PENGURUSAN Danaharta Nasional Bhd, which will cease operations at the end of next year, is confident its 10th and last nationwide tender of foreclosed properties from Oct 4 to 29 will be well supported because it is an affordable portfolio that offers some attractive buys.

Of the 193 properties available, more than 33% are priced below RM500,000 while 74% are below RM3mil. The latest property portfolio has a total indicative value of RM846.12mil.

According to the senior general manager of Danaharta's property division, Datuk Johan Ariffin, there are some land parcels that have seen their indicative value drop by between 30% and 50% since the earlier tenders and this would provide a low entry level for developers who bid for them.

One such example is a 706-acre parcel in Rembau, Negri Sembilan, that has a price tag of 49 sen per sq ft. The land, which has been on offer since the seventh tender, has seen its indicative value drop by 43%.

''Some of the properties are offered at below replacement cost and offer good upside potential for the buyers. For developers, they should look at the various land parcels available as they may just end up with some worthwhile buys,'' he told StarBiz.

Datuk Johan Ariffin.

In the latest tender, there are 67 new properties and 126 units that were brought over from previous tenders. Of the portfolio, there are 56 industrial properties, 40 commercial units, 38 residential properties and 40 pieces of development and agricultural land.

In terms of indicative value, development land has the highest value at RM353.7mil or 41.8%. Commercial properties rank second at RM153.2mil (18%), followed by industrial properties with a total value of RM147.34mil (17.4%). Most of the properties are located in the Klang Valley, Johor and the northern states.

Johan said the recovery rate was expected to be good as the types of property available were suitable for those looking to expand their businesses or for new start-ups.

''Subject to board approval, we may again participate in the tender by putting in minimum bids to facilitate the conversion of ownership of these properties in anticipation of the closure of Danaharta next year.

''After this tender, Danaharta will hold two to three specific tenders early next year involving a smaller number of properties. These will offer high-ticket properties, or properties of the same type, or within the same development,'' he added.

On Danaharta’s role in recovering non-performing loans (NPLs), Johan said the national asset management company had always worked closely with the borrowers to find other recovery methods such as loan restructuring, settlement and schemes of arrangement.

''Foreclosure will only be resorted to if all the other methods fail. Of the RM17bil worth of collateral put up for the NPLs, only RM3bil comprised foreclosed properties. So far, the other methods have been working well and there are fewer properties coming up for tender now.

''With the good efforts that we put in to maximise the recovery of the NPLs and minimise any losses, we are confident of redeeming all the RM11.14bil worth of bonds issued by Danaharta as consideration for buying the NPLs. We have to date redeemed RM9.37bil worth of bonds. The balance of RM1.76bil is to be redeemed in the next two tranches at the end of this year and in March next year,'' Johan said.

Source : The Star  15/10/2004