KUALA LUMPUR (Jan 3): The Tun Razak Exchange (TRX) is set to be the most successful master-planned development in 2018, said Savills Malaysia Sdn Bhd (Savills) managing director Datuk Paul Khong.
“The TRX site, which was initially inaugurated as the KL International Financial District in 2010 has achieved remarkable growth in terms of market acceptance and speed of development. Even before completion, it has already attracted an array of international and domestic institutions in one central precinct including HSBC, Prudential, Mulia and Lendlease,” he said at a presentation by Savills entitled “The Property Market in 2018 — Savills' Top Four Picks” which highlighted the consultancy’s stand-out stories for this year.
The other three top stories include the proximity to the Mass Rapid Transit line becoming a new dimension in assessing the attractiveness of a property, logistics properties to be the focus in the industrial sector and Malaysia being the top destination for new retail brands expanding into Southeast Asia.
Menara Prudential is set for completion at the end of this year, while the Affin headquarters and Mulia Group’s The Exchange 106 will be completed in 2019.
This will be followed by the completion of the HSBC headquarters by the end of 2020.
“A comparison of the amount of completed gross floor area in several major masterplans in KL compared with TRX such as Bangsar South, Mid Valley City and KL Sentral will show that TRX is completing at the fastest rate over a 10-year period,” said Savills Malaysia executive chairman Datuk Christopher Boyd.
Commenting on the office sector, Boyd noted that an estimated 20 million sq ft of space is expected to enter the Greater Klang Valley market over the next four years, while eight million sq ft of office space is expected to be taken over the same period
“This is not a life-threatening situation. It is enough to keep the office rents stable. There won’t be a crash in the market, but there will also not be a sharp capital appreciation. What we will see is tenants moving to newer buildings with higher specifications without paying more rents instead of refurbishing their current office space. This will be good for the industry,” he explained.
Meanwhile, the office buildings which are 30 years old or older will likely lose their tenants to younger buildings, rendering them ready for redevelopment — including into other types of buildings such as high-rise homes, said Boyd.
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