New projects for Penang

An artist’s impression of the RM320mil City Mall & City Residence project in Tanjung Tokong.

Riding on a stronger gross domestic product (GDP) forecast of 4.5% to 5.5% for 2013, Kuala Lumpur and Penang-based developers plan RM9.733bil gross development value (GDV) of residential and commercial properties on Penang island this year.

The GDP forecast from the Finance Ministry is slightly stronger than the projected 4.5% to 5% for 2012.

IJM Land Bhd (GDV of RM5.4bil), Mah Sing Group Bhd (RM248mil),Sunway Bhd (RM120mil), Ideal Property Development Sdn Bhd (RM2bil), SP Setia Bhd (RM945mil), Eastern & Oriental Bhd (RM500mil)and Ivory Properties Group Bhd (RM520mil)) are among the developers with plans for new residential and commercial schemes on the island.

Some RM5bil are commercial properties, while the remaining RM4.6bil residential properties.

The North-East district, which covers prime residential cum commercial neighbourhoods such as Tanjung Tokong, Batu Ferringhi, Pulau Tikus, and Bayan Mutiara, will see some RM6.7bil worth of projects taking off this year.

The South-West district, covering residential cum commercial neighbourhoods such as Relau, Batu Maung, Bukit Jambul, Bayan Lepas, Sungai Nibong and Teluk Kumbar, will see the development of the remaining RM3bil projects.

The South-West district still draws developers to launch high rise properties for RM400,000 to RM670,000 per unit, considered as “affordable” nowadays, although land prices in the area has risen by about 30% compared to two years ago.

Presently, the construction cost to build a condominium in the South-West district is about RM250 per sq ft to RM300 per sq ft, which is inclusive of land cost which is hovering around RM100 to RM150 per sq ft, about 30% more than two years ago.

“Thus it is still possible for developers to build homes within the RM400,000 and RM670,000 range in the South-West district and still make a decent profit despite the higher land costs and development charges,” said Ideal Property managing director Datuk Alex Ooi.

The commercial projects are IJM Land's RM5bil The Light Waterfront Penang, IPGB's RM100mil shopping mall in Tanjung Tokong, and SP Setia's RM55mil Setia Tri-Suites in Bayan Lepas.

IJM Land will start its commercial precinct project on 102 acres in mid-2013 located next to the Penang Bridge on Tun Dr Lim Chong Eu Expressway.

The precinct is designed to accommodate four hotels, a shopping centre, the Penang Waterfront Convention Centre, and an international business district, which will take seven to eight years to complete, said IJM Land general manager (North) Toh Chin Leong.

“The RM346mil Penang Waterfront Convention Centre (PWCC), scheduled for completion in 2017, will serve as an alternative to renowned convention venues in places such as Kuala Lumpur, Bangkok, Singapore, and Hong Kong,” he added.

In mid-2013, IJM Land is also launching the RM400mil Light Collection IV scheme in The Light Waterfront Penang, comprising 79 condominium units and 19 sea-fronting bungalows.

The condominiums have built-up areas of 1,990 sq ft and 3,249 sq ft, while the built-up areas of bungalows starts from 8,000 sq ft

“The selling price of the properties starts from RM1,000 per sq ft,” Toh said.

IPGB's shopping mall is part of the RM320mil City Mall & City Residence project in Tanjung Tokong, comprising an RM100mil shopping mall and two blocks of 202 condominiums with a RM220mil GDV, which will be launched during the Chinese New Year.

“The condominiums with 1,230 sq ft and 1,830 sq ft of built-up areas will be sold at RM800 per sq ft. So far we have received registrations for over 50% of the condominiums,” said IPGB executive director Murly Manokharan.

In Bayan Mutiara, the IPGB will launch 400 condominium units with built-up areas ranging from 460 sq ft to 1,300 sq ft in the second quarter.

“These properties, with RM200mil GDV, are priced at RM550 per sq ft, and are in phase one of the RM10bil Penang World City project, which will be completed in eight years,” he said.

SP Setia will be launching the RM55mil Setia Tri-Suites, comprising 72 business suites with built-up areas of 700 sq ft and 1,200 sq ft in Bayan Lepas, during the Chinese New Year.

This year, S P Setia is also undertaking the development of the recently launched RM290mil Setia Pinnacle, comprising 434 condominiums, and the RM600mil Sky Vista, comprising 800 condominiums, scheduled for launching in the second quarter.

The built-up areas of Sky Vista range from between 900 sq ft and 1,500sq ft, while the built-up areas of Setia Pinnacle range between 1,100 sq ft and 1,500 sq ft.

“All the residential and commercial properties are priced around RM450 per sq ft,” said SP Setia (Property North) general manager Khoo Teck Chong.

Mah Sing will undertake the development of the RM248mil Emaryl Condo Villas in Ferringhi Residence, a low-rise condominium scheme comprising 200 condominum units in Batu Ferringhi.

“The units, with built-up areas ranging between 1,510 sq ft and 1,752 sq ft, are priced from RM1mil, which is very competitive compared to the properties of similar range found in Hong Kong and Singapore,” said itschief operating officer Teh Hong Chong.

The Emaryl Condo Villas were launched on Jan 19 and Jan 20.

Eastern & Oriental Bhd deputy managing director Eric Chan Kok Leongsaid the group would launch the third tower of Andaman Condominiums at Tanjung Seri Pinang in Tanjung Tokong, comprising 210 condominiums with RM500mil GDV soon.

“In April 2011, we obtained the approval-in-principle from the Penang state government to reclaim the balance of the 760 acres at Seri Tanjung Pinang.

“We are in the midst of obtaining approvals from relevant authorities and which include the undertaking of environmental impact assessment and traffic impact studies with the overall concept master-plan,” Chan said.

The second largest project on the island is the RM2bil Ideal Vision Park by Ideal Property in Bayan Lepas in the South-West district.

The project, to be launched in May, comprises 1,945 condominiums that are priced from RM400,000 to RM670,000, in Bayan Lepas.

Ideal Property said that the project located on 25 acres in Bayan Lepas would comprise six phases to be launched in stages over a five-year period.

“We will start off with the launch of the first two phases this year,” he said.

Some 80% of the project comprises residential high-rises, while the remaining are commercial properties.

The condominiums, with built-up area of 900 sq ft and 1,500 sq ft, are priced at RM450 per sq ft.

“This means that a unit, depending on the size, is priced between RM400,000 and RM670,000,” he said.

Ideal Vision Park will also have the space to accommodate an international school, according to Ooi.

Sunway Bhd is launching the RM120mil Sunway Cassia in Batu Maung, which comprises 96 super-linked homes with built-up areas of 3,000 sq ft priced from RM1mil.

“The selling price is very competitive, as it is difficult to find a landed property nowadays with a RM1mil price tag.

“We also provide a two-acre park for Sunway Cassia, which is a guarded project,” Tan said.

According to Raine & Horne Malaysia director Michael Geh residential property prices in Penang are likely to rise by at least about 7% to 8% by the first half of 2013, due to the steady demand from the domestic and overseas market.

“New properties launched with a bundled-up financial package would be most popular.

“This is why this segment will perform better than those properties in the sub-sales market, where the buyer and seller have to do more paper work,” he said.

According to the latest National Property Information Centre property market report, total transactions for residential properties in Penang hit 18,316 for the first nine months of 2012, with a transacted value of RM5.2bil.

The whole of 2011 saw the state registering some 30,674 residential property transactions valued at RM7.7bil.

Geh says the total volume of property transacted for 2012 was unlikely to catch up with last year.

Meanwhile, Chan says the group maintained a cautiously positive outlook on the residential property market in Penang.

“For the first half, we anticipate that investors and buyers may adopt a wait-and-see attitude in light of the impending general election, global economic uncertainties as well as the market expectation for further measures to curb speculation.

“Notwithstanding these uncertainties, we expect the overall outlook for residential properties in a leading property destination like Penang to remain favourable, as its properties are still competitively priced in the region,” he says.

Penang Master Builders and Building Materials Dealers Associationpresident Lim Kai Seng says construction cost will likely be maintained in the first quarter of 2013.

Although sand prices have gone up, the smaller volume of construction jobs available is off-setting the impact of the rising prices.

“Due to the competition for jobs, construction cost will be maintained,” he says - The Star