Property portfolio to swell by RM1.5bil

Pengurusan Danaharta Nasional Bhd expects to receive an additional RM1.5bil worth of properties from loan restructuring and set-off proposals that are being implemented. 

Together with its property portfolio, comprising some RM869mil worth as at the end of last year, Danaharta has roughly RM2.4bil in properties yet to be sold. 

Over the last three years, it has sold RM1.39bil worth of properties through its seven nationwide tenders, specific tenders and private treaty sales. 

In its 2002 annual report, Danaharta said that since there was less than three years before its planned closure in 2005, it would speed up and intensify its disposal efforts. The public can expect its property tenders to take place more frequently from now, largely in the form of specific tenders offering more individual high-ticket properties. 

The market could absorb the properties, said Danaharta. 

“According to Napic (National Property Information Centre), RM20bil worth of properties of all types was transacted in the country in the first half of 2002, after RM39bil changed hands in 2001 and RM41bil in 2000. Our RM2.4bil worth of properties spread out over three years is insignificant by comparison,” it said. 

On its 62% sales rate, Danaharta noted that it applied to a basket of various types of properties and that sales rates for non-residential properties were notoriously lower. If residential properties were isolated, its average sales rate was a much higher 87%. 

It said the good sales performance vindicated its use of real estate agents as its main marketing channel. Real estate agents were responsible for 42% of successful bids in the first tender, but have more recently accounted for over 90% of successful bids in the later tenders. 

To date, Danaharta has offered 890 properties and has sold 745 or 84%. The unsold portion represents an “overhang” rate of 16%, which the it said compared favourably with the national overhang rate of 25% (residential), 38% (commercial) and 37% (industrial) at June 2002, as published by Napic. 

Counting both sales of primary (properties offered for the first time in the tender) and secondary (unsold properties from previous nationwide tenders that are re-offered in following tenders) properties, Danaharta said it received almost four bids per property. 

On average, considerations received exceeded indicative values by just 6%. The biggest difference was 17% during the fifth tender, it said. More often than not, the excess came from the sale of development land. “Overall, we think a 5%–10% variance is healthy as it means the properties are priced attractively to secure bids – thus ensuring a market driven process – without foregoing too much upside,” it said. 

It feels that its property tenders have been “so far so good”. 

While it sought to improve on sales and bid rates, it was aware that to the extent that new methods would need to be equally transparent and do just as much justice to the underlying value of its assets, “we suspect that they are likely to complement rather than replace our regular tender exercise,” it added. 

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