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“INVEST IN MALAYSIA –
OPPORTUNITIES IN GREATER KL”
ARENA REAL ESTATE NETWORK ALLIANCE CONVENTION &
EXHIBITON
25TH – 27TH AUG 2017 | BERJAYA TIMES SQUARE HOTEL
DATUK SERI MICHAEL K C YAM SMW,
DSNS
CHAIRMAN, INVEST KL CORPORATION
Presentation
by:
MALAYSIA AND KL’S ECONOMIC
FUNDAMENTALS
2
29,782 30,698 32,596
34,839 36,078 37,738
39,315
5.1 5.64.7
65
4.25.6
-
10,000
20,000
30,000
40,000
0
5
10
15
20
2011 2012 2013 2014 2015 2016 Q1 2017
RM Real GDP
Source : EPU, Bank Negara Malaysia and MIER
(%) (RM)
STRONG ECONOMYREAL GDP AND PER CAPITA GNI (2011 -
2017)
3
MALAYSIA’S GDP IN USD$
4
Real GDP Growth (%)
Source: Economist Intelligence Unit
ASEAN : POSITIVE PROSPECTS
5
STEADY POPULATION GROWTH
6
MALAYSIA’S FUNDAMENTALS REMAIN
SUPPORTIVE OF GROWTH
7
CITIES vs CITIES
&
THE BIRTH OF INVEST KL
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• GNI per capita of USD 15,000• 3.3 million additional jobs• USD 444 billion investments
Greater Kuala Lumpur/ Klang Valley
Oil, Gas & Energy Palm Oil & Rubber Financial Services
Tourism Business Services Electrical & Electronics Wholesale & Retail
Education HealthcareCommunications, Content
& InfrastructureAgriculture
DRIVING MALAYSIA’S GROWTH AND COMPETITIVENESSECONOMIC TRANSFORMATION PROGRAMME (ETP)
ETP GOALS BY 2020
12 NATIONAL KEY ECONOMIC AREAS (NKEAs)
9
10
GREATER KUALA LUMPUR (GKL)/ KLANG VALLEY (KV)
FAST FACTS
7.2 millionPopulation
2,793 km2
Area
10Local Authorities
33%Fresh Graduates Move to GKL/KV Upon Graduation
Commercial and financial capital
(4 times the Size of Singapore)
30%GDP Contribution
Main economic engine hub
11
BIG TALENT POOLGROWING SUPPLY OF QUALITY TALENT
94.6%Literacy Rate
UNESCO Institute for Statistics 2015
>130Public & Private
Universities/Colleges
45 public & private universities in GKL
2.5 million
Graduates p.a.
200,000 projected tertiary enrolment by 2025
✓ High Competency
✓ Language Proficiency
✓ Regional Experience
✓ Highly Motivated
14.7 million
Labour Force
Total of 21.7 million working age population (15-64)
Source: Ilmia (As at Q22016)
100,000 330,000 211,500
2,830 10,000 180,000
Board of EngineersMalaysia
RegisteredMembers
Financial Services Professionals
11,000 (ACCA member),600 (The Actuarial Society
members)
Information and Communication Technology (ICT)
Knowledge Worker
The Chartered Institute of
Logistics and Transport Malaysia
Members
Malaysian Institute of
Management (MIM) Members
Healthcare Professionals
33,000 (Doctors), 60,000 (Nurses), 20,000 (Skilled-
Workers)
KEY TALENT SECTORS
Board of Engineers Malaysia, 2015
Malaysian Institute of Management, 2015
The Chartered Institute of Logistics and Transport, 2015
Department of Statistics Malaysia, 2014
Department of Statistics Malaysia, 2014
NOTABLE PERFORMANCE INDICATORS
Yearly growth in number of patents from 2007 –2011, Malaysia was 28th in the world in 2011
Increase in total higher education enrolment (2004 – 2014) to 1.2 million students
Increase in Bachelor degree enrolment (1990 – 2010)
Increase in Masters and PhD enrolment (1990 – 2010)
Increase in number of citations from 2005 – 2012
of publications from 2003 – 2012contributed by 5 MRUs
Increase in publications from 2007 –2012, highest in the world
12
Cost Length Pax / day Stations
US$6.56bil 51KM 400,000 31
MRT LINE 1FULLY OPERATIONAL AND LAUNCHED BY PRIME MINISTER NAJIB ON 17 JULY 2017
MRT Line 1
LRTKommuter
Monorail
KLIA Transit
LRT
13
COST EFFECTIVE PLACE FOR DOING BUSINESS AND AFFORDABLE QUALITY LIFESTYLE
COST OF LIVING
Kuala Lumpur
Shanghai
151st
Singapore
4th
7th
1st
Least Expensive
Most Expensive
Hong Kong
74th
Bangkok
Source: Mercer Cost of Living Survey 2016
190.3
69.8
14.70
50
100
150
200
HongKong
Singapore KualaLumpur
Prime Office Gross Effective Rents1
(US$/sqm/mth)
1Source: Knight Frank Research-Asia Pacific Prime Office Rental Index Q12016
2Source: 2016 Hays Asia Salary Guide(Salary based on Accounts Support position within an MNC)
38.6 43.4
13.2
-
10.0
20.0
30.0
40.0
50.0
HongKong
Singapore KualaLumpur
Average Cost of Talent2
(US$k/annum)
381
265
205
0
100
200
300
400
500
HongKong
Singapore KualaLumpur
Hilton Room Charges3
(US$/night)
3Source: Hilton Reservation(Nett charges based on Deluxe Room)
17
22
13
0
5
10
15
20
25
HongKong
Singapore KualaLumpur
International School Fees4
(US$k/annum)
4Source: International School Tuition Fee Schedule 2015-2016Elementary school (Year 1-Year 5)
WITH TAX INCENTIVES
Source: Internal
COMPETITIVE TAX REGIME
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OBJECT OF INVEST KL AND
ITS PERFORMANCE
15
Special Purpose Investment Promotion Agency of the Government of Malaysia For Greater KL
(set up in July 2011)
MANDATE: ATTRACTING AND FACILITATING 100 LARGE MULTINATIONAL COMPANIES (MNCs) TO ESTABLISH THEIR
BUSINESS, INNOVATION, AND TALENT HUB IN GREATER KUALA LUMPUR
UNDERSTANDING BUSINESS NEEDS AND DEVELOPING A COMPREHENSIVE SOLUTION FOR MNCs
Talent facilitation➢ Employment pass➢ Residence pass ➢ Talent sourcing
Connection with relevant authorities➢ Government agencies & authorities➢ Customs & immigration➢ Tax consultants & banks
Establishing business➢ Office leasing➢ Company registration➢ Business licenses
Collaboration with universities➢ Research & development➢ Internship programs➢ Seminar participation
INVESTKL: ATTRACTING 100 LARGE MULTINATIONALS TO GKL BY 2020
Hidden ChampionsLarge SMEs
(Revenue >USD 500 million)
16
Total100
MNCs
2011
2018 –2020
2012
OVERALL INVESTMENT, JOBS AND MNCS – ON TRACK (64% OF KPI MET)
Graph not according to scale2013 2014
For notation, TOTAL from July 2011 – 31 December 2016Total MNCs Secured : 64
Total Approved / Committed Investment : RM8.825 billion
Total Realized Amounts Spent by MNCs in Malaysia : RM2.9 billion (35.2%)
Total Committed High Skilled Regional Jobs : 9,011Total High Skilled Regional Jobs on Payroll : 5,012 (55.6%)
2015
14
5
1012
10 10
2016
13
2017
Investment Committed*
RM2.981B
Regional Jobs Committed *
1,862
*committed / approved 17
REALIZED VS APPROVED/COMMITTED INVESTMENT COMMITMENTS -
ON TRACK (Q4 2016)
Investments
Regional Jobs
On Track36%
Realized
On Track56%
Realized
Employees on payroll
8,896
9,335
18
REGIONAL JOBS CREATEDSalary Analysis (Q4 2016)
Locals vs Expats (Salary Scale)
Overall 5,233 Local 4,318 (83%) Expat 915 (17%)
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IMPACT OF INVEST KL ON THE
REAL ESTATE INDUSTRY
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LOCATION OF INVESTKL’S MNCS IN GREATER KL
KL Sentral• Wilhemsen (1 Sentral)• Darden (Menara CIMB)• Red Lobster (Plaza Sentral)• Verdandi (Plaza Sentral)• Saipem (Menara Shell)• International SOS (Nu Tower)• Codemasters (Plaza Sentral)• Wilson (Plaza Sentral)• Hobsons (Plaza Sentral)• Cerner (Nu Tower)• Rhodium (KL Sentral)
Petaling Jaya• Atalian• Aecom• Dieffenbacher• Vinci• Arcadis• EPSON• TTDA• Philips HC
Bangsar• Indra (Bangsar South)• Worldline (Centrepoint MV)• Cargill (Bangsar South)• Valmont (Gardens S. Tower)• TPSC (Mid Valley)• KBR (Bangar)
Mont Kiara • Service Source (1
Mont Kiara)• Irfaz (Solaris)• Promat (Wisma Tune)
Sepang• Horizon
KLCC City Centre• Subsea 7 (G Tower)• Tecnicas (G Tower)• Schlumberger (Rohas P’kasa)• Cameron (KLCC)• McDermott (M. Hup Seng II)• Honeywell (M. Hup Seng)• UIL (Etiqa)• RCMA (KLCC)• Worley Parsons (Intermark)• Turner Int (Intermark)• Bechtel (The Weld)• SPIE (Changkat T45)• Sucden (UBN Tower)• Oceaneering (Wisma Goldhill)• Oracle (Wisma Goldhill)• ABI (KLCC)
Subang Jaya / Shah Alam/ Klang• Linde• Clariant• Oleon• SC Johnson• Rentokil• Agusta• HSIS• Huntsman• Menard• Colas Rail• AMER• NOVARTIS• CRH
Cyberjaya• IBM
KL General• Zurich (Menara Zurich)• Kadokawa (B. Tasik Selatan)• Voith (Dolomite BP)• CREC (Faber Towers)• IFFCO (Etiqa Twins)
Note: 70% of MNCs are located in Kuala Lumpur
21
State No. of MNCsRealised Jobs
(Q4 2016)2016 Office Space Utilization* sqft
Kuala Lumpur 44 2,069 248,280
Selangor 20 3,164 379,680
TOTAL 64 5,233 627,960
Average Rental :
-Kuala Lumpur RM7 /sqfT
-Selangor RM5 / sqfT
OFFICE SPACE UTILIZATION
RM Million
Estimated Annual Rental (2016)
RM 43.6 million
*Estimated utilization at 120 sqfT/personKLCC average NLA / floor – 18,000 sqft
The 64 MNCs would
occupy 35 floors of
one Petronas Tower
New office space
35 floors @ Petronas Twin Towers
22
RECENT MAJOR G2G
ANNOUNCEMENTS
Kuala Lumpur
• 14 Agreements - USD32.7b
• 16 G2G MoUs
• 7 commercial MoU –USD2.21b
• Saudi Aramco – Petronas USD7b
• 4 G2G MoU
• 15 commercial agreements – USD5b
• USD2b urea plant , 2.5m tons annually for export to India
• World’s first Digital Free Trade Zone
23
PRIME OFFICE RENTS FOR UPPER FLOORS IN
SKYSCRAPERS AROUND THE WORLD
CITY USD$ psf pa RM psf pm
HONG KONG 278 100
NEW YORK 158 57
TOKYO 150 54
LONDON CITY 114 41
SAN FRANCISO 113 41
SYDNEY 91 33
BOSTON 77 28
SINGAPORE 72 26
SHANGHAI 72 26
BEIJING 63 23
CHICAGO 59 22
PARIS 57 21
MUMBAI 53 19
FRANKFURT 53 19
TORONTO 49 18
KUALA LUMPUR 22 824
2014
25
NZ
AUS
HK
SG
US
GLOBAL COMPARISON OF HOUSE PRICE
INDEX
26
UP COMING MAJOR HUBS IN GREATER KL
KL Internet City and DFTZ
27
1950s
1970s
1980s 1990s
1960s
THE MALAYSIAN PROPERTY INDUSTRY EVOLUTION
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2000s
THE MALAYSIAN PROPERTY INDUSTRY EVOLUTION
29
2010s
THE MALAYSIAN PROPERTY INDUSTRY EVOLUTION
30
2010s
THE MALAYSIAN PROPERTY INDUSTRY EVOLUTION
31
QUALIFYING CRITERIA AND
SERVICES FOR PRINCIPAL
HUB INCENTIVES
32
NOTES[1] Network companies refer to related companies (any entity within the group including subsidiaries, branches, joint ventures, franchises) or unrelated companies
within the applicants’ supply chain and business with contractual agreements[2] P&L Management focuses on the growth of the company with direct influence on how company resources are allocated - determining the regional/ global
direction, monitoring budget expenditure and net income, and ensuring every program generates a positive ROI
I. Local incorporation under Companies Act 1965II. Paid-up capital of more than RM2.5 Million III. Minimum annual sales of RM300 Million (Additional requirement for companies applying for tax exemption on trading income) IV. Serve and control network companies[1] in at least three (3) countries outside MalaysiaV. Carry out at least three qualifying services, of which one of the qualifying services must be Regional P&L/ Business Unit Management
from the strategic services cluster as follows:
A. Strategic Services 1. Regional P&L [2] / Business Unit
Management2. Strategic Business Planning &
Corporate Development 3. Corporate Finance Advisory
Services4. Brand Management5. IP Management6. Senior-level Talent Acquisition &
Management
B. Business Services1. Bid & Tender Management 2. Treasury & Fund Management3. Research, Development &
Innovation 4. Project Management5. Sales & Marketing 6. Business Development7. Technical Support & Consultancy8. Information Management &
Processing9. Economic/ Investment Research
Analysis10. Strategic Sourcing, Procurement and
Distribution 11. Logistics Services
C. Shared Services1. Corporate Training and Human
Resource Management2. Finance & Accounting
(Transactions, Internal Audit)
ELIGIBILITY CRITERIA & QUALIFYING ACTIVITIES
33
CONCLUSION
34
VIDEO CLIP
KL – A CITY OF OPPORTUNITY
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THANK YOU
&
SELAMAT HARI
MERDEKA