Malaysia Reviews Rules for Foreign Investment

In an attempt to protect the country’s lucrative property market, the government of Malaysia has agreed to review the rules governing foreign investment. The move is welcomed by the country’s property professionals.

Although the announcement was triggered by concerns over the recent credit crunch, members of the property industry have been calling for the move for some time. The relaxation of restrictions on property investment by foreigners is largely seen as a way to increase Malaysia’s attractiveness as an overseas property investment destination.

According to Datuk Richard Fong, the Malaysian president of the International Real Estate Federation, the current foreign investment guidelines for the property market were introduced in 2006 and have been successful in attracting interest from investors from Asia, the UK and the United States. However, the restrictions that still remain are preventing the country from attracting higher levels of foreign investment.

James Gonzalez, Market Analyst at Obelisk, believes that these obstacles need to be lifted to maintain competitiveness in an increasingly tight market. “Malaysia is ready to launch a public-private sector initiative to attract €2.25 billion of foreign investment over the next 5 years. If they hope to reach that goal, they will need to remove unnecessary restrictions on investment. If not, investors will look elsewhere.”

These restrictions include the fact that each state authority has the discretion to assess every purchase made by a foreigner based on its location, type of property and the percentage of the total number of properties in the complex. If the state chooses, the purchase can then be blocked.

At the very least, this system causes unnecessary delays in the purchase process. Property professionals are looking toward a system where the federal and state levels will be integrated and the wishes of one level of government will not be counteracted by the other.

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Egyptian Construction Goes Suburban

Egyptian developers have recently started to reverse a trend steeped in centuries of urban expansion. No longer is Cairo’s sprawl continuing only to spread solely along the banks of the Nile, but instead, suburban developers are also setting their sights on areas away from the river.

The move to newer, gated communities started in a few years ago when in 2004, Prime Minister Ahmed Nazif began to undertake numerous liberal measures aimed at simplifying bureaucratic red tape and working toward the privatisation of many aspects of daily life that previously had been the sole domain of government. Part of this movement also led to the liberalisation of housing regulations.

Tarek Shahin, a construction analyst based in Cairo, sees this move to suburban construction as not only a sign of the modernisation of the industry but also as representing a shift from smaller, locally based builders to larger companies with better economies of scale. The fact that these companies now have greater control over both the size and types of properties offered means that average Egyptians now have options that they never previously imagined.

"Suddenly there's the option of living in a villa, [owning a] garden and a swimming pool, away from the pollution," Shahin said. With these new possibilities, Egyptians are now keen to take out their savings or even borrow money to pursue the new Egyptian dream.

Even with mounting fears of a worldwide recession, many analysts believe that Egypt’s property market has the capacity to remain sheltered. Their claims are based upon the fact that Egypt has an extremely healthy domestic level of demand, that it remains a heavily cash-based economy and that the most common form of off-plan contracts used in Egypt demand more money from the buyer, leading to lower levels of speculation.

James Gonzalez, Market Analyst at Obelisk, also believes that the property boom in Egypt can be sustained throughout a downturn. “Although the registered growth may not match that of years gone by, Egypt is still seeing rising wages and a robust population growth rate. No matter what occurs in terms of foreign investment, the internal demand for quality homes should be enough to fuel a reasonable level of expansion for some time to come.”

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Abu Dhabi Beating the Credit Crunch

At a time when many nations in the world are fearful of the credit crunch, it appears that Abu Dhabi is resisting the trend. One major local property developer is reporting Q3 profits three times more than a year ago and expectations are that the trend will continue next year, according to a recent Reuters survey.

Abu Dhabi is part of United Arab Emirates (UAE), a federation of seven Middle Eastern states on the Persian Gulf. Abu Dhabi city is the capital of the UAE. Although it is one of the world’s largest producers of oil, Abu Dhabi has recently been trying to diversify its economy into other sectors such as the property and tourism markets.

There are other reports which support the Reuters findings. In recent weeks, the government has pumped US$33 billion into the banking system. Fitch Ratings recently expressed its approval of the government’s moves to guarantee liquidity in the banking system and it believes it will be unnecessary to downgrade the emirate’s Long-term Issuer Default Rating.

“The risks of a UAE bank suffering a capital markets-driven liquidity crisis are limited as none of the banks are reliant on these markets. Their funding bases are predominantly based on retail and corporate deposits, with the balance as inter-bank borrowings and some limited debt capital market issuance,” says the Director of Fitch’s Banks team, Robert Thursfield.

According to James Gonzalez, Market Analyst at Obelisk, guaranteeing liquidity is an important issue for Abu Dhabi. “In contrast to Dubai, where the earliest off-plan investment opportunities saw completion in 2002, the first completed units in Abu Dhabi will only be delivered in late 2009. Abu Dhabi remains a relatively new option for foreign buyers and lacks the market saturation of Dubai. It still remains an emerging market.”

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Russians Buy Up Bulgarian Property

Years ago, when Russians went to Bulgaria, they brought with them communism and were not very welcome guests. Now, Russians are again coming to Bulgaria; for politics but instead, for property. According to official statistics recently released at a tourism conference in Sofia, Russians bought 45% of all property purchased by foreigners in 2007.

For the Russians, Bulgaria’s attractions include its milder climate, its relatively short distance to Russia and above all, the extremely competitive prices for coastal property when compared to nearly all other EU holiday destinations. Once they have invested, many Russians then choose to start up businesses inland at ski or medical/spa resorts.

Officials stated that statistically, today’s Russian investor is between the ages of 25 and 45 and is buying a second home along the Black Sea coast. Most pay between €100,000 and €200,000 for their homes.

James Gonzalez, Market Analyst at Obelisk, sees the Russian interest in Bulgaria as a continuation of a long relationship. “Bulgaria was a favourite holiday resort for Russians for decades and now, in the free market system, it still remains popular. Prices are extremely reasonable and for an entrepreneur, investing in Bulgaria can be a great access point into the larger EU market. Finally, Russian interest creates even more exit strategies for other foreign investors.”

Russian citizens can enter the country on a 1-year business visa, register as a company and acquire property as that company. At the end of the year the visa can be extended by another 3 years, allowing the investor to expand the business within Bulgaria and if desirable, within the rest of the EU.

The Bulgarian government has also been doing all it can to encourage foreign investment by simplifying and modifying the bureaucratic process. Foreign citizens can now apply for a Bulgarian visa through a new online system, called the “E-Visa Application System”, a programme initiated in March, 2008.

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Mega Project Reflects Confidence in Tunisia

Mr Farhan Faraidooni, CEO of Sama Dubai, the property development arm of Dubai Holdings, recently announced that the development plans for the project dubbed “Century City” have been approved. An agreement was reached with the Tunisian government and the first stage of the project (which will be located around the former Tunis harbour) will begin shortly.

The announcement comes one year after the Tunisia’s President Ben Ali participated in laying the founding stone for the mega project, which is estimated to cost US$30 billion by completion. The US$1.3 billion first stage of the project will comprise of 16 apartment towers constructed over the next 4-5 years. The entire project will take 15-20 years to complete and will eventually house 500,000 people.

Mr Faraidooni spoke at length about the four principal reasons behind his group’s decision to invest so heavily in Tunisia: Tunisia’s proximity to Europe, the country’s political stability, government incentives available to investors and the prime location where the project will be built. Century City will be located on 1000 hectares in the centre of the Tunis, with wonderful views to the sea. It is estimated that a staggering 100,000 people per day will visit the area.

Mohamed Nouri Jouini, Minister of Economic Development and Foreign Investment, stated that the project is expected to generate one million jobs over the next 10 years. Once completed, Century City will offer a vast range of services, and will house 5 and 7 star hotels with a capacity of 12,500 beds. In addition will be the apartment buildings, sports facilities, marinas, cinemas and banks.

James Gonzalez, Obelisk’s Market Analyst, sees this massive foreign investment as yet another signal that Tunisia is ready to do business. “More and more investors are beginning to see that Tunisia is a market that offers unique possibilities for the overseas investor. It will also be aided by the fact that its neighbour, Libya, is making great strides moving toward a capitalist economy. Much of this additional business is bound to benefit Tunisia.”

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Multinationals Continue to Choose Romania

Romania continues to attract large amounts of foreign investment from multinational companies. One of the latest companies to announce plans to expand its production into the country is Procter & Gamble.

Procter & Gamble (P&G) had been planning to open a plant in Eastern Europe for some time and Romania was a late addition to the shortlist. “Up until two years ago, Romania was not on P&G’s radar for such investments,” says Ramona Brad, External Relations Group Leader for the US based company. However, things changed rapidly when P&G examined exactly what Romania had to offer.

In 2006, the company opened a regional services centre in Hungary with possible plans for constructing a production facility in Poland, Turkey or the Ukraine. The US$100 million facility is now going to be built in the Romanian town of Ploiesti where it will produce hair products. P&G is also talking to the Romanian government about partnering in a personnel training programme.

James Gonzalez, Market Analyst at Obelisk, has been monitoring this trend for some while. “P&G is another in a long list of multinationals that find the economic situation in Romania extremely attractive. Not only does the country provide the right business environment but it is also very aggressively working to attract these companies so the trend will continue.”

Romania’s entry into the EU has improved its business profile around the world and recently the French car manufacturer, Peugeot, announced that it is seriously considering Romania for the site of a new engine plant. Jean-Phillippe Collins, chairman of the Peugeot Group, made the announcement, confirming what had been rumoured since April.

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Cape Verde Development Sector Form Body

Cape Verde, the picturesque archipelago in the North Atlantic Ocean has recently become an investment hotspot for European and American buyers. Its success has been so great that a new trade body, Promitur, has been created with the aim of improving the real estate sector throughout the country.

The newly formed organisation had 30 members at its inception, from different parts of the real estate market. Members include developers, agencies, legal and financial advisers and the hope is that the number will increase to include the majority of the tourism and services sector.

The aim of the new body is to act as a voice for the property market’s interests, promoting positive changes in the law and infrastructure developments. Just as importantly, Promitur also plans to serve as a major point of reference for investors considering the purchase of property in Cape Verde where problems or queries can be addressed.

James Gonzalez, Market Analyst at Obelisk, finds the formation of this association in Cape Verde very encouraging. “Cape Verde developers are taking the right approach. With the formation of this body, they are demonstrating to the world that the islands’ development is being achieved in a thoughtful and regulated manner. They are putting their best foot forward.”

Foreign investment in Cape Verde has brought with it an expansion in air services, including many direct flights from the UK. Also, the government has recently secured a €47 million loan from the European Development Bank to improve the port facilities at the port of Palmeira. The aim is to allow cargo ships to unload easier, aiding the development sector.

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Brazil Booms during Credit Crunch

Brazil may well be proof positive of the old adage, “Every cloud has a silver lining”. While much of the world is feeling the repercussions of the worldwide “credit crunch”, Brazil is not only resisting the trend but continues to thrive.

According to a study released at the recent “Nordeste Invest 2008” (a conference held in Recife that focussed upon increasing both tourism and foreign investment in the region), non-residents invested an incredible US$646 million in Brazilian property in 2007. Broken down by nationality, Americans invested US$102 million, Spaniards US$82 million and Italians US$63 million. In 4th place in investor rankings were UK buyers who spent US$54.7 million on Brazilian real estate. Most of the remaining investment came from various other EU countries.

In fact, investor interest is so high in Brazil that conference organisers believe that over US$1.28 billion of business including property purchases was done during the Nordeste Invest 2008 conference alone.

Felipe Cavalcante, president of the Association for Real Estate and Tourism Development in the Northeast of Brazil and organiser of the annual Nordeste Invest believes that the reasons for this incredible interest in Brazil are quite simple: “The attractive prices, the cost of living and the prospect of generating substantial returns…”

James Gonzalez, Obelisk’s Market Analyst, is not surprised at the released findings. “We at Obelisk have been bullish on Brazil for some time now and the Nordeste Invest 2008 event findings confirm our predictions. Brazil is one of the few nations in the world which can offer this level of investment environment and with the explosion in the size of the middle class, quality properties will become even more in demand.”

The credit crunch certainly seems to have bypassed Brazil and analysts believe there are several reasons behind this. Banks in emerging markets are in relatively solid financial form and more importantly, household finances are not over-stretched.

As Jonathan Garner, the head of emerging markets strategy at Morgan Stanley adds, “You also have households that are not overextended. The ratio of household debt to GDP in Brazil ranges from 5-10% compared to over 90% in the US and 100% in the UK.”

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.

Russians Bolster Luxury Property Market

According to the New York Times, many Russians are now choosing to diversify their portfolios investing heavily overseas. A negative business climate coupled with the less-than-transparent Russian economic policy means that an outflow of capital from Russia has been increasing. It is reported that 46% of the value of Russia’s RTS index was wiped out in the last week alone.

Such instability recently led Standard and Poor’s, the credit rating agency, to lower Russia’s future credit rating down from “positive” to “stable”, something that is bound to affect Russian confidence in their own market.

In response, many Russians are now putting part of their money into luxury properties around the world. Hadleigh Bolt, a developer of high end properties on Spain’s Costa del Sol, says the increase of Russian buyers has been noticeable. “We’ve seen a certain rise in the number of Russian nationals expressing interest in our bespoke properties... [High-end property] offers enormous appeal to affluent Russians due to heightened security measures, the countryside environment, direct air access to Malaga and, of course, year-round warm weather.

Obelisk’s Market Analyst, James Gonzalez, believes that the outflow of funds from Russia is becoming more important to the international investment market. “We have already seen the effect of Russian investment on the high end property market in Spain. As their needs to diversify increase, I can also see Russian influence growing in lucrative emerging markets like Brazil. They are investors who know a bargain when they see it.”

According to Overseas Property Professional, the outflow of capital in August 2008 alone equalled 1% of Russia’s GDP or US$13 billion.

For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE).

Email: info@obeliskinternational.com or visit our website: http://www.obeliskinternational.com.

For press enquires, please contact Obelisk’s marketing department on (+34) 952 820 319 or email press@obeliskinternational.com.