DBKL’s incentive for developers needs to be implemented wisely

The recent announcement by Kuala Lumpur City Hall (DBKL) to give 50 percent discount on development charges to developers could spell good news and bad news for the consumers.

By Khalil Adis

Take a walk around Kuala Lumpur and you will notice the towering skyscrapers dotting the city’s skyline. From the Petronas Twin Towers to Menara Maxis, these buildings have become icons of Kuala Lumpur.

However, there is a cost for having such iconic buildings – the lack of green lungs in Kuala Lumpur and park connectors to connect the different land use.

Kuala Lumpur has been developing rapidly since Mahathir’s era in the 80s to the current Najib’s administration.

Some of the iconic developments that will soon tower over the city will include Tun Razak Exchange (TRX), KL Metropolis, Warisan Merdeka @ KL118, Bandar Malaysia, and the Pudu Jail Redevelopment near the Hang Tuah Monorail Station.

In TRX alone, 25 buildings will be developed ranging from offices to residences.

Delicate balancing act between development and sustainability

While the various mega developments will certainly be a confidence booster for the property market, it needs to be analysed from a bigger picture.

As someone who visits KL often, there are several things that I have noticed about the city which could be further improved – the notorious traffic jams, the lack of connectivity, and green lungs between the developments as well as the public transportation.

Look at the big picture

While I welcome DBKL’s incentive to boost the quiet property market, it needs to be implemented cautiously.

One thing I noticed about Kuala Lumpur is the fondness for overdevelopment with very little thought for its surroundings and its impact on the environment.

And when improvements are made, they seem to be more of an afterthought rather than a proper masterplan. For example, the sky bridges linking Pavilion to KLCC and the upgrading of train stations.

As such, the city’s potential is not fully achieved, especially when it aims to be a developed country by 2020.

One of the best example is Singapore. In Singapore, we have a central body called the Urban Redevelopment Authority (URA) that oversees the entire masterplan of the city.

Therefore, when developers tender for a site, they must ensure that they adhere to the planning guidelines that make the entire city work and not just their development only.

As a result, you can walk from one building to another via park connectors, sky bridges or tunnels to the MRT stations. Each different part of the city complements each other to ensure the city works.

In Malaysia, the developers are only concerned about their own projects. As a result, there is a lack of integration between the different buildings and train stations.

Dilemma in building the city

I recall back in 2009 when I attended DBKL’s briefing on making Kuala Lumpur a green and sustainable city, as well as its way of tackling the traffic jams that Klang Valley experience on a daily basis.

According to DBKL, almost one million cars enter and exit the city every day, leading to traffics jams that KLites have gotten used to.

Since 2009, you can see lots of improvements to make the transfer within the different lines smooth.

For example, you now have Nu Sentral to connect the KL Sentral Monorail Station to the main KL Sentral. Meanwhile, at the Hang Tuah LRT Station, you do not have to tap in and out to change to the Hang Tuah Monorail Station. There’s also the park–and-ride scheme to encourage car owners to take the trains.

The city now has a population of 7 million with 2.5 million jobs created in 2010 and a further 4.2 million by 2020.

If you look at the current traffic situation, there are still traffic jam issues that plague the city.

Therefore, I feel a lot more things need to be considered when DBKL announced that it would give developers a 50 percent discount on development charges.

While I laud DBKL for implementing and improving the entire transport system since 2009, developers need to ensure that they adhere to a masterplan for the benefit of the rakyat.

The good and the bad

Despite the falling Ringgit, the property market in Kuala Lumpur is quiet. Foreign investors are few and far between, while locals feel they are priced out of the market.

The advantage of this incentive is that it will jump-start the quiet property market.

Developers may also pass on the cost-savings to the consumers, which might create a good time to look for bargain hunts in Kuala Lumpur – be it for locals or foreign investors.

For locals, this will definitely be favourable, especially for first-time homeowners and upgraders who cannot afford to purchase a house and have to find an alternative in the suburbs in Selangor.

The disadvantage includes an increase in traffic congestion with more developments coming in the Klang Valley vicinity.

What would work is to have integrated green developments with park connectors and bridges linking to the future MRT line to make Kuala Lumpur an even greener city.

The various Budget 2016 announcements to spur green and sustainable development could work well for Kuala Lumpur, if implemented correctly.

Budget 2016 has allocated a substantial amount for green technologies and sustainable developments. Green is also predicted to be the buzzword for next year.

Hopefully, the budget contributes for DBKL’s masterplan, to provide a more sustainable Kuala Lumpur. This would provide some sort of incentives for the developers to build green developments and make the city more pleasant for everyone.

I am certainly looking forward to see if DBKL will be announcing that its fund is part of Budget 2016.

Iskandar Malaysia’s Eastern Corridor could be game changer for supply overhang

2015-04-20 12.29.19

Budget 2016 had allocated RM18 billion worth of funds for the Pengerang RAPID project. Photo credit: Khalil Adis Consultancy.

Developments in the eastern corridor will hopefully help to absorb the supply of homes coming on-stream and solve housing woes among Johoreans.

By Khalil Adis

Iskandar Malaysia’s eastern corridor is poised for the next phase of economic growth as various developments are being planned in the pipeline to ensure that the spillover impact is more evenly distributed so as to benefit Johoreans and give the property sector a much-needed boost.

Home to the largest oil & gas project in Pengerang as well as manufacturing and port industries in Pasir Gudang, the centre of gravity appears to be shifting away from Nusajaya and Johor Bahru as more jobs are expected to be created from two major projects in the eastern corridor.

In Pasir Gudang, a new mixed-use development by UMLand called Taman Seri Albion was announced in September last year by the current chief minister of Johor Dato’ Mohamed Khalid Nordin. Dato’ Nordin is currently the area’s MP.

The development within his stronghold is expected to create 12,100 jobs for Johoreans with 865 units of affordable housing to be built by 2018.

Over in Pengerang, Malaysia’s largest oil & gas hub is being developed under the RAPID project undertaken by Petronas.

This RM70 billion project spanning 2,000 hectares has already created 40,000 jobs in the construction industry, 400 jobs for engineers and a further 4,000 jobs for trained technical staff.

Dato’ Nordin had noted that Taman Seri Albion project is in line with the state government’s vision to see Johoreans thrive in businesses as a result of its economic spillover as well as from the oil and gas industries in Pengerang.

Drawing in investments in the manufacturing sector equals demand for homes

Since Iskandar Malaysia’s inception in 2006, the manufacturing sector is a force to be reckoned with and has continued to be a major contributor to its economic growth.

According to data from Iskandar Regional Development Authority (IRDA), from 2006 to March 2015, the region has attracted about RM166.1 billion worth of investments.

Of this, a majority of the investments (RM50.82 billion) are in the manufacturing sector followed by the residential property sector (RM40.06 billion).

The data suggests that there is a strong correlation between drawing in investments in the manufacturing sector and demand for residential properties.

Therefore, it is not surprising that this is an important sector for Iskandar Malaysia’s success as it has helped create jobs for both locals and foreigners, which has continued to lead the demand for properties.

Economic spillover impact

That appears to be the game plan in Pasir Gudang for Taman Seri Albion.

Measuring 347 acres, the township will be developed by Tentu Teguh Sdn Bhd, a wholly own subsidiary of UMLand.

Its first phase project is a business park that will comprise 89 units of terrace, cluster and semi-detached factories with a built up size from 3,276 sq ft to 14,532 sq ft.

Called Dover Business Park, its estimated pricing will start from around RM300 per sq ft with an estimated gross development value (GDV) of RM 178 million.

“The township will change the investment landscape here. It is a step in the right direction considering it is a mixed-use development with affordable housing for Johoreans,” Dato’ Nordin said at the groundbreaking ceremony, UM Land’s third township in Iskandar Malaysia and its fourth in Malaysia.

The business park’s target markets will be Malaysian and Singaporean small and medium-sized enterprises which are involved in industries such as food and beverage production, the garment manufacturer, printing and packaging, electronics, storage and warehousing, services, information technology, machinery spare parts, carpentry and furniture production and automotive workshops.

This will in turn create business opportunities for Johorean entrepreneurs from small “mom-and-pop” shops to hawkers.

Strategic partnership forged during the recent leaders’ retreat

The developments in the manufacturing and industrial property sectors in the eastern corridor of Iskandar Malaysia appear to be in line with what was discussed by both the Singaporean and Malaysian Prime Ministers at the recent leader’s retreat held in May in Singapore.

During the retreat, Prime Minister Lee Hsien Loong had reaffirmed that Iskandar Malaysia is important to Singapore.

Both countries will be implementing the ASEAN Economic Community (AEC) measures by the end of this year and deepen economic integration beyond 2015. In addition, more co-operation were announced in the manufacturing and industrial property sectors.

The target industries include advanced materials engineering, electronics, creative services and food industries.

Oversupply: Perception versus reality

The oversupply in homes has been a huge concern in Iskandar Malaysia as Chinese developers from China have been aggressively acquiring land banks with plans to build condominium units by the thousands.

The overhang in supply is certainly valid for high-end condominiums targeting foreigners from Danga Bay condominiums targeting foreigners from Danga Bay all the way to Johor Bahru.

This is where the danger is.

When it comes to mass market homes, however, the supply is still lagging behind demand as developers have been busy chasing the foreign dollar.

This is where to next focus is for the state government as there is genuine demand from Johoreans for such homes.

The chief minister, therefore welcomed such initiative at Taman Seri Albion as it will add to 37,000 affordable housing that will be coming on-stream by 2018 in Johor.

Homes to be kept within means

Housing affordability was a contentious issue during the last Malaysian general election. Johoreans had complained of rising property prices, especially within the areas of Nusajaya, Danga Bay and Johor Bahru where economic development have been taking place at breakneck speed since Iskandar Malaysia’s inception in 2006.

Dato’ Nordin said that the affordable homes that will be offered in Pasir Gudang will be different from the federal-launched PR1MA housing project.

The highest quantum price here will be capped at RM150, 000.

The homes will benefit workers in the industries and will be equipped with sustainable development features and high-speed internet connection.

With the job creation from the developments in the eastern corridor of Pengerang and Pasir Gudang, this will hopefully help to absorb the supply coming on stream for high-end homes especially among white collar professionals while solving affordable housing woes for Johoreans.

This story was first published by iProperty.com in its September 2015 issue

Back to basics

Singapore, the city where I was born and raised. 2015 will see me going back to my roots.

Singapore, the city where I was born and raised. 2015 will see me going back to my roots.

With year almost coming to an end, I felt this blog posting is an apt one to thank my readers and clients.

2014 has indeed been an incredible year.

Never in my wildest imagination did I anticipate the exciting journey my life would suddenly take me – from a property journalist, author, speaker and an entrepreneur.

While I am extremely grateful for the recognition and amazing adventures that life has taken me, I feel it is also important for my readers to understand that my knowledge goes beyond Iskandar Malaysia.

In fact, Iskandar Malaysia is just a fraction of what I had covered in my career as a property journalist.

If you were to google my articles, you will see that my expertise goes beyond Iskandar Malaysia.

When Iskandar Malaysia became a hot topic in Singapore in 2010 to 2011, I kind of rode the wave as not many people knew about this special economic zone.

Since there was hunger for the topic and my article on Iskandar Malaysia was regularly highlighted, iProperty.com then invited me to give talks to fill in the gap, so to speak.

This, in addition to the book and the many articles that I had written to inform and educate Singaporeans, had many people forming the perception that Iskandar Malaysia is my forte.

When I was editor for Property Report in 2008, I was covering the regional property market that include cities like Singapore, Bangkok, Phuket, Kuala Lumpur, Penang, Iskandar Malaysia, Bali, Jakarta and Ho Chi Minh, just to name a few.

My background is in journalism and my passion has always been in writing.

Moving forward, 2015 will see me going back to basics by covering the other markets that I had enjoyed covering as a property journalist.

I never want to limit myself.

We should always endeavour to broaden our horizons.

Khalil Signature

 

 

 

Ribuan terima kasih

Ribuan terima kasih kepada hadiran dan hadiran sekilian yang telah menghadiri ceremah saya di Pusat Informasi Iskandar Malaysia (IMIC) di Danga Bay, Johor Bahru. Tidak lupa kepada IRDA dan Syarikat Perumahan Negara Berhad (SPNB). Foto: Khalil Adis.

Ribuan terima kasih kepada para hadiran dan hadiran sekelian yang telah menghadiri ceremah saya di Pusat Informasi Iskandar Malaysia (IMIC) di Danga Bay, Johor Bahru. Tidak lupa kepada IRDA, Syarikat Perumahan Negara Berhad (SPNB) dan Puan Rozalina Rahim dari REConsult. Sokongan anda sangat saya hargai. Foto: Khalil Adis.

Pada bulan November 2013, saya telah mencekalkan hati untuk menubuhkan syarikat saya.

Seperti kerjaya saya dahulu (dan juga sekarang) sebagai seorang wartawan, saya telah menceburinya dengan penuh kesabaran dan menabahkan hati menempuhi segala dugaan.

Seperti yang saya telah berkongsi di Havoc Hartanah Iskandar Malaysia, “dari seorang wartawan saya menjadi seorang usahawan dan mungkin seorang hartawan (part ini saya bergurau saja).”

Ia bagaikan, saya diberi petunjuk dan firasat oleh yang Maha Esa.

Tidak ramai yang tahu peristiwa pahit manis yang saya lalui pada masa itu.

Ibu saya dan sahabat handai telah memberi saya sokongan moral dan keyakinan diri.

Dari situlah syarikat saya ditubuhkan.

Alhamdulilah, selepas itu saya dipilih oleh UNIQLO sebagai duta AIRism dan juga oleh iProperty.com Malaysia sebagai duta Iskandar Malaysia.

Kadang-kala kita harus menempuhi pelbagai kesusahan dan rintangan sebelum mencapai kejayaan.

Oleh itu, saya ingin mengucapkan ribuan terima kasih kepada rakan-rakan saya di Singapura, Malaysia dan Jepun yang telah menghulurkan tangan dan memberi sokongan.

Saya juga ingin mengucapkan terima kasih kepada pemaju-pemaju yang sering menggunakan khidmat saya sebagai seorang penceramah bagi majlis-majlis pelancaran projek-projek anda.

Tidak lupa pula kepada pihak media di Singapura, Malaysia dan Jepun kerana sering menjemput saya menulis sebagai seorang kolumnis dan menemuramah saya.

Tanpa sokongan anda, saya takkan kemana-mana.

Insyallah, kita jumpa lagi.

Khalil Signature

P.S: Saya teringin sekali merasakan hidup dikampung dan melakukan aktiviti-aktiviti seperti memancing dan sebagainya di Johor. Saya lihat di daerah berdekatan dengan Tuas, banyak kawasan perkampungan dan kelong-kelong di Selat Johor yang sangat indah. Manalah tahu, ia akan memberi saya ilham untuk menulis buku yang terbaru? Sudikah anda membuka rumah anda bagi projek ‘home stay’ ini?

Get your inaugural issue of The Insider

The Insider is a peek into the fun, interesting lifestyle offerings in Johor and Malaysia. Written from the perspective of writer Khalil Adis, he recommends some of the best places and things to check out from food, design, arts and culture.

The Insider is a peek into the fun, interesting lifestyle offerings in Johor and Malaysia. Written from the perspective of writer Khalil Adis, he recommends some of the best places and things to check out from food, design, arts and culture.

Dear friends and associates,

We are pleased to launch the monthly online mini-mag, The Insider, a free monthly read for some 3,000 readers from around the region. The Insider is a lifestyle and real estate title that focuses on the latest happenings and hot topics from around Malaysia.

If you would like to subscribe, kindly e-mail khalil@typewriter.sg

For reviews and press releases, send to press@electricsociete.com

For advertorials, e-mail advertising@typewriter.sg

The next issue will be published on Aug 28, where we will also unveil The Insider’s website.

Editorial deadlines for The Insider closes on Aug 20.

Yours sincerely,

Khalil Adis
Editor, The Insider
10 Anson Road International Plaza #26-04
Singapore 079903
Get your insider here
To subscribe click here

Will new party capital of Asia become the next property hotspot?

By Khalil Adis

TREC is located in Jalan Tun Razak and will open in the first quarter of 2015. Photo: TREC.

TREC is located in Jalan Tun Razak and will open in the first quarter of 2015. Photo: TREC.

When it comes to partying, no other city knows how to live it up and let their hair down like Bangkok. Whether your idea of a night out is dancing the night away or something more salacious, Bangkok offers everything, from go-go bars at Silom to jazz bars in Thonglor.

However, for some, Bangkok might seem a bit too racy. In Singapore, we have our very own Zouk which has helped put Singapore on the global clubbing guide.

For Singaporeans, this clubbing institution has become synonymous with every student’s rite of passage, specifically its “Mumbo Jumbo” nights.

With news that Zouk Singapore’s lease is expiring and that we may potentially see the demise of an uber club that has stood the test of time, it appears Kuala Lumpur could well be the next party hub of Asia – at least for those not wanting to travel too far.

After all, once the curtains close for Zouk Singapore, you always have Zouk KL to rely on there.

Unlike Singapore and Hong Kong which have its own dedicated entertainment enclave in Clarke Quay and Lan Kwai Fong respectively, Kuala Lumpur’s entertainment districts are spread across Bangsar, KLCC, Bukit Bintang and Sri Hartamas.

These areas are also known as property hotspots as locals and foreigners alike want to live close to where all the action is.

Kuala Lumpur’s plus points include relatively affordable cost of entertainment, more variety and a more relaxed environment.

However, traffic jams and lack of parking spaces are also something local clubbers complain about.

By 2015, however, a new entertainment enclave called TREC will open just opposite Malaysia’s own dedicated financial district, Tun Razak Exchange (TRX) with ample parking spaces.

A new KLCC in the making?

TREC which stands for “Taste, Relish, Experience, Celebrate” will feature a variety of different styles, atmospheres and moods in five separate zones offering casual and fine dining, quirky and independent cafes, wine bars, pubs, lounges and clubs.

To alleviate parking problems that KL is notorious for, the developer of TREC will build around 1,000 plus car park bays.

Party revelers can also rely on the neighbouring car parking lands and those inside office buildings which account for approximately 2,000 car parking bays.

Timed with the opening of TRX in 2015, Jalan Tun Razak could well be the next property hotspot in Kuala Lumpur as it will be Malaysia’s largest financial and entertainment hub.

Measuring 70 acres and estimated to generate a gross development value of RM26 billion, Prime Minister Dato’ Sri Najib Tun Razak has already said some 500,000 jobs will be created directly and indirectly once TRX is completed

Of this, 40,000 will be knowledge work specialising in financial services, specifically in the Islamic Finance sector which Malaysia is renowned for.

TREC appears to tap on the future growth of TRX as it is poised to offer 20 million sq ft of space, of which 48 per cent and 31 per cent have been allocated for office and residential spaces.

For sure, those working and living within TRX will need a breathing space to let down their hair after a day’s of hard work.

And when we mean space, we are talking over 200,000 sq ft of space, with a total of 77 units ranging from 400 to 5,000 sq ft, allowing TREC to target a tenant mix unparalleled in Malaysia in terms of scale and diversity.

Costing RM323.6 million to develop, TREC is expected to create over 1,500 jobs and estimated to add RM143 million to the local economy annually.

With pricing for condos in KLCC already reaching a record price of RM3,000 per sq ft, the Jalan Tun Razak could very well be the next prime area but offering investors a lower entry price as it is an up and coming business district.

This article was first published by PropertyGuru Malaysia.