5%

11.5%

7.7%

1.8%

25.0%

3.6%

Units

Units

Source: NAPIC, MPI Research

Note:•Buyers comprise individuals and companies.•Transactions in Kuala Lumpur comprise municipalities of Batu, Seksyen 1-100, Kuala Lumpur, Ampang and Petaling only.•Transactions in Selangor comprise districts of Petaling, Gombak, Sepang and Hulu Langat only.•Transactions in Johor comprise districts of Johor Bahru, Pontian and Kota Tinggi only.

Local Property Buyers Foreign Property Buyers

Legend:

Total Value = RM1.34 billion

Total Value = RM2.05 billion

Total Value = RM5.71 billion

Units

Units

LOOKING FORINVESTMENT Malaysia Property Incorporated (MPI) receives foreign investor queries on an ongoing basis. For any parties interested to pursue these investment requirements, please contact the MPI team.

CROSS-BORDER QUERIES 10

Request Client Requirement Location

4Q 2011

Factory cum distributor office

Dubai, UAE 10,000 square feet area

Klang Valley

3Q 2011

Landbank,Development rights

Landbank,Development JV

Singapore

Singapore

10 acres and above of freehold landto built a logistic park

Mixed development with medical component, medical resort

e.g medical themed service apartments, retirement village

Klang Valley(Shah Alam, Bukit Raja)

Klang Valley, Johor, Penang

2Q 2011Landbank,

Development rights

Asset acquisition

Landbank,Development rights

Landbank,Development JV

Asset acquisition,Development JV

Landbank,Development rights,

Development JV

Landbank,Development JV

Seoul, Korea

Shenzen, China

Singapore

Jakarta,Indonesia

Kuala Lumpur,Malaysia

Shaanxi, China

Bangalore,India

20 acres, mixed development

Golf course with land for residential development

Industrial park development(size TBA)

High-end residential development(size TBA)

Commercial development opportunities, Grade A office en-bloc

Mixed development land or construction

12 - 15 acres of land in KL for JV to build school & boarding facilities

KL City Centre

Greater KL vicinity

Greater KL vicinity,Iskandar region

Greater KL vicinity,Iskandar region

Greater KL vicinity

Kuala Lumpur orJohor Bahru

Greater KL vicinity

1Q 2011

Construction JV Seoul, Korea Infrastructure projects with Minimum Return Guarantee

Nationwide

11

ABOUT USMalaysia Property Incorporated is a Government initiative set up under the Economic Planning Unit to drive investments in real estate into Malaysia. As the first port-of-call for real estate investment queries, Malaysia Property Inc. connects interested parties through an extensive network of government agencies, private sector companies, real estate firms, business councils and real estate-related associations. MPIhastwocoreobjectives;tocreateinternationalawarenessand to establish connections between foreign interests and Malaysian real estate industry players, ultimately contributing to real estate investments into the country.

For further information and up-to-date tracking of Malaysian real estate data, visit:www.malaysiapropertyinc.com

For further enquiry, write to:info@malaysiapropertyinc.com

Disclamer: This report contains information that is publicly-available and has been relied on by Malaysia Property Incorporated on the basis that it is accurate and complete. MPI is not liable if the case proves to be otherwise. No warranty or representation, express or implied, is made to the accuracy or completeness of the information contained herein, and the same is submitted subject to errors, omissions, change of price, rental or other conditions, withdrawal without notice, and to any special listing conditions imposed.