Cover: Property buying frenzy

In Penang

The overwhelming response to I&P Group’s Temasya Suria in Glenmarie, Shah Alam, on Aug 1, has come on the heels of a property buying frenzy in the Klang Valley and up north in Penang. The overnight queues, a feature of a hot property market, are back, though for selective projects.

It is noteworthy that properties being snapped up are the high-end types. More such launches can be expected as developers, buyers and investors are now sitting up and paying attention to the change in sentiment.

Some of the more notable excitement could be seen in IJM Land’s maiden launch of The Light Linear in Penang and in Kuala Lumpur, Eastern & Oriental Bhd’s St Mary Residences CBD and S P Setia’s Sky Residences, the developer’s high-end condo debut.

A residential component of The Light waterfront project, The Light Linear, comprising 328 units, has become the talk of the town. All the non-bumiputera units have been sold, bringing sales to a credible 82%. The sales were chalked up progressively in tandem with the developer’s sales strategy that kicked off last month.

A series of by-invitation only previews culminated in a soft launch on Aug 1. That day saw 55 interested buyers queuing for the remaining 15 non-bumiputera units — the first three buyers had queued for three days, IJM Land managing director Datuk Soam Heng Choon tells City & Country.

The Light Linear condominium units average about 1,500 sq ft and are priced at about RM400 psf. To make it a compelling buy, the developer had dangled an early bird incentive of RM20,000.

A delighted Soam attributed the strong response to the project’s waterfront concept. “Due to the high number of registrants, we had anticipated good response. But we were surprised that all the non-bumiputera units were snapped up,” he says.

The market would surely be watching out for the next launch of The Light, called The Light Point, towards the end of the year.

“The Penang market is quite mature. Buyers look for new concepts and projects of international standard,” Soam says, adding that IJM Land’s Summer Place project of 530 units launched in April this year achieved 100% non-bumiputera take-up in two months.

“We believe that with the current low interest rates, people are buying to hedge against inflation. The market in Penang should continue to strengthen, barring any negative financial or political news,” Soam says.

The Light Waterfront Penang, a RM5 billion project to be developed over the next 12 to 15 years, has been designed to rival landmarks such as Canary Wharf in London, Docklands in Melbourne and Queens Quay in Toronto. The developer has appointed six Malaysian architectural firms to craft the residential components in the first phase of the project that is set to be the developer’s crown jewel.

Phase One of the three-phased project will comprise six parcels of high-end waterfront homes sprawled over 42 acres. The first phase will have 1,177 units provided by The Light Linear, The Light Point and The Light Collection I, II, III and IV. Phase Two, over 103 acres, will house an integrated commercial city with a five-star boutique hotel and another four-star hotel catering for business travellers and exhibition visitors. The final phase will see a seafront park that will feature a marina and a yacht club.

In the heart of KL, Eastern and Oriental has registered strong take-ups for its St Mary Residences, which comrpise three 28-storey serviced apartment blocks with 657 units and a 3-storey parking lot for 719 cars. Two of the towers are for sale.

On June 25, the first block, Tower C, comprising 169 units, was soft-launched at an introductory price ranging from RM830 to RM1,500 psf. Early bird purchasers enjoyed discounts, so the average selling price was about RM1,000 psf. Sales of 75% were achieved within five days. Tower A is likely to be put on the market before year-end while Tower B will be retained.

The project sits on what used to be the site of St Mary’s School. The Synod of the Diocese of West Malaysia, the previous owner of the 4.04-acre freehold tract, had paved the way for the project when it signed an agreement with Lion Group for the latter to build a new St Mary’s School in Selayang and an apartment block (one of the three St Mary Residences CBD blocks) in exchange for the land.

This was in line with the Kuala Lumpur Structure Plan 2020 whereby schools are to be relocated to the Klang Valley suburbs to ease traffic congestion in the city centre. Lion Group has invited E&O to jointly own and develop the tract through Mergexcel Property Development Sdn Bhd, a 50:50 joint venture between Ribuan Imbangan Sdn Bhd (wholly owned by E&O) and Lion Courts Sdn Bhd (wholly owned by Lion Industries Corp Bhd).

E&O marketing and sales director K C Chong says the company had expected a good turnout at the soft launch because it was offering the right product. Does he see the market bottoming out? “In some respect yes, as there appears to be that eagerness and propensity to commit to [investing in the property sector]. It’s just that the level of confidence might have been contained somewhat, given the current overall market sentiment,” Chong says.

“We felt we had the right product to lift the gloom — attractively priced first-class apartments located in the central business district of KL.

“These apartments have their own attractive features such as huge luxurious master bath suites, a central park of 1.2 acres and more. The one-bedroom apartment itself is a spacious 1,135 sq ft — ultra sheer luxury space and possibly suited to the current market.”

E&O is also active in Penang. Says Chong: “We received good response to our properties there throughout last year. It would appear that confidence has returned to the Penang market as we have been  entertaining more enquiries lately.

“The Malaysia My Second Home programme has been beneficial to the Penang market and there is sustained interest from this quarter for good quality homes. The island’s prominence as a World Heritage Site has also helped raise awareness of Penang’s unique attributes and charm among a wider worldwide audience.”

Elsewhere in KL is S P Setia’s debut in high-end condominiums via the Setia Sky Residences, which have received good response. The project, located near the intersection of Jalan Tun Razak and Jalan Raja Muda Abdul Aziz, comprises four 40-storey blocks on six acres of freehold commercial land. Only the first two blocks have been put on the market. The first tower is 92% sold while the second tower is 26% sold. An average 1,300 sq ft 3+1 bedroom unit costs about RM800,000.

The project developer is Exceljade Sdn Bhd, in which S P Setia has a 70% stake. The remaining interest is owned by Appronic Sdn Bhd.

This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 767, Aug 10-16, 2009.