The property values of Malaysia's first master-planned community to adopt sustainable development and New Urbanist principles have been appreciating at an impressive rate. The township, which is only 50% complete, has more to offer, says Perdana ParkCity's group CEO Lee Liam Chye. Will investors continue to be interested?
"I believe people deserve the right to reclaim ownership of a community"
Mention Desa ParkCity and the chances are people will start talking about how capital values in this 473-acre freehold township in Kuala Lumpur have spiked in recent times.
Digest this: Back in 2003, the 2-storey terraced Adiva Parkhomes in the township were sold for RM550,000. A recent transaction on the secondary market shows that these homes are now going for as much as RM1.1 million. The 3-storey type, then sold for RM650,000, is now changing hands at RM1.6 million.
Adiva Parkhomes came out tops in the residential (low rise) category of the Fiabci (International Real Estate Federation) Prix d’Excellence Awards 2010.
Aside from Adiva, values in Desa ParkCity’s gated and guarded enclaves of Zenia and Amelia have also risen impressively. According to Metrohomes Sdn Bhd’s Eric Wee, an agent familiar with the township, the 2-storey terraced Zenia Parkhomes, sold in 2005 for RM615,000 to RM650,000, fetched RM1.4 million this year while the 3-storey type is worth some RM1.6 million to RM1.9 million today compared to the developer’s price of RM800,000 to RM900,000.
Some 70% of the homebuyers so far have been owner-occupiers. So to say the market has responded really well to Desa ParkCity’s concept would be an understatement.
In fact, the developer was the first to introduce strata-terraced developments to the country.
Interestingly, it is not just the landed homes that are hot in the township. A special priority launch of its latest condominium project, The Westside One, on June 5 saw many repeat customers. The developer Perdana ParkCity Sdn Bhd had initially planned to unveil only 150 units of the total 338, but due to overwhelming response, all the units were opened for sale. That weekend saw the sale of almost 90% of the non-bumiputera units at an average price of RM600 psf. About 16% of the purchasers were repeat buyers, group CEO Lee Liam Chye tells City & Country. A total of 2,100 people registered for the 40-storey project which offers units that are 969 to 2,066 sq ft in size.
For one of the repeat buyers, a unit in Desa ParkCity’s Nadia condominium was her first purchase several years ago. She has since gone on to invest in five other units in the township, including in The Westside One.
“We really love the place as we feel safe living here. So we started looking for a landed unit as our children want to have a pet. The price appreciation here has been really good, so it has been a good investment for us,” she says.
Certainly, the appeal of Desa ParkCity has not gone unnoticed. In his talk at The Edge Investment Forum on Real Estate 2010 in April, Ho Chin Soon of Ho Chin Soon Research Sdn Bhd, also known as the map king, called Desa ParkCity an “extension” of the exclusive condominium enclave Mont’Kiara, which in turn is an extension of Bangsar.
He referred to the Amelia phase, comprising 3-storey linked homes, in the township, which has been enjoying an annual capital appreciation of some 28%. “The 3,600 sq ft homes were RM1.03 million in 2007 and have jumped to RM2.15 million currently. The 2-storey linked homes there were RM750,000 in 2007. Their current value is RM1.35 million. That’s a 21.6% increase in value per year,” he said.
The fact is, Desa ParkCity is only 50% complete. So, will values rise further when more amenities are added to the township?
A Chinese primary school is operational now and Lee reveals that an international school will open in September next year. A private high-end 300-bed hospital — Sime Darby Medical Centre — will operate as a tenant with a 15-year lease from 2013.
“Everyone wants a piece of Desa ParkCity. It’s a different feeling altogether there during the day and the night, and since the landed properties are quite expensive, many people are looking at the condominium units and even those are quite expensive. Based on current demand and rents there, the prospects for the area are definitely good,” says Wee of Metrohomes.
Another agent familiar with the township says he expects a lot more excitement in Desa ParkCity once the international school and private hospital are completed. “As it is, rental demand is pretty high in the area. We’re seeing many corporate tenancies, with foreigners moving in from nearby condominium enclaves as they prefer the space and concept of the township as well as its good security,” he says.
According to the agent, the 3-storey intermediate 4+1-bedroom Zenia homes, with built-ups of 3,400 sq ft and partially furnished, are commanding rents of at least RM6,500 a month.
Once fully completed, says Lee, the township will have about 7,500 homes and an estimated population of 30,000. About 1,500 homes have been completed so far, of which 80% are occupied. The current population is 6,000 to 7,000.
So, what makes this place one of the hottest pieces of real estate in the country?
The developer Perdana ParkCity, a member of Sarawak-based Samling Strategic Group, decided in 1999 that a scalable middle-class housing project on the fringes of Kuala Lumpur would be sustainable. When Lee set eyes on what was then a quarry with two high-capacity crushing plants, he knew that was the site they were looking for.
“The land was not on the market then in February 1999, but after some enquiries and stating our interest to buy it, I remember getting a call in April while having breakfast in Paris,” Lee recalls. The tract belonged to Sharikat Permodalan Kebangsaan Bhd (SPK) and was sold for RM200 million.
The developer had to be a bold visionary, to say the least, to try and turn a quarry into what is touted today as “The best place to live in KL”. Extensive rock blasting had ravaged the land, which meant a lot of environmental cleanup and hill slope repairs. A huge amount of topsoil was added as well as trees to minimise soil erosion. Construction finally commenced in June 2002.
“We estimated the cost of earthworks, including slope stabilisation and reinforcements as well as the removal of some 7.2 million tonnes of excess rocks, at RM250 million. We then decided to use the two crushing plants to process the excess rocks for sale and for construction works. In the end, the earthworks cost only RM90 million,” Lee says.
From the start, the developer was determined to build a township based on sustainable living principles. “What is common in most developments is the same products in a different geographical location ... faceless communities. There is no connection among the residents and the people live in isolation. In Desa ParkCity, we introduced the New Urbanism living concept. New Urbanism can be seen in communities in the US, England and other parts of Europe,” Lee explains.
He had started reading about New Urbanism back in 1995. “I was interested in the community, in the master planning of such communities. New Urbanists want authenticity — not grandeur or vulgar spending. They are more interested in using indigenous materials, local craft as well as culture. In fact, I believe people are becoming more creative and imaginative,” Lee says.
Homebuyers, he observes, were bored with the offerings and wanted better homes in a more livable environment. “People thrive best in small neighbourhoods. New Urbanists promote human interaction and walkable distances within the township. Amenities are centrally planned, creating a sense of place, while commercial entities are tucked away in the other end of the township.
“So we planted the ‘DNA’ of the township, influenced by New Urbanist principles, to shape the future of Desa ParkCity,” he says.
The principles were reflected in the masterplan — a compact township comprising mixed housing and offering great connectivity between both people and places.
For example, walkways in the township are 9ft wide compared with the 5ft required by the authorities. Lee says the 9ft double-tree-lined walkways suppress the use of cars, creating a sense of nearness while promoting walkability.
“The township, with its nearness of places, makes cycling and walking an everyday possibility for its residents, thus resulting in a reduction of automobile dependence and calmer streets,” he notes, adding that the township is Malaysia’s first master-planned community to adopt sustainable development and New Urbanist principles. Of the township’s 473 acres, 330 can be developed.
“Building a township is a long-term enterprise and as a developer, you have the magic wand as you can design the lifestyle of the development. We are big enough to create our own identity,” Lee comments.
Perhaps being an avid traveller helped him think of exciting ideas for the project. In fact, Lee took his team to the US to learn more about New Urbanist communities there. This included visits to 1,000-acre Irvine Ranch in Orange County, Laguna West in Sacramento County and Communication Hill in San Jose, California. The team then conducted focus group discussions and came up with the plans for Desa ParkCity.
The small neighbourhoods in the township are arranged around a waterfront. There are two lakes in the township — one artificial and the other natural. The artificial lake was created to act as a retaining facility as well as to regulate water flow.
The Waterfront retail centre, completed 1½ years ago, fronts the man-made lake, or what the developer refers to as “rain jail”. The natural lake is closer to the town centre being planned with a gross built-up of four million sq ft on the other side of the township.
Apart from the Chinese primary school, the upcoming international school and Sime Darby Medical Centre, there are also the residents’ clubhouse and sports centre, which includes a FIFA-size football field.
Lee is still in the midst of planning the 55-acre town centre. “We have the size to do something exceptional — perhaps a town centre with the historic atmosphere of European cities. The town centre will act as a large gathering place for residents, very spontaneous and walkable,” he says.
From his travels to Europe, Lee believes European cities and New Urbanism have the same principles and will work well in promoting walkable communities.
Ideally, the whole township will be completed in 2020. “By then, the essence of Desa ParkCity will be where people ‘own’ the community and feel safe — a place where people want to go out and connect with one another. I believe people deserve the right to reclaim ownership of a community,” Lee says emphatically. The community, he adds, must have a deep communal sense, a sense of belonging, where they want to protect their own and public assets.
How does the developer plan to achieve this? “By giving them a place they are proud of, with good values and a deep sense of respect,” Lee replies.
On lessons learnt, he says it is better to over-provide than under-provide infrastructure. “Perhaps even to design more winding roads in the township to encourage slow driving instead of speeding on straight roads.”
Meanwhile, the developer is looking for new land for its next project. “We’re interested in good-sized townships, at least 300 acres, for urban development. Middle-class housing needs are our forte, and we’re looking at states such as Johor, Penang and Selangor.”
This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 810, June 14-20, 2010
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