WITH new highways and public transport systems coming up and the redevelopment of Atria in full swing, property consultants expect the area to become more attractive to real estate investors and end-users when these projects are completed.
Despite the traffic congestion caused by the redevelopment of the 30-year-old Atria Shopping Centre, coupled with the property market’s less buoyant mood, Damansara Jaya continues to be an attractive location for real estate investors and end-users as highways and public transport systems come up and the new mall takes shape.
While the rebirth of Damansara Jaya’s landmark is a somewhat painful process for people in the neighbourhood, investors can ultimately leverage the new Atria for further upside in value, say consultants.
Vincent Ng, CEO of Kim Realty Sdn Bhd, tells City & Country that the redevelopment of Atria will boost the prices of homes and shoplots in the area. “People in Damansara Jaya are looking forward to new Atria’s completion and are confident that it will pull people in.”
He says commercial lots in Damansara Jaya have been slightly on the quiet side since the redevelopment of Atria started in 2012 due to the noise and lack of parking space.
Some businesses that were based in Damansara Jaya, such as Gamuda Bhd, have moved out due to the inconvenience, he adds.
However, shop owners remain optimistic. “People believe the new Atria will be a catalyst for the area,” says Ng. “I believe it will boost the prices and rents of shops and homes even further, although it is difficult to estimate by how much.”
OSK Property Bhd started the redevelopment in December 2011. The new Atria will comprise 5-storey Atria Shopping Gallery and two 16-storey towers of Atria SoFo Suites (small office/flexible office) with two levels of basement parking and five levels above ground. It is expected to be completed by the 2Q2015.
Atria was developed in the 1980s and became a popular place. The development housed two international department stores — Kimisawa of Japan and Printemps of France. However, the 1988 economic slowdown saw they close down.
However, Atria continued to attract visitors with a department store, lifestyle and food and beverage outlets until 2010. News about the redevelopment upset the residents as they were not notified.
The redevelopment was mooted in 2008, but residents were against it as they felt that a high-density project would only worsen the traffic congestion.
However, consultants believe that the new Atria will give a new lease of life to the area and boost the values of properties within Damansara Jaya. Kim Realty’s Ng believes it will not just be a neighbourhood mall but will also attract crowds from outside the area.
The prices of shoplots in Damansara Jaya have appreciated since 2011, especially those in good locations, he adds. “Those facing the main road are being offered at between RM3.5 million and RM4 million. Some are even willing to pay RM8 million for a corner lot. Unfortunately, there are no sellers at the moment.”
Ng notes that shoplot transactions were almost non-existent for the past 5 to 10 years. However, he says there were more transactions involving 2-storey shoplots closer to KDU University College as the properties might be cheaper than the 3-storey ones.
On the rental rates of shophouses in Damansara Jaya, Ng says they have been increasing the past three years. The rent for ground floor space, which was RM3,000 a month in 2011, has gone up to RM6,000 [in anticipation of the opening of the new Atria].
However, Ng notes that the rent is still lower than that in SS2, which is about RM8,000. He expects the shoplots facing Atria to get better yield.
According to consultants, the current pull factors of the area are KDU University College and accessibility via Lebuhraya Damansara-Puchong (LDP), New Klang Valley Expressway (NKVE) and SPRINT Highway.
James Wong, the managing director of VPC Alliance (M) Sdn Bhd, says Damansara Jaya has good connectivity because of the highways.
Meanwhile, See Kok Loong, a director of Metro Homes Sdn Bhd, says the existence of KDU University College has helped boost the prices of residential and commercial properties in Damansara Jaya and attracted buyers and students to purchase or rent homes there.
Wong says prices of terraced houses in the area have appreciated by an average of 8.6% per annum in the past five years. “In 2010, the price of 2-storey houses with land areas of 1,800 to 2,143 sq ft was RM392 psf, but in 2014, it is RM560 psf. Based on our research and analysis of transactions of terraced houses in Damansara Jaya, they are considered good investments.”
“We have seen property prices increase over the last three years,” says Ng.
He notes that renovated 2-storey terraced houses were sold for RM1.5 million while those that are not renovated fetched RM1.3 million. “You have to acknowledge that Damansara Jaya houses have more space — 23 ft by 95 ft — instead of the normal 22 ft by 75 ft.”
On the appreciation of the house prices, Ng says the area boasts an effective Damansara Jaya Residents and Owners Association (DJROA), which has kept the neighbourhood safe. The DJROA has also won several awards since 1994 for being the best neighbourhood association.
“People are concerned about safety in the Klang Valley, and Damansara Jaya has a great community with the DJROA,” he says. “I believe people move to Damansara Jaya because they like what it has that you cannot get anywhere else — a good neighbourhood association.”
Because of this, Ng notes that property prices there have appreciated much faster than in other areas in Damansara, such as Bandar Utama and Damansara Utama.
Unlike commercial properties in Damansara Jaya, houses there have seen more transactions over the last five years.
“The 2-storey link houses with new designs like the Avante are more popular. These homes, located in SS22/32 up to SS22/40, are being transacted at between RM1.1 million and RM1.5 million, ” Ng says.
Damansara Jaya is a quiet, quaint housing area in Petaling Jaya that covers about 300 acres. It encompasses SS22 and SS22A and has a population density of 12,000.
It was developed by See Hoy Chan Sdn Bhd in the 1970s, which transformed its estate into a housing development. Later, the company set up KDU University College due to the demand for private higher education in Petaling Jaya, anticipating its potential as future development catalyst.
A couple of decades later, Damansara Jaya became a fully matured area with little or no land left for development.
All three consultants agree that Damansara Jaya has no more land to be developed. “Every parcel has been developed,” Ng says. “Small units and bungalows with built-ups of about 5,000 sq ft are taking up the remaining pockets of land.”
The question now is whether there is still growth going forward.
Apart from the new Atria, the consultants are looking forward to the completion of
Line 1 of the mass rapid transit.
Wong is confident that once the line is completed in 2017, with stations in TTDI and 1 Utama, property prices in Damansara Jaya will rise.
While many people oppose the construction of the Kinrara-Damansara Expressway (Kidex), Ng says it is good because it will connect Kinrara and Damansara. “Generally, all highway developments are good because they are meant to cut travel time.
“I believe that they help open new areas for development, give more value to existing properties and ease traffic congestion. Kidex will smoothen traffic flow, from the south heading to Damansara and further up without using the LDP. Besides, you have to pay a price for progress, and Kidex, which will be an elevated highway, is part of the progression.”
The three consultants agree that due to the lack of future supply, prices of residential and commercial properties in Damansara Jaya will continue to appreciate.
The last developments in the area — Palm Reserve and Cloverton — were carried out by OCR Land Holdings Sdn Bhd.
Palm Reserve is a high-end development comprising 17 units of 3-storey semidees and three units of 3-storey bungalows. Launched in 2009 and completed in 2011, the units had built-ups of between 3,398 and 5,277 sq ft, with a launch price of RM1.6 million upwards.
Cloverton comprises only four units of 3-storey bungalows with a built-up of 5,978 sq ft. The houses, with a starting price of RM4.9 million, are scheduled for completion this year.
This article first appeared in The Edge Malaysia Weekly, on June 23 - June 29, 2014.
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