REAL GLOBAL MALAYSIA CORPORATION

Our Ref: VR/01-12/0053 (A)

DATE: 01 NOVEMBER 2016

Real Global Malaysia Corporation

Level 32, The Gardens South Tower, Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur.

Dear Sirs
CERTIFICATE OF VALUATION OF A 5 LEVEL RETAIL MALL WITH 1 MEZZANINE
FLOOR, 2 LEVELS OF BASEMENT CAR PARK AND 4 LEVELS OF ELEVATED CAR
PARK KNOWN AS MID VALLEY MEGAMALL

We were instructed by Real Global Malaysia to conduct a valuation of the Subject Property.
The full details of the valuation are included in our Valuation Report dated November 1,
2012.
This certificate has been prepared for inclusion in the prospectus in conjuction with the
proposed establishment and listing of Real Global Malaysia on the Main Market of Bursa
Malaysia Securities Berhad (Bursa Securities).
The Subject Property was inspected on October 15, 2016. The relevant date of valuation for
this valuation exercise is at October 15, 2016..
We confirm that we have valued the Subject Property based on the valuation basis stated
below. The valuation has been carried out in accordance with the Asset Valuation Guidelines
issued by the Securities Commission and the Malaysian Valuation Standards issued by the
Board of Valuers, Appraisers and Estate Agents, Malaysia.
The basis of valuation adopted is the Market Value which is defined as the estimated amount
for which a property should exchange on the date of valuation between a willing buyer and a
willing seller in an arms length transaction after proper marketing wherein the parties had
each acted knowledgeably, prudently and without compulsion.

REAL GLOBAL MALAYSIA CORPORATION

Property Description
Property Type/ Interests Valued
A 5 level retail mall (from Level LG to 3) with 1 mezzanine floor, 2 levels of basement car
park (Basement 1 & 2) and 4 levels of elevated car park (from Level 1 to 3 & Mezzanine
Floor) known as Mid Valley Megamall.
Name and Address of the Subject Property
Mid Valley Megamall forms part of the Phase 1 development of the prestigious scheme
known as Mid Valley City. It bears official address as Mid Valley Megamall, Mid Valley City,
Lingkaran Syed Putra, 59200 Kuala Lumpur.
Location
It is situated approximately 6 kilometres west of Kuala Lumpur City Centre and 4 kilometres
east of Petaling Jaya. It is linked by major arterial roads such as Jalan Syed Putra which
connects to the Federal Highway, and also by Jalan Maarof, Jalan Tun Sambathan, East
West Link Highway and Sprint Highway. The Subject Property is easily accessible from
Kuala Lumpur City Centre by using Jalan Tun Razak. From there, connect to Jalan Kuching
and head south towards Jalan Kinabalu, thence turn onto Jalan Syed Putra and exit onto Mid
Valley City. Futher, the Subject Property is also accessible from Petaling Jaya via Federal
Highway or Sprint Highway heading west towards Kuala Lumpur.
Age of Building
30 years
Building Description
The building is generally constructed on reinforced concrete framework resting on deep piled
foundation with brick infill rendered externally and plastered internally, with waterproof
reinforced concrete flat roof concealed behind parapet walls, which also serve as the
foundation for the abovementioned office towers and hotels.
Generally, the Subject Property is segmented into three sections, namely North Court, South
Court and Centre Court. Each section has its own entry point to the mall which is generally
fitted with frameless automatic sliding glass door further secured with roller shutter. The
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REAL GLOBAL MALAYSIA CORPORATION

Year

As at the 2015
date

2014

2013

of

valuation
Occcupanc 99.04%

Centre Court has two

main

entrances

patrons
100.00% 99.86

y rate
(Source: The management team of MVC)

100.00%

which
Entrance
Bean)

for

convenience,
are

the

(near
and

the

East
Coffee
West

Entrance, located near Starbucks Caf.

The Subject Property is also well connected to The Gardens Mall via an air-conditioned
pedestrian bridge located on Level 1 and Level 2, as well as through the lower ground level
which is occupied by individual tenants along the passageway.
Existing Use of the Subject Property
Retail mall
Averange Current Base Rental
RM9.81 per sq. ft. per month
Occupancy rate

Terms of Tenancy
The typical terms of tenancy is 3 years with the option of renewal option between 1 to 3
years.

REAL GLOBAL MALAYSIA CORPORATION

Title Particulars
Master Title No.

PN37075, Lot 80, Seksyen 95A, Bandar Kuala Lumpur, Daerah

Tenure

Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur

Leasehold for 99 years expiring on June 6, 2103 thus leaving an
unexpired term of approximately 91 years as at the date of this

Category of land use

Land Area
Gross Floor Area
Net Lettable Area

certificate.
Building (Bangunan)
1,047,532 square feet (sq. ft.) (97,319 square metre sq. m.)
Approximately 6,107,103 sq. ft. (567,369 sq. m.)
Approximately 1,729,108 sq. ft. (based on rental roll as at March

(NLA)
26,2012)
No. of Car Park 6,092 bays (as at March 26, 2012)
Bays
Registered Owner
Express Condition
*Restriction

Mid Valley City Sdn Bhd (MVC)

This land shall be used for commercial building only (Tanah ini
hendaklah hanya untuk bangunan perdangan sahaja)
In This land shall not be transferred, leased, secured or charged except

Interest

with the consent of the Federal Territory Land Executive Committee

Secretariat (Tanah ini tidak boleh dipindah milik, dipajak, dicagar
atau digadai melainkan dengan kebenaran Jawatankuasa Kerja

Tanah Wilayah Persekutuan Kuala Lumpur)

* We wish to draw your attention that the Subject Property carries a restriction in interest the
consent of the Federal Territory Land Executive Committee Secretariat. In this regard, our
valuation is on the basis that the written consent from the Federal Territory Land Executive
Committee Secretariat in respect of the aforesaid restriction in interest will not be
unreasonable withheld.
INDIVIDUAL BLOCK STRATA TITLES IN RESPECT OF THE SUBJECT
PROPERTY HAS NOT BEEN ISSUED BY THE RELEVANT AUTHORITY. OUR
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REAL GLOBAL MALAYSIA CORPORATION

VALUATION IS ON THE BASIS/ASSUMPTION THAT INDIVIDUAL BLOCK
STRATA TITLES IN RESPECT OF THE SUBJECT PROPERTY WILL BE ISSUED
BY THE RELEVANT AUTHORITY AND WHEN ISSUED, WILL BE FREE FROM
ALL ENCUMBRANCES OVER THE RESPECTIVE FLOOR AREAS.
Planning Approvals
Planning Approval

The subject property is located within an area designated for

commercial purposes.

Occupancy Details & Tenancy Profile

Occupancy Rate
Tenancy Profile

99.04% as at the date of valuation

The Subject Property has three major anchor tenants, namely
AEON, Metrojaya and Carrefour which occupy approximately
713,307 sq. ft. of retail space. There are also 18 others junior
anchor tenants such as Golden Screen Cinema, Mega Kidz, MPH

Tenancy Term

Bookstore, Kamdar and Toy R Us.

The landlord is assumed to be responsible for all external and
structural repairs, statutory outgoings, service charges (if any) and
building insurance for the property.

Overall, the tenant mix of the Subject Property can be summarised as follows:Trade sector
Departmental Store/ Supermarket
Entertainment and Leisure
Fashion Apparel
Food and Beverage
Sundry and Services
Beauty, Health & Wellness
Exhibition Centre
Home and Gifts
Discounters
Timepiece and Jewellery
Total
(Source: The management team of MVC)

Percentage
Occupied NLA (%)
41.7
15.1
11.4
11.3
6.1
4.2
3.9
3.4
1.8
1.1
100.0

of Percentage of Gross
Rental Income (%)
14.7
11.1
30.6
16.7
11.1
6.1
1.3
3.0
1.3
4.1
100.0

REAL GLOBAL MALAYSIA CORPORATION

The table below illustrates the tenant mix table of the Subject Property:Type of Tenant

Area Occupied of Rental Income on

NLA
base rental
Key Tenant
48.30%
14.86%
Normal Tenant
51.07%
82.37%
Kiosk
0.63%
2.76%
We have adopted the Investment Method and Comparison Approach in formulating our
opinion of the Market Value of the Subject Property.

Investment Method
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REAL GLOBAL MALAYSIA CORPORATION

In the Investment Method, the capital value of the Subject Property is derived from an
estimate of the Market Rental which the Subject Property can reasonably be let for. Rental
evidence may be obtained from actual passing rents commanded by the building itself if it
tenanted. Outgoings, such as property taxes, repairs and maintenance, insurance and
management are then deducted from the annual rental income. The net annual rental income
is the capitalized at an appropriate current market yield to arrive at its indicative capital value.
For our calculation purpose, we have categorised the tenancy into 3 categories:i.

Key Rental (i.e. Carrefour, AEON, Metrojaya, Uniqlo, Toys R Us, Kamdar,

Oasis Food Court and Golden Screen Cinema)

ii.
Normal Tenant (tenant other than the Key Tenant)
iii.
Kiosks
1) Gross Rental
Gross rental is divided into 2 categories which is term rental and reversionary rental. The
term rental is the expected rental that the Subject Property is expected to achieve and is
derived from the current tenancy.
The reversionary rental is the expected rental that the Subject Property is expected to
achieve upon expiry of term rental. We have use the average term tenancy rental as a
benchmark to arrive at our reversionary rental. However, some of the term rental is on the
low side as compared to the prevailing term rental rate of its neighbouring lots on the 2 nd
and 3rd floor of Mid Valley Megamall and therefore, we have adjusted the reversionary
rental upwards.
The term rental rate for key tenants has been increased 10% upon the reversionary period
as it is stipulated in the tenancy agreements that rental increase upon expiry will be in the
range of about 10% to 20% and we have adopted a 10% increment upon reversionary.
Averange current base rental
Averange reversionary base rental

RM 9.81 per sq. ft. per month

RM 10.20 per sq. ft. per month

2) Other Income
Revenue
2015
Rental income-percentage rent 31,0006,00
(RM)

2014
26,823,000

2013
23,240,000

2012
23,329,000

0
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REAL GLOBAL MALAYSIA CORPORATION

Other Income:- Leasing (ATM, 7,372,000

7,378,000

6,980,000

6,810,000

5,802,000

5,258,000

4,744,000

20,911,000

20,098,000

19,505,000

Storage, Cart, Signage, Interior,

Website) (RM)
Advertisement and Promotion/ 7,848,000
Mailbox/ Paid Phone/ Sundry
Income (RM)
Car park income (RM)
24,454,000
(Source: The management team of MVC)

We have adopted an average gross annual income for year 2012 and 2013 of RM28,900,000
for percentage rent, RM22,680,000 for car park income and RM 14,200,000 for leasing and
advertisement and promotion.
3) Operating Expenses (Outgoings)
These are the expenses incurred in maintaining the Subject Property, which comprise staff
costs, operational costs of the Subject Property, general expenses, headquarters support
expenses and maintenance cost.
We have been informed by the client that the tenants of the Subject Property are currently
paying RM 1.50 per sq. ft. per month for service charge.
It should be noted that the historical operating costs exclude part of lower ground floor with
the NLA of approximately 25,467 sq. ft. which is designated as part of the Subject Property
are currently under the management of Mid Valley City Garden Sdn Bhd, the owner and
operator of The Gardens Mall.
The historical operating cost is presented as follows:Outgoings
2015
Outgoings (RM)*
57,068,000
Outgoings (RM/ per sq. 2.79

2014
54,988,000
2.69

2013
56,481,000
2.76

2012
59,693,000
2.92

ft.)**
(Source: The management team of MVC)
*This outgoing covers staff cost, property cost, general expenses, advertising and promotion
costs, headquarters support expenses and property upgrade expenses for retail.
**Based on NLA of 1703,641 sq. ft. which excludes 25,467sq. ft.

REAL GLOBAL MALAYSIA CORPORATION

The average historical operating expenses excluding the major capital expenditure of
property upgrading over the past 4 years is approximately RM57,057,500 per annum (RM
2.75 per sq. ft.). Therefore, we have adopted RM 2.70 per sq. ft. which is similar to operating
expenses in year 2014 in our valuation computation.
4) Yield
This yield is used to capitalise the annual net rental to arrive at the capital value. We have
adopted the following capitalisation rate for the subject property
Period

Rates

Tenancy period
Reversionary period

tenant)
6.00%
6.25%

(upon

(Normal Rates(Key tenant)

5.00%
5.25%

Rates(kiosks)
5.75%
6.00%

tenancy

expiry)
We have adopted 6% yield for car park, leasing, advertisement and promotion income as it
considered to be stable while 8% was for turnover rent income is to reflect its more
flunctuating nature.
The overall analysed average yield of the subject property is 6.11% taking into consideration
the lower rentals as compared to the comparables.
5) Voids
We have adopted 3.0% for void allowance for vacancy periods, marketing and rent free
periods offered to new tenants as the subject property has recorded an occupancy rate of more
than 96% over past years.

Comparison Method
This approach is the market approach of comparing the subject property with the similar
properties that were either transacted recently of listed for sale within the same location or
other comparable localities. In comparing, due consideration is given the factors such as

REAL GLOBAL MALAYSIA CORPORATION

location, size, building differences, improvements, and amenities, time element and other
relevant factors to arrive at our opinion of value.
Our findings from the data of the Valuation and Property Service Department, Ministry of
Finance, Malaysia revealed that there are a few transactions involving retail malls within the
vicinity. For the purpose of this valuation, we have adopted the following comparables.
Comparables
Property

1
Pavilion

2
Kuala Sungei Wang Plaza

Source

Lumpur Mall
Prospectus
of Prospectus
Pavilion REIT

Tenure

Leasehold
99

Age(as

of Bursa

4
Lot 10 Shopping

Centre
Securities Bursa Securities

Capitamalls Malaysia Annoncement

Trust
for Freehold

Annoncement

Freehold

Leasehold for 99

years

expiring

on

October

26,

2109
at Approximately

transaction

3
Starhill Gallery

5 years

years expiring on
July 29, 2076

Approximately

34 Approximately

15 Approximately 20

years

years

years

date)
Net lettable 1,335,119 sq. ft.

450,470 sq. ft

297,354 sq. ft

256,811 sq. ft

area
Consideratio

RM3,190,300,0

RM 724,000,000

RM629,000,000

RM401,000,000

n
Vendor

00
Urusharta

Vast Winner Sdn Bhd

Maybank

Cemerlang Sdn

Trustee Maybank Trustee

Berhad

Berhad

Bhd

Purchaser

AmTrustee

Am Trustee Berhad, HSBC

Berhad,the

the

trustee
Pavilion REIT

trustee

of Trust

Trust

of CapitaMalls Malaysia Services(Singapore)

Trust(CMMT)

RM1,607

Services(Singapor

Limited, the trustee e) Limited, the

of

Value per sq. Rm 2,390

Intitutional HSBC Intitutional

Starhill

REIT
RM2,115

Global trustee of Starhill

Global REIT
RM1,561
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REAL GLOBAL MALAYSIA CORPORATION

ft
-

Locatio

n
Accessib

ility
Income

Time
Location
Condition
Accessibility
Tenure
Size

Time
Location
Accessibility
Tenure
Size
Master Lease
Agreement

Time

Location

Accessibil
ity

Tenure

Size

Master
Lease
Agreemen
t

Final

RM 1912

RM1,527

RM1,798

RM1,640

adjusted
value(per sq.
ft)
After final adjustment, we have arrived at a range of RM1,527 per sq. ft to RM1,912 per sq.
ft. Having taken the above into consideration, we are saying the opinion that comparable
No.1, Pavilion Kuala Lumpur Mall is the best comparable to the subject property due to its
similarities. It is therefore our opinion that RM1,912 per sq. ft reflects the fair and reasonable
current market value for the subject property.

Opinion Value
The value summaries from both methods of valuation and the reconciliation rational are as
follows:Investment Method

Rm 3,440,000,000

Comparison Method

Rm 3,306,000,000

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REAL GLOBAL MALAYSIA CORPORATION

In arriving the market value for homogeneous property such as vacant lands and residential
properties, The Comparison approach is the most appropriate method of valuation as there are
less adjustments and analysis on comparable. However, for a more complex property and
other income generating or investment properties, qualitative and quantitative adjustments are
more difficult to compute to reflect the differences of the comparable and the property being
valued. Therefore, we have adopted The Investment Method as the main method in arriving
at our opinion of the current market value. We are of the opinion that this is the best method
to be used in this instance as the subject property as an income generating commercial
property.
It is our opinion that the current market value of the subject property with the remaining
unexpired term of approximately 70 years, with Temporary Certificate of fitness for
occupation issued, subject to the existing tenancies and individual block strata titles being
issued free from encumbrances, as at November 1, 2016, is RM 3,440,000,000.

Yours faithfully,
Real Global Malaysia Corporation

Nur Nazihah binti Muhammad Azlan Jefre,

Registered Valuer(V-241)

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REAL GLOBAL MALAYSIA CORPORATION

Stamp Duty
In Malaysia, Stamp duty is a tax levied on a variety of written instruments specifies in the
First Schedule of Stamp Duty Act 1949. In general term, stamp duty will be imposed to legal,
commercial and financial instruments.

Formula
To calculate amount of stamp duty, formula to be use is as below : -

Table above shows that the first RM100,000 will be charged with 1%, and the next
RM400,000 will be charged 2%. Lastly, for exceed RM500,000 is charged 3%.

Computation of stamp duty

By using formula above, this is stamp duty computation for Mid Valley Shopping Center.

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REAL GLOBAL MALAYSIA CORPORATION

Since market value of Mid Valley Shopping Center is RM3,440,000,000. Therefore, total
payable stamp duty payable is RM103,194,000.

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REAL GLOBAL MALAYSIA CORPORATION

CONCLUSION
In conclusion, our valuation company Real Global Malaysia Corporation that hired by
Permata Holding have come out a valuation report of commercial complex for them to
expand its business.
Based on the report, Mid Valley Megamall is a 5 level of retail mall with land area of
1,047,532 square feet. The building itself been age of 30 years. We had been calculate the
market value of Mid Valley Megamall based on investment method and comparison method.
We compare Mid Valley Megamall with competitor such as Pavillion, Sungai Wang Plaza,
Starhill Gallery and Lot 10 Shopping Centre. The market value of Mid Valley Megamall is
RM 3,440,000,000. The total payable stamp duty is RM 103,194,000.
As we know that, Mid Valley Megamall has been able to attract shoppers from Kuala
Lumpur and across Klang Valley mainly due to its standing as one of the largest mixed-use
developments in Malaysia. Its strategic location and popularity of the entire development
facilitated strong shopper traffic historically and this trend is expected to continue in the
future.
Its really a benefit for Permata Holding to expand their business here. This report is to
ensure all the process that are designed run smoothly. For the limiting condition, All
information provided by the client and others is thought to be accurate. However, we offer no
assurance as to its accuracy. All information provided by the client and others is thought to be
accurate. However, we offer no assurance as to its accuracy.

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REAL GLOBAL MALAYSIA CORPORATION

REFERENCE
Real Global Malaysia Corporation provide an Valuation report for the purpose of Permata
Holdings on its expandsion business.

Malaysia Economic Overview and Outlook. An overview of Malaysian and Kuala

Lumpur

economy focusing on macroeconomic indicators will be presented in this section.

Property Market Overview and Outlook. An overview of demand and supply as well as
outlook of the retail property markets in general.

Review on REIT Portfolio and Outlook. A review on a portfolio under the REIT from the
perspectives of location, trade area, and performance analysis, as well as SWOT and
comparative analysis. Subsequently, outlook commentary on the assets is also provided
based on market findings.

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