Eco World Development Group Bhd (EcoWorld) is expected to launch its first project in Penang, Eco Terraces condominium, in mid-June.

“Apart from being the first project for the group in the northern region, we believe Eco Terraces will also set new standards in high-rise living here,” EcoWorld president and CEO Datuk Chang Kim Wah said in a statement.

Eco Terraces will be located on Jalan Paya Terubong. The project should be about a 25-minute drive from Georgetown and approximately 15 minutes’ drive from the First Penang Bridge and Queensbay Mall. Eco Terraces is scheduled for completion in the second quarter of 2019 (2Q2019).

“For Eco Terraces, we have already started improving the infrastructure by upgrading part of Jalan Paya Terubong leading into the development,” said Chang.

The 12.79-acre freehold project offers 333 units in a 33-storey block. The units have a built-up area ranging from 1,095 sq ft to 2,008 sq ft. They come in layouts of 3-bedroom and 2-bathroom units and 4-bedroom and 3-bathroom units. Indicative prices are RM846 psf. Maintenance fee is estimated at 36 sen psf.

The gated condominium offers facilities such as a multipurpose hall, karaoke room, golf simulation room, indoor badminton or tennis courts, barbeque area, swimming and wading pool, gym, aqua gym, jogging and cycling tracks.

Chang added that the developer’s show gallery — EcoWorld Gallery @ Macalister along Jalan Anson — has a “3D walkthrough” experience of Eco Terraces to help visitors to understand what the condominium has to offer. The 3D walkthrough will run for a month from May 22.

Eco World said it has accumulated 5,245 acres of landbank, with RM65 billion worth of gross development value remaining.

Through the group’s associates, there are developments lined up for launch this year in Leamouth Peninsula, London (London City Island, GDV: £617 million [RM3.45 million]) and Parramatta, Sydney (Weat Village, GDV: A$285 million [RM802,641]). The former will be launched in Malaysia this weekend while the latter will be launched in 2H2015.

Source: TheEdgeProperty.com

Population

Population growth comprises two basic components – the natural population growth (birth and death), and the non-natural population growth (relocation), which by contrast may occurs quickly and unexpectedly.

With natural population growth, developers can react accordingly to the market demands. They are able offset anticipatable demand by providing more supply. On the other hand, a non-natural population growth may be unpredictable. Underreacting to that unexpected demand will drive up house prices.

So what does this mean for the property market in Penang?

Penang overall population has been growing steadily at around 2 percent per year for the past two decades and will continue to do so as the state has been going through a notable transformation. The figure below shows the population distribution between island and mainland for the year of 1991 and 2012 (latest available data).

 

 

Clearly, the share of population living in the island has shrunk moderately over the years. By 2012, only 45.8 percent of the population lived in the island, compared to 48.7 percent in 1991. This is mainly attributed to the relocation of people from island to the mainland for cheaper houses and employment opportunities.

While the 2.9 percent population shift may seem insignificant, the dramatic change in growth patterns between 2008 and 2012 should not be overlooked (Figure 2). Most notably, the 4.9 percent average annual growth in southern part of Seberang Perai was the highest annual growth recorded among all districts since 2000. The trend is likely to sustain as the rapid economic development in Batu Kawan continues bringing enormous opportunities into the region.

 

 

With the extensive population growth channeling into the southern part of Seberang Perai, the quick demographic change will strongly influence the nature of demand for housing in the coming decades.

Perhaps the most debated question at present – Will Mainland ever be at the same level as the Island in terms of branding and property value? I don’t think anyone has a definite answer to this question. Instead, one should ask in response, “Why is it necessary to be the same?”

OTHER TOPICS:
Penang Island vs Mainland (Part 1) – Location branding
Penang Island vs Mainland (Part 2) – Land scarcity or abundant?
Penang Island vs Mainland (Part 3) – Connectivity & accessibility

– Ken Lim
(Founder and Principal Reviewer, PenangPropertyTalk.com)

Avenue Garden Serviced Apartment, the upcoming high-rise development by Tambun Indah in Simpang Ampat, Penang. It is strategically located in the heart of Pearl City township development, just a stone’s throw away from the GEMS International School.

This development comprises a 17-storey service apartment (312 units) with 5 level of multi-storey car park.

More details to be available upon project launch.

Property Project : Avenue Garden
Location : Pearl City, Simpang Ampat, Penang
Property Type : Service apartment
Total Units: 312
Tenure : Freehold
Indicative Price : (open for registration only)
Developer : Tambun Indah

Location Map:

 

Maintain “hold” with revised target price of RM2. Excluding exceptional items of RM103 million, E&O’s fourth quarter financial year 2015 (4QFY15) core earnings came in at only RM3.4 million.

This takes FY15 core profit to RM43 million, which is significantly below consensus’ and our projection as we had earlier expected a much stronger quarterly profit.

E&O completed two blocks of the Andaman Condominiums project in Seri Tanjung Pinang (STP) during the quarter, which saw a 38% year-on-year (y-o-y) drop in revenue to RM143 million.

A first and final dividend per share in the form of one treasury share for every 50 E&O shares has also been proposed, resulting in 3.7 sen per share.

Meanwhile, net gearing rose to 60% due to the acquisition of Landmark House and Thames Tower in London for £57 million (RM310 million).

On outlook, E&O has achieved RM940 million sales in FY15 driven by its projects in Johor, the Klang Valley, Penang and the United Kingdom. Launches in the pipeline in financial year 2016 (FY16) include those of Avira Garden Terraces Phase 2 and 3, Tamarind Executive Apartments@STP Phase 2, as well as the Conlay project.

The tender for the STP2 reclamation was completed on May 11, 2015 and a tender interview will be conducted on May 29 for the four bids which will be followed by the reclamation contract award. E&O is expected to finalise its long-term strategic partner for its STP2A’s 253 acres (102.38ha) within six months, given the high capital requirement for the massive reclamation works.

E&O has announced that its UK property arm will pursue a listing on the AIM of the London Stock Exchange this year to grow its franchise via a local platform.

It is expected to reduce its holdings in E&O UK to below 50%, though it will remain the single-largest shareholder of E&O UK. This is estimated to reduce E&O’s net gearing to 30% after the de-consolidation.

We have now imputed slower property sales in view of the cautious sentiment. We note that E&O’s inventory has increased to RM208 million in FY15 from RM75 million in FY14. This could be attributed to the completed units at Andaman Condominiums.

The risks include the STP2 reclamation requiring heavy capital spending, given the huge area involved. Future phases will likely need joint-venture partners or rights issue.

With the Penang and Johor state governments imposing additional restrictions on top of Budget 2014, this could discourage foreign buyers to whom E&O has a large exposure. — AllianceDBS Research, May 26

Source: TheEdgeProperty.com

Bank Negara Malaysia (BNM) has reiterated that there has been no tightening of policy for first-time home buyers.
However, its governor Tan Sri Dr Zeti Akhtar Aziz said all borrowers need to be credit-worthy and therefore, there is an affordability test.

“If a borrower can demonstrate that they have income stream that can service their borrowing, then they will be entitled and eligible to borrow,” she told reporters yesterday.

She noted that there’s only been a tightening on borrowing for third-time borrowers …”that means if you are borrowing for your third property, and there’s been a tightening if you are purchasing multiple properties. Our policy is not to allow our country to become over leveraged, over indebted because it has very severe consequences as we have seen what happens in other countries,” she added.

She was commenting on Johor state government’s calls for BNM to relax its regulations on banks in approving loans for eligible house buyers, especially first-time home buyers.

Source: TheSunDaily.my