TAKE the North-South Expressway towards Seremban, the capital of Negeri Sembilan, and about 10km from the town centre is Bandar Sri Sendayan.
The developer, Matrix Concepts Holdings Bhd, has its hands full to make the developing township — first featured by City & Country in 2011 —not only appealing to investors, but also meet market demand and fulfil the state's aspiration in attracting foreign direct investments (FDI). Bandar Sri Sendayan has attracted an impressive RM2.1 billion worth of FDI to date.
The township, with a gross development value (GDV) of RM5 billion, sits on 5,233 acres of freehold land and will take 10 to 15 years to develop. BSS Development Sdn Bhd, a subsidiary of Matrix Concepts, is overseeing the project, made up of a residential and recreational component (35%), commercial and institutional (10%), industrial (20%), a Royal Military Air Force base (14%) and an orchard (21%).
Matrix Concepts chairman Datuk Mohammad Haslah Mohammad Amin tells City & Country that 314.6 acres in the 1,000-acre industrial estate, called Sendayan TechValley, have been sold to date to nine companies from Taiwan, China, Japan and France. The parcels were sold at RM12 to RM26 psf.
"A few international companies from Austria, Germany, US and the UK are also interested," he says. "The Austrian and UK companies are big and their requirement in terms of land space is also huge. They are looking at 50 acres of land each, and have budgets of not less than RM600 million."
Some 676.5 acres in TechValley are available for sale, with the developer keeping 485.1 acres for future projects.
About 20% of the industrial land for sale will be used to build detached industrial lots, semidee lots and other industrial components, to be launched in the third or fourth quarter.
Haslah says that since 2004, the amount of FDI flowing into Seremban has increased as Negeri Sembilan becomes increasingly investor friendly. In 2011, the state was ranked third for attracting FDI into Malaysia. The Malaysian Investment Development Authority (Mida) has been heavily promoting Sendayan TechValley.
"The reason why all these foreign companies have come to our township is that we have the only industrial estate in Negeri Sembilan," Haslah says. In terms of industrial area size, TechValley is larger than the industrial estate in Bandar Enstek at Sepang, Selangor.'
Matrix Concepts is putting in a lot of effort to make TechValley appealing, planting greenery along the roads and putting up cycling paths. It spent RM9 million to add a 15km natural gas line to the TechValley with the cooperation of Gas Malaysia Bhd. This was to accommodate a request by French company Messier-Bugatti-Dowty but Haslah says this will benefit other companies that require an alternative source of energy.
A wholly-owned subsidiary of Safron SA — a multinational aircraft and rocket engine, aerospace component and security company —Messier-Bugatti-Dowty is the world's largest manufacturer of aircraft landing gear. It is involved in the design, development, manufacturing aof all types of aircraft landing gears, wheels and brakes. The company plans to manufacture aero brake discs in Sendayan TechValley.
Another reason why Sendayan TechValley is drawing foreign companies is that it is only 90km from Port Klang, Selangor, the main gateway by sea into Malaysia. It is also near the Nilai Inland Port.
The land price is another factor as the cost in Negeri Sembilan is still in the double-digit range at an average of RM26 psf, compared with RM100 and above in the Klang Valley.
Menteri Besar Datuk Seri Utama Mohamad Hassan also takes the time to greet foreign investors, which helps to reassure them of the state's commitment, says Haslah.
The developer is also banking on companies that are moving into the industrial area to spread the word and attract others to set up shop there.
"Messier-Bugatti-Dowty is the third largest conglomerate in France," says Haslah. "Since this is its first venture into Asia-Pacific, we're hoping other companies will follow suit."
The developer hopes to keep the momentum going. Haslah suggests that Mida and other agencies play a more active role in helping to attract FDI, for example, by highlighting recent events on the international front that can work to Malaysia's advantage. These include the recent floods in Thailand and the dispute between China and Japan over the Senkaku islands.
"One reason why Nippon Kayaku, an air-bag manufacturer, decided to invest in Malaysia was because of the recent Japan-China island dispute," Haslah says.
Tension between the two countries soared after the Japanese government bought over the Senkaku islands from its private owners in September. That caused violent demonstrations in China, with protestors even setting fire to Japanese-made cars.
"We should take advantage of foreign situations such as these," says Haslah. "Other situations, like the Thai floods, should also be used to our advantage."
The other Japanese companies that have decided to set up their plants in TechValley are Akashi-Kikai/Daihatsu Motor (electronic auto transmission), Daihatsu Motor (automotive), Meditop Corp (M) Sdn Bhd (medical equipment, Hino Motors (truck assembly and engine block) and MBM Resources/Mitsubishi (automotive).
In terms of residential property, demand in Bandar Sri Sendayan is strong, particularly for 1-storey terraced houses. The first residential launch was Nusari Homes, launched in 2008.
"All of our buyers are owner-occupiers and not speculators," Haslah says. "That's why our price appreciation is gradual ... over a period of five years."
One-storey terraced homes at Nusari Bayu 1, launched in 2008 for RM82,000, were going for as high as RM103,888. in 2010. Two-storey terraced homes at Nusari Aman 2A, initially sold in 2009 for RM208,000, could fetch for RM224,301 in 2011.
The most recent launch was the Ivanix Park Homes @ Idaman Bayu 2, in October 2012.
Since 2012, there has been a shift in the buyer profile, with 40% of the purchasers from the Klang Valley. Previously, buyers were mainly from the Seremban area.
"They are coming here because of the improved infrastructure and convenience of the Kajang-Seremban Highway (LEKAS), North-South Expressway and the eventual Senawang-KLIA Expressway," says Datuk Lee Tian Hock, group managing director and CEO of Matrix Concepts. "This accessibility allows them to work in the Klang Valley and live in Seremban."
As Bandar Sri Sendayan slowly transitions from offering medium-end products to more high-end projects, real estate values in the surrounding areas are expected to benefit.
According to Lee, Bandar Sri Sendayan's growth has been tremendous. "Over the past one year, we have undertaken two projects — the 1Sendayan Club and Matrix Global Schools."
1Sendayan Club is a leisure and business club on seven acres of freehold land that is scheduled to start operation in 2014. It offers an Olympic-size swimming pool, Jacuzzi, water-sports station, tennis and badminton and squash courts. The club will also have a bowling alley, as well as a games room, gymnasium, food and beverage outlets, and other amenities.
Purchasers of the township's residential units will be offered free membership and be given the option of renewal after a certain period. Membership will also be open to the public.
Matrix Global Schools will have a private primary school, a secondary school as well as an international school offering the Cambridge syllabus from pre-school to year 13. The school complex sits on 20 acres and will have an estimated built-up of 550,000 sq ft. Expected to be completed by September 2014, it can accommodate 2,100 students, with the first intake slated for 2015.
Lee says the schools will be managed by Matrix Concepts' new education subsidiary, 1Sendayan Education Sdn Bhd. A consultant with a 20-year track record in education management has been engaged.
"Seremban has never had an international school," says Lee. "We found that a lot of professionals working in industries and international manufacturing facilities would rather stay in the Klang Valley because of this."
Another pull factor Lim is proud of is the green space that has been allocated within the township. The government's guidelines state that 10% of a land that is developed must be allocated for green space, but in Bandar Sri Sendayan, 30% has been set aside. That includes a two-acre orchard belonging to Federal Land Development Authority (Felda) settlers. This means the township will have a green lung of some 1,600 acres.
The developer had purchased nearly 4,000 acres from Felda settlers for Bandar Sri Sendayan. The compensation package involved a 50% cash payment, a 1-storey bungalow with a land area of about 10,000 sq ft, and a 2-acre orchard, said to be worth a total of RM600 million.
Some 90% of the township's infrastructure has been completed.
About 12 projects are under construction, comprising 2,079 units of 1- and 2-storey terraced houses as well as shopoffices. The overall take-up rate is 92%. Some 4,483 units will be launched between 2012 and 2016.
The developer is also looking at creating some mini-theme parks but these are still in the planning stages according to Lee.
"As Bandar Sri Sendayan reaches full maturity in 2019, we anticipate a population of 100,000 made up of both owner-occupiers and those working in the township," says Lee.
Matrix Concepts owns 2,500 acres in Negeri Sembilan and Kluang, Johor, that will last it until 2019.
Haslah says the company will keep an eye out for land in the Klang Valley and hopes to have a presence there someday.
Matrix Concepts was established in 1996 with core activities in investment holdings, property development and construction. The group has completed and sold 15,000 residential and commercial properties with a GDV of RM1.8 billion to date. Completed developments include Taman Gadong Jaya in Seremban, Taman Intan Perdana in Port Dickson and Bandar Anggerik Tenggara in Johor.
The company has received the Securities Commission Malaysia's approval to be listed on the Main Market of Bursa Malaysia and expects to make its debut in the first half.
According to its prospectus, it will issue 62.5 million new ordinary shares worth RM1 each with an offer for sale of 37.5 million ordinary shares.
This story first appeared in The Edge weekly edition of Feb 11-17, 2013.
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