S P Setia acquires 673 acres of land in Semenyih for RM4billion project

SHAH ALAM: S P Setia Berhad Group is acquiring about 673.27 acres of freehold land in Semenyih, Selangor for RM381.3 million or RM13 per sq ft. The sale and purchase agreement was made between Setia Hicon Sdn Bhd (a wholly-owned subsidiary of the Group) with Spektrum Megah (M) Sdn Bhd.

In an announcement on Oct 3, the proeprty developer said the land is located in Rinching and situated midway between the towns of Semenyih, Bangi Old Town and Beranang. It is approximately 13 kilometres south of Kajang town and 35 kilometres south of Kuala Lumpur City Centre. Travelling time to the proposed Bandar Kajang MRT on the Sungai Buloh-Kajang Line is approximately 15 minutes, it said.

The existing category of land use is a combination of “building” and “industry” with premiums paid and layout approval obtained.

The acquisition marks the second piece of land that the Group has acquired in the Semenyih-Kajang corridor. On Aug 12, the Group announced the acquisition of 1,010 acres in Mukim Beranang (Beranang Land) where the developer has plans for starter homes catering to first-time owners and other house buyers.

S P Setia President and Chief Executive Officer, Tan Sri Liew Kee Sin said the Rinching land offers the Group a good opportunity to repeat its success with Setia Alam and Setia Eco Park in an untapped corridor.

Both Setia Alam and Setia Eco Park in Shah Alam originated from a single 4,000-acre oil-palm plantation acquired by the Group in 2002. Since then, the projects have become highly sought after addresses today with impressive capital appreciation.

According to the developer, a 20 ft by 70 ft  2-storey terraced house in Setia Alam was sold for RM218,000 in 2004 while in comparison a similar house in the township was recently launched at RM688,000. In Setia Eco Park, semi-dees that were first launched in 2005 at around RM600,0000 now command prices above RM2 million. Despite the significant increase in prices, property buyers continue to flock to both townships, as attested by the strong sales achieved of RM995 million combined in the first 10 months of FY2011.

“The value which the Group has created in the western Klang Valley corridor through our well-executed master planning and upfront investment in key infrastructure as well as amenities has benefited not just us but other surrounding developments,” said Liew.

“As a result, the landbank in Setia Alam and Setia Eco Park have become very valuable and we are now in a position to launch very upmarket products in both projects,” he added.

Liew said Setia Alam and Setia Eco Park are now matured townships and due to its success, the Group was no longer able to cater to first-home owners or entry level up graders seeking to buy landed property there.

“As such, we have been scouting very hard over the last year to identify suitable land bank in the Klang Valley where we can re-introduce the Setia Alam and Setia Eco Park winning formula but with the added benefit of the lessons learnt from our execution of numerous townships not just in the Klang Valley but also in Johor Bahru and Penang.

“The Group’s branding today is also much stronger which will enable us to garner the high-level of initial homebuyer support so necessary in transforming a relatively secondary location into a thriving township,” he said.

Just last week, S P Setia was again ranked No.1 in The Edge Malaysia Top Property Developers Awards 2011. This is the 6^th time that the Group has emerged No.1 since the inception of the awards, making it the only developer in Malaysia to have achieved such recognition.

With the proposed acquisition of the Rinching land, the Group now has two projects with a combined GDV of RM7.5 billion in the Semenyih-Kajang corridor. Liew said the Group intends to launch the Rinching Land first as it has already been converted from agricultural to building land. Layout approval has been obtained but the Group will be submitting a revised layout to the relevant authorities to maximise the development potential of the land.

Subject to the necessary development approvals being obtained, the target launch for Rinching Land will be in the fourth quarter of 2012. This would be followed by plans to launch Beranang Land shortly after in 2013.

Liew said Rinching Land will offer a more up-scale product mix to target up graders planning to invest in the Semenyih-Kajang corridor, thus complementing the mass market products to be offered at Beranang Land.