KEPONG INDUSTRIAL PARK (KIP) Group, a real estate developer that is known for the fresh market outlets called KIP Mart in Johor, Melaka and Negeri Sembilan, plans to launch two of its largest projects at the end of this year.
First on the list is 8Scape at Iskandar, a RM700 million condominium in Taman Perling that falls under Flagship A of Iskandar Malaysia. The 9.2-acre freehold development comprises four 24-storey blocks with 1,255 units that are 808 to 1,700 sq ft in size. The largest units are dual-key and feature a secondary studio.
“If you have a family, you could live in the larger unit and rent out the smaller one or if you are single, you could rent out the larger unit. Either way, the owners earn extra income, which they could use to pay for the condo,” director Valerie Ong tells City & Country.
The project will be launched in two phases with the first two towers released by the end of this year. The group has not decided when it will launch the other two towers.
Apart from a host of landscaping features, 8Scape’s facilities will include a viewing deck overlooking the Straits of Johor, an infinity pool, an aqua gym, a gymnasium, a tennis court, a playground and an exercise station. The prices for the first phase are pegged at around RM500 psf.
|Top: Ong: There is no big existing supply of apartments in Johor now. Bottom: Yap says the group may list a REIT in a year’s time, but it has not worked out the details|
According to Ong, KIP Group is not overly concerned about competition from Iskandar’s property market as 8Scape is located in an established neighbourhood where most of the homes are landed.
“There is no big existing supply of apartments in Johor now, so it is great that a lot of new projects cater for upgraders who wish to live in a safer environment. We also believe there is no other project with these facilities at this price point anymore,” she says.
“Most of our buyers are locals. In fact, they are previous buyers of our Kipark Service Suites Tampoi Indah high-rises that were launched seven to eight years ago.”
Construction of 8Scape is expected to start early next year with completion targeted for the middle of 2017.
KIP Group’s biggest project yet is a RM1.5 billion integrated development coming up on 15.72 acres along the Middle Ring Road 2 in Kuala Lumpur that is tentatively called KIP City.
Its plan has not been finalised yet, but the group is looking at the following components — a shopping mall with a gross floor area (GFA) of 600,000 sq ft, shoplots, a hotel, office towers and serviced apartments with a built-up of around 500 sq ft.
“We noticed that there were no apartments here of this size to cater for young executives. Plus, we will have a mall and an office all under one roof, so they won’t have to travel very far … it will be quite convenient, especially if some of them are working here in the future,” says Ong.
Adds the group’s CEO Yap Boon Teck, “The shoplots will be lined along an avenue. We also plan to maintain a ‘fresh market’ within the shopping mall because we believe it will be of real benefit to urbanites to shop in a clean and dry ‘wet market’ ... so far, maybe the closest competitor is the market in Taman Tun Dr Ismail.”
KIP Group plans to devote 40,000 sq ft of the mall to KIP Mart. The rest of it will be tenanted by F&B outlets followed by some fashion retail names, says Ong. The mall will be managed by KIP Group, which will draw on its experience in managing KIP Mart.
The prices of the serviced apartments and shoplots have not been fixed yet as the project is still pending approvals. It is expected to be launched in 2Q or 3Q2014.
A 20-minute drive away is Sunway Putra Mall, which will be transformed into a gleaming, modern landmark at a cost of RM300 million. No doubt, it will be the most significant competitor to KIP City. However, Ong says KIP City’s mall will target the catchment in Selayang and its immediate neighbourhoods, such as Batu Caves and Rawang.
The group also recently ventured into hospitality with its three-star KIP Hotel brand. In August, it held a groundbreaking ceremony for its first KIP Hotel on a 0.4-acre site in Taman Wahyu, Selayang. The 199-room, 12-storey hotel is aimed at business travellers working in Kuala Lumpur as it is just about a 20-minute drive away via Jalan Ipoh and Jalan Tun Razak.
The first KIP Hotel, which will be completed by 2016, will be managed by Lexis Hotel Group, which also operates Lexis, Grand Lexis and Lexis Hibiscus hotels in Port Dickson and Lexis Suites in Penang. The group is planning a further two hotels in Sepang and Melaka in the next four years.
“We realised that there was a shortage of decent accommodation, especially for business travellers. Nearby is the city where the offices are whereas on the other side are tourist attractions like Batu Caves,” says Ong.
|An artist's impression of 8Scape at Iskandar|
It was for the same reason that the group decided to build another hotel in Melaka. In Sepang, the site of the proposed hotel is close to the low-cost carrier terminal, which makes it the first, or the last, shopping stop for most commuters coming from or going to the airport.
Besides opening new KIP Hotels, the group plans to expand its KIP Mart franchise. Currently, it runs six of them — one each in Masai, Tampoi, Kota Tinggi and Segamat in Johor and one each in Senawang, Negeri Sembilan, and Melaka. An expansion is planned for the Tampoi outlet, which will boost its GFA and net lettable area to 470,0000 and 255,000 sq ft from 220,000 and 140,000 sq ft respectively. There will also be an increase in the number of retail units to 420 from 273 and parking bays to 925 from 628.
The group will open a further four outlets by 2014 — one each in KIP City, Kota Warisan in Dengkil, Melaka and Kuantan. Besides growing its footprint in Johor and Negeri Sembilan, other states the group is eyeing are Selangor, Perak and Pahang. As KIP Group has a fairly mature stable of commercial properties and is keen to grow its assets through its KIP Marts and KIP Hotels, it is no surprise that it is considering a real estate investment trust (REIT).
Yap says the group may list the REIT in a year’s time, but it has not worked out the details, like the value of the properties, the number of units or the price.
“We are talking to our consultants now. Later, we will have to do submissions to list. We can do that because our KIP Marts have a pretty high occupancy rate of around 90%. In Johor, the older marts are about 98% full, but more importantly, we have ‘locked in’ major tenants for them.”
On concerns over whether the group will face challenges in keeping both its future unitholders and tenants happy, Yap says the group will balance the rent per square foot of existing properties with properties in the pipeline.
This article first appeared in The Edge Malaysia Weekly, on November 4, 2013.
TOP PICKS BY EDGEPROP
2.5 Storey Bungalow House Kg Kubu Gajah
Sungai Buloh, Selangor
Elegan Townhouse, Taman Putra Perdana
Elegan Townhouse, Taman Putra Perdana
Twin Key Best Investment Project With 0 Booking
RM598K Only for a Gated & Guarded Community
Kota Kemuning, Selangor