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Care Homes Investment – A Stand Out Asset Class

Part 2 of the Care Homes Article Series. Read Part 1: The Ageing Population in UK here.

The UK care homes market faces an imminent crisis due to a national shortage, creating increasing opportunities for investors and generating a truly global appetite for the sector. The sector has been named the stand out asset class of the year by Knight Frank.

Statistics show that old age is closely linked to debilitating illnesses such as dementia and Alzheimer’s Disease, causing an increase in the need for care homes and assisted living. The UK has a growing ageing population, with new  research by the ONS revealing that 1 in 4 people will be aged 65 years old in less than 30 years.

Of this population, there are approximately  850,000 people with dementia. With better diagnosis and rising life expectancy rates, numbers could exceed 1 million by 2025 and reach 2 million by 2051, when 1 in 3 people over 65 years will have the disease. Today, dementia is the leading cause of death in England and Wales, replacing heart disease.

What is now a grave concern is the inadequate supply of proper care homes and facilities to cater to the increasing number of aged citizens, particularly those afflicted with dementia.

National Crisis: Critical Shortage of Care Homes

Currently, only about 416,000 people live in care homes (Laing and Buisson Survey 2016) in the UK. This constitutes only a meagre 4% of the population aged 65 years and over, and 16% of those aged 85 and above.

Clearly, the UK care homes sector is facing a national crisis — an issue that Knight Frank’s UK Healthcare Development Opportunities 2017 report attributes to a nett loss in homes and beds. This is a trend that is likely to continue for awhile. 

A survey of UK local authorities by the Family and Childcare Trust confirms this:  4 in 5 UK local authorities have insufficient care for older people, particularly those with dementia. And only ⅓ of councils had enough nursing homes with specialist dementia support.

Research by charity outfit, Independent Age revealed that overall, a quarter of homes were rated as either inadequate or requiring improvement in January this year with the worst region being the Northwest (this includes Stockport, Salford and Manchester). Which is why there is an increasing need for properly built, fully-functional care homes that cater to the varied needs of the aged and infirm. 

Research by charity outfit, Independent Age revealed that overall, a quarter of homes were rated as either inadequate or requiring improvement in January this year with the worst region being the Northwest (this includes Stockport, Salford and Manchester). Which is why there is an increasing need for properly built, fully-functional care homes. Image credit: http://bit.ly/2ouQfOj

The Economist published an article revealing fundamental and systemic flaws, explaining that the care home market has not responded to demand, and, even when built, are often not located in the right places.

‘It is hard to get an old-people’s home built. Local authorities are not always willing to grant planning permission, especially when a plot could be used more lucratively, such as for shops,’ the article states.

The fact is, dedicated care is very costly. And, understandably, social care provided by councils is quite tightly rationed, as local authorities can only provide help to those with very high needs. Currently, only those with low means — under £23,250 in savings and, in some cases, the value of a home — get help towards their costs. The rest have to pay all their care costs, which could exceed £100,000. 

Julian Evans, Knight Frank’s Head of Healthcare said that the UK care homes market faces an imminent crisis due to a national shortage of beds. However, this crisis and acute undersupply of care homes has created opportunities for investors, and will continue to drive investor appetite in the coming years.

“The disparity of care bed supply and demand presents increasing opportunities for investors, and, combined with the fall in the sterling, has generated a truly global appetite for the sector.

“The care home sector is likely to be the stand out asset class of 2017, particularly for those investors wishing to diversify their asset portfolios in the current uncertain economic climate,” he explained.

Stand-Out Commercial Property Class

Just like residential property and student property in the UK, the law of economics applies to UK care homes investment — with low supply and high demand, as well as the average cost of ₤574 per week at a care home facility, returns are pretty impressive. 

Some projects offer up to 8% nett yield (after all expenses) for up to 25 years, as well as an exit clause. For many investors, the exit clause is part of the investment attraction.

Some of the care homes investment projects in our portfolio offers an exit/guaranteed buyback at years 10, 15, 20 and 25.

“Indeed, retirement living has fundamentals for growth, and makes a great investment opportunity. With the ageing population thrown in to the equation, care homes investment could be the next student investment,” said CSI Prop spokesperson Virata Thaivasigamony.

A care home project that has drawn great response from investors is Clarence Grove. This 91-bed facility offers much-needed, top-notch dementia and palliative care in the densely populated Greater Manchester area.

It is a fully-managed, income-generating asset that delivers respectable returns and a direct, positive impact on the lives of those in need of quality, affordable care. The home is surrounded by beautifully landscaped gardens, with seating areas, raised flowerbeds and a tranquil sensory area. There is also ample parking on the grounds.

Commercial property care homes investment: this is selling out fast. 5 units left.
Commercial property care homes investment: this is selling out fast. 5 units left.

This project is almost sold out, with only 5 units left. Here are some highlights of the investment:

  • Completed & fully operational
  • Priced from £75,000
  • 8% rental yield
  • Assured 25 years
  • Guaranteed buyback/exit at year 10, 15, 20 and 25
  • ZERO stamp duties
  • ZERO legal fees (terms apply)

If you want further information about this project or any other care homes projects for investment, contact us at 016-228 8691 or 016-228 9150.

By Vivienne Pal

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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UK Landlord Licensing

The Landlord Licensing scheme has recently taken effect in several cities and boroughs in the United Kingdom.

The scheme, which is also known as selective licensing, sets out to ensure that landlords are “fit or proper persons”, and that the buildings being let out are fit for occupation. If someone cannot meet the ‘fit and proper’ landlord criteria the scheme sets out, they will be refused a licence.

Despite having been introduced in certain areas recently, it is not new, and was provided for by the UK Housing Act 2004. Nonetheless, enforcement of Landlord Licensing is still in its infancy. Several city councils, for example, Bradford, Luton, Stoke & York have yet to implement the scheme (as at time of publication), whilst Liverpool and Manchester enforced the scheme in 2016 and 2017, respectively.

Selective licensing really is an attempt to improve the rental market by raising standards and helping to identify non-compliant landlords and management agents who do not invest in their properties or manage them properly.

Areas are designated for selective licensing upon the discretion of the local council. Often a scheme will only cover certain wards or areas of a city, and under new rules only 20% of a council’s area can be selectively licensed without a special application being made.

A scheme lasts for five years and can be renewed if the local council deems it necessary.

Right now Liverpool is running the scheme citywide, while Manchester has introduced licensing in only some parts of the Crumpsall, Moss Side and Rusholme areas.

Landlords in London can use the London Property Licensing website to find out whether they are in an area covered by a scheme, but there is no countrywide list of schemes. Checking with the local council is the safest strategy.

Where selective licensing applies, then normally all houses within the private rented sector for that area must be licensed, except where they require to be licensed as HMOs (houses in multiple occupation). Licensable HMO properties are properties with three or more storeys, and are occupied by five or more tenants not from a single household. Non-licensable HMOs must be licensed under selective licensing.

Some properties are exempt from selective licensing. These include:

  • Holiday lets
  • Business premises
  • Student premises where the university is the landlord/manager
  • Premises where the tenant is a family member

Each local council sets their own licence fees and discounts, and the licences last until the end of the 5-year period. In Manchester the licence costs £650, with each additional licence costing £550. Liverpool charges a fee of £400 for the first, with each subsequent licence costing £350.

In Liverpool, properties managed by professional managers who are members of one of the council’s approved co-regulation organisations (e.g. the Association of Residential Lettings) are entitled to a 50% discounted fee. This means that investors of property developments like Queensland Place and Parliament Place need only pay £200 for the licence.

If the property consists of en-suite units in a cluster sharing a common living area, only a single licence is required for the whole cluster. Student accommodation is a good example of this. This means that cost of one licence can be divided amongst the individual units, greatly reducing the price of licensing.

This is good news for investors in student accommodation. The more units one cluster has, the greater the division, and the lower the cost of licensing. However, studio apartments with no common living area will require a single licence for each individual apartment.

The local councils are taking this very seriously. In October last year, a landlord in Liverpool was fined £1,500 due to his failure to obtain a licence.

“The punishments can be very high,” says Richard Tacagni, founder and managing director of property consultancy London Property Licensing. “Landlords can be forced to pay 12 months’ rent back to a tenant, or could be told that they are unable to rent out a property in future.”

Article by Ian Choong

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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UK Bank Raises Interest Rates

Experts and industry players are clear that the increase in interest rates will not have too adverse an effect on the property market. In fact, the UK’s property market will take the rise in its stride, according to ratings agency Moody’s.

The official bank rate in the UK has been lifted from 0.25% to 0.5%, the first increase since July 2007. The move reverses the cut in August of last year, which was made in the wake of the vote to leave the European Union.

Even with the increase, interest rates still remain at historic lows. To lend some perspective, Malaysia’s interest rates are at a high 3%, while the interest rates for Australia and Singapore are at 1.5% and 1.1%, respectively.

Higher interest rates increase the cost of borrowing money, which moderates economic growth and brings inflation under control.The panel which sets interest rates, called the Monetary Policy Committee (MPC), has justified the rate increase by pointing to record-low unemployment, rising inflation and stronger global economic growth.

 

In contract, Malaysia's interest rates are at a far higher 3% compared to UK's 0.5%. Image credit: Trading Economics
In contract, Malaysia’s interest rates are at a far higher 3% compared to UK’s 0.5%. Image credit: Trading Economics

Bank of England governor Mark Carney stated that the UK economy is expected to grow at about 1.7% for the next few years. He said this would require “about two more interest rate increases over the next three years”, taking the official rate to 1%.

The Bank of England (BOE) has been reluctant to raise interest rates until now, arguing that inflation had been boosted by the fall in the value of the pound since the Brexit vote in June of last year. OBR predicts inflation will peak at 3% this quarter before falling back towards its 2% target over the next year.

Expectedly, the increase in interest rates will cause knock-on effects in the UK property market. Homeowners on variable rate mortgages, whether it is a standard variable rate or a tracker rate, will be most affected. However, homeowners whose mortgages are on a fixed rate will not be affected by the rate hike until  they remortgage their property.

Higher mortgage payments caused by rising rates can put less households in reach of a mortgage (loan). The lower competition can reduce demand for property which will in turn slow down property price growth. Correspondingly, the market for rental properties will increase as people who might have bought a house can now only afford to rent. This, from the investor perspective, is a good thing.

Experts and industry players are clear that the increase in interest rates will not have too adverse an effect on the property market. In fact, the UK’s property market will take the rise in its stride, according to ratings agency Moody’s.

Moody’s economist Colin Ellis said, “We have expected a rate rise for some time. This is about taking away emergency stimulus introduced after the referendum vote. A rise of 25 basis points [0.25%] is not going to move the dial. A rise of 0.25% pales into insignificance compared to the 8%-10% decline in the currency.”

Surveys from major mortgage lenders Halifax and Nationwide have painted a buoyant picture of the housing market. Halifax reported that house prices in the UK were rising at their fastest annual pace since February, up 4.5% to a record £225,826. Nationwide’s house price index also showed prices picking up in October, to an annual rate of 2.5%, the highest reading recorded in three months.

Savills predicts the housing market will grow by 14% from 2018 to 2022 based on an assumed Bank base rate of 2.25% by 2022. The north-west of England is set to experience the fastest price growth in the UK over the next five years: a surge of 18.1%.

Savills also forecast that rents are set to grow faster than house prices in London for the first time since 2011. They are forecast to rise 17% over the next five years, despite a 3% fall this year.

Virata Thaivasigamony of property consultancy CSI Prope commented, “The interest rates are now still very low, so it’s a good time to get into property. The fact that the UK is increasing interest rates at this time is a great statement of confidence in its economy, that Brexit is no longer a cause for concern.

“The UK has had a housing crisis over the past few years, and the increase in interest rates isn’t going to change the basic fact that people still need homes — which are a basic necessity. If people can’t afford to mortgage, they will have to rent. You’ll see rental income potentially going up, as demand for housing continues its upward trend.”

Interest rates remaining near historic lows bodes well for buyers, and today’s market still reflects some of the cheapest debt a property buyer will be able to attain in the market.

Article by Ian Choong

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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Property Investors Benefit from UK Stamp Duty Cut

The abolishment of the stamp duty for property up to £300,000 in the recently announced UK Budget will largely benefit first-time house buyers as well as investors/ current owners.

The UK Budget, announced just a few days ago, was billed the ‘Housing Budget’, with housing placed at the heart of the British government’s spending plans.

Chancellor Philip Hammond announced that more money will be poured into housing over the next five years to ensure that land is available, that homes, including affordable homes, and supporting infrastructure will be built where needed.

But the real headline-grabber was the abolishment of the Stamp Duty and Land Tax for first-time buyers, which is effective immediately.

Stamp duty and land tax is a lump sum payment imposed on purchases of property or land over £125,000. The tax rate varies depending on the value of the property.

The new Budget stipulates that stamp duty will not be imposed on purchases of property priced up to £300,000 outside London.  Meanwhile, in high priced areas like London, exemptions will be availablle on the first £300,000 of the purchase price of properties up to £500,000.

The Chancellor said that this is effectively a stamp duty cut for 95% of first time buyers and that going forward 80% of first time buyers will not pay the tax.

The changes in stamp duty announced in the UK Budget on 22 November, is effective immediately and will not just benefit first-time buyers, but also current owners/investors. . Image credit: http://bit.ly/2BkH1Is
The changes in stamp duty announced in the UK Budget on 22 November, is effective immediately and will not just benefit first-time buyers, but also current property owners/investors. Image credit: http://bit.ly/2BkH1Is

The Chancellor introduced the policy after it was revealed that the number of people under 45 who own their own home has fallen by 20% since the Tories took power seven years ago.

While the new policy will largely benefit first-time house buyers, investors will benefit, too, as demand will push up property prices, which, together with the inherent lack of supply, will continue to drive people to rent. This will keep the rental market strong.

“The abolishment of stamp duty for property under £300,000 will fuel a spike in the prices of homes within this range due to increased demand and a rush to buy currently available property within this price range,” says CSI Prop spokesperson Virata Thaivasigamony.

“It’s a double-edged sword and boils down to housing availability. The reality is that there is a housing undersupply in the UK with little likelihood that supply will increase in such a short period,” he adds, alluding to the Chancellor’s pledge to increase construction of new homes to 300,000 a year on average by the mid-2020s (up from 217,000 last year).

The secretary of state responsible for housing, Sajid Javid, has said that up to 300,000 additional homes must be built in England annually, up from about 150,000 in 2015 and a little more than 220,000 over the past year. Some industry players say this looks increasingly unlikely given the significant national deficit and ongoing debates over green belt construction.

The Office for Budget Responsibility said that the tax break could push property prices up by approximately 0.3%, with most of the increase coming in 2018. It also said that it is the current property owners who would be the main gainers of the new policy.

HMRC has also confirmed in a statement that while the new stamp duty policy reduces the upfront cost of buying a home for first time buyers, it is also expected to lead to an increase in house prices in the first year after implementation.

Meanwhile, with the increase in prices and undersupply in housing comes a continued demand for the private rented sector. The Property Wire quotes Andrew Turner, chief executive of brokerage Commercial Trust Limited, as saying that there could be a higher demand for private sector homes in Birmingham, Manchester and Liverpool where landlords are already enjoying higher yields than in London.

The Royal Institute of Chartered Surveyors (RICS) has predicted that 1.8 million more households would be looking to rent by 2025 as a result of increasingly unaffordable homes.

Dorian Gonsalves, chief executive officer of franchise lettings agency Belvoir, pointed out that demand for rental properties is set to remain high. 

He pointed out that many young people are actively choosing to rent rather than to become first time buyers and that is not necessarily going to change.

‘The reasons for renting are numerous, and many young people simply do not want the commitment of a 25 year loan,’ said Gonsalves.

What was rather unexpected in the Autumn Budget was the announcement that capital gains tax (CGT) will be imposed on all real estate types, to be effective likely by April 2019. Currently, CGT is only imposed on residential property.

This, however, is unlikely to affect investor appetite much, as many other jurisdictions already impose CGT on foreign property investors. Additionally, the robustness, transparency and resilience of the UK property market — on top of the weakened pound — continue to remain top criteria for foreign investors.

The Autumn Budget has also given local councils the authority to double taxes on empty properties. Under the new rules, local councils can charge up to an extra 100% of council tax if a home has been empty for two years or more, up from the current 50%.

Looking for projects below the £300,000 and  £500,000 (London) range? Contact us at 03-2162 2260.

Article by Vivienne Pal

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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The Ageing Population in UK

The UK population is growing — and ageing — as births continue to outnumber deaths, and immigration continues to outgrow emigration.

According to latest figures by the Office of National Statistics (ONS), the UK’s population in 2016 was at its largest ever at 65.6 million, and is projected to reach over 74 million by 2039.

This projection by the ONS which shows the distribution of the UK population from 1976 - 2046 depicts an ageing society in the UK that is growing. Image credit: http://bit.ly/2uuMcka
This projection by the ONS which shows the distribution of the UK population from 1976 – 2046 depicts an ageing  society in the UK that is growing. Image credit: http://bit.ly/2uuMcka

But as the population expands, so does the number of the elderly and infirmed. The old age dependency ratio (OADR) in 2016 was at 285. This means that there were 285 people aged 65 and over for every 1,000 people aged 16 to 64 years (i.e. the traditional working age). Of these figures, 18% are aged 65 and over, and 2.4% are aged 85 and over.  These figures have been increasing since 1996 and is expected to rise further, with 157 local authorities looking at an OADR of above 500 by 2036 compared to only 11 local authorities in 2016.

West Somerset is projected to have an OADR of 928 by 2036 — almost matching the number of those aged 16 to 64 years!

To lend more perspective, only a handful of areas in the UK had over 25% of their local population aged 65 and over in 1996. But by 2036, more than half of the local authorities in the UK are projected to have 25% or more of their local population aged 65 and over. ONS predicts that the number of those aged 65 and over will grow to nearly a quarter of the population by 2046.

The number of those aged 85 and over is also growing. In mid-2016 there were 1.6 million people aged 85 and over, and by mid-2041 this is projected to double to 3.2 million.

Conversely, the proportion of children in the UK population has declined from over 24.5% in 1976 to 18.9% in 2016. This proportion is projected to decline even further in future years.

Projection by the ONS on the population growth by 2041 to reach another 7.3 million by 2041. Image credit: http://bit.ly/2znUvFv
Projection by the ONS on the population growth by 2041 to reach another 7.3 million by 2041. Image credit: http://bit.ly/2znUvFv

Interestingly enough, centenarians are the fastest-growing age group in the UK, with the number of 100-year-olds almost doubling from 7,750 in 2002 to 14,910 in 2016 (note: there were only 3,642 centenarians in 1986!).

The number of people aged 90 and over in the UK reached 571,245 in 2016 — its highest ever.

ONS predicts 46% of growth in the next decade will be from more births  than death.

Underlying improved mortality rates over the last few decades is the steady increase in life expectancy. Life expectancy at birth for females is projected to be 85.1 years by 2026 and 86.6 years by 2036. Males are also projected to live longer, increasing to 82.1 years by 2026 and 83.7 years by 2036.

Inadequate Care Facilities for the Elderly

However, with the increase in OADR across the UK comes an increased demand for professional care facilities to cater to the higher number of elderly and infirmed.

New research has revealed that 1 in 4 women and 1 in 6 men aged 65 and over will be physically impaired by 2047, and their disabilities will be sufficiently severe to affect their daily routines.  

Researchers from the Wittgenstein Centre International Institute for Applied Systems Analysis in Austria, wrote: ‘[This] might require several measures to accommodate the needs of an increasing number of people with activity limitations such as expanding infrastructure for disabled people in the public as well as private sectors, training of medical specialists and care professionals.’

The question that now arises is whether there is adequate supply of care homes for the elderly and infirm.

There was more than 570,000 aged 90 and over living the UK. This is the highest number ever in the history of UK's population. As the population of the aged and infirm inceases, so does the demand for proper care homes and facilities. Image credit: http://bit.ly/2xCM1Xg
There was more than 570,000 aged 90 and over living the UK. This is the highest number ever in the history of UK’s population. As the population of the aged and infirm inceases, so does the demand for proper care homes and facilities. Image credit: http://bit.ly/2xCM1Xg

Unfortunately, the UK care home sector is facing a national crisis, due to a nett loss in UK care homes and beds. Knight Frank’s UK Healthcare Development Opportunities 2017 report identified a decrease in the number of registrations of both new homes and new beds. Combined with the long-term trend of increased deregistrations, this has caused a nett loss of 166 homes and 2,612 beds across the UK market as at Sept 2016.

The shortage in supply of ade quate care homes and beds is predicted to continue as the UK treads the murky waters of Brexit and other factors.

“The UK care market is facing an imminent crisis as the sector struggles to cope with a national shortage of beds. Our research suggests that if de-registrations continue to exceed the number of new registrations that come to market, approximately 6,000 beds are at risk of closure over the next five years,” said Julian Evans, head of healthcare, Knight Frank.

This crisis and acute undersupply of care homes has now created increasing opportunities for investors, and will continue to drive investor appetite in the coming years.

“But this disparity of care bed supply and demand presents increasing opportunities for investors, and combined with the fall in sterling has generated a truly global appetite for the sector, with the care home sector likely to be the stand out asset class of 2017, particularly for those investors wishing to diversify their asset portfolios in the current uncertain economic climate,” Evans explained.

This marks the first article in the Care Homes series. Next: Care homes- an investment opportunity

By Vivienne Pal


CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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UK Taxes & the Common Reporting Standard – Investor Club

In the hall at the CRS & Tax Talk
The crowd pay close attention during our Investor Club UK Taxes & Common Reporting Standard Q&A session with the panel of experts.

The recent CSI Prop Investor Club event was a resounding success — a wholesome combination of learning, good food and networking. This instalment of our Investor Club focused on taxes and UK property, and the global and automatic exchange of financial information under the Common Reporting Standard (CRS).

The atmosphere was relaxed and slightly festive, with decor and food lending a nod to the recent Deepavali celebration.

Kierson Hughes, our specially invited guest speaker from Adams & Moore Tax Consultancy Ltd, a UK-based accountancy and tax firm, took our clients through the various property taxes for investors. Kierson has more than 25 years of experience in the industry and, together with her team, has handled a portfolio of over 3,000 clients.

Kierson Hughes at the Tax Talk
Kierson Hughes highlighted the importance of promptly filing UK tax returns, even if the tax is not applicable to the investor, in order to avoid penalties.

Kierson highlighted two taxes that UK property investors should note: the Stamp Duty Land Tax, which is paid upon purchase of a property, and the Capital Gains Tax, payable upon sale of a property. She also stressed on the importance of promptly filing UK tax returns, even if the tax is not applicable to the investor, in order to avoid penalties.

In the second part of the learning session, guest speakers Fennie Lim and Alvin Yap enlightened clients on the Common Reporting Standard, an international effort involving the automatic sharing of individuals’ financial and tax information among more than 100 member countries/ jurisdictions to combat tax evasion.

Fennie and Alvin speaking at the CRS Talk
Fennie and Alvin speaking about the Common Reporting Standard and international automatic exchange of information.

Fennie is the executive director of Crowe Horwath KL Tax Sdn Bhd, and has 25 years of experience in income tax compliance, tax advisory and indirect tax, as well as tax investigations and field audits.

Alvin, the associate director of Wealth Management at Crowe Horwath KL Tax Sdn Bhd, has more than 20 years experience in personal and corporate risk management, specialising in asset protection, preservation planning and business succession planning.

Reportable accounts under the CRS includes interests earned, dividends, sales proceeds from financial assets and income from certain insurance contracts. Property is among the fixed assets currently not covered by the CRS.  49 jurisdictions have already implemented the CRS this year, with the remaining to follow suit in 2018. Malaysia is among the 53 jurisdictions that will commence its reporting next year. 

The food at the CRS and Tax Talk
In keeping with the festive theme, our team arranged for a sumptuous serving of delicious Indian food to fill the stomachs of our hungry guests.

In keeping with the festive theme, our team arranged for a sumptuous serving of delicious Indian food to fill the stomachs of our hungry guests.

The live thosai station -- a  huge hit and a real crowd-pleaser -- churned out mouth-watering thosai after thosai, made extra fragrant with generous drizzles of ghee.
The live thosai station — a  huge hit and a real crowd-pleaser — churned out mouth-watering thosai after thosai, made extra fragrant with generous drizzles of ghee.

The live thosai station — a  huge hit and a real crowd-pleaser — churned out mouth-watering thosai after thosai, made extra fragrant with generous drizzles of ghee. And, to sweeten the deal, each table had a serving of traditional Indian snacks and sweets like acimurruku and rava kesari.

The Kids' Corner at the CRS and Tax Talk
The Kids’ Corner kept the little children busy making colourful sand art and cute clay figurines of their favourite superheroes as parennts listened to the talk.

There’s always something for the kids here at CSI Prop. The little ones were kept busy, making with colourful sand art and making cute clay figurines of their favourite superheroes, whilst their parents listened to the talk.

Mohammed speaking on Yoga at the CRS and Tax Talk
Mohammed Amiri, a qualified yoga instructor tell us a thing or two about yoga and meditation.

In keeping with our core values of Knowledge and Fun, we ended the evening with Mohammad Amiri, a qualified instructor with the MAYI Yoga Academy and long-time yoga practitioner, who spoke to the crowd about the benefits of yoga and meditation. In his calming, pleasant tone of voice, Mohammad demonstrated how to disconnect from the hustle and bustle of our surroundings and drift into a peaceful state of mind. He also taught us a couple of yoga postures that helped relax and rejuvenate our stiff muscles and tired minds.

The Investor Club in Dec will feature Star Wars!
The next Investor Club in Dec will be the movie premiere of The Last Jedi. Star Wars fans, stay tuned!

A heads up to our clients: our next Investor Club event will be an exciting one! To be held mid-December, we will be bringing to club members (from a galaxy far, far away) an exclusive screening of The Last Jedi, the latest Star Wars movie at an exclusive and plush cinema in the Klang Valley.

As always, delicious refreshments will be served. Club members may just catch a surprise appearance of a character or two from the movie! We will be sending out details soon via e-mail and whatsapp, so STAY TUNED!

The Investor Club is an extension of the company’s core values of Knowledge, Service and Having Fun; and an effort to make a difference in the lives of clients through the sharing of knowledge, fun activities and networking. Club events are private and membership is extended exclusively to our clients. For more details on the investor club, call 03-2162 2260.

Article by Ian Choong


CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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Manchester, The Original Modern City

For over 250 years, one UK city has built its reputation for creating more than its fair share of world firsts. Guess which city that is?

Manchester, the new Modern city
Manchester is the UK’s original modern city (Image source: Youtube)

For much of the time it existed, Manchester was a manorial township, with peasants working the fields for the Lord of the Manor. It was only during the turn of the 19th century that Manchester underwent a transformation, and grew at an astonishing rate. This expansion and urbanisation was brought on by a boom in textile manufacturing during the Industrial Revolution, and resulted in Manchester becoming the world’s first industrialised city.

Today, Manchester is known as the UK’s second city. With 50% growth in the last 10 years, it is the UK’s fastest-growing city and Europe’s second largest creative tech hub. Around 70,000 people now work in the city’s creative, digital and tech industries and a rich talent pool of over 110,000 thinkers thrive in the four leading universities there.

Many defining achievements in science and technology come from Manchester. It’s where the world’s first IVF baby was conceived, where they split the atom and isolated graphene. It’s also where the world’s first stored programme computer was built. A total of 25 Nobel prize winners have come out of Manchester!

Massive amounts of investments have gone into Manchester as part of the British government’s Northern Powerhouse push. Starting from this year, £1 billion will be spent to transform the Manchester airport, further establishing Manchester as one of the most connected cities in the world. The city already boasts direct connections to many of the world’s major capitals, like New York, Hong Kong, Singapore and Beijing. The new High Speed Rail (HS2) under construction will cut travel time between Manchester and London from the current 2 hours to just over an hour when it is ready, and, in its second phase, also reduce the time required to travel to Birmingham and Leeds.

Manchester’s staggering development makes it an attractive place for investors looking for the next big thing to invest in. Property, in particular, is a solid choice as there is a growing demand for housing in the city. Manchester registered a 7.3% increase in house prices over the past year, topping the list of all cities in the UK. This demand is bound to rise even higher as Manchester’s economy grows, and more and more jobs are needed.

This video captures the essence of Manchester as the original modern city of the UK:

Facts and figures about Manchester:

  • Birthplace of the Industrial Revolution
  • Where the world’s first IVF baby was conceived
  • 25 Nobel prize winners
  • Where they split the atom and isolated graphene
  • Where the world’s first stored program computer was built.
  • Population of 2.7 million people
  • Over 200 languages
  • With 50% growth in the last 10 years, Manchester is the UK’s fastest-growing city and Europe’s second largest creative tech hub
  • Around 70,000 people now work in the city’s creative, digital and tech industries
  • A rich talent pool of over 110,000 thinkers from four leading universities.
  • Between 2015 and 2017, over £1 billion was spent on the city’s infrastructure.
  • Direct flights to many of the world’s cities, e.g. New York, Hong Kong, Singapore, Beijing etc.
  • Called the UK’s second city
  • Global exporters of world-class culture as well as technology; a city united by a passion for sport and music
  • One of the world’s best places to visit in 2015 — the only British city to be given this accolade by the New York Times
  • Home to some of the world’s biggest brands which contribute to Manchester’s £50 billion economy.
Article by Ian Choong

CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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London Falling

Not all about London anymore. The London housing market is struggling with prices falling for the first time in 8 years. At a record drop of 0.6% in September this year, London is the weakest performing region in the UK for the first time since 2005. Image credit: http://bit.ly/2gcAlkU

Increasingly, statistics reveal that growth is expanding outside London. The focus — be it for housing, jobs, resources, or investment — has moved to buzzing regional cities where business is booming on the back of lower costs and a higher quality of living.

The London housing market is struggling. Nationwide reports that London house prices have fallen for the first time in 8 years, and, at a record drop of 0.6% in September this year, London is the weakest performing region in the UK for the first time since 2005.

Outside London and across the UK, however — despite Brexit and concerns about the economy — prices are still rising, albeit at a slower pace than in recent years. And yet, while London’s house prices may have dropped, they remain unapproachable compared to the cities beyond.

To date, house prices charting the most significant increases in England and Wales are the Midlands* and Northwestern cities of Manchester and Liverpool, as well as in some pockets off central London like Luton and Guildford, and Northern Ireland.

A chart published recently in the Financial Times shows house prices falling in London and the South East but growing elsewhere. Image credit: Financial Times; source: RICS

Greener Investment Pastures Beyond London

Years of rapid price increases have made London and the south unaffordable to many buyers, prompting them to buy further away and commute. After all, it takes less than an hour to travel from Bedford or Luton  to central London by train, while cities like Birmingham, Manchester and Liverpool have a buzzing business scene.

The signs have been there for a while now, says Virata Thaivasigamony of CSI Prop, an active property investment consultancy in Kuala Lumpur, Malaysia that promotes investments in UK and Australian property.

“The writing has been on the wall for some time and we’ve said that prices in London will flatline this year. London has always been regarded as the business capital and startup central of the UK, but the fact is that businesses and investments are moving outside of London and into the regional cities. It would be remiss of us to ignore that the best places to invest in are now in those cities,” he elaborates.

What’s Trending

Manchester, popularly assumed as UK’s second city and the Silicon Valley of Britain, is fast earning a reputation as the hotbed of tech and startup talent in the UK, thus pushing property prices up. The city is also a recipient of billions in investment dollars, thanks, in part, to the government’s push for the Northern Powerhouse, propelling the rise in investment returns across central and Greater Manchester, including Salford as well as other Northern Powerhouse core cities like Liverpool.

Prices of property have been rising in Northwestern cities such as Manchester, as more corporations move from London to this city to set up headquarters and make use of its resources and talent pool. Image credit: http://bit.ly/2hEX3Um

Corporations are decentralising from London to the regional cities, too. BBC, ITV and HSBC come to mind, having set up home in Greater Manchester; airlines such as Hong Kong’s Cathay Pacific have since 2014 provided direct flights between Manchester and Hong Kong, while China’s Hainan Airlines launched a direct flight service in 2016, making Manchester Airport the only British hub outside London to have non-stop flights to Beijing.

Meanwhile, Berkeley, one of Britain’s best-known luxury housebuilders has broken out of London to build a business in Birmingham to cater to housing demand in the city.

Javad Marandi, a British businessman with investments in commercial and residential real estate says, “Regional markets including the North East, the South West and Yorkshire and Humber have shown growth in commercial property activity, a sure sign of a growing business environment with an increasingly positive outlook, making them one of the best regions to invest in. Building a workforce, free of soaring London living costs, will in turn be cheaper to employ – and no doubt happier with the favourable cost of living outside the capital.”

That Britain is plagued by a serious undersupply in housing is an understatement. Opportunities in these cities have expanded the population, further underscoring the acute demand and need for housing. From a property investment standpoint, this is a good thing.

Meanwhile, a number of university cities are showing a spike in house prices. Towns that are home to a large student population such as Guildford and Liverpool, are seeing a surge in prices. The biggest 3-year percentage house price rise was near the University of Bedfordshire, which has its main campus in Luton, charting a 42% increase in prices over the period of an undergraduate degree.

“The best regions to invest in lie outside the capital – it’s no longer all about London,” Marandi concludes.

Statistics by RICS indicate that house prices are set to rise across England next year except for London. Image credit: Financial Times; source: RICS

Growth Outside London  

The UK is still seen as a good and safe place to invest your money due to a weakened pound, and, in spite of uncertainties arising from Brexit.

House prices will continue to rise as demand increases and Britain grapples with a chronic housing undersupply, but it appears — for now — that the best investment opportunities lie in regional cities like Manchester and Liverpool, and the outer boroughs of London.

That said, it is crucial to note that London is a market within a market, with characteristics of its own, and that it will bounce back — just as the housing market in the Midlands* bounced back from a low in 2015 to become one of Britain’s fast-growing housing markets today. On a positive note, it is during these low-market times that savvy investors invest in order to reap the most luscious of fruits when the market bounces back.

Article by Vivienne Pal


CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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Demand for Purpose Built Student Accommodation to Rise

Demand for purpose-built student accommodation (PBSA) in the UK, like One Islington – the latest student accommodation project in our portfolio – is set to rise. Find out more about One Islington from us.

Savills reported a 17%  increase in student accommodation investment in the UK this year, and expects investments in the sector  to reach £5.3bn by the end of the year, surpassing the £4.5bn spent in 2016. Meanwhile, Knight Frank’s UK Student Housing Rental Update reports that headline rental growth for the sector increased by 2.55% for the 2017/18 academic year.

Demand for Purpose-built Student Accommodation (PBSA) or UK Student Property is expected to rise as students continue to flock to the UK to study. Unlike residential property, this sector is seen to be a rock-solid investment in the face of global and domestic challenges.

Savills reported a 17%  increase in student accommodation investment in the UK this year, and expects investments in the sector  to reach £5.3bn by the end of the year, surpassing the £4.5bn spent in 2016. Meanwhile, Knight Frank’s UK Student Housing Rental Update reports that headline rental growth for the sector increased by 2.55% for the 2017/18 academic year.

While some of the younger UK population prefer to seek apprenticeships instead of applying for university, the latest analysis by the Universities and Colleges Admissions Service (UCAS) shows that demand for higher education among 18-year-olds remains strong. In addition, the Government’s removal of the student cap will continue to see an increasing number of international students applying to study in Britain. In the 2017/18 academic year, non-EU applications had risen by 2.2% even while EU applications had fallen ostensibly due to Brexit.

The provision of good quality student accommodation was traditionally the responsibility of universities, but in recent years, most new accommodation has been provided by private investors and developers.

International students can be very profitable for landlords and letting agents, as many are prepared to pay higher rents for superior quality accommodation.

David Feeney, Head of Student Analytics at Cushman & Wakefield said: “More students than ever are demanding a bed in purpose-built accommodation. This, coupled with pressure on local housing markets, means that demand for purpose-built accommodation should remain strong. However, micro-market knowledge is essential to investment success.”

Mike Mitchell, Partner in Cushman & Wakefield’s Student and Residential Investment team, commented: “Across the UK, the PBSA market continues to be one of the most attractive asset classes in real estate for investors. Despite applications to Universities falling by 3.7%, the sector has witnessed year-on-year rental growth. Due to the value of foreign currencies against the Pound, there has been an influx of capital from overseas buyers in 2017 who are now competing with UK purchasers.”

The UK overtook the US as the largest student property market for the first time in 2015 after reaching a record £6.56bn in investment volumes.

Article by Ian Choong


CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260

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Liverpool’s Knowledge Quarter is World-Class Innovation District

Liverpool’s Knowlegdge Quarter: here’s a partial location map to provide perspective to the project. Image credit: http://bit.ly/2y9YbGi

Liverpool is on the cusp of becoming a world-class destination for science, innovation, education, technology and the creative and performing arts. The city’s £2bn vision to establish Liverpool’s 450-acre Knowledge Quarter as one of the world’s leading innovation districts, will further reinforce its status as one of the best student cities in the world.

The Knowledge Quarter is one of five mayoral development zones in Liverpool. It spans a huge area mostly to the east of the city centre behind Lime Street Station, encompassing the University of Liverpool, Liverpool John Moores University, the Liverpool School of Tropical Medicine, the new Royal Liverpool University Hospital, Sensor City, and the Liverpool Institute for Performing Arts.

The Knowledge Quarter in Liverpool is around 450 acres and Paddington and KQ Gateway are each around 30 acres. Image credit: http://bit.ly/2ylVlPm

Within the Knowledge Quarter are two major development sites: the £1bn Paddington Village and Knowledge Quarter Gateway. Another key development is the Knowledge Quarter Liverpool (KQ Liverpool) railway station, connected to the city’s underground network.

Paddington Village

The Paddington Village project occupies a massive a 1.8m sq ft behind the Royal Liverpool Hospital, and is earmarked for health, education, science and residential development. Construction giant Morgan Sindall has already won the contract to design and build the £35m new Northern base for the Royal College of Physicians (RCP).

The RCP is one of the world’s most renowned medical institutions and the Liverpool project, its first centre of excellence outside London, will create 100 jobs. Completion is targeted at 2019.

Also committed to the site are Liverpool International College and The Rutherford Cancer Centre. The RCP and Liverpool International College are the anchor tenants of the site.

Work has already begun at the new Royal Liverpool Hospital, which is perhaps the biggest project in the Knowledge Quarter. Here is Aidan Kehoe, chief executive, Royal Liverpool and Broadgreen University Hospitals NHS Trust, on the site of the new Royal. Image credit: http://bit.ly/2xe8Bp1

KQ Gateway

KQ Gateway sits at the other end of the Knowledge Quarter, between Mount Pleasant, the old Lewis’s store, Copperas Hill and Lime Street Station. The area, with the support of the mayor of Liverpool and collaboration with other parties, will be transformed into a vibrant space – new shops, offices, galleries, bars, restaurants, gyms and university space.

Only 2 hours from London by train, KQ Gateway will offer a new commercial space for tech and digital businesses, alongside futuristic educational space. Regeneration of KQ Gateway is already underway — the Ion scheme on Lime Street and the Liverpool John Moores University’s demolition of the former sorting office on Copperas Hill, to name a few.

Work Underway

The new Sensor City in Liverpool’s Knowledge Quarter is cladded with stunning gold circuit boards, marking a £15m high-tech hub that could create 1,000 jobs and help make Liverpool a global technology leader. Image credit: http://bit.ly/2yawoWk

The biggest project so far in the Knowledge Quarter is the massive new Royal Liverpool Hospital.

But several other projects are already well under way, including the £15m Sensor City scheme and the Materials Innovation Factory where Unilever and the University of Liverpool are working together to create innovative products and materials.

Existing schemes in the Knowledge Quarter include Liverpool Science Park, whose three buildings are already 90% full.

Liverpool mayor Joe Anderson said: “With £1bn of investment already underway and a potential further £1bn at Paddington Village alone, these are really exciting times for Liverpool and the wider city region’s knowledge economy.

Mayor Anderson agrees: “KQ Gateway not only presents an opportunity for significant future investment and regeneration but will ultimately create more highly skilled jobs in Liverpool and strengthen the city’s position as a world-leading innovation district. By attracting investment and creating jobs, I believe that we can improve people’s lives.

“Ordinary cities lead to ordinary lives but Liverpool is no ordinary city – we are exceptional and exceptional cities foster exceptional lives”.

What’s clear at the end of the day is that the Knowledge Quarter scheme could bring THOUSANDS of new jobs to the city in addition to increasing demand for housing.

Knowledge Quarter chief executive Colin Sinclair said: “We’re not just banding big figures around. What we’re trying to say is this is a landmark, a historic moment in the future of Liverpool .

“And there’s a really bright future for Liverpool. When that kind of investment is being made you can really say to any investor from around the globe, America, India, China, that Liverpool is a city of opportunity.

“It’s a step change. We’re not dabbling around the edges here. We’re trying to create something that is lasting for the city.”

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CSI Prop proudly promotes international investment property with high yields at low risk. Our portfolio comprises residential and purpose-built student property in cities across the United Kingdom (London, Luton, Manchester, Liverpool, Newcastle, York, Glasgow, Scotland; Sheffield, etc); Australia (Melbourne, Perth, Brisbane) and Thailand (Bangkok). Our projects are concentrated in high-growth areas with great educational, infrastructural and job growth potentials. We aspire to make a difference in the lives of our clients by helping them achieve their investment goals through strong market research backed by third party experts and due diligence. 

Disclaimer: CSI Prop does not provide tax & legal advice and accepts no liability. Readers are encouraged to consult a qualified tax or legal advisor for a thorough review.

Need advice or clarification? Call us for more information and/or to find out about our projects! Hotline: 03-2162 2260