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KUALA LUMPUR: Malaysians get the first bite of the cherry as Canada-based property investor and developer Vision International Properties (VIP) launches its C$55 million (RM174 million) Sage Gardens condominium project on August 24 in Kuala Lumpur, before heading to Singapore and Hong Kong.
VIP has offices in Kuala Lumpur, Singapore and Japan. It buys properties in Canada, sells the units to investors and provides management services such as finding tenants, collecting rent and selling the property on behalf of the owner.
"Southeast Asian investors, including Malaysians and Singaporeans, are only just beginning to take notice of Canada as a viable, if not better option, considering the economic recession affecting most countries in Europe, including the UK, and the lingering debt crisis in the US," director Virata Gamany said in an interview during the week prior to August 19.
Sage Gardens sits on a 3-acre (1.2ha) plot of freehold land in the city of St Albert, about 30 minutes' drive from Edmonton, Alberta. This 4-storey condominium project will be built in four phases — one phase is a commercial block — and is scheduled to be completed in 2015. There will be 281 units for sale, with a starting price of C$200,000 (C$270 psf). Built-ups range from 650 sq ft to 1,000 sq ft, and rentals are estimated to be from C$1,300 per month, and yields from 7%.
VIP was founded in 2005 in Canada by Virata Gamany, director of the KL office, with business partner Tom Napiontek, who is based in Canada. The company invests in built properties and not in landbank. Due to the bad publicity of Canadian property companies that have liquidated — such as Edgeworth Properties — leaving investors in limbo, Gamany understands the apprehension Malaysians have today on buying property in Canada.
"It is interesting that this [landbanking issue] has happened here in Malaysia, but it has not happened in Canada," he said.
"And the reason I believe, in this case, is that these are UK companies, not Canadian companies, involved in landbanking that have been closed down because it is illegal to run a landbanking business. We are not in the landbanking business, where people buy agricultural land, and speculate on a 20-year plan.
"Buy something you understand. Don't get involved in speculative investments or things that are too complex," advised Gamany.
To date, VIP has invested in 19 buildings, and buyers of Canadian units are given titles immediately. They begin servicing the loan on receiving the keys. These turnkey investment properties have a rental assurance for four years, with a return on investment of about 7%, according to Gamany — a Malaysian who lived in Canada for several years before returning to head the KL office.
The company concentrates its business in the province of Alberta and the major cities of Edmonton and Calgary. Over the last 10 years, Alberta has benefited from the oil boom, which has attracted much investment into the province, resulting in an active property market.
This article first appeared in The Edge Financial Daily, on August 23, 2013.
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