JOHOR BAHRU: The property sector outlook in Johor Bahru is expected to be positive as the market has maintained its growth momentum in the second half of 2010, said property consultant Knight Frank Malaysia in its research report on Malaysia's 2H2010 Real Estate Highlights.
Notable growth was particularly experienced by the mid-high to high end residential properties.
The positive sentiment, it said, takes into consideration the advanced stages of completion for major infrastructure works in Johor Bahru, as well as the co-operation forged by the Malaysian and Singaporean governments.
Major projects in Iskandar Malaysia coming on stream in 2012 and the investment prospects enhanced by the Economic Transformation Programme (ETP) also contributed to the overall positive outlook.
Among the indications for a positive market outlook include Bandar Raya Developments Bhd taking over from Limitless Holdings Pte Ltd in the partnership with UEM Land (60:40) to develop the 111-acre land identified as Residential North, Puteri Harbour in Nusajaya, with an expected gross development value (GDV) of about RM2.3 billion.
Also noted was Dijaya Corp Bhd's partnership with Iskandar Water Front Sdn Bhd to form Goldhill Quest Sdn Bhd for the development of a 14.8-hectare site in Danga Bay, Johor Bahru with a GDV of about RM3.8 billion.
Also in September 2010, Iskandar Investment Bhd and Bina Puri Holdings Bhd sealed a joint venture agreement to develop Medini Square in Nusajaya, a commercial development consisting of retail, shop offices, SOHO units and an office tower. The proposed development is expected to generate RM500 million of GDV.
"The Iskandar Regional Development Authority and State Economic Planning Unit is conducting studies on the transformation of Johor Bahru city centre into a vibrant city and expected to released the results of the studies by early 2011," it said, adding that under the 10th Malaysia Plan, some RM1.8 billion will be spent for this purpose.
WCT Bhd is also taking part in the development of a 10.3-acre site in the Medini Business District, Nusajaya. The RM688 million project will include a media village and film and television production facility.
The report added that as of September 2010, Iskandar Malaysia has attracted investments of approximately RM64.38 billion, exceeding the RM47 billion target for 2010.
"More Singapore investors are expected following the joint statement by Singapore's and Malaysia's Prime Ministers in May to establish a close relationship in the development of Iskandar Malaysia Studies are also being carried out to develop a Rapid Transit System (RTS) between Singapore and Iskandar Malaysia," it said.
Under Budget 2011, RM339 million was allocated for the infrastructure support of the economic regions of Iskandar Malaysia.
Meanwhile, outside Iskandar Malaysia, S P Setia Bhd has acquired a 259-acre land for the development of Taman Setia Indah in Johor Bahru. The proposed development is expected to have a GDV of RM1.5 billion.
Knight Frank said mid-high to high-end residential properties is a growing sector in Johor Bahru. Among new developments are Nusa Sentral by Country View Bhd located along Jalan Gelang Patah, Nusajaya. The development offers 312 units of terraced homes, with built-up areas from 2,100 sq ft to 2,300 sq ft. The prices range from RM338,000 to RM380,000 per unit.
Another residential development is The Z, Indah Villa by S P Setia, located within the ongoing Taman Setia Indah offering 22 units of semi-detached houses for sale. The built-ups range from 3,795 sq ft to 4,212 sq ft with prices ranging from RM1,288,800 to RM1,408,800.
However, the commercial property market with the exception of shop offices, remained subdued
The supply of Johor Bahru's purpose-built office space remains unchanged, with the total net lettable area (NLA) of purpose-built office space in Johor Bahru as at Q3 2010 at 8,194,542 sq ft. The overall average occupancy rate is in the region of 75%.
Knight Frank said in its report that the prime central business district (CBD) office space is let at a gross rental range of RM2.50 to RM3.00 psf per month whilst offices at secondary locations are leasing below RM1.50 psf per month.
On retail property, Knight Frank said that as of 3Q, the NLA of retail space in Johor Bahru is estimated at 10,921,012 sq ft. The overall average occupancy rate is 71.0%. Prime centres have all recorded occupancy rates in excess of 80%. Prime gross rents range from RM15 to RM40 psf per month.
The report added that new proposed retail developments in Johor include a lifestyle mall by Iskandar Investment Bhd located at the western development zone of Medini North, Nusajaya with a gross retail space of one million sq ft which is expected to be completed by 2012.
There will also be the redevelopment of the KOMTAR shopping mall in Johor Bahru CBD by Johor Corporation, with a gross lettable area of about 383,000 sq ft. The mall is scheduled to be completed by 2012.
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