http://www.starproperty.my/index.php/articles/investment/tale-of-new-townships/
Tale of new townships
Despite concerns of an oversupply of properties flooding Iskandar Malaysia, developers remain optimistic in bringing to fruition their sustainable, groundbreaking plans for upcoming township developments that will change the skyline.
Designer Block
BY YVONNE YOONG
[email protected]
Sunway Iskandar – Medini’s only Seafront Integrated City.
DESPITE cooling measures introduced in Budget 2014, an overall cautious sentiment characterising the property market, a higher loan-to-value (LTV) ratio and increased interest rates – a few good developers are forging full steam ahead with ambitious plans that can best be described as game-changing, with the propensity to alter the way one defines lifestyle and how one views addresses of the future in Johor’s latest diadem known as Iskandar Malaysia.
The buoyant optimism displayed seems to dispel misgivings about an overall cautious property market. Despite uncertainties, the direction of the plans being unveiled in this region seems to point to an innate ability of the property market to sustain the upward momentum of planned developments being launched in Iskandar Malaysia.
Mega developments are already taking shape as seen in the example of Country Garden Danga Bay by Country Garden Holdings Ltd which will see the China-based developer’s integrated mega project comprising residential and commercial components targeting the completion of around 9,600 luxury serviced apartments in Iskandar Malaysia by 2018.
UMLand Bhd group chief executive officer Charlie Chia Lui Meng believes that in this current situation, “water will find its own level and the numbers will adjust itself in line with the demand” even as a slew of local and Chinese developers forge ahead with their range of offerings in Johor’s latest property playground. That too, despite expressed concerns of oversupply flooding a market which is largely seen to be reliant on foreign purchasers, resulting in concern over the longer term sustainability of Iskandar Malaysia.
“With the onset of the number of units launched by the Chinese developers in Iskandar Malaysia, there is definitely an oversupply. Developers will review their supply in between the launches to determine the market’s appetite and the supply (issue) will be addressed. Nevertheless, each developer in the Iskandar Malaysia market will find the market competitive and will innovate to tailor their products to suit the purchasers’ interest,” Chia observed.
“Iskandar Malaysia has presented itself as a desired destination for both Malaysians and foreigners due to its strategic location which is similar to the Shenzhen/Hong Kong model. I strongly believe that the migration of populace to the transformed Iskandar Malaysia will sustain demand and provide a huge marketplace,” he analysed, likening it to Shenzhen in the 1990s and what it has evolved into today.
“The huge opportunities will definitely attract tremendous interest and investments. Developers are confident that they are entering early enough to reap the benefits. Analysts are concerned that such massive real estate is not sustainable and the small population there is not supportive of these developments.
“However, with the numerous attractive economic incentives and new infrastructure in place here, the influx of the new industrial network and supporting commercial facilities will attract a huge migration – with the current population of 1.3 million possibly ballooning to 4 million in a matter of time. Shenzhen, with its 10 million population today, has proven that this is possible.”
Chia noted that the prices of properties here four years ago was half of the current market prices so investors who earlier had faith in the potential of Iskandar Malaysia have benefited from the completed infrastructure and dynamic policies that are in place now.
“These successes will certainly find more room for upside growth in the coming years. This will encourage more new players to come into the market.”
Expressing optimism in UMLand’s ability to reap the benefits presented by a transformed Iskandar Malaysia, having been a strong property player here for almost 20 years now, he said that although the marketplace has picked up a few years ago, it still is a “new field for many property players”.
“We have a good record. I am optimistic that with our advantage, we are poised to be a top player here,” he pointed out, citing its first flagship township in Bandar Seri Alam, Johor, developed in 1990.
The thriving township is now known as the “City of Knowledge”, given the numerous educational institutions attracting students and academia there.
“Our other award-winning Bandar Seri Austin development in Johor which commenced in 2005 has been named a model township for smart and healthy living.”
Having just launched Seri Alam 2, its Pasir Gudang township in Johor, he said the residents’ happiness index was key as green landscapes, outdoor gymnasiums and recreational health retreats will be part of the development, even as a high-tech techbiz park complements the township.
The media have over the past few months been privy to ambitious township launches by developers armed with well thought-out, mega master plans for super projects marking the precedent chapters in the development of other new areas in Iskandar Malaysia. Besides these new mixed-use development townships, there was also a new wave of industrial real estate offerings that will set a new trend in terms of modern designs and eco-green features that were recently launched, including UEM Sunrise Bhd in partnership with Ascendas Pte Ltd’s Nusajaya Tech Park.
The group has the largest land size, with its 4,500-acre (1,821ha) Gerbang Nusajaya in Flagship A that comes with a gross development value (GDV) of RM7.7bil. Other catalysts here include FASTrack Motorsports City and Asian Trade Centre.
Also quick to seize a window of opportunity, WB Land Sdn Bhd, a developer which is part of a construction group in Johor, launched its award-winning Frontier Industrial Park Phase 2 development, featuring 92 units within a 62-acre (25ha) gated and guarded industrial zone at Desa Cemerlang in Iskandar Malaysia to rave reviews from local and Singaporean investors.
The Lakeview precinct recorded 100% sales of its office suites during the launch of its first phase.
Playground for the privileged
Judging from the series of launches – each seemingly outdoing the other – it is becoming increasingly clear that in the coming years, more mixed-use developments will shape the skylines of these townships – transforming the way people live, work and play.
A flashback to May 29 saw a confident Sunway Group Bhd organising a media familiarisation tour to its Sunway Iskandar site in Medini, complete with a quick tour of its constructed projects that included Legoland Hotel and a drive outside the Pinewood Iskandar Malaysia Studios film studio, where an international filming was taking place. All this showed that Sunway’s optimistic input into its plans for Iskandar Malaysia has already started to bear fruit.
It also built Asia’s first Legoland Theme Park and the central utilities facility at the Bio-XCell biotechnology park in Johor.
Two months later, the first fruits of the successful realisation of its plans were already reflected in Sunway Iskandar’s Citrine office suites recording 100% sales in conjunction with its initial Phase 1 launch of the Lakeview precinct at its sales gallery in Medini. The encouraging news was an affirmation of the great standing of one of the nation’s property-construction groups.
“We’re encouraged by the strong response to our first launch as buyers liked our approach in providing a holistic range of products to create a community within The Lakeview precinct to live, learn, work, shop and play,” was the elated response from Sunway Bhd joint managing director of the property development division for Malaysia and Singapore, Sarena Cheah.
“As a community developer, we believe that we are not here just to sell properties, but to co-invest and continue to grow with the community in line with our build, own and manage business model,” she said.
The Seafront promises pristine views.
The group will inject RM60mil into its purpose-built Sunway International School (SIS) in Malaysia that will offer the Canadian (Ontario) curriculum in English, one of the world’s best school systems for primary and secondary education delivered fully in English. Students will be taught by certified Canadian teaching professionals licensed by the Ontario College of Teachers (OCT) for pre-school, primary and secondary grades.
SIS in Sunway Iskandar is an International Baccalaureate (IB) candidate school to offer the IB Diploma Programme.
Khazanah National Bhd executive director of investments Hisham Hamdan concurred, attributing its first phase 100% sell-out as “a remarkable achievement and encouraging news to all stakeholders of Iskandar Malaysia”.
“Since Khazanah and Sunway teamed up as a joint venture in 2011, we have been collaborating to drive Medini Iskandar’s progress as a catalyst development for Iskandar Malaysia. We are confident that this is just the beginning of a greater success story,” he reiterated.
Citrine at The Lakeview, the first precinct to be launched comprises an integrated mixed development with a GDV of RM300mil. It will comprise 167 office suites and 51 retail units spread across 140,000sq ft located next to the 20-acre (8.09ha) Emerald Lake garden. The office suites’ built-up area will range between 746sq ft and 1,671sq ft with an average selling price of RM760 per sq ft.
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The scenic Riverside precinct.
The overall Lakeside precinct spreads across 100 acres (40.5ha) with a gross development value (GDV) of RM2bil.
In view of the successful launch of its Citrine office suites, 328 serviced apartment units with built-up area ranging from 618sq ft to 1,571sq ft priced between RM800 per sq ft and RM900 per sq ft will be launched next, followed by its landed homes – all anchored around the Emerald Lake within The Lakeview precinct.
“With the overwhelming response for the designer office suites, we decided to immediately open registration for the priority preview of Citrine’s serviced apartments.”
Cheah is optimistic that the group’s plans will flourish given the strategic location of its site at Sunway Iskandar as it reprises its role as a master community developer covering six precincts spread across Medini and Pendas in its largest township development yet in Flagship B of Iskandar Malaysia.
“Sunway Iskandar will span across 1,800 acres (728.4ha) of land in Iskandar Malaysia with a gross development value (GDV) of more than RM30bil.
“The seafront, river and forest give the development a distinctive character. The low plot ratio will also give it a spacious and balanced living environment. With our experience in creating communities, we are excited to start yet another sustainable township in the southern region of Malaysia,” she said.
The Parkview precinct enveloped by lush greenery.
Although a relative latecomer to Iskandar Malaysia – having joined the property game here two years ago as compared to other developers who have already made their inroads here years ago – the group will complete each of its precincts within a period of five to seven years respectively.
“Our first priority is to establish a living community at the Lakeview precinct with its serviced apartments, schools, offices, shops, landed residences, roads, etc. As we are constructing, another cluster will come in. We’re here for the long-term and are here not just to sell, but to build a community,” she said, anticipating Sunway Iskandar’s population to hit over 120,000 in 20 years time.
Series of successful blueprints
The development plans for Sunway Iskandar, dubbed “Nature’s Capital City”, marks the conglomerate’s third and most ambitious planned integrated township following in the legacy of its other signature townships – Sunway Resort City in Sunway and Sunway City Ipoh in the once tin-rich state.
The RM15bil Sunway Resort City comprising retail, commercial, education, health care, hospitality, theme park and residential components is a far cry from what was previously a derelict wasteland leftover from tin mining and quarrying activities. Being Malaysia’s first Green Building Index (GBI)-certified township spread across a gross floor area (GFA) of 13 million sq ft, it continues to attract more than 40 million people annually to the township.
The bustling view of The Capital precinct.
“Our chairman’s vision is always about extraordinary land. When we looked at the land here, we found it to be exciting because there’s a river and forest. We’re excited about how we can replicate various communities here in Johor.”
Aware of the stiffening competition here, Cheah said they are banking on the group’s strong track record in township building, community development and construction.
“Let’s face it. It’s challenging out there. We have the cooling measures on one side, and we have a lot of supply coming into Iskandar Malaysia. It’s important that we further differentiate ourselves from the crowd in that we not only build townships, but also create communities.”
Sunway Iskandar, Nature’s Capital City
Its freshly-minted Iskandar Sunway encompasses six self-sustaining modern precincts of mixed-use townships. They are The Lakeview which was recently unveiled; The Capital – a vibrant city in the heart of the development; The Parkview surrounded by a botanical garden; The Riverside against the lush backdrop of a tropical rainforest; The Seafront with its 2.5km pristine views overlooking Singapore and the Second Link on the horizon and The Marketplace – with its food, arts and culture attractions surrounded by greenery fronting Emerald Lake garden.
Modelled after the successful Sunway Resort City, each precinct will be designed to reflect a self-sustaining integrated city with amenities.
Having entered into separate agreements with strategic investment fund Khazanah Nasional Bhd and Iskandar Investment Bhd on a 60:40 basis respectively in deals worth approximately RM413mil at the end of 2012, Sunway Iskandar can be divided into 700 acres (283.3ha) at Medini while 1,100 acres (445.2ha) are reserved for the site at Pendas. Both sites are separated by the 7km Pendas River.
Cheah said that between the two parcels of Sunway Iskandar land, Medini comes with incentive schemes for both local and foreign buyers that will see exemption from the new real property gains tax (RPGT) without a minimum investment value for foreign purchasers. The development in Medini will also enjoy incentives introduced by the Iskandar Regional Development Authority.
Furthermore, she believes the group’s track record as a township developer, the strategic location of Sunway Iskandar and incentives for investment will likely generate higher capital appreciation for investors.
Sunway Iskandar, located in the heart of Johor, will be seamlessly linked to major highways and is just a five minutes’ drive to the Second Link via the proposed Southern Access as well as major Iskandar attractions such as Legoland Malaysia, Pinewood Iskandar Malaysia Studios and EduCity.
It will also be connected to key destinations when the Singapore-Johor Baru Rapid Transit System is completed.
Residents can spend their leisure time at The Marketplace precinct.
“In terms of transportation, accessibility and location – they are all there. That’s why we have a lot of keen interest in Sunway Iskandar. We’re optimistic we can create something different here. When we first looked at the land, we asked ourselves how we were going to develop it. It’s about nature and city living so we positioned it as a good balance of work-and-play – especially since the land is nature-based, spacious, accessible and liveable,” she commented.
Sunway Bhd joint managing director Ong Pang Yen agreed, saying that the landscape and skylines of Medini and Pendas will reflect Nature’s Capital City in time to come with sustainability being a key consideration.
“We have this development philosophy which is to build along the lines of nature. We believe that developments should not replace nature. Hence, 40% of the 1,800 acres (728.4ha) which is just about 700 acres (283.3ha) – as large as Bandar Selangor – will be conserved as green areas, path walks and gardens for residents to enjoy,” he said of the low density plot ratio that has been planned for Sunway Iskandar with its 60% residential and 40% dedicated commercial components.
“These numbers that we have may slightly change as work progresses, but that’s how we view them to ensure they are sustainable.”
Its executive director for property and construction for the southern region and Singapore, Tan Wee Bee, said that Sunway Iskandar envisioned as a world-class city, will be the first township in Iskandar Malaysia that will have five main components – retail shops, office units, serviced apartments, a theme park and an international school within the first year at its first phase.
Other facilities include a petrol station, ultra high-speed broadband and security units with CCTVs.
Revealing what will undoubtedly characterise one of the largest, new gleaming townships to emerge in Iskandar Malaysia, other key components such as education, medical facilities, eco-themed river parks, themed hotels and malls will be linked via walkways and roads connecting the shops with the residential units, said Cheah.
She believes that the success of the launch of the first phase of its Citrine development in The Lakeview precinct bodes well for the other precincts. Incidentally, the retail component of Citrine will not be sold but will be leased out by the Sunway retail management team, which is also the asset manager of Sunway REIT – the community builder famous for its “build, own and manage” philosophy. This is to ensure the continued enhancement of its townships is in tandem with the growth of the respective communities in Sunway Iskandar.
