Talam sees bright prospects for projects


BY ANGIE NG

TALAM Corp Bhd, which has emerged as the property vehicle of Tan Sri Chan Ah Chye after a rationalisation and merger exercise, sees good prospects ahead in its property ventures, especially in the affordable housing sector.  

Chan, the executive chairman of Talam, said the company specialised in building affordably-priced houses to meet the high demand for such properties. 

“There is a shortfall of at least 450,000 such houses nationwide and the industry is only able to build about 40,000 units a year,” he said.  

Tan Sri Tan Ah chye (right0 explaining the site of the proposed Canal City project.With him is Kumpulan Europlus chairman Tan Sri Lamin Mohd Yunus.

Chan said with the completion of the exercise, the enlarged Talam was now one of the largest developers of affordable properties in the Klang Valley. It builds about 12,000 units a year, which contribute to about a third of the market demand. 

“In terms of unit sales, Talam has become the single largest property group,” he added.  

The corporate exercise involving Chan's two flagships, Talam and Europlus Bhd, was completed on Nov 3. All the property divisions in Talam and Europlus were consolidated under Talam while a new company, Kumpulan Europlus Bhd (KEB), would manage all the non-property related businesses comprising construction, infrastructure, manufacturing and plantation.  

KEB is now the parent company with Talam as its 49% associate company. 

“I am confident that this exercise will spur the growth within the two companies to new heights in tandem with the country's positive growth forecast and general market consensus,” Chan told a media briefing last Thursday. 

Talam has a land bank of about 17,500 acres in fast-growing suburbs and townships like Bukit Jalil, Sepang and Sungai Buloh. Of this, some 10,000 acres are still undeveloped, which would keep the company busy for the next 15 years. 

Talam has 20 ongoing projects in the Klang Valley including Saujana Puchong, Pandan Perdana, Saujana Kajang, Danau Putra, Saujana Putra, Saujana Selayang, Puncak Jalil, Lestari Puchong, Saujana Damansara, Pandan Indah and Kinrara Perdana. 

It is also involved in various investment property developments comprising three shopping complexes, two office blocks, a college campus with a medical centre and a hotel. 

Talam is expected to secure RM1.5bil in annual sales. It has about 19,000 units of various properties worth RM2.7bil in different stages of completion. 

Its forthcoming projects include Ukay Perdana II, a 90-acre mixed development, which is expected to bring in total sales of RM150mil. 

A 389-acre parcel in Selayang, scheduled for launch in the first quarter next year, will be developed in Bandar Selayang for a total gross development value (GDV) of more than RM200mil. 

Canal City, a 1,000-acre site in the southern corridor of the Klang Valley, will be launched in the later part of next year for a GDV of RM450mil. 

Chan said based on a 12-year cycle, the property market, especially the commercial sector, should start to show better upside potential in the next three to four years. 

“By then, we expect our 2,500 to 3,000 units of four-storey shophouse to regain their former value like that of the last market boom in 1995 at around RM1.2mil to RM1.3mil a unit,” he said. 

With Talam's borrowings of around RM2.1bil as at January to be pared down to RM700mil by this year-end and to RM306mil by 2007, Chan said: “We are no longer under pressure to sell our properties fast and this has helped increase our property value by about 30%.” 

On KEB's earnings potential, Chan said the construction and infrastructure group would be able to record a turnover of about RM560mil next year. 

KEB, a Class A contractor with a current order book of RM788mil, also expects about RM1bil worth of property construction contracts from Talam over the next three years. 

Chan said the construction of the 260-km West Coast Expressway from Taiping to Banting worth RM2.4bil was to be completed over four to five years. 

KEB, Kumpulan Darul Ehsan Bhd and Perak Corp Bhd are involved in the 60:20:20 Konsortium LPB Sdn Bhd, which is expected to sign the concession agreement for the project with the government soon. 

“As the new expressway will be running parallel with the North South Expressway, the toll rates will be exactly the same as that charged by Projek Lebuh Raya Utara Selatan,” he said. 

KEB's other projects in the pipeline are the RM250mil Shah Alam-Shah Alam 2 Highway and the RM450mil Canal City project.  

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