MALAYSIA'S property market is expected to move out of its current extended consolidation period and improve, possibly registering growth from next year onwards.

Property consultancy Knight Frank Malaysia chairman Datuk Michael Cheah said: ''We see bright prospects for the local property market especially with Bank Negara's announcement on the economic growth this year surpassing the official forecast of 4.5%.''

Knight Frank Malaysia is part of Britain-based Knight Frank Worldwide, which is one of the world's leading groups in real estate advisory services. Since its establishment last year, Knight Frank Malaysia has advised on valuation of properties with an aggregate value in excess of RM2bil.

''The company, in the first year of its operation, focused on professional work in the corporate sector, which contributed more than 80% to our revenue,'' Cheah told a media briefing in conjunction with Knight Frank Asia Pacific Regional Conference and its first anniversary in Kuala Lumpur yesterday.

The projects included the successful sale and lease back of Bangunan Shell Malaysia by tender for RM79mil, which was completed within six months.

Knight Frank Malaysia has also been appointed consultant and project manager to Commerce Asset-Holdings Bhd to handle the acquisition of a new corporate head office in Kuala Lumpur, as well as exclusive marketing agent to Kuala Lumpur Golf and Country Club's upcoming residential development project of 128 upmarket resort villas.

On Malaysia's office sector, Cheah said approvals for new office developments within Kuala Lumpur had been frozen except for buildings being developed for owner-occupation.

''This limited new supply has resulted in occupancy rates of prime office space moving towards 80% and rents firming at about RM4 to RM6 per sq ft per month.''

He also said the government's economic package of 100% income tax exemption for 10 years to encourage international companies to set up their headquarters in Malaysia was expected to attract many multinational companies to relocate here.

Within the retail sector, Cheah said the average occupancy rates were hovering around 80%.

''However, such an indication can be misleading as successful shopping centres like Suria KLCC, Mid Valley, 1-Utama and Sunway Pyramid have a queue of prospective tenants wanting to set up shop,'' he added.

He said developers of these successful retail complexes, encouraging by improving retail spending, were feeling positive on the market.

''Major retail complexes such as Mid Valley and Sunway Pyramid have plans to expand and 1-Utama is almost in the final stages of their expansion,'' Cheah said.

With the improving economy, he also expects rents to move upwards for the popular shopping centres.

Cheah said condominiums within the city centre had also attracted strong buying interest.

''Sales and rentals have been encouraging,'' he said, adding that with attractive financing terms offered, the prospects were good for development in premier locations in the city centre and prime sub-urban neighbourhoods.

He said prices and rentals for high-end units were also improving to around RM500 to RM700 per sq ft and RM3.50 to RM5 per sq ft per month respectively.

Source : The Star  31/10/2003