FOR Gamuda Land Sdn Bhd managing director Chow Chee Wah, 2013 has been a good year thanks to all the projects the developer has been busy with. However, the year just got a little sweeter with two of its joint-venture projects receiving merit awards under The Edge-PEPS Value Creation Excellence Award 2013 in both the residential and non-residential categories.
The merit award under the residential category went to Lagoon Suites Condominium in Kota Kemuning, while in the non-residential category it went to the Botanic Business Gateway in Bandar Botanic, Klang. The developer of Lagoon Suites is Hicom-Gamuda Development Sdn Bhd, a joint venture between DRB-Hicom Bhd and Gamuda Land while Gamuda Land Sdn Bhd wholly developed and owns Botanic Business Gateway.
“We are very proud to receive the value creation awards,” says Chow. “This is an honour because we always appreciate The Edge’s recognition of our developments, especially after we came out tops for Horizon Hills and Kota Kemuning last year.”
In 2012, Gamuda Land’s Phase 1A3 The Gateway at Horizon Hills in Johor and the Lake Precinct Business Park 2 at Kota Kemuning in Shah Alam, Selangor, were the winners in the residential and non-residential categories respectively.
|We are very proud to receive the value creation awards. This is an honour because we always appreciate The Edge’s recognition of our developments, especially after we came out tops for Horizon Hills and Kota Kemuning last year. — Chow|
The Edge-PEPS Value Creation Excellence Award is a collaborative effort between The Edge and the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia (PEPS) to recognise projects that have created value appreciation for their buyers and investors over a pre-determined time frame.
Chow says the awards prove that Gamuda Land is able to create value for its purchasers and investors because Kota Kemuning was recognised not only at its initial phase of development, but also as the township gets more matured.
“This just shows that throughout the whole development period, we are able to continue to create value for our purchasers,” he adds.
Chow points out that value creation lies in the sustainability of a township and he is glad that in Kota Kemuning, Gamuda Land was able to have the foresight to carve out a sustainable master plan and sound engineering solutions as well as identify the right place to allocate the green spaces.
“From the experience we gained from Kota Kemuning, this has carried into our Bandar Botanic project, which we started five years later,” he says.
The Edge-PEPS Value Creation Excellence Award 2013 | Residential: Merit Award - Lagoon Suites Condominium, Kota Kemuning, Shah Alam — Hicom-Gamuda Development Sdn Bhd
LAGOON SUITES is part of the 1,854-acre freehold development in Kota Kemuning. Located in Shah Alam, Selangor, the township has a total gross development value of RM3.6 billion and comprises industrial, commercial and residential properties.
Meanwhile, Lagoon Suites comprises condominiums and town houses. Gamuda Land Sdn Bhd managing director Chow Chee Wah says since Lagoon Suites was a strata development, there were constraints in the layout of the land, which is long and narrow. So, along with the two blocks of condos, Gamuda Land decided to build 52 units of town houses.
“The town houses are similar to 3-storey link homes with a built-up of 1,620 sq ft and three covered car parks,” he says.
Commanding a gross development value of RM74 million, Lagoon Suites has 350 units of condos in two 15-storey blocks, with sizes ranging from 500 to 900 sq ft. The units are priced at RM125,000 to RM218,000 during launch in April 2010 and has since appreciated between 60% and 95%. Current prices stand at RM300,000 to RM400,000
“The prices start from RM242 psf, which is 10% higher than the units at Kota Kemuning Lakeside Condominiums that was transacted at RM220 psf for 980 sq ft,” says Chow.
He adds that the selling points of the Lagoon Suites are that each unit has a 24-hour security system, and access cards are needed to enter the building from the car park podium. Each unit is also allocated two covered car parks and there is only one entry and exit point in the building.
Amenities include a playground, an open badminton court, a kindergarten, a launderette, a reading room, a surau, a jogging path and a multi-purpose hall.
Lagoon Suites was completed in September 2012.
According to Chow, when Gamuda Land first put the project on the drawing board, the size of the units were a mere 500 to 700 sq ft. Normally, he says, sizes like these would be acceptable in the central business district area but not in the suburbs. However, the company took up the challenge anyway and rolled out the development with those sizes.
He adds that the response from the public was positive and the project was well received.
“We were pleasantly surprised with the good response when we launched the first block as we did not anticipate such a good take-up rate,” says Chow. “It was indeed a big risk for us to launch the small condos back then because the site is surrounded by unfavourable factors, such as high tension cables and Petronas oil reserves.”
Chow says to mitigate these factors, the company carried out the advance planting of trees and shrubs with the car park podium positioned in such a way that it acts as a buffer against the pylons.
Another challenge were the power lines, monsoon drain and gas pipelines running along the parcel of land. To alleviate this problem, Gamuda Land created an eco wetland park from an idle swamp land.
“With assistance from Wetlands International, the park was innovatively restored to function as a natural filtering system as well as an educational park where people can bird watch and enjoy nature,” Chow explains.
“We had all these pipes and lines running near our land, it was an eyesore. So we opened up the whole area and created a wetland in order to draw the eye line away from the power lines and gas pipes and downward to the scenic environment,” he says, adding that this is how the place was transformed to double the value of the land.
Lagoon Suites is the last high-rise development in Kota Kemuning. It has a 70% occupancy rate in block 1 and a 45% occupancy rate in block 2. Lagoon Suites is 80% tenanted and 20% owner occupied. The monthly rental varies between RM900 and RM1,600 for the 500 sq ft units and RM1,000 to RM1,700 for the 700 sq ft units. The 900 sq ft units fetch between RM1,100 and RM2,000.
Chow says the company learnt a lot from this project, including advance planning, a good layout, the orientation of a building, and lush landscaping. “These factors will entice purchasers to purchase irrespective of the built-up and unfavourable factors surrounding the building.”
With experience from Lagoon Suites, Gamuda Land plans to continue developing similar projects in the future.
The Edge-PEPS Value Creation Excellence Award 2013 | Non-residential: Merit Award - Botanic Business Gateway, Bandar Botanic, Klang — Gamuda Land Sdn Bhd
LOCATED at South Klang in Selangor, Bandar Botanic is a self-contained township accessible via the Shah Alam Expressway. It comprises bungalow land, bungalows and apartments. There are also 2 and 3-storey link houses, and 2-storey semi-detached homes. For its commercial phase, Bandar Botanic offers 1 to 4-storey shoplots including the Botanic Business Gateway with 136 units of 2 and 3-storey shopoffices with a gross development value of RM114 million. Standard lot sizes are 22ft by 80ft with a built-up of 3,497 sq ft.
Launched in October 2009, the Botanic Business Gateway was completed in September 2011. The types of shops that opened there at that time included a car showroom, a wedding decorator, a solicitors’ office, an automobile workshop and an organic food shop.
The shopoffices submitted for the award were sold by the developer in 2009 for RM653,000 to RM788,000 and later on the secondary market in 2011 and 2012 for RM1.32 million to RM2.38 million translating to a capital appreciation of 50% to 97%.
According to Gamuda Land managing director Chow Chee Wah, the company does not control the tenant mix and to date, the Botanic Business Gateway is 23% occupied. While the occupancy rate is relatively low, Chow says it is expected to increase to about 70% by end-2014.
“With the increase of the population catchment, there is a high potential for the occupancy rate to increase as well,” he adds.
Gamuda Land is also the developer of block B of GM Klang, which is located close to the Botanic Business Gateway. The company is developing another block in the wholesale city development, which is expected to commence in 2014 and will increase the value of the commercial centre.
“We added the wholesale mall in order to create heavy human traffic around it, which promotes commercial activity,” says Chow. “This will complement and boost the occupancy rate of the Bandar Botanic Business Gateway shoplots and once the occupancy increases, people will start to see its value.”
The first block of the 7-storey wholesale mall has been operational for over a year with a net lettable area (NLA) of 230,000 sq ft, while the second block with an NLA of 320,000 sq ft will begin foundation works in the next two months. The total land size is over 20 acres and will be developed in phases.
“When we first launched the Botanic Business Gateway, it was priced at RM700,000 onwards. Today, we are seeing prices of over RM1.3 million and that’s only in over three years,” Chow points out.
Most of the buyers are investors and existing purchasers of properties in Bandar Botanic. Currently, there are no plans to build a bridge but Gamuda Land has built the KESAS ramp — which was completed in 2011 — which gives better access to the commercial areas in Bandar Botanic.
According to Chow, Bandar Botanic has seen a spillover effect in terms of an increase in its rentals by between 30% and 50% within the last 24 months as a result of the better access.
He adds that all the essential elements that resulted in the success of its Kota Kemuning township development can be found in Bandar Botanic. “We learnt a lot from Kota Kemuning in 1995. In terms of the master plan, emphasis was placed on gated and guarded living, as well as planned infrastructure and road networks.
“If you compare us with other developers, we always take our time during the master planning stage. We will roll out the development in one or two years’ time to get things in place before we start launching. We usually have large-sized developments, so that will usually take 10 to 12 years,” says Chow.
“We also keep evolving in terms of the concept and approaches. We hear what our purchasers require and we put that in place. We always think ahead in that sense so that value can be created along the way, so it won’t be outdated and it can support the community within the township.” Last year, Gamuda Land’s The Lake Precinct Business Park 2 in Kota Kemuning won in this category. The development sits on 5 acres and comprises 40 shopoffices that featured a modern design with dual frontages. The shopoffices submitted for the award were sold by the developer in 2009 for RM893,544 to RM980,000 and later on the secondary market in 2011 and 2012 for RM2.28 million to RM2.38 million translating to an appreciation rate of 141%.
This article first appeared in The Edge Malaysia Weekly, on October 14, 2013.