KUCHING: Despite a volatile and uncertain global outlook, Sarawak’s leading property developer is on the hunt for bargains.
Naim Holdings Bhd is seeking to buy prime land for property development nationwide in the current economic downturn.
Naim thinks it is time to beef up its existing land bank of some 1,000ha, including prime parcels in the industrial town of Bintulu, state capital Kuching and Miri.
“As part of our long-term strategies, we plan to increase the size of our land bank by acquiring land in strategic locations in Sarawak, Sabah and Peninsular Malaysia. This will further strengthen our property segment.
“The slowdown in the economy, which is expected to continue in the next few years, could also give rise to buying opportunities at bargain prices, ” according to chairman Datuk Amar Abdul Hamed Sepawi and managing director Datuk Hasmi Hasnan in their message to shareholders in the company’s newly released 2019 annual report.
Abdul Hamed and Hasmi (pic below) own 25.17% and 38.14% equity interest respectively in Naim. Their combined stake stood at 63.48%, a steep increase from some 40% on completion of the company’s rights issue which raised about RM118.7mil last year.
Naim has three flagship integrated property developments – Kuching Paragon, Bintulu Paragon and Miri’s Permyjaya new township.
Under phase one of Kuching Paragon, Naim has completed two of the three towers named Sapphire on the Park condominium which offers a total of 427 units. The project is located in Jalan Batu Lintang. Works for the third tower is ongoing. It is scheduled to be completed by 2021.
Naim recently completed The Peak condominium – Sarawak’s tallest condominium tower at 34 storeys – within the Bintulu Paragon project. The company has obtained occupation permit (OP) for the 261 condominium units. This will enable buyers to move in.
The company’s other major investment in Bintulu Paragon is its first-owned international hotel Fairfield by Marriott which commenced business about six months ago.
In the new township of Permyjaya, Naim has sold more than 9,000 residential and commercial units in the past two decades.
Abdul Hamed and Hasmi said the persistent weak buying sentiment for properties the last couple of years is a major concern due to a prevalent job security fears. There will be many who will take a wait-and-see attitude even after the movement control order (MCO) is lifted.
The general view is that the virus will be around for a while.
As such, Naim would have to come up with innovative strategies to spur sales of unsold property at competitive prices.This move is to reduce associated holding costs.
The company has offered competitive rebates to property buyers to clear the existing unsold units.
“We will also strive to improve our sales value proposition by offering value-added services, such as the leasing of sold units for our customers, in an effort to drive more sales.
“Besides property sales, we will continue to strengthen our leasing of functional units for our unsold commercial and residential properties in order to provide a temporary recurring income stream. Units on lease will also present better value proposition for property investors, which can also help to drive the sale of these units ultimately, ” they added.
The lacklustre demand for higher-priced residential properties is expected to persist, Abdul Hamed and Hasmi said. The company would, therefore, focus on launching more medium range and affordable properties.
“With the housing affordability threshold of the average urban household in Sarawak expected to remain below RM350,000, we should see continued demand for affordable properties once the dust has settled post-MCO, ” they added.
In 2019, Naim recorded higher new property sales of RM159.5mil, up from RM133.1mil in 2018.
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