AS Malaysians enter the second month of 2016, questions with regards to the property market in Shah Alam are slowly surfacing with a positive outlook for Selangor’s capital.
Touted to be the next Petaling Jaya, Shah Alam has steadily seen a boom over the last five years with developments cropping up in strategic locations.
Before its establishment in 1963, Shah Alam was known as Sungai Renggam, an oil palm estate nestled between Petaling Jaya and Klang. It was linked via the only highway at that time, the Federal Highway.
As Shah Alam grew and became a city in 2000, more international companies set up factories here especially the Japanese.
Initially industry workers as well as students from UiTM flocked to the city. However, as the years went by, government servants and retirees settled there.
Although most of the city’s characteristics including its cultural identity, unique street names and architecture were retained, Shah Alam today has a fresh outlook that has surprised many.
This captivating feature has prompted many to secure a home in Shah Alam with developers designing townships and residential units to cater for all segments of society.
The Shah Alam City Council (MBSA) has given priority to eight areas and these are the city centre in Section 14, i-City in Section 7, Bukit Jelutong in Section U8, Setia Alam in Section U13, Elmina in Section U16, Sungai Buloh in Section U4 (which includes a small part of Damansara), Kota Kemuning in Section 31 and Alam Impian in Section 35.
i-City’s marketing director Monica Ong said an important key behind a thriving property market was that as Selangor’s capitol, there would be growth potential from both the administrative as well as commercial sector.
“All the major property developers have projects in Shah Alam and their presence will drive new product innovation,” Ong said.
i-City is an excellent example of a driving force as it is a 29ha freehold site located along the Federal Highway with commercial, residential and leisure components.
Its property development component comprises corporate towers, office suites, service apartments, three hotels, data centres and a 1.5 million sq ft Central Plaza Mall @ I-City, shopping mall that will be opened in 2018.
Setia Alam is another good example of a sustainable township put together by S P Setia Bhd.
Setia Alam is a 1,618ha township located on the fringe of Shah Alam and Klang out of this, 320ha was earmarked for Setia Eco Park, Malaysia’s first eco-themed township .
Another 244ha was sold to the Selangor State Development Corporation (PKNS) and the remaining land was reserved for SP Setia’s flagship township – Setia Alam.
S P Setia Bhd executive vice-president Tan Hon Lim, said a well branded township with ample green parks for community activities, ample amenities and security was key to boost the property market.
Apart from that, Tan said connectivity and accessibility were focal points to consider when purchasing a property and both Ecoworld Development Group Berhad and Mah Sing Group Bhd could attest to that.
Eco Sanctuary located in Kota Kemuning is one of the upcoming property developments that is being snapped up quickly thanks to its eco-friendly designs with ample space and elegant finishings.
The development called Eco Sanctuary was launched in June 2015, and is a 125ha leasehold mixed development township with a gross development value of RM8bil.
Its general manager Ho Kwee Hong said Shah Alam was blessed with excellent connectivity and was linked to many highways allowing superior accessibility between all urban and suburban areas.
Mah Sing Group Bhd, one of the early developers in Shah Alam has residential properties such as Kemuning Residence and Aman Perdana as well as industrial developments such as iParc (Bukit Jelutong), iParc2 (Shah Alam) and iParc3 (Bukit Jelutong).
Aman Perdana was launched in 2005 with a launch price of RM279,000, Kemuning Residence was launched in 2007 from RM887,645 onwards while iParc@Bukit Jelutong was launched in 2010 starting from RM2.5mil.
“New growth corridors will benefit from the ongoing and proposed major infrastructure projects such as the MRT, LRT extension as well as the proposed High Speed Rail that will further drive sales performance,” said Mah Sing’s Group managing director Tan Sri Leong Hoy Kum.
Bookings for properties in i-City amounted to RM688mil in 2015 compared to RM693 million for 2014 while Setia Alam with properties ranging from RM42,000 (low cost apartments) to RM9.5mil (Villa at Eco Park) is also enjoying good sales.
Prices have increased in the last two years with 30% to 60% in Setia Alam, while Mah Sing has had an increase between 40% to 149% on average since their launch.
“The property market is still very strong in growth areas such as south Shah Alam or the South West Klang Valley Corridor.
Eco Sanctuary is one such example of a new development that has received overwhelming response since its launch,” said Ho.
i-City, which will see the launch of their new Hyde Towers located next to Central Plaza @ i-City and consisting of 571 fully-fitted London interior design themed units at the end of this month, has seen prices of its units doubling in the last two years as well.
“Demand for properties especially affordable landed properties in Setia Alam is still healthy albeit with more careful prospects due to the soft market outlook,” added Tan.
Their three-storey terraces Caffra, Crista and Fusca were fully taken on the weekends when it was launched last year while their semi-detached homes within the gated and guarded enclave has a 100% take up rate.
Ho said most of the buyers were young families and there were some who wanted to upgrade to better and bigger and were keen to explore a different potential living experience.
“Property buyers in i-City are mainly those who look for urban lifestyle living within an integrated environment where they can dine, entertain, work and shop all in one place,” added Ong.
The demand for the property in Shah Alam in each corridor has made the properties there desirable for investments, as well.
“Since last year, we have noticed that many are buying either for their own stay or mid or long-term investment.
“There are a number of parents buying for their children or move there after their retirement,” said Ho.
Mah Sing which sold their properties several years ago said their target market for the Kemuning Residence, were professionals with families, with an average income of RM15,000 – RM20,000 per month.
“Another target market are investors who are quick to see potentially high returns in terms of capital appreciation and rental yield in a good project,” said Leong.
SP Setia, meanwhile, said 70% of their properties were purchased for own use while only about 30% of buyers purchased property in Setia Alam for investment.
“The rental prospects has been very encouraging as we continue to see a growing catchment in Setia Alam.
“We are anticipating an increase in Setia Alam of approximately 5,000 personnel from the Health Ministry to be based in Setia Alam once the National Institute of Health or better known as 1NIH is ready next year,” added Tan.
All these factors had led to these developers seeing a potential growth in the next 10 years with the advent of new public infrastructures, town planning guidelines by the Shah Alam City Council (MBSA) and public transportation.
“With the LRT3, we will see Shah Alam becoming an important node in the Greater Kuala Lumpur area.
“We expect more high-rise developments and it is likely that we will see some urban re-development projects for the older parts of Shah Alam.
“It is also likely that the Bukit Rajah Industrial Estate beside i-City will start to be re-developed into commercial centres very much like what is happening in Petaling Jaya,” said Ong.