Tuesday, September 18, 2012

Alam Sim continue to dominate and profit from urban Kuching

Condominium demand to pick up in Sarawak

, Thursday

GAINING MOMENTUM: The image captures an artist’s impression of Riverine Resort, one of Kuching’s prime condominium projects. Industry experts opine that gated guarded living will continue to pick up its pace in light of the growing concerns over security and convenience.
KUCHING: Sarawak is set to see an elevated supply of high-rise residences as developers are progressively moving to tap into the gated guarded living in the state.
In an interview with The Borneo Post, managing director of Silverdrum Sdn Bhd, Alan Sim highlighted that demand for condominiums, in particular the urban areas in Kuching had intensified as preference for both security and convenience grew.
“I think Kuching has come to a level where condominium living is picking up. People are starting to acknowledge the advantages of these residences in terms of security, convenience and the wide-ranging facilities that they offer.
“If we are looking at the rate of development of condominiums, it is definitely gaining momentum as developers are able to build more units on a piece of land.
“If we talk about building high-end semi-detached units for example, the density is only six units an acre.
“This is different for condominiums whereby you develop it upwards and from what I’ve seen, developers are keen on tapping this market, leveraging on the heightened concerns for safety,” he explained.
According to a report released by the Sarawak Housing Controller: 10 SHCC meeting on February 24 this year, the number of condominium units have picked up from 140 units in 2009 to 482 units in 2010.
Apartments on the other hand had also seen an increase from 299 units to 466 units from 2009 to 2010.
Four-storey apartment as well witnessed a growth of supply as the report revealed a growth from 64 units to 192 units from 2009 to 2010.
Commenting on this figure was secretary general of Sarawak Housing and Real Estate Developer Association (Sheda) Sim Kiang Chiok who opined that developers were eager to foray into the gated and guarded community development concepts (Gacos) propelled partly by the increase in transportation cost.
“Apartments and condominiums strata development are catching up, particularly here in Kuching. These are generally gated and guarded projects sited at fairly prime locations and are available from the medium end apartment at RM250,000 to RM950,000 for the upper end segments.
“If you drive around Kuching, the ratio of high-rise residences as compared with landed properties is still low but it is starting to gain pace. A lot of the younger generation and the educated elderly prefer these kinds of homes because they find they do not have to deal with the gardens and security.
“If we’re talking about the rate of increase in the next few years, it will be to a certain extent affected by the rise in petrol prices. As such, condominiums only work if the location is situated in prime area. The furthest location we have observed so far where demand for high-rise is strong is within the Batu Kawah vicinity, roughly six to seven mile radius from the city centre,” he observed.
Despite market’s observation that condominium living would be a way of life for most home-buyers in the longer term, Sim underscored that landed properties would still be a primary choice for many residents.
“Property developers in the residential sector are looking for good take-up rates. Traditionally, terrace houses and semi-detached are still the popular choice in the market. Kuching is still moving at a slower pace and we are still more laid-back.
“Although property developers seek good returns and higher margins, the development of condominium varies from the conventional landed properties. It is a different lifestyle as you have to put up with communal facilities, elevators, basement car parks and management,” he elaborated.
Adding to this was general manager of IJM Land Bhd (IJM Land), Chong Ching Foong who pointed out that as the units go higher, it became costlier and more complex for the developers.
“One can actually count the number of condominiums in Kuching and that of Sarawak, simply because it is costlier to build one. The cost escalates when we go higher, and at the same time, the developer needs to be financially strong and experienced.
“So there is a misconception that building a higher unit yields higher margins. For example, for condominiums, cost of construction itself is higher. If we were to compare the pricing between East Malaysia and West Malaysia, we simply cannot charge the kind of niche pricing charged by the property boys in the Peninsular because a majority of the population will not be able to afford it.
“When IJM Land first set up its Kuching branch some years ago, we were one of the pioneers in condominium development in the state. Until today, I still don’t see many similar players around. With that, I don’t foresee a rapid increase in this particular sector in the next five years. But, this scenario can change in the long run,” he reckoned.

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