PJH to focus on commercial development in Putrajaya

AS you cross the Seri Gemilang Bridge in Putrajaya, you will see a number of high-rise government office buildings built by Putrajaya Holdings Sdn Bhd (PJH).

PJH, the master developer of Putrajaya, is completing its last remaining government projects under its portfolio, including the Ministry of International Trade and Industry (Miti) within the Matrade Centre at Jalan Khidmat Usaha (off Jalan Duta) and projects on parcel F, which will include the expansion of several government buildings and the proposed Malaysian Anti-Corruption Commission (MACC) building.

While PJH has been focusing on government-commissioned buildings and residential developments in the federal administrative centre over the past few years, the developer aims to revitalise the township with more commercial developments in 2013.

"We are now embarking on the commercial development of Putrajaya and it looks promising," says Putrajaya Holdings Sdn Bhd CEO Datuk Azlan Abdul Karim.

He says market studies have shown that there is a demand for more commercial products in Putrajaya.

From the initial plan to deliver 600,000 sq ft of office space, PJH now plans to increase this to 2.2 million sq ft. This does not include government office space.

For shops and office suites (not included in the planned 2.2 mil sq ft office space), the total space has been increased from 127,000 sq ft to 650,000 sq ft, with the first office suite products to be delivered in FY2013 or FY2014. These will be located at strategic locations in the core area of Putrajaya.

The core area is positioned at the centre — or "core of the city". It consists of five precincts — the government, mixed development, civic and cultural, commercial, and sports and recreation.

Commercial projects slated for launch this year include 148 and 164 units of office suites on lot Z1 and Z2, with a tentative launch date in September 2013; 75 units of landed shop lots; 96 units of stratified retail lots as well as an additional 37,943 sq ft of stratified retail lots in zone 5; and 27 units of shop lots within the diplomatic enclave, which will be launched end-2013.

Azlan says PJH derives its income from the rental of its buildings to government bodies. He explains that government departments outside Putrajaya occupy 1.8 million sq ft of office space. Thus, PJH is maintaining adequate "stock" of office space to ensure availability for future demand.

PJH now has 801 acres of undeveloped land for various developments in Putrajaya.

Projects in the pipeline

PJH had a fruitful financial year ending Dec 31, 2012. The group generated revenue of RM1.8 billion — an increase of RM135 million from its previous year. Azlan says the increase is due to buoyant demand for its residential and commercial property. It aims to match last year's results this year.

PJH is also building the Heriot-Watt University in Precinct 5, to be completed by September 2014. "We are constructing a building to be leased to Heriot-Watt University," says Azlan. "It is roughly 250,000 sq ft and we have the necessary approval."

There are also plans to expand Putrajaya's Alamanda Shopping Centre. "We are going to expand Alamanda by another 50,000 to 100,000 sq ft of retail space and build serviced apartments next door," Azlan says. "There is a lot of demand in the area. It was a typical suburban mall in the past but has since evolved into a fashion hub, with brands like Uniqlo coming in," he says.

The current net lettable area (NLA) of Alamanda is 660,463 sq ft. Plans for the new expansion will be ready in June 2013.

PJH's residential property launches in 2013 include Tamara — a 240-unit condominium project in Putrajaya.

"We managed to sell everything within a week and soon we'll launch the second phase," Azlan says. "There is a lot of demand for residences and I don't think there will be any problems selling off the other units."

Phase 1 of Tamara was launched in March 2013. Tower B and C in phase 1 comprise 240 units with a selling price of RM480,888 to RM518,888. All units were sold in three days. Phase 2 of Tamara comprising 200 units in Tower A and D was launched in May 2013 at RM538,888 to RM572,888. Some 90% has been sold. Tamara comes in one size — 1,205 sq ft with all units being corner units.

PJH also launched the Ferra semi-detached villas along the waterfront in January 2013. "Units fronting the waterfront were 90% sold within a week, while the other units have a lower take-up rate," Azlan says.

Fera Waterfront Twin Villas comprises of 62 semi-detached villas. It was launched in January 2013 at between RM1.96 million and RM3.62 million, with built-ups of between 3,383 sq ft and 5,026 sq ft. The total GDV is RM171.3 million.

PJH is looking to launch 1,000 units of residential products within the year, not including the units mentioned above. The 2010 census puts the population of Putrajaya at 67,964.

"We build when there's demand. We are lucky that residential demand is picking up. People like staying here," Azlan says.

Adding vibrancy to the administrative capital

Putrajaya Holdings Sdn Bhd (PJH) CEO Datuk Azlan Abdul Karim says the general perception about Putrajaya is that only civil servants should invest in properties there.

"We are slowly changing this perception by entering into joint venture projects to develop the commercial aspects of the city," he says.

PJH aims to make Putrajaya a more vibrant place and attract long-term residents. To achieve this, the developer needs to address a few challenges, including the perception that Putrajaya is Malay-centric and only for government servants.

"We also have to identify key factors to broaden our customer base and incorporate them into upcoming developments. Aside from that, we have to compete with the surrounding areas such as Puchong and Cyberjaya," says Azlan.

Putrajaya also aims to achieve green city status and initiatives — such as partnerships with public and government agencies, businesses and the local government — towards that aim are ongoing.

PJH is also venturing outside its comfort zone by expanding its landbank outside of Putrajaya. The developer is exploring a number of potential sites in Klang Valley and Penang.

"With our experience in developing office, retail and residential developments, we are keen to use our financial strength and expertise to develop similar products outside Putrajaya," Azlan says.

He adds that PJH does not own any land outside Putrajaya but hopes this can be remedied in the next few years.

For its long-term strategy, PJH will focus on more green developments. "We are currently operating in the first Green Building Index (GBI) Gold Certified commercial building — Menara PJH in Putrajaya," says Azlan. Menara PJH has a gross floor area of 581,040 sq ft.

PJH is also developing strategic sites in the core area to create retail and commercial activities as well as street level activities to build a vibrant urban environment.

The developer is looking to promote a cosmopolitan township by building the International Hub @ Precinct 7 and 8. The layout plan for the second phase of precinct 8 is currently being finalised.

Azlan adds that the plan started with the development of 120 retail and office spaces and is currently working on the masterplan for the remaining area, which will be finalised in 3Q2013.

The international hub will consist of predominantly mixed-development projects such as retail, office and residential properties, supported by a university, hotel and medical centre.

"The hub is expected to add to Putrajaya's vibrancy and to its attraction as a destination in the southern region of the Klang Valley," Azlan says.

The total built-up area of the international hub is about 3.1 million sq ft, with a GDV in excess of RM2 billion. It is expected to be launched in 2Q2014.

The developer is also planning a Medical Tourism precinct to occupy Precincts 4 and 5.

This story first appeared in The Edge weekly edition of July 8-14, 2013.

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