PROTASCO Bhd is adopting the new urbanism concept in its maiden project, De Centrum City, in Kajang, Selangor. The group, which is known more for its infrastructure construction and engineering businesses, is aiming high with its property development division.
The concept, an urban design movement that promotes walkable neighbourhoods, is similar to the one adopted by award-winning Desa ParkCity in Kuala Lumpur.
“Desa ParkCity sells. We are not trying to replicate Desa ParkCity but we have noted homebuyers’ wish to stay in the vicinity of the city, yet escape the hectic city life,” explains managing director of property and infrastructure Datuk Kenny Chong.
A way to enhance connectivity in De Centrum City is a linear sky deck walkway, he says. “It will be about 500m to 600m long. It will be expensive to build but it will certainly add value to our development as it will allow residents to walk, instead of drive, around the township, surrounded by greenery.”
A 100-acre freehold mixed-use development with a total gross development value (GDV) of RM10 billion, the township will be fully developed in 15 to 20 years.
De Centrum City comprises four components —commercial (50%), residential (30%), academic (10%) and recreational (10%).
It was first unveiled in 2007 with the launch of two blocks of De Centrum Unipark condominium, which is targeted at investors who want to rent their units to the substantial student population provided by Infrastructure University Kuala Lumpur (IUKL), formerly known as Kuala Lumpur Infrastructure University College (KLIUC), and Universiti Tenaga Nasional (Uniten), which are located within the township. IUKL is a subsidiary of Protasco.
Blocks A and B of De Centrum UniPark offered units of 1,062 to 1,252 sq ft at between RM180,000 and RM250,000.
Protasco subsequently launched Blocks C and D in November 2014. Block D is fully sold while Block C has a balance of 20%, which comprise duplex units the group is holding for recurring income. Slated for completion in 2017, De Centrum UniPark will have 640 units in total.
As the development is intended for students, Chong says the facilities available are minimal, with a gym, swimming pool, multipurpose hall and tennis courts. He adds that the condos offer an average rental yield of 6% and sub-sale prices range from RM460 to RM480 psf.
“Students will add vibrancy to the township although the number of students we have [from IUKL] is small compared with the whole population in De Centrum City,” he says.
At end-2012, Protasco launched a mixed-use development comprising De Centrum Residences (320 serviced apartments); De Centrum SoHo Tower (192 units); De Centrum shops (54) and shopping mall Gallerie @ De Centrum. The first two are fully sold. “The buyers of De Centrum Residences and De Centrum SoHo were mostly investors and first-time homebuyers. De Centrum Residences will be managed by a professional property management company,” says Chong.
The mall is scheduled for a soft launch this year. Chong says confirmed tenants include fast food chain, Kentucky Fried Chicken, 7-Eleven and Optical 88.
According to iProp Realty Sdn Bhd managing director Victor Lim, an increasing number of homebuyers are considering Kajang because properties there are relatively more affordable than those in Kuala Lumpur. “Most people who are renting in Kuala Lumpur and are looking to purchase their first home or want to start a family may consider Kajang,” he notes. “I would say that properties that are going for RM600 to RM700 psf in Kajang would have to offer amenities such as a botanic garden, lake club and recreational park.”
Lim also notes that highways such as Kajang Dispersal Link Expressway (Silk), Kajang-Seremban Highway (Kaseh), Cheras-Kajang Highway (Grand Saga Expressway) and North-South Expressway, and the upcoming MRT line will make it easier for residents to travel to the city. The area is set to have three MRT stations — at Saujana Impian, Bandar Kajang and Jalan Reko.
“The completion of MRT Sungai Buloh-Kajang Line in 2017 will make it convenient for residents of Kajang,” Lim notes.
Protasco plans to officially launch the higher end Rimbawan Residences next quarter. The RM342 million project will feature four 22-storey blocks (504 units) and 13 villas on a 7.4-acre parcel. More than 90 units of condos and villas have been sold, Chong reveals.
The built-ups of the condos will range from 872 to 1,332 sq ft, with selling prices starting from RM625 psf (before discount). The villas, which will have built-ups of 4,542 and 4,553 sq ft with prices starting from RM448 psf, have been fully sold. The villas will be perched above a green pathway cooled by artificial water mist. Each villa will have a private garden, lap pool and private basement car park.
Rimbawan Residences is slated for completion in mid-2019.
“Rimbawan Residences is aimed at a different target market. We are looking at young families and those in the higher end of the rental market. In short, Rimbawan Residences is a more premium development with a premium price,” says Chong.
He expects to attract buyers from KL South areas such as Sungai Besi, Kajang, Semenyih, Bangi and Nilai.
Protasco has six core businesses — maintenance, construction, property development, engineering and consultancy, education as well as trading and manufacturing.
Currently, the company’s property development segment contributes 10% to the group’s revenue and to overall profit. “We are targeting to reach at least 50% in profit contribution in the next five years or so,” says Chong.
“Apart from De Centrum City, we have 14 acres in Pasir Gudang, Johor, and seven acres in Sandakan, Sabah. We are also currently in the midst of inking some joint-venture contracts with other developers. We will definitely take up JV projects as it will ease our cash flow.”
Chong explains that Protasco is making property development its core business because it will have more control of things. “True, the property market is very much driven by market sentiment, but unlike the other sectors such as trading, which very much depends on products and market condition, we can decide what we should build and when to build and launch them.”
Currently, Protasco has a full property development team involved in leasing, sales and marketing as well as property management. Chong adds that the group is currently working on an overseas project but declines to reveal more information.
“We will keep it a surprise for now as we are still in the preliminary stages of planning. However, all we can say is that it is not in Asia and it is a place where most property developers are heading to now,” Chong says with a laugh.
Chong, who holds a Master of Engineering Science from the University of Melbourne, had worked with an engineering consultancy in Melbourne before returning to Malaysia. In January 2011, he was made a director of Protasco Development Sdn Bhd and its subsidiary, Ikram Builders Group.
He was promoted to his current role in January 2014.
“One thing I picked up when working overseas was technical knowledge in construction and property development. When I was in Melbourne, my role was to give advice to different municipalities facing issues in road works. When I returned to Malaysia [to join Protasco], it was only natural that I became a pavement engineer [under Kumpulan Ikram Sdn Bhd] because that was my forte.”
Subsequently, Chong moved to other departments including construction, pavement, asset management and green technology. He realises that in managing a company, it is important to have people management skills.
“There are so many different divisions and employees in the company and everyone is different. You really need to give clear instructions to the staff on their roles and [to explain] the internal restrictions of the company.
“For example, we know that our company only has the capacity to develop a 100-acre parcel. We will let them know that we should focus on the 100 acres instead of having ideas for a 200-acre or a 300-acre project. We need to know what we are capable of delivering within the constraints that we face,” Chong said.
He hopes that the team understands the company’s vision and mission.
This article first appeared in City & Country, a pullout of The Edge Malaysia Weekly, on May 16, 2016. Subscribe here for your personal copy.
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