£148 million? Shocking to Say The Least!


I thought it would be a peaceful Friday evening when I settled down beside my son at his insistence that I watched “The Green Hornet” with him. As I surfed the net while pretending to watch the movie, I nearly dropped my laptop when I read THIS ARTICLE HERE which said:

The Employees Provident Fund (EPF) has bought a commercial building in central London from Union Investment for £148mil. It marks the EPF’s third property investment there since announcing an allocation of £1bil for British property purchases, Savills Rahim & Co said.

According to that report, EPF, in just seven months of unveiling the buy-British plans in August, has spent £485mil of the £1bil allocation. EPF’s other two property purchases are One Sheldon Square in Paddington Central, which was bought for £156mil, and 40 Portman Square near Oxford Street which was acquired for £180mil. The two properties have yields of 5.75% and 5.55% respectively.

I am not sure if we are supposed to be happy to read that “the prime central London market has been recovering strongly since the first quarter of 2009. Prime yields are currently around 4% in the West End and 5.25% in the City, compared with about 3.5% and 4.25% respectively prior to the crash in 2007.”

According to THIS BLOG POST, Rahim & Co is the same company that valued Khir Toyo’s palace at RM3 million in the past. Datuk Rahim is a loyal UMNO member.

I am just wondering why EPF chose to invest such a HUGE amount overseas. Is that not an outflow of funds representing a leakage from the circular flow of income? I am sure there are reasons why EPF diverted such a huge amount of our $$$ out of the country. Perhaps they should disclose the rationale of the decision in detail.