The Edge Outstanding Property Project Award 2013: Sunway Resort City
'THIS is what good entrepreneurship can do — turn a wasteland into a wonderland'. That’s what Lee Kuan Yew said, and that is what I hope I have done [with Sunway Resort City],” says Tan Sri Jeffrey Cheah, with a touch of pride.
The former prime minister of Singapore had paid the founder of the Sunway group this compliment during a visit to Sunway Resort City (SRC) in 2001, four years after the Government of Singapore Investment Corporation (GIC) had acquired a stake in Sunway Bhd.
SRC is the winner of The Edge Outstanding Property Project Award this year. The award recognises SRC’s transformation from a former tin mine to an international landmark. The various attractions and facilities that make up the core of the township have raised the values of properties not only within SRC but also the surrounding neighbourhoods.
Sunway’s masterpiece is an 800-acre township located between Petaling Jaya and Subang Jaya.
At the heart of the township are Sunway’s crown jewels, namely Sunway Pyramid mall, Sunway Lagoon theme park, Sunway Resort Hotel and Spa, Sunway Medical Centre and Menara Sunway, the group’s headquarters.
Together, these facilities cover seven million sq ft and are connected. This means that a visitor can walk from one building to another without having to set foot outdoors. Besides Sunway University, there is Monash University.
Recognised as Malaysia’s first green township by Green Building Index, SRC was designed to be the country’s first safe township with more than 2,000 closed-circuit television cameras, covered walkways, an auxiliary police force and police beat bases.
|In the late 80s, Bandar Sunway was little more than a barren wasteland that was scarred by years of mining|
“I think I’ve invested billions of ringgit into the township! But having said that, the people who stay here are like my partners. They may ask why the property here is more expensive than that outside of the township? It is because of our enhancements,” says Cheah.
“We widen the roads and fix the potholes. I always tell Petaling Jaya City Council, ‘you collect a lot of quit rent and assessments, but you don’t fix the potholes and maintain the landscape; I do them!’.”
With 60 to 70 acres remaining in the township, Sunway is still not done with its flagship. Coming up is Sunway Geo, a mixed-use development within the upscale, gated-and-guarded Sunway South Quay, featuring a lake at its centre. Floating in the lake is the South Quay Princess, a 77-foot boat that can be rented by the residents.
Under construction next to Menara Sunway is The Pinnacle, a 27-storey, green Grade A office tower with a net lettable area of 580,000 sq ft. Cheah considers it the missing piece of SRC’s puzzle. Some of the facilities at The Pinnacle include a sky garden, a gymnasium and nursing rooms, while across the road is a kindergarten targeted at children with working mothers in the area. The project is slated for completion at the end of next year.
“I know there is a glut of office space in the market, but we have to look at demand and what’s in the market before we can start. But our rents will be very competitive, and we will have direct links to our buildings and walkways.”
Cheah also believes that having Menara Sunway and The Pinnacle fully occupied can only bring more vibrancy to the township, which will buoy businesses in the nearby shoplots and Sunway Pyramid.
Linking all the facilities is the upcoming 5.4km bus rapid transit (BRT) system, an elevated two-lane road just for buses. There will be seven stops along the route, which will connect the KTM line at the Setia Jaya station to the Kelana Jaya extension line, near Summit USJ, which is under construction. The system, jointly developed by Syarikat?Prasarana?Negara Bhd and Sunway, is a prototype that will be implemented in 15 other places. Prasarana had awarded a RM452 million contract to the group’s unit Sunway Construction Sdn Bhd while the group is forking out a further RM99 million as part of its corporate social resonspiblity.
However, it was difficult to imagine back in the 1970s that this “lunar landscape” would become so successful today.
Cheah acquired the initial 500 acres from a British mining company in 1974 for RM300,000, when the land lease was near expiry.
“They knew that with only five years left on the lease, it was better to pack up and go home. So, they sold it to me and I mined it a bit for a few years,” he explains.
The earnings from mining were used to pay off the RM300,000. However, Cheah had always planned to transform the site into a township, thanks to its strategic location — between Petaling Jaya and Subang Jaya.
To kick-start the development, he launched single-storey, terraced houses, priced at RM65,000 each, in 1986. The simple, affordable products were necessary to draw interest to the barren landscape.
“This place was previously a tin mine. People looking for houses don’t want homes on ex-mining land. Furthermore, it is leasehold land,” says Cheah.
“My competitors in Subang advertised their houses like this: ‘Buy our houses. We are freehold, we don’t build on ex-mining land, everything grows here, our houses won’t crack’.
“I told them, ‘You are hitting below the belt. Why are you saying all this, la? You should say your houses are good la, not that they won’t crack!”
Nonetheless, he persevered. Investing in good foundations for the homes, he eventually proved the critics wrong — Sunway’s homes were as safe as those built on so-called more solid ground.
However, his battle with the sceptics was not over. Despite SRC’s strategic location, most people still shied away because as far as they were concerned, it was a faraway tin mine.
To overcome this, Cheah moved Sunway College (now Sunway University), which was established in 1986, from Petaling Jaya to SRC.
“By having Sunway College here, parents sending their children to college would see what was happening in the area. The roads were bad at first, and there were so many sceptics. Even my own directors thought I was mad, putting so much money in a place that looked like the surface of the moon!” he recalls.
This strategy paid off as more people came to know of the township. He continued to invest in universities within the township to enhance the neighbourhood. “You can live, play, work and learn as well as get treated here if you are not well. So, we are building a strong community. That’s why we have a strong community of lecturers, doctors and specialists.”
Recently, Harvard University agreed to set up an Institute of Southeast Asian Studies in Sunway after receiving a US$6.2 million (RM19.4 million) endowment from Cheah.
“I have courted Harvard for a long time. My requirement [for the institute] is that all professors coming to Southeast Asia must stop by our country, stop by Sunway. If I don’t specify this, they will stop by Jakarta, Hanoi or Bangkok and completely bypass us.
“So, they must have their conference here, research and lecture a bit before flying off. I have accommodation, transportation, everything. So, what’s the problem?
“I think Harvard is the best university in the world. They have produced 12 presidents of the US, while six of the eight Supreme Court judges are also from Harvard. So, you can see how powerful this university is.
|By having Sunway College in SRC, parents sending their children to college would see what was happening in the area. The roads were bad at first, and there were so many sceptics. Even my own directors thought I was mad, putting so much money in a place that looked like the surface of the moon! — Cheah|
“Now we are linking Harvard to Malaysia, and hopefully, they will open more schools here like the Harvard Business School. It’s a dream, but I dreamt of Jeffrey Cheah School of Medicine and Health Sciences, too. I fought hard and dreamt hard and finally, got my wish. Nothing comes easily.”
He recalls how he tirelessly persuaded the government, the councillor at Monash and his company to set up the school almost a decade ago.
“It cost RM120 million to set up and it was expected to be loss-making for the first 10 years, but I wanted it, and now in eight to nine years, we have produced three or four graduates, and these graduates can practice in Australia, New Zealand and Malaysia. I need not say anything anymore.
“At our medical centre, we have a good pool of specialists. Through the government’s TalentCorp, we have brought back a number of good, talented doctors from overseas. Without a strong brand and a good name, how can you do that?”
Sunway’s flagship attractions — Sunway Lagoon theme park and Sunway Pyramid — are all about good, clean fun, Cheah says.
“I remember in 1988, I went to the bank to ask for money to build a water theme park. The banks said, ‘Sorry, we have never heard of a water theme park’. So, I had no funding and had to start it myself. When we opened the park, it was a runaway success. We had 15,000 to 20,000 visitors each weekend.
“I love watching people’s faces when they have fun. They have never seen anything like this before! Now, we have to continuously add new things because it gets stale if you don’t.
“We’ve just opened the Vuvuzela, the world’s largest water ride. Then, we have the world’s largest wave surf pool. We also signed a three-year deal with MTV to bring famous international acts here,” he beams with pride.
Sarena Cheah, joint managing director of Sunway’s property development division and his daughter, notes: “It’s interesting because Sunway Lagoon has grown up, too. When it opened, it was mostly for children and now, it is an international tourist attraction, catering for the young and old alike. So, this component of our township has grown to cater for different market segments and that is why it is sustainable.”
While Cheah is proud of how far he, the Sunway Group and its flagship development have come, there were things in the early stages of SRC that he would have wanted to do differently.
“When Tun Dr Mahathir Mohamad was the prime minister, he once asked, ‘Hey, Jeffrey, why did you build all those link houses in your first phase?’ Those were the houses I sold for RM65,000, and the price rose to more than RM100,000 later.
“So I told him, ‘Sir, you must understand that I did not have money.’ I wanted to build something better and sell them at higher prices, but this place was so undeveloped and there were no trees then. With hindsight, I see it is a different show now.”
Similarly, he would have saved the land currently occupied by workshops and factories for Sunway University’s expansion.
“I did not want to sell the land back then, but what choice did I have? It was the only product that I could sell at that price. Sometimes, I curse myself. Why did I do that? The factories should never have been there! Now, the students have to walk by the factories and they are so noisy!” he stresses.
Despite all the hardship the group has had to endure in the early years, the township has blossomed beyond imagination. Who says nothing can grow from a wasteland?
|Today, the township is an international destination with a theme park, hotel, shopping centre, universities and medical centres seamlessly connected|
This article first appeared in The Edge Malaysia Weekly, on October 14, 2013.