S P Setia's Melbourne project achieves strong sales

MELBOURNE (Nov 11): S P Setia Bhd's maiden Australian venture, Fulton Lane apartments, has achieved strong sales to date. With a gross development value (GDV) of A$470 million (RM1.5 billion), Fulton Lane comprises two towers of 28 storeys and 45 storeys, with a retail component on the ground level.

Of the 291 units in the shorter tower offered for sale in June, 80% have been sold. The 487 units in the taller tower were available for sale end-September via launches only in Melbourne, Indonesia, Hong Kong and Singapore. There is no date set for a Malaysian launch. So far, about 30% of the units have been sold.

The project was officially launched by Housing and Local Government Minister Datuk Wira Chor Chee Heung on Monday in Melbourne.

Also present were S P Setia CEO and president Tan Sri Liew Kee Sin and Setia Melbourne Development Co Ltd CEO Choong Kai Wai.

Fulton Lane is designed by architect Karl Fender of Fender Katsilidis and is located minutes from the Queen Victoria Market and close to RMIT University, La Trobe University and Melbourne University.

Units at the 28-storey tower comprise studio, 1-bedroom, 1-bedroom+study, 2-bedroom and 3-bedroom types. The built-ups range from 500 sq ft to 1,475 sq ft.

In the taller tower, units include studio, 1-bedroom, 2-bedroom, 3-bedroom, 4-bedroom and dual-key units. Built-ups are from 430 sq ft to 1,507 sq ft. The dual-key units are designed to have two separate spaces where one part can be leased out and the other can be used by the owner. Prices start from A$365,000.

Buyers can expect the units to be partially-furnished with kitchen appliances like refrigerator, dishwasher, cooker and hob. Furniture packages will also be offered to owners to help furnish their units.

A property management office will be available to help in leasing out units on behalf of owners about six months before handover. Gross yields are anticipated to be about 6%.

Fulton Lane will also provide a total of 14,000 sq ft of retail net lettable space for convenience stores and food and beverage outlets to cater for the residents. Liew said the retail space will be retained by S P Setia for recurring income.

"I hope that S P Setia will bring back positive lessons to be implemented in Malaysia," Chor said at the launch.

Liew concurred saying, "Melbourne is a good place to invest and we wish to exchange knowledge between Malaysia and Melbourne."

He cited how Australia considers the environment and pays attention to details such as "where the shadow of a building lands because you cannot have the shadow of your building falling on another property."

S P Setia's second project in Melbourne on a 2.22-acre plot in South Yarra along St Kilda Road will be targeted at the local market, said Liew. There are plans for a residential development of 329 apartments with an estimated GDV of A$250 million.

The design of the project will ensure that the view of the Shrine of Remembrance, a war memorial and landmark in the area, will not be blocked

On the outlook for Melbourne's property market, Choong expects buyer sentiment to improve in the first half of next year in anticipation of a further interest rate cut in 1Q.

"The A$700,000 subproperty sector is performing consistently which was recently encouraged by the fall in official interest rates, a traditional driver to increase buyer sentiment especially for investors who are active in this price sector," he said.

According to Choong, S P Setia will seek new landbank in the CBD and city fringes. "Locations which attract us must have evidence of strong development fundamentals, including close proximity to transport hubs, retail/commercial centres and a strong surrounding demographic profile."

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