Is property building management a professional?

Have separate board 

WE refer to the letter “Leave it to professionals”, (see article below) on the issue of strata management.

Building management is not a profession: it is a multi-disciplinary management function encompassing a wide range of skills such as engineering, architecture, accounting, law, vocational skills, etc.

It cannot and should not be the exclusive domain of any particular profession like registered valuers.

No country has laws that specify that only registered valuers admitted as property managers pursuant to Section 21(1)(a) of the Valuers, Appraisers and Estate Agents Act, 1981 (VAEA Act) can undertake property management.

To put things in perspective, the Building Management Association of Malaysia (BMAM) is not objecting to registered valuers managing stratified properties.

What we are strongly opposed to is the creation of a monopoly favouring registered valuers if the Bill is signed into law in its present form.

The Board of Valuers, Appraisers and Estate Agents is offering to open a sub-register for non-valuer managing agents to be admitted as property managers.

We are not accepting the board’s proposal as it would only further entrench its monopoly over property management, given that the admission, suspension and even eventual deregistration of non-valuer property managers will be at the sole discretion of the board.

We are calling for the establishment of a separate multi-disciplinary Board of Building Managers under the jurisdiction of the Housing and Local Government Ministry with regulatory support from the Commissioner of Buildings (COB).

There are more than 4,000 stratified projects (80% of them residential) in Malaysia at the moment, and about five million Malaysians belonging to the low and middle income groups live in them.

Since the common properties and facilities in the flat and apartment premises cannot be sold or subdivided and are meant for the exclusive use of the residents, all that the owners need is a building manager to maintain the common areas and facilities, and not a property manager whose portfolio includes leasing, collection of rent, promotion of sales, etc.

A building manager appointed by the joint management body (JMB) or management corporation (MC) upon mutually agreed terms and conditions of scope of work and remuneration would be significantly cheaper than a property manager whose fees are subject to a schedule under the VAEA Act.

The building manager is only expected to carry out his duties and responsibilities according to the terms and conditions of his appointment as well as the instructions of the JMB or MC Management Committee.

All fiduciary responsibilities, particularly the management of the Building Fund Account, are undertaken by the JMB or MC pursuant to the Building and Common Property (Maintenance and Management) Act, 2007 and the Strata Titles Act, 1985.

These records are submitted to the COB every year after the annual general meeting.

PROF S. VENKATESWARAN
Secretary General
Building Management Association of Malaysia

Leave it to professionals

THE public deserves an unbiased understanding beyond the shadow play leading up to the third reading of the Strata Management Bill 2012 in parliament.

The proposed Act stipulates that a managing agent for stratified property must first be free from any potential conflict of interest (i.e. independent) and secondly, a registered property manager.

The Act replaces the Building and Common Property Act, which did not emphasise that such functions are to be performed by a registered property manager.

The key problem is that property management at present is also practised by an unregulated group and such parties are not accountable to a regulatory body unlike registered persons i.e. property professionals or chartered surveyors.

The new Act aims to rectify this disparity by uniformly regulating all property managers of stratified properties.

Under the Valuers, Appraisers and Estate Agents Act (VAEA), a Registered Property Manager must possess:

1) An academic qualification from an approved institution of higher learning or recognised professional examinations; and

2) Pass the Test of Professional Competence set by the regulating body.

These robust standards and established processes are aimed towards registering professionals of sound qualifications and adequate competency levels.

A registered property manager is continuously subjected to a code of conduct, professional standards and various stipulations under VAEA to ensure they discharge their duties in a manner that serves the public adequately and to the highest possible industry standards.

The registration of property managers and firms is undertaken by the Board of Valuers, Appraisers and Estate Agents Malaysia (board).

The board, a governmental regulatory body under the purview of the Finance Ministry, was set up in 1981 to regulate Estate Agents, Valuers, Appraisers and Property Managers in Malaysia.

It is legislatively empowered to deal with complaints from the public and take disciplinary action against any errant registered persons or firms, including stripping them of their licence and barring them from further practice, amongst other possible disciplinary measures.

Given the established competency requirements and standards imposed on registered property managers, I cannot see beyond reasonable logic for such professionals to utterly fail in their professional duties to a joint management corporation, management corporation or individual owner.

The board, in the spirit of laissez-faire, has opened the registration of property managers to include these non-regulated practitioners.

Property management was always the domain of property professionals but only in recent history, primarily property developers and others have set up property management businesses to rival property professionals for the property management trade but in an unregulated fashion, taking advantage of the limitations of statutes. This is where the battle lies and the public should take notice.

If a non-regulated practitioner wishes to practise as a property manager in efforts to legally comply with the greater standards as demanded by the new Act, I cannot see why they should shy away and not readily subject themselves through the established process and competency test in order to become a registered property manager.

The process is not designed to penalise individuals but to assess if a candidate has the required level of competency, in order to be accountable to the public as a practising professional.

The merit of regulating the property management profession far outweighs any self-serving agenda, and the public must insist for high standards in lieu of the nation’s Vision 2020 agenda.

To the lawmakers and members of Parliament, my plea is to make the right decisions in cognisance of standards, accountability and professionalism.

The last thing we want is a mushrooming of “urban slums” in our beautiful country.

A. PADMAN  Kuala Lumpur - The Star, Nov 5 2012

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America's problem: Money politics seldom supports reforms

“Money politics” has become even more prominent in the U.S. presidential race this year.

In 2010, the U.S. Supreme Court removed the limits on corporate donations to political campaigns and ruled that corporate donations are a protected form of free speech. As a result, this year’s congressional and presidential elections have become the most expensive in U.S. history, with billions of U.S. dollars spent already.

While rich people are throwing loads of money into the presidential election, ordinary Americans are worried about their own financial conditions.

Over the past 20 years, the income of middle-class Americans has been on the decline, and the income gap is becoming increasingly wide.

A poll has found that most Americans believe that too much money has been spent on the elections, and political contributions will only enhance rich people’s influence over the policy-making. No matter who is elected the U.S. president, he is bound to pay more attention to the needs of the rich than those of the poor.

Rich people are enjoying greater influence in politics, while the rights of ordinary voters are being damaged, which runs counter to the U.S. constitutional principle of “political equality.”

The economy is the decisive factor in this year’s presidential election, but the two candidates have mainly attacked each other, and failed to introduce specific plans for solving the country’s economic problems when it comes to debates on economic issues.

The weak U.S. economy is a result of both the global financial crisis that broke out a few years ago and the country’s own political problems. All Americans see on television is the ugly partisan strife and politicians’ lack of courage to carry out reforms.

The U.S. president needs great public support to lead the country out of crisis, and should figure out whether he rules simply for the sake of ruling or acts only after carefully considering the people’s immediate and long-term interests. Americans should remember that money politics seldom support reforms.

Read the Chinese version: “金钱政治”砸不出变革动力; 
Source: People's Daily; Author: Zhong Sheng

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Property market here skyrocketing demand; calls to make Malaysia a real estate investment hub

Homes prices in Malaysia are expected to be stable, thanks to solid domestic demand and ample purchasing power, said Datuk FD Iskandar (pictured), Deputy President of the Real Estate and Housing Developers’ Association of Malaysia (REHDA).

“With the implementation of the Economic Transformation Programme and the Greater Kuala Lumpur, the real estate sector is set to experience skyrocketing demand in the coming years,” he told The Borneo Post.

Compared to other property segments, landed houses saw the highest demand this year and the same is expected for 2013 and 2014. One of the factors that contributed to the domestic demand was the country’s growth rate of between 2.2 and 2.3 percent, as well as the rapid urbanisation of Malaysia.

“In the 70s, the degree of urbanisation in Malaysia was only about 30 percent and it increased to 40 percent in the 80s. Now, the degree of urbanisation in the country is between 55 percent and 56 percent,” he said, adding that 200,000 houses were sold in 2011, of which 50 percent were new properties, with the rest being resale properties.

At the same time, people need not worry that a property bubble is looming. Of all the properties sold in 2011, only 1.8 percent was bought by foreigners, unlike in Singapore, where over 39 percent of properties were sold to expatriates, he said.

In addition, property prices in Malaysia are still one of the lowest in the ASEAN region.

“The best that we have is the KLCC area, with an average selling price of US$500 psf (RM1,525 psf). In Singapore, you will be paying US$2,000 (RM6,103) for the same area, while in Jakarta, you will get it in between US$700 and US$800 (RM2,136 to RM2,441),” he added.

By Cheryl Tay 
 

Calls to make Malaysia a real estate investment hub

 
By Andrew Batt:

The Malaysian government should amplify efforts to promote Malaysia as an international property investment hub, according to property developers in a report by The Business Times.

At present, 2 percent of the total property sales in Malaysia come from foreigners, compared with Singapore’s 30 percent. Taking into account that about 120,000 new units enter the market each year, this translates to 2,400 properties.

The government has also introduced measures to cut red tape and enhance the delivery of public service at all government agencies both at federal and state levels.

Moreover, Malaysia is eyeing to attract thousands of expatriates to Iskandar. Three times the size of Singapore, this region will feature an education hub, leisure facilities, a financial district, as well as residential and commercial areas.

European expatriates based in Singapore are planning to relocate to Malaysia due to its cheaper property and low cost of living. Many have already purchased homes in the southern part of the country.

According to Jason Thoe, Head of Marketing at PropertyGuru.com.my, investors are flooding in to Malaysia from Singapore, China, Japan, South Korea and Hong Kong snapping up residential properties in Johor, Kuala Lumpur and Penang.

Ho Hon Sang, Managing Director (property development division) at Sunway Bhd, added that Chinese, Japanese and South Koreans are coming back to Malaysia to invest in properties.

“The country’s leadership and branding is important to attract foreigners here. The government is (also) addressing the issue of affordability so that all Malaysians could own a property,” added Ho. 

South-East Asia in the frontline of US containing China rise?

The US presidential contest will make very little difference to us. American policy in the Asia-Pacific has already been reconfigured. The die has been cast.

DON’T wait up. As the world’s second-largest (and most expensive) democracy elects a president, South-East Asians might as well switch off. The US presidential contest will make very little difference for us.

Obama or Romney? Republican or Democrat? Who cares? American policy in the Asia-Pacific has already been reconfigured. The die has been cast.

After a decade-long obsession with Iraq and Afghanistan, the United States has finally switched its focus further east.

In essence, Washington has acknowledged Asia’s centrality both economically and now, politically.

The move has been dubbed the “pivot” as a steady shift towards Asia (and especially the “containment” of China) becomes more deeply-institutionalised in Beltway thinking.

Another less well-known development is accelerating this shift.

Basically, the United States after decades of being a net importer of energy is emerging as a new exporter.

This trend – driven by the shale gas revolution (powered by the “fracking” technique by which gas is extracted from rock) – will reshape the way Americans view the world.

Certainly, petro-powers such as Saudi Arabia and the United Arab Emirates will see their influence dipping in Washington DC.

According to the US Energy Information Administration, the world’s second-largest energy consumer after China has huge shale gas reserves (some 860 trillion cubic feet).

Indeed, The Economist in July 2012 estimated that shale gas currently contributes one third of America’s gas supplies and by 2035 this could rise to 50%.

Moreover, these new developments could create three million jobs in the United States by 2020.

There’s also the possibility – controversial and hotly-debated– that America might start exporting its LNG surplus, generating, according to Michael A. Levi of the Council on Foreign Relations in an August 2012 New York Times article, an additional US$3bil per year for the American economy.

It’s hard to imagine how an energy-independent America will behave.

There’s no doubt that the Middle East will no longer be so central to US foreign policy. Instead, a resurgent America may well have greater wherewithal to check China in their common Asia-Pacific backyard.

Moreover, an influx of American LNG imports could strengthen its influence on countries like Japan (which is seeking to step away from nuclear power) and radically upend Asian energy markets, including in South-East Asia.

For starters, Indonesia’s coal will be less sought after.

At the same time, the region’s large and costly LNG facilities may well end up experiencing a drop in profitability as long-term contracts lose their attractiveness.

Ironically, America’s new-found energy independence is contrasted by China’s increasing energy import-dependence.

In July, Beijing’s National Energy Administration reported that the Middle Kingdom imported 81.09 million tonnes of coal (up 70.6% year-on-year), 30.2 million tonnes of crude oil (up 30.2%) and 4.08 million tonnes of LNG (up 100.2%) in the first half of 2012 alone.

China’s demand for energy is vast.

Imagine then a super-power that views its energy security with mounting unease, if not “paranoia”: watching developments in the South China Sea, the Strait of Malacca and Myanmar as a series of deliberate moves to limit its reach.

So, while the US presidential elections won’t have any direct bearing on our lives, South-East Asians are going to have to get used to being an important geopolitical stage as the two great superpowers jockey for pre-eminence.

For starters, our hitherto uneventful Asean meetings (durian fests, golf, silk batiks and bad karaoke) will become argumentative, testing all of us.

What happened recently at the Asean Foreign Ministers meeting in Phnom Penh when the Cambodian hosts refused to sign off on a joint communique will become a regular occurrence as Great Power rivalry courses its way through our association.

Having said this, the region barely featured during the actual campaign.

The third and final Obama-Romney debate on foreign policy was merely a set-piece of China sabre-rattling.

Still, Obama’s “pivot” towards Asia and Romney’s talk of a “Reagan Economic Zone” of “free trade”-oriented nations to combat China’s influence underlines the shift.

Of course, all of this is not surprising. We all know that economic gravity is shifting to Asia which in turn will also boost the strategic importance of South-East Asia.

So, like it or not, the next American president’s main foreign policy challenges are likely to come from South-East Asia as anywhere else.

Let’s not forget that China will also have a new leadership in place by then as well, fronted by that princeling extraordinaire Xi Jinping.

As I said earlier, South-East Asia is likely to be at the frontlines of the next global contest for supremacy. Let’s hope we’ll be able to cope with all the attention.

CERITALAH By KARIM RASLAN

Related posts: 

The role that the US plays in Asia: Containment of China! Nov 27, 2011 
China advises ASEAN to be independent Jun 26, 2012

Singapore warns US on anti-China rhetoric! Feb 11, 2012

China warns US on Asia military strategy Jan 07, 2012

US Military Strategy to Asia: Poke a Stick In China's Eye Jan 22, 2012

US threat: superpower gun barrels pivot east Aug 12, 2012

Top-selling news app: Summly, launched by teenager

  Nick D'Aloisio took time off school to develop the Summly smartphone app

A smartphone app which provides summaries of news stories soared to number nine in Apple's app store just two hours after its release in the US.

The app, called Summly, was designed by 17-year-old Londoner Nick D'Aloisio, and has received more than $1m in funding from investors.

High-profile supporters include Stephen Fry, Tech City CEO Joanna Shields and Newscorp owner Rupert Murdoch.

However some early reviewers have described the app as "confusing".

"Navigation unclear," wrote Oliver Devereux on the app store's review page, while another described it as "quite unintuitive".

But the app is still rating an average score of four out of five possible stars from users overall.

Mr D'Aloisio took time off school to develop his idea for a smartphone application that offers summaries of existing news stories published on the net.

The free-to-download app uses algorithms to process news stories into summaries which users can then swipe to see in full if they wish.

"We worked hard on an interface that looks like nothing else on iPhone," he told the BBC.

"We merged algorithm with beautiful design. It's summarising thousands of articles every minute."

'Big visions'
 

Nick D'Aloisio talks to Jane Wakefield about the app in December 2011

Mr D'Aloisio, who celebrated his 17th birthday on Thursday, has appointed Bart Swanson, who oversaw the roll-out of retailer Amazon in Europe, to chair the company behind Summly.

"I see big visions for the company longer term," the teenager said.

"We can really become the de-facto format for news on mobile. People are not scrolling through 1,000-word articles - they want snack-sized information."

In the longer term Mr D'Aloisio would like to see users make micro-payments to read some stories in full should they choose to view the entire article.

"Traditionally publishers have been confined to a paywall system," he said. "You can either give away the headline or the full article. But we can really sell the summary level."

Mr D'Aloisio now intends to finish his education and go to university - but he also wants to remain involved in the company.

"I'm going to do my best to stay, I'm the founder and it's my vision and I want to see that through," he said.

Source: BBC
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Why Failure is so important to Success?

Failure and more importantly studying others’ misfortunes is one of the most important educational tools we have. In fact there is an entire convention in the Bay Area for technology entrepreneurs, investors, developers and designers to study their own and others’ failures and prepare for success, thefailcon.com. We had the amazing opportunity to chat today with Caroline Cummings, VP of Marketing at Palo Alto Software. As the former co-founder and CEO of two technology companies, she’s experienced both start-up failures and successes, and has raised close to $1 million in investment capital.

Her first venture, OsoEco.com (healthy social shopping), dissolved in 2009. Her second venture, RealLead (mobile marketing for real estate) sold in early 2012. She has co-founded several successful entrepreneurial programs for the Eugene Area Chamber of Commerce, including Smart-ups Pub Talks and the Southern Willamette Angel Network. Not only has Caroline had an amazing career where she has had the opportunity to be both entrepreneurial and intrapreneurial, she strongly believes in paying it forward through mentorship. “I think the secret to the universe is mentoring,” said Cummings.

She has created what she calls “The 10 Reasons Why a Startup Fails” to help other entrepreneurs avoid some of the detrimental mistakes that she has made and witnessed over the years.

1. The Wrong Team – as Jim Collins noted in his book Good To Great, “start by getting the right people on the bus, the wrong people off the bus, and the right people in the right seats.”

2. The Single Founder – finding the right co-founder is critical. To find the right partner you have to be able to recognize the skills that you do not posses and be willing to admit that you have shortcomings.

3. The Wrong Legal Team – Caroline found that having legal counsel that was not well-versed in business law was one of the biggest mistakes that her failed business encountered! Make sure you have sound, credible counsel and do your due diligence.Caroline suggests that you need to trust your gut when it comes to your legal counsel but also has laid out some questions that you should ask any legal representative you are considering:

• Have they worked with your industry?
• How much time do they have to spend with you?
• Who else do you go to if they cannot be available to you (partners)?
• Have they raised rounds of financing before?
• If so, have they created/read a Capitalization Table?
• Have they done compensation packages?
• Do they have experience with IP protection?
• Do they have experience with Global Expansion?
• Do they have experience with exits, M&A’s, IPOs?

4. Boiling the Ocean – Is your concept completely new? Will you have to teach your potentials consumers about your product, will there be a learning curve? Can you borrow techniques that have already been created or partner with companies that already exist?

5. Not Talking to Customers – often entrepreneurs do all of their concepting and creation within a bubble either because they are afraid someone will steal their idea or because they want it to be perfect before releasing it to the world. Lean Start Up methodology has taught us to find our MVP (Most Viable Product) and roll with it. Test the product, concept or service to see if it is viable. It doesn’t have to be perfect right out of the gate, get feedback, make changes, pivot where necessary. Include your customers in your research and development.

6. Stealth Too Long – If you are too slow to draw, you may miss your opportune time to launch or worse yet, someone else might beat you to the finish line. Take advantage of all of the tools and information out there to help you get your business up and running (like www.chic-ceo.com and many easily accessible books like “The Art of the Start” for example.)

7. Stuck on Original Idea – although it is important to have a clear direction for your company, you must be nimble when it comes to having a successful startup. Opportunities arise, projects fail and situations change.

8. Taking Dumb Money – when you are raising capital and spending money other than what your company has generated, you get a say in the transaction. Don’t just take a deal because you need the money, be smart about what the money brings with it. Look for investors that are willing to mentor you, introduce you to contacts and take a significant interest in the success of your organization.

9. Founder-itis – “An organization faces founder’s syndrome or founder-itis as the scope of activities widen and number of stakeholders increase. Without an effective and inclusive decision making structure and process there is potential for conflict between newcomers who seek effective involvement with organizational development and the founder(s) who seek to dominate the decision making process. This can be very disruptive both to the organization and to the individuals concerned and should be carefully and clearly diagnosed and addressed quickly and decisively.^“

10. Spending Too Much Money – Often startups think that once they hit a certain threshold they can become less frugal. Frugality is a virtue that many startups have a hard time managing. It is important to be willing to spend where necassary but to manage the bottom line. Luxuries like fancy office spaces may not be necessary in the startup phase.

By Jody Coughlin, Forbes Contributor 
Jody Coughlin is the CMO and co-owner of Chic CEO – a free resource for female entrepreneurs. You can follow her and Chic CEO on twitter at @ChicCEO.

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Taking a loan is fine, but if you can’t pay back your loans ...

HAVING gone through a few recessions and occasional global financial crisis in my lifetime, I have seen enough suffering by genuine business owners and their families.

When the going gets tough, the banks call in the loans and their cash-strapped business just fold up. The bank will then sell their pledged collateral and sue them till they are declared bankrupt. Standard operating procedures (SOP) for the bank and sobbing by the poor chap.

Then you have property speculators and big-time stock market manipulators bankrolled by greedy bankers until the bubble burst and the market crash. All hell will break loose as all parties scramble to damage control mode. The cash rich speculators will survive but the bankers always end up with having to take an unwanted haircut. High margins come with high risks. Fair game.

To get a loan, small businessmen have to charge to the bank whatever properties they have as collateral. At all times, they have to sign a personal guarantee too, just in case the bank cannot fully recover their loan sum from the forced sale of the property.

Unless you are someone special with VVIP status, the bank will come after you. Trust me, bankers are sticklers to SOP and they will make sure your name appear in the classified pages for bankruptcies if you don't pay up.

So, I am sure everyone is watching with great interest the latest promise in parliament by our Agriculture and Agro-based Industries Minister on the full recovery of the RM250mil loan from the National Feedlot Corp.

It looks like there were no properties charged to the Government as the 600ha in Gemas was leased from the Negri Sembilan government for RM200,000 a year and the condominiums were bought with the loan money. Did the borrowers provide the Government with any personal guarantees?

As with all loans, recovery of the loan sum will start with a demand letter saying that the bank/government is recalling the loan and you are given three months to pay back in full, principal sum with interest. Or else they will take you to court and sue you. Once they get judgement against you, the court will appoint a liquidator to salvage whatever assets you have and sell whatever cows and bells left to any interested cowherd with a big haircut. If you have signed a personal guarantee, you will be a bankrupt. Nothing personal, just SOP.

Now you are really on your own, with nobody to turn to. All your so-called friends are avoiding you like the plague. What can you do?

As an experienced restructuring expert and part-time lipstick salesman, my advice to you is not to hire sleazy advisors to solve your problems or you will end up suing him for unsatisfactory service levels filled with lies and empty promises.

There is no bypassing the SOPs. When the shit hits the fan, it is every man for himself. You still have to pay back... in full. Stay calm and meditate and God will show you the way.

First step is to look for a friendly tycoon who can buy over the cow business for RM250mil in the name of national interest. It is only petty cash to the tycoon but it will blend in nicely into his portfolio of staple food businesses.

Do not worry if nobody wants to talk to you now because the concerned ministry is already talking to a few parties for a friendly takeover. Maybe an attractive haircut might work.

If the first step doesn't work, I suggest you take the next step with caution. You can borrow RM250mil from Ah Longs but make sure you pay the high interest rates or your house will be splashed with red paint and your neighbours will know about your non-payment. That would really be embarrassing.

Ok, maybe that was a wrong step to recommend. As a last resort, when in court, plead ignorance, blame everybody else for your ills. Be a man like William Hung, admit you have no experience and you did not know a bull from a cow. Since you have not signed any personal guarantees, they will only take whatever is left in the company which should be fine with you. It was never yours in the first place.

My simple advice to entrepreneurs who need bank loans to expand the business, make sure you treat the approved loans with utmost respect. The loan officers have put their heads on the chopping block when they recommended your loan application.

If you failed them due to mismanagement and misinformation, you can bet your last dollar they will come after you and make sure your next four generations will continue to pay your debt.

Oh yeah, another piece of an advice. Do not wear V neck pink t-shirts when you meet your bankers. Just play it straight.

There are just too many issues raining down on our heads nowadays and we do not need another downpour.

ON YOUR OWN
By TAN THIAM HOCK

To access earlier articles of On Your Own, log on to www.thiamhock.com. Honest comments welcomed and approved.

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