Mah Sing Group Berhad announced a double acquisition done via its subsidiaries it said in a press release dated 28 October 2009.

The first acquisition is 26 acres of freehold land in Selayang for a total cash consideration of RM41.65 million. The land is located 2km from the group’s Perdana Residence development and will be developed into a RM209 million gross development value (GDV) gated and guarded residential development to be named Perdana Residence 2 and comprising mainly super link homes.

Mah Sing said in the press release that the acquisition is strategic as Perdana Residence saw 10 times oversubscription of interest and had capital appreciation of approximately 15 to 20 percent for secondary transactions since its completion in mid 2008.

The second acquisition involves 19.6 acres of freehold land in Petaling Jaya for a total cash consideration of RM89 million. A sales and purchase agreement has been entered with Panasonic HA Air-Conditioning (M) Sdn Bhd for the land situated at the crossroads of Lebuhraya Damansara-Puchong (LDP) and the Federal Highway.

Mah Sing plans to develop the land into a mixed commercial development comprising of shop offices, semi-detached offices, SOHO and retail units. The entire project will be developed over five years and has a GDV of RM838 million. According to the press release, the development will incorporate green concepts such as airflow and energy management as well as sustainability which will increase the environmental friendliness of the project.

The acquisitions was announced on the back of a RM23.5 million third quarter profit against RM16.5 million for the previous year corresponding period.

Mah Sing’s group managing director cum group chief executive Tan Sri Dato’ Sri Leong Hoy Kum said, “We have overshot our full year sales target by approximately 1.4 times, achieving RM615million for the first 3 quarters of 2009 against our full year sales target of RM453million. We believe that the property market is gaining momentum for a likely up cycle in the second half of 2010, and have planned ahead to meet the coming demand with several land acquisitions. Today, we signed up two pieces of prime land in the matured townships of Selayang and Petaling Jaya which can yield an estimated total gross development value of RM1.05billion.”

“At 42.3 percent, Malaysia has the third highest savings rate in the region, and this liquidity coupled with low returns on fixed deposit rates has made property an attractive investment. Affordability is improved due to benign interest rates which are expected to remain low to support economic growth. The new scheme allowing further draw downs from EPF Account 2 to finance first house purchase will further increase affordability as it enables buyers to obtain higher financing for their properties. There is still stable employment, with increases in wages and re-hiring especially in the manufacturing sector, as well as improvement in both consumer and business conditions indices in 2Q09. All these should result in sustained or improved property demand in the coming months in anticipation of asset reflation as our properties are still among the cheapest in the region,” said Tan Sri Dato’ Sri Leong.