Eco World Development Group Bhd will take up the offer to buy 190.2ha in Batu Kawan from Penang Development Corp (PDC) for RM1.02bil.

PDC is offering the sale of the property to Eco World as the group is the only bidder. It is learnt that PDC will give Eco World the offer letter in two weeks to buy the property at RM50 per sq ft.

PDC has firmed up plans to turn the 190.2ha near the second Penang bridge into a golf course and a mixed development project.

Of the 190.2ha, Eco World will develop a golf course on 60.7ha and use the remainder for a mixed development project.

The group plans to build landed properties on the hilly portion of the land and a waterfront city, overlooking Penang island.

The development density for Batu Kawan is between 11 units and 60 units per acre, depending on the approval given for the development.

Eco World already owns 24.28ha in Bukit Tambun, on which it plans to launch a RM920mil mixed development called Eco Meadows next year.

With the acquisition of this 190.2ha, Eco World is set to be a major landowner and developer in Penang.

Since the announcement of the second bridge in 2006, property prices in Seberang Prai and on the island have surged significantly.

The price of vacant land in the area, especially in south Seberang Prai where the second bridge is located, is now hovering between RM40 and RM50 per sq ft, a huge jump from 2006’s RM8-RM9 per sq ft range, according to Henry Butcher Malaysia (Seberang Prai) Sdn Bhd associate director Fook Tone Huat.

Land prices in central and north Seberang Prai are now within the range of RM50-RM100 per sq ft, compared with RM20-RM40 per sq ft then.

In 2007, Asas Dunia Bhd bought 138 acres from TPPT Sdn Bhd for RM5.58 per sq ft.

In 2014, Tambun Indah Land Bhd purchased 200 acres agriculture land in Simpang Ampat for RM16.40 per sq ft.

If converted for mixed development, the property can be valued between RM20 and RM30 per sq ft at today’s market price.

Recently, PDC sold 99 ha in Batu Kawan to Aspen Group Holdings for RM45 per sq ft to develop the Aspen Vision City. It will have residential properties, offices, medical facilities, a large central park, international school, retail shops and an integrated central integrated hub for Seberang Prai.

On an adjoining land measuring 121.4ha, sources said, a large Kuala Lumpur-based resort and theme park operator had made a bid with an overseas developer that specialised in theme park development.

In May this year, Eco World president and chief executive officer Datuk Chang Khim Wah told StarBiz that the freehold land status and location near the second link and adjacent to the North-South Highway gave it great potential to be developed as a mixed development project.

He said the company was planning the development of a mini mall, comprising shops and offices in line with its “Eco” theme that emphasises sustainability and livability.

“Over time, we aim to build up our presence in Penang to consistently contribute between 10% and 15% to total group sales,” he said.

On Penang island, the group is planning a preview of the RM340mil EcoTerraces in Paya Terubong, which comprises luxury landed homes, condominium units and a private residents’ club on 5.26 ha.

Source: StarProperty.my

If you travelling from Prai to Bukit Mertajam via Jalan Baru, you would probably notice an ongoing construction on your right that stretches over an area of about 200 meters wide. It is the upcoming MYDIN Wholesale Hypermarket, by far the largest in the northern region. Once completed, Jalan Baru is going to be a lot more busier, especially during festive season.

Here are a few ongoing/upcoming residential and commercial projects that could benefit from being connected to the mall via Jalan Baru:

• The Signature
• The Presidence
• Scarlet Villa
• Arcaria @ Taman Pauh Jaya
• Frontage
• Taman Villa Indah
• Pegasus Residence
• Prominence

In the following weeks, we are going to share a few more projects being proposed around the same area.

MYDIN Prai Location:

Property developers have come out with some hard facts that suggest that the sector is cooling off.

According to the first half 2014 Property Industry Survey by the Real Estate and Housing Developers’ Association Malaysia (Rehda), properties in the affordable housing price range below RM1mil have been facing a tough sell largely because of homebuyers’ difficulty in getting financing and a glut of unreleased bumiputra lots.

Also, some 31% of properties in the RM500,001 to RM1mil range were still left unsold after completion in the past three years. These were largely in hot property markets like Selangor and Johor.

Properties in the price range of RM250,000 to RM500,000 also faced the same dilemma, with 34% of the completed units unsold. These were located mainly in Perak and Pahang.

Close to 90% of the respondents experienced a slowdown in property sales due to cooling measures announced in Budget 2014 and over 80% of the respondents of the survey held a “neutral” to “pessimistic” outlook for the first half of 2015.

Rehda president Datuk Seri Fateh Iskandar Mohamed Mansor said demand for property was intact but with the Government’s cooling measures introduced a year ago, developers were finding it difficult to successfully sell in the affordable housing segment.

“A property is a person’s biggest wealth creation asset, yet they can’t seem to own one,” he noted. He suggested that the Government reinstated the developers’ interest bearing scheme for first-time house buyers to allow the working class to own a roof over their head.

The survey found that while 84% of developers were able to get bridging financing for their projects, 53% of their buyers faced challenges getting financing to buy the properties. Among the loan rejections from financial institutions, the highest rate was among home buyers in the RM200,001 to RM500,000 property range.

“We can build but it is a different story for those with the capacity to buy the homes,” he said, adding that the 70% loan-to-value ratio was beyond the capability of many home buyers too.

Hence, Fateh Iskandar appealed to the banks to revisit the guidelines for responsible lending to property buyers.

He further pointed out that for the first time in the recent history of the property sector, less than 50% of units launched were sold in a half-year period.

Of the total 10,189 units launched in the first half of this year, only 49% were taken up. Of that figure, 41% of the launches were in the RM200,001 to RM500,000 price range, mainly located in Johor and Pahang, while 31% were in the range of RM500,001 to RM1mil. This trend was similar to the the second half 2013 period.

At the same time, property developers have had to struggle with the lack of demand for bumiputra lots in locations where bumiputras do not traditionally settle in.

Fateh Iskandar said the authorities’ call to raise the bumiputra quota in property developments up to 70% would only further squeeze developers who would not be able to sell the lots despite their best efforts in marketing the projects to the targeted buyers.

“Demographics and locality can’t be pushed. If you were to ask a non-bumiputra to buy a property in Kampung Datuk Keramat or a bumiputra to buy a house in Jinjang, for example, it’s going to be difficult,” he said. “Yet these quotas are still being put in place everywhere.”

Fateh said developers were supportive of the original quota of 30% bumiputra lots but felt a higher quota would not serve certain locations.

Rehda has suggested for the automatic release of the unsold bumiputra lots in tranches – 10% release every six months from the launch – but this notion has not been taken up by the federal nor state authorities.

Source: StarProperty.my

Proposed mixed development by Orientside Development Sdn. Bhd. in Batu Ferringhi, Penang. It is situated on a 13.3ha plot of land next to the island’s tourism belt in Batu Ferringhi and adjacent to Uplands International School.

The development comprising of multiple high-rises, a hotel and high-end, low-cost housing and a 7-storey shopping mall. It would developed in multiple phases and the entire project would take 12 to 15 years to complete.

The development:

• 20-storey hotel (368 bed)
• 7-storey shopping mall
• 2 blocks of 33-storey serviced apartment (333 units)
• 24-storey serviced apartment (216 units)
• 38-storey low cost apartment (480 units)
• 48-storey medium cost apartment (293 units)
• 49-storey condominium (84 units)

More details and photos to be available upon project launch.

Project Name : (Pending approval)
Location : Batu Ferringhi, Penang
Property Type : Mixed Development
Tenure : Freehold
Developer : Orientside Development Sdn. Bhd.

Bulk-buying of houses by investors’ clubs is not a sure-fire way for people to make money as they could lose everything if a deal goes bad.

The Urban Wellbeing, Housing and Local Government Ministry’s Housing Department said yesterday there were risks involved for people who joined such investors’ clubs, especially when the price of real estate fell or did not appreciate as hoped.

“Those who took loans from financial institutions face the risk of having their property auctioned off or being declared bankrupt,” said the department’s director-general, Datuk Mohamad Yusoff Ghazali.

Responding to the front page Malay Mail report yesterday on the call by certain groups to ban property bulk-buying, he agreed that the investors clubs’ activities would indirectly cause property prices to surge but pointed out they currently did not contravene any legislation.

In the report, Federation of Malaysian Consumers Association president Datuk Paul Selvaraj said priority should be given to first-time buyers and not to bulk buyers, whom he deemed “property speculators”.

Malaysian Institute of Estate Agents (MIEA) deputy president Erick Kho had also said bulk-buying created an unnatural scenario of demand and supply within the property industry.

Mohamad Yusoff admitted the activities of the investors’ clubs caused a shortage of property in the open market, in addition to inflating prices and causing them to be much higher than the original purchase prices.

“The properties are sold to club members at far lower prices compared with those sold to other buyers,” he said.

“The discounts were from 10 per cent up to 20 per cent off the original price. Those who purchase the properties from club members will pay a premium over the original price.”

Mohamad Yusoff said the ministry had introduced several steps to counter speculative activities in the property market and stabilise housing prices.

“To this end, we have raised the Real Property Gains Tax (RPGT), increased the minimum property purchase price for foreigners to RM1 million, and disallowed developers from implementing projects that have features of Developer Interest Bearing Scheme (DIBS),” he said.

“To increase transparency, we have also required developers to explain in detail the selling price of a property including benefits and incentives offered to buyers.”

Source: The Malay Mail Online