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City&Country: Cover Story-- Melawati, a new hot spot

Mention Melawati and what usually comes to mind is a rather quiet housing area that offers little excitement. But drop by there and you will be surprised at the building activity going on, particularly in the northeast sector, nearest to the panaromic Klang Gates Quartz Ridge, which is also known as Bukit Tabur.

altCity & Country recently visited the Melawati area, located just 20 minutes from the Kuala Lumpur city centre. It is a peaceful neighbourhood with mostly residential developments. Turn into Jalan Taman Melawati — the main road heading to Taman Melawati and the Kemensah area — from Middle Ring Road 2 (MRR2), we can immediately see a change in the scenery. Mature trees flanking the road provide shade as one drives past mostly established and mature housing areas.

Further up the road on Jalan Melawati 5 and the subsequent Jalan K5, you can have a bird’s-eye view of ongoing construction works, where some projects are already in the advanced stages. Most of the new developments are on the fringes of Taman Melawati — by far the largest and among the oldest townships in the area.

A slew of developers — big names as well as smaller outfits — have been busy building here since the mid-2000s. With land in Kuala Lumpur city getting scarce, Melawati offers a good alternative for developers, especially with the completion of the Duke Highway (Duta-Ulu Kelang Expressway) in 2006. Duke provides the “missing link”, joining Duta in the west to Ampang in the east, and to Karak in the north.

Developers are also banking on the scenic surroundings of limestone hills and forest between Hulu Kelang and Gombak. Nature enthusiasts often trek up the ridge, near the Klang Gates Dam — the country’s oldest water reservoir.

Melawati was once dubbed Malaysia’s Hollywood because it is where the headquarters of the National Film Development Corp (Perbadanan Kemajuan Filem Negara or Finas) is located.

iProp Realty Sdn Bhd MD Victor Lim says the area is linked to the city centre via the MRR2, Jalan Ampang, Ampang-KL Elevated Highway (AKLEH) and the Genting Klang-Pahang Highway, while the Duke highway is nearby.

Another property consultant, VPC Alliance (KL) Sdn Bhd MD James Wong, says: “There are some aggressive developments in Melawati, making it among the fastest growing suburbs of Kuala Lumpur. However, further development to the north is constrained by environmental issues, such as the Klang Gates Reservoir.”

While the area’s population was once predominantly Malay, as shown by the 2000 population census, it is now more mixed. Land there is mainly freehold, except for some pockets in the western portion, he adds.

“Many developers have realised the potential of Melawati for high-end residential development, with urban development in Kuala Lumpur expanding northwards,” Wong tells City & County.

“Melawati now offers upmarket hillside homes, including bungalows with designer layouts, as well as gated-and-guarded residential developments. The area is set to offer more luxurious residences with panoramic and limestone hill views, promoting healthy green living on the fringe of the city,” he says.

A number of major developers own land there including Eastern & Oriental Bhd, which has 310 acres in Kemensah Heights. Sunway Group Bhd, Selangor Dredging Bhd and Mutiara Goodyear Development Bhd are already busy on their projects.

High-end
The Melawati district, with a total size of 1,823ha or 4,505 acres, covers Pusat Bandar Melawati, Taman Melawati, Bukit Kemensah, Ukay Perdana, Bukit Mewah and Taman Lembah Keramat.

Some 792.81ha have been allocated for residential use, according to the Ampang Jaya Municipal Council Local Draft Plan 2020 launched last year.

altMeanwhile, 84.1ha is for commercial use, 24.56ha for industrial use and 129.77ha for agricultural use.
Among the existing townships are Taman Andaman Ukay, Taman Bukit Mulia, Taman Dataran Ukay, Taman Permata, Taman Tun Abdul Razak, Taman Oakleaf Prima Villa, Tropika Kemensah, Beverly Heights, Duta Suria and Nusa Tropika.

Most people would associate Melawati with the 1,200-acre Bandar Melawati, which comprises three developments — Taman Melawati, Taman Desa Melawati and Taman Wangsa Melawati. These were developed by Negara Properties (M) Bhd since the mid-1970s. Landed terraced, semi-detached and detached homes catering to the middle-income group are among the most popular properties in this established and mature district, says James Tan, associate director of Raine & Horne International Zaki + partners.

“Melawati is the ‘happening’ place right now. The scenery here is good, with fresh air and untouched nature. There is a very nice ridge [Klang Gates Quartz Ridge], which is too difficult for development. A lot of developers are capitalising on the scenery of the ridge,” he adds.

Tan notes that new bungalows in the area were only selling for about RM2 million each about two years ago. Today, new bungalow launches can start from RM6 million. Newer developments incorporate value-added features like lifestyle concepts, quality finishes as well as gated and guarded facilities, he adds.

At the sub-sale level, VPC Alliance’s data reveals that a terraced home on Jalan A4 in Taman Melawati Phase 1 was sold for RM360,000 in March 2007, while a similar property in Jalan B4 was transacted at RM425,000 this year. This translates to a gain of 18% in three years.

A 7,000 sq ft bungalow on Jalan 5/1B in Kemensah Residency was sold at RM2.7 million in November last year. Last month, a bungalow with the same built-up in the same area changed hands for RM3 million — a rise of 11%.

altThe newer developments, especially those at the northeast sector, are mainly high-end landed projects, such as Amber Hill by Tunas Manja Group and Sunway Rydgeway. Others include 20trees and 20trees West, Nadayu, Contours by AQRS The Building Company Sdn Bhd, and Bayu Kemensah by Delta Elegance Sdn Bhd.

Sales of these new projects seem to be doing well. For example, Sunway Rydgeway is almost 100% taken up. Developed by Sunway Group Bhd, it is a gated and guarded project that promotes a wholesome and safe community concept. It spans 13.8 acres and comprises 40 zero-lot bungalows and 30 semi-detached homes. Due for completion next year, the gross development value (GDV) will be RM160 million.

Also capitalising on the green surroundings is Selangor Dredging, which is developing its second project in the area, 20trees West. The freehold 10.75-acre development, with a GDV of RM150 million, consists of 43 units of 3-storey bungalows with private swimming pools and two-tier landscaped gardens of specially selected tropical trees. Land sizes are between 5,000 and 8,300 sq ft, with built-ups from 6,400 to 7,200 sq ft. Tagged at RM3 million up, the project is 80% sold.

Selangor Dredging was one the earliest developers in that part of Melawati and recently completed 20trees, on a 23 acre parcel of land. Offering 83 landed units and 118 low-rise apartments, the project is 88% sold.

A few smaller developers have also made their presence felt, among them Symbol Vintage Sdn Bhd, which is developing Bukit Melawati, comprising 21 bungalows on an 8.131-acre tract at the edge of the ridge. Selling from RM2.7 million to about RM3.7 million, the project has a GDV of RM66 million and is 70% taken up.

At the highest point in Taman Melawati is Amber Hill by Tunas Manja Group, on a 9.04-acre freehold tract. The development comprises 30 units of 3-storey semidees, with land areas of 3,600 to 6,000 sq ft, and 16 units of 3-storey bungalows, with land areas of 6,500 and 14,000 sq ft. Built-ups for semidees are a minimum of 4,500 sq ft, and the bungalows, from 6,500 sq ft.

A resident, Jane, who was born and grew up in Taman Melawati, says it is a serene area with lush greenery that has attracted interest from potential buyers and tenants.

She recently bought an apartment unit there for investment.

“There were not many developments here previously but since Sime Darby [Property Sdn Bhd] took over [Negara Properties], many other developers have started coming in too,” the 25-year-old tells City & Country.

To recap, the merger of Sime Darby Bhd, Golden Hope Plantations Bhd and Kumpulan Guthrie Bhd to create the world’s largest listed oil palm plantation player, announced on November 2006, triggered a mandatory general offer for Negara Properties, then a subsidiary of Golden Hope.

Substantial increase in values
Another listed developer here is Mutiara Goodyear, which is developing Nadayu, comprising 142 bungalows with built-ups ranging from 6,477 sq ft to 8,401 sq ft.

Phase 1 of 21 units of bungalow was priced from RM5.95 million, in which it works out to about RM918.6 psf — a price nobody expected and which is even higher than similar products in Petaling Jaya, says Tan.
This phase has achieved a take-up rate of 80% since its soft launch in March.

Apart from the bungalows, Nadayu also offers semi-detached homes, superlink houses and boutique commercial units.

According to Ho Chin Soon Research Sdn Bhd data, Mutiara Goodyear purchased the 50-acre parcel, where part of the Nadayu development now stands, at RM15 psf in December 2004 through its subsidiary Twin Ridge Sdn Bhd. It also acquired a 9.88-acre parcel at RM16.4 psf the same month. Twin Ridge then bought another 2.21 acres next to Selangor Dredging’s 20trees West development at RM21 psf in May 2006. Meanwhile, Sunway Group acquired the parcel for its Sunway Rydgeway project in June 2007 at RM26.2 psf.

In July 2007, there was another transaction by an unknown buyer for a 5.81-acre parcel at RM59.2 psf.
Using Mutiara Goodyear’s transactions in December 2004 as a benchmark, land values had increased by almost 300% as at July 2007. However, it is not known if the substantial increase in land value is because of the change in the land status.

The parcels at the northeast sector, with ongoing projects, were initially categorised as agriculture land. The previous landowners converted the parcels for residential use before selling them to developers. These converted parcels are now selling at RM55 psf on average, Tan says.

“One plot is about three to four acres. There is not much land left in the that area and some parts are too steep for development. It is a hot spot now and land is being snapped up by developers,” he adds.

Catalyst
Jane, the local resident, says there is talk that Sime Darby is going to build a hospital in the area. Property values will rise even more if it happens, she believes.

A Sime Darby spokesman says this can’t be confirmed immediately. Sime Darby now operates two medical centres — Sime Darby Medical Centre Subang Jaya and Sime Darby Specialist Centre Megah (formerly known as Megah Medical Specialists). It will also run a private high-end 300-bed hospital on a 15-year lease from 2013 in Desa ParkCity, Kuala Lumpur.

Raine & Horne’s Tan notes that the Melawati district is mainly a residential area and the commercial component has not been as vibrant. A 4-storey shopoffice at Taman Melawati is going for a “reasonable price” of about RM1.2 million. Most residents go to the hypermarkets nearby — Giant, Carrefour and Tesco Stores — to shop for groceries.

VPC Alliance’s Wong says the commercial centre at Melawati Urban 1 consists of 2-to 4-storey shopoffices. The upcoming Melawati Urban II has 30 units of strata retail and business suites. These commercial centres are developed by Sime Darby.

He expects the Melawati area to further benefit from the implementation of a proposed highway along the upper north perimeter just before the Klang Gates Reservoir and the Pandang Malay Reserve. That will improve traffic flow and accessibility in and about Melawati.

This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 822, Sep 6-12, 2010


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