City & Country: Mutiara Damansara to get new catalysts for growth

Boustead Properties Bhd has been seemingly quiet of late — it has been going about its business with little fanfare. At its flagship Mutiara Damansara township, it is taking its time to unlock the value of its remaining available land.

The 355-acre freehold Mutiara Damansara in Petaling Jaya is a success story with its transformation from oil palm and rubber estate into sought-after development, like the nearby Taman Tun Dr Ismail (TTDI) and Bandar Utama townships. Values are expected to increase further with the completion of several ongoing commercial projects.

The corporate and residential precincts in the township have recorded impressive capital appreciation. In October 2000, a 13.06 acre parcel was sold to Ikano Corp Sdn Bhd for just RM99.12 psf. Now, a vacant commercial plot in the township is going for RM480 psf at the sub-sale level, says Boustead Properties executive director Datuk Ghazali Mohd Ali.

Surian Residences
On July 3, Boustead Properties launched its latest condominium project, Surian Residences. At the end of that day, 80% had been taken up, with all non-bumiputera units sold and only 70 bumiputera units remaining, says Ghazali.

“More than 1,000 people turned up for the launch, with 500 ballots deposited. The project allocated 50% of the units for bumiputera buyers in accordance with Selangor state regulations,” he tells City & Country.

The RM300 million freehold condo project on an eight-acre site offers 311 units in two towers, one of which is 25 storeys and the other, 23. Unit sizes range from 850 to 2,443 sq ft, and prices range from RM507,000 to RM1.35 million. That works out to between RM550 and RM650 psf. That is not unlike the pricing for The Westside One condos launched in Desa Parkcity, about six kilometres away, which sold for an average of RM600 psf when launched in early July.

Boustead Properties launched its first condo project in Mutiara Damansara, Surian Condominums, some six years ago in February 2004, at an average RM250 to RM300 psf. This means capital values have appreciated by about 120%, using Surian Residences’ pricing as a benchmark.

“The density here is low … about 40 units per acre. It is the hallmark of Mutiara Damansara — a low-density area with plot ratio of three. The area has been developed quite extensively. We are connecting the Surian Tower (office building), the new hotel, e@Curve (formerly known as Cineleisure Damansara), The Curve and later Curve NX. The upcoming public transportation system that runs along Persiaran Surian will also augur well for the development,” Ghazali says.

Facilities in the project include two covered car park bays for each unit, gymnasium, tennis court, lounge pool and multi-function hall. The project is designed to harvest rainwater for storage to water plants for landscaping, and will also use energy saving bulbs.

There are only about five acres left for residential development, on the hillside, in the township, says Ghazali. This may comprise low-rise condominiums, but plans have not been finalised. The developer is also pushing the government to build a primary school on a five-acre site reserved for it.

The success of the township is not without reason. The developer brought in value-added facilities by inviting Ikano Corp Sdn Bhd and Tesco Stores (Malaysia) Sdn Bhd to set up shop there in 2000 and 2001 respectively. It subsequently developed The Curve shopping mall. Property values have since been trending upward.

Nucleus
But Boustead Properties, a subsidiary of Boustead Holdings Bhd, is not sitting on its laurels. It aims to bring in new catalysts that will enhance property values.

The developer is mulling several options for a 10-acre project it has tentatively called Nucleus, on which it hopes to start construction by year-end.

Plans for the parcel in the corporate precinct are for 1.3 billion sq ft of commercial space, including corporate offices, serviced apartments and another mall with limited retail space. There may also be an aesthetic wellness center, Ghazali says.

The developer is aiming to get green certification for the development.

“We have potential buyers for enbloc sales of offices in Nucleus. The plan is now going for approvals and we hope to start work by this year-end,” Ghazali says.

“However, we are open to opportunities and might sell the parcel together with the approved plans to other developers so that they will build according to our plan, or we can sell once the buildings are completed. We may also look for joint-venture partners to develop part of the project. There are many options,” he says.

“A lot of corporations such as TSR Bina Sdn Bhd, Mudajaya Group Bhd and Glomac Bhd that bought corporate lots from us some time ago are now building. For us, it is good to have more offices here to bring in daytime traffic to The Curve. We position these offices near The Curve so that the car parks in those offices can be used during weekends. However, developments here are kept to a plot ratio of three. We will object if anyone goes beyond that because it will add to the traffic and cause congestion,” he notes.

For the existing commercial component, Ikano Power Centre attracts about three million shoppers a month, while the The Curve chalks up two million to 2.2 million.
Curve NX, located diagonally opposite The Curve and Ikano Power Centre, will house educational theme park Kidzania and a McDonalds Drive-Thru outlet. It will be ready next month and is scheduled to open next March.
Over 70% of Surian Tower, located opposite e@Curve, has been taken up. Tenants, which include multinational corporations such as Procter & Gamble (Malaysia) Sdn Bhd, Nestle (M) Bhd and Petra Energy Bhd, have moved in and the developer hopes to fill up the remaining space in the office block by year-end.
There is another parcel, measuring one acre, next to Menara KLK that Boustead Properties sold to a private party last year. The buyer, a private limited company, whom Ghazali did not name, is expected to build an office block on it.

e@Curve
Formerly known as Cineleisure, Boustead Properties took over full ownership last year from Singapore’s Cathay Organisation Holdings Ltd, which previously held 50%.

Subsequently renamed e@Curve, the mall is now undergoing renovation works that will be completed next year. The developer is rebranding the mall to be more entertainment-based and is in the midst of getting the right tenant mix.

“We have to clean up the mall and make sure all the shops have more visibility. We are also relocating shops because the most important thing in a shopping mall is to look fresh. We just handed over shops to six new tenants on Jan 1.

“I think everything will fall into place once the new hotel (located behind e@Curve) is ready and Surian Tower is filled up. We want to have fashion, entertainment and F&B together in e@Curve, rather than put entertainment all on the top floor like other malls do,” Ghazali says.

Royale Bintang Damansara at The Curve has also been renamed Royale Bintang Curve while the new hotel will be named Royale Bintang Damansara, he adds. The latter is scheduled for completion by early 2012 and will be opened in stages. First to be ready early next year will the hotel retail podium, which will house an ice-skating rink as well as F&B and retail outlets.

Meanwhile, over in Semenyih, Boustead Properties is developing the 1,400-acre Mutiara Hills, 100 acres of which is occupied by the Malaysia campus of the University of Nottingham.

Ghazali says the project will see a “big catalyst of 300 acres” by the middle of next year, but declines to give further details.
Last September, one-acre homestead lots for orchards and small homesteads were launched, tagged from RM10 to RM12 psf.

Meanwhile, at its Mutiara Rini township in Skudai, Johor, recent launches — including 17 shophouses and 304 units of 2-storey terraced homes — garnered an average take-up of 60% to 70% over a weekend. About half the 1,400-acre township has been developed since the first launch in 1996.

The developer is also in the process of disposing two parcels of land in the township to two hypermarkets — one local and another foreign. It hopes to conclude the deal by year-end.

This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 821, Aug 30- Sept 5, 2010.