On the recovery path

 

Penang property market to rebound amid lingering challenges

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THE Penang property market, which had actually started seeing a rebound in transactions since last year, is expected to resume its recovery path into 2022.
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CBRE|WTW director Peh Seng Yee says the Penang property market can expect a “rebound amid lingering challenges” this year.
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“We do expect a recovery in market activity for 2022. Prices of landed properties will continue to remain resilient.
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“For the high-rise sub-sector, it will continue to be a buyers market,” he says at the launch of CBRE|WTW’s 2022 Market Outlook Report, recently.
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Peh adds that future launches will generally comprise self-sustained developments that will be on a smaller scale, while at the same time fulfilling the demand for affordable units.
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Knight Frank Penang executive director Mark Saw also says the residential sub-sector in Penang has improved, posting higher volume and value of property transactions as of the third quarter of 2021.

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“The Penang state government’s commitment to increase home ownership with plans for a range of affordable homes in various strategic locations, extension of the Penang Home Ownership Campaign until June 2022 and enforcement of mandatory installation of fibre optic telecommunication infrastructure for all new developments, will spur the state’s residential property market.”
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In terms of challenges, Peh says scarcity of sizeable land in Penang will still continue to pose development constraints.
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“Additionally, the prolonging effects of the pandemic, especially with the new Omicron variant, could result in cautious spending and a wait-and-see approach.
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“Stringent lending guidelines and concerns over job security could also potentially derail the market,” says Peh.
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On the outlook of the Penang office market, Peh says the segment is expected to remain healthy this year, with stable rentals and occupancy rates.
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“The prospects of co-working spaces still remain encouraging,” he says.
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As for Penang’s retail sub-sector, Peh says the removal of movement restrictions since last year has been a boost to this sector.
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“We see normalisation amid ‘freedom euphoria’. However, we expect rentals to be flattish and a widening gap between the newer and older shopper complexes.”
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As for Penang’s hotel sub-sector, Peh says this segment is set for a steady recovery if the pandemic is significantly contained.
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“The segment can be spurred further by travel bubbles and other government initiatives.
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“We also see pent-up demand for medical tourism and intensifying market competition for the hotel sub-sector.”
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Meanwhile, Knight Frank Malaysia in its real Estate Highlights for the second half of 2021, says the Penang residential market is expected to pick up this year, supported by a series of measures announced under various stimulus packages and Budget 2022.
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“This will encourage people from various income levels to purchase their dream homes. The overhang of high-rise residential properties, especially in the category of condominiums and apartments, has also been growing.”
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With limited new supply of purpose-built offices in the state (existing and future), Knight Frank says the occupancies and rental rates for better grade purpose-built office buildings are expected to hold steady.
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“Meanwhile, with the growing work-from-home trend, some business premises have been converted into co-working space.”
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Knight Frank noted that the country’s vaccination rate has continued to improve and with further easing of restrictions, the retail segment is expected to slowly recover.
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“Selected retailers are expected to embrace the rise of eCommerce as they head down the path of recovery.”
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It adds that Penang’s industrial segment has continued to remain strong and steady throughout the pandemic.
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“This is especially with the Penang state government’s commitment to expand another two industrial parks in Batu Kawan, with focus on the logistics industry and the remaining phases for mixed industries.
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“This industrial park is set to continue its history of the successful Bayan Lepas Industrial Park.”
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Meanwhile, CBRE|WTW in its 2022 Market Outlook Report says property transaction activities in Penang increased for the period of January to September 2021.

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“A total of 11,981 properties valued at RM7.23bil were transacted, reflecting 13.9% and 33.9% increase in volume and value, respectively, year-on-year.
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“As more businesses are allowed to operate, the Penang property market has generally rebounded.”
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CBRE|WTW is optimistic that the rebound will extend into this year.
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“However, the rebound would be gradual as the pandemic lingers on, along with a sluggish economy and higher cost of living.”
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CBRE|WTW also expects to see more bargain hunting for residential units this year.
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“The overhang remains a concern. Prospective purchasers can negotiate for more discounts in addition to the incentives offered,” it says.
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According to the National Property Information Centre (Napic), there were 30,290 unsold completed residential units (overhang) worth RM19.75bil as at September 2021, compared with 30,926 units worth RM19.99bil in the previous corresponding period.
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Of the 30,290 overhang units, 18,829 units (or 62.2%) comprised high-rise units, while 6,803 units (22.5%) consisted of terrace houses.
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The bulk of the overhang units were focused mainly in Johor (6,441 units), Penang (4,638 units), Kuala Lumpur (3,863 units) and Selangor (3,376 units).
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Napic says 33.7% of the overhang properties consisted of units ranging between RM500,000 and RM1mil, while 28.4% comprised units ranging between RM300,000 and RM500,000.
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Units below RM300,000 comprised 25.5% of the total overhang, while units above RM1mil (12.4%) consisted of the remaining unsold units during the period under review.
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Knight Frank concurs that the overall property overhang status continues to remain elevated, especially in the high-rise residential segment.
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“The performance of the residential sub-sector is improving gradually, registering higher volume and value of property transactions as of the third quarter of 2021,” it says.

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US and China announce surprise climate change agreement

 

 

United States and China, the world's two largest emitters of carbon dioxide, unveiled a deal to ramp up cooperation tackling the climate crisis. US climate envoy John Kerry and his Chinese counterpart Xie Zhenhua announced the framework agreement at the UN climate conference in Scotland. Both billed it as way to tip the summit toward success. 'In the area of climate change', Xie Zhenhua said. 'There is more agreement between China and the US than divergence, making it an area with huge potential for cooperation'.

How The U.S. Fell Behind China In The Fight Against Climate Change

Ever since President Trump withdrew the U.S. from the Paris Agreement, China has played an increasingly large role in the international fight against climate change. The country is now the world’s largest manufacturer of solar panels, lithium ion batteries, and electric vehicles. But while China has stepped up in these regards, it is still the global leader in carbon emissions, and burns more coal than the rest of the world combined. As President-elect Joe Biden looks to reassert American leadership in green energy and climate initiatives, it remains to be seen whether the U.S. and China can work collaboratively to address the climate crisis.

CORRECTION (November 16, 2020): Barbara Finamore and Alvin Lin both work at the “Natural Resources Defense Council” not the “National Resources Defense Council”

China's War on Pollution

 

China-US Glasgow declaration ‘key step in the right direction’ on global climate actions, prevents decoupling worst scenario 

 China's Special Envoy for Climate Change, Xie Zhenhua speaks during a joint China and US statement on a declaration enhancing climate action during the COP26 climate change conference in Glasgow on November 10. Photo: AFP

China and the US released a joint declaration on tackling climate change during the ongoing COP26 in Glasgow, including setting up a working group and reducing methane and CO2 emissions. Officials and analysts said the declaration highlighted that China-US cooperation is the only right choice, noting it is a significant move on global climate actions and also sends strong positive signals for the success of the COP26.

China and the US on Wednesday released the China-US Joint Glasgow Declaration on Enhancing Climate Action in the 2020s. The two sides said they appreciated the work done so far and pledged to continue working together and with all parties to strengthen the implementation of the Paris Agreement. On the basis of the principle of common but differentiated responsibilities and respective capabilities as well as taking into account national conditions, enhanced climate action will be taken to effectively address the climate crisis.

The two sides agreed to establish a working group on enhancing climate action in the 2020s to promote cooperation on climate change between the two countries and the multilateral processes.

They reiterated they will observe the Paris climate agreement to keep temperatures below two degrees and to pursue efforts to limit it to 1.5 degrees.

On cooperation of reducing emissions of methane, the two countries intend to develop additional measures to enhance methane emission control, at both national and sub-national levels. China intends to develop a comprehensive and strong national action plan on methane, aiming to achieve a significant effect on methane emissions control and reductions in the 2020s.

On reducing CO2 emissions, the two agreed to cooperate on distributed generation policies that encourage integration of solar, storage, and other clean power solutions closer to electricity users. China will phase down coal consumption during the 15th Five Year Plan（2026-30）and make best efforts to accelerate this work.

Xie Zhenhua, China's Special Envoy for Climate Change, said on the release of the declaration that it once again shows that China-US cooperation is the only right choice, and that China and the US have more consensus than differences on climate change. Together, China and the US can accomplish many things that can benefit both countries and the world. China and the US should shoulder major responsibilities and follow the trend of the world, Xie said, jiemian.com reported.

He said he wished the declaration will contribute to the success of the COP26 as negotiations are still ongoing.

Setting up the working group was to institutionalize the China-US cooperation mechanism on climate change, and make joint actions more practical, Xie said, noting that the working group plans to have their first meeting in the first half of next year.

UN Secretary-General Antonio Guterres tweeted that he welcomed the agreement between China and the US to work together to take more ambitious climate action in this decade. "Tackling the climate crisis requires international collaboration and solidarity, and this is an important step in the right direction," he said.

Chinese experts considered the declaration between China and the US,two largest emitters, as a significant move in helping the globe battle climate change, with concrete progress made on how to advance the working mechanism on cooperation in handling climate change and stepping up efforts in boosting financial support for developing countries.

"It's crucial for China and the US to work together. No matter the target is 1.5 C or 2 C, the target can only be achieved with the joint efforts of the two countries," Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times on Thursday.

Lin highlighted the progress in the latest consensus reached by China and the US including stepping up efforts on $100 billion pledges by developed countries to developing countries from 2020 to 2025 in order to achieve the climate change targets and also setting up a working group on enhancing climate action in the 2020s. "Frequent communication on handling the climate change is a crucial part of global efforts," he said.

Li Shuo, Senior Policy Advisor at Greenpeace East Asia, told the Global Times on Thursday that the declaration served the background of the reported upcoming leaders' summit between the two countries and created cooperative atmosphere for the two countries' further communication on climate change.

It has prevented the worst scenario of China-US decoupling on climate actions, Li said.

Xu Huaqing, a senior adviser of the Chinese delegation to COP26, told the Global Times that China has taken an active part in leading global climate governance, and also played an important historic role in facilitating the formulation of rules for the Paris Agreement through the diplomacy of the heads of state of China, the US and the EU. China looks forward to further strengthening dialogue and cooperation with the US and the EU, and working with other parties to strengthen the implementation of the Paris Agreement.

To achieve the long-term goals set in the Paris Agreement, developed countries should first take the lead in deepening emission reduction, which is the key to achieving global net zero emissions at an early date. The key to the international community's ambition lies in the need for countries to take strong concrete actions rather than empty slogans, Xu said.

Regarding the expected goals of the COP26, Xu said he believes that it is particularly important to form a consensus on some aspects, including finishing the talks on the implementation rules of the Paris Agreement, and making concrete progress on financial and technology support for developing countries.

For a long time, no effective progress has been made in funding, technology and capacity building support, which is of great concern to developing countries. As the Paris Agreement officially enters the implementation phase, these issues are related to political mutual trust and climate action by developing countries, Xu said.

He noted that the COP26 should also make clear arrangements for those matters in order to balance the financial support and adaption to climate ambitions, while also advocating countries to transform their goals into implemented policies and specific actions in order to avoid turning those promises into empty slogans.

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