Strong demand: An aerial view of UEM Sunrise’s biggest township in Iskandar Puteri, Gerbang Nusajaya. The industrial segment of the project is expected to contribute more than 20% of the total gross development value potential of RM45bil.
PETALING JAYA: Leveraging on last year’s annual property transaction historical high, UEM Sunrise Bhd
(UEMS) is optimistic about ending financial year 2024 (FY24) on a good note.
Its chief executive officer Sufian Abdullah (pic) said among the many projects the group has embarked on included Gerbang Nusajaya – where it successfully launched and completed 921 residential and commercial units with a 99% take-up rate.
He said for FY24, the group plans to launch the balance 253 units of the ‘Nest Series’, Aspira Lakehomes Phases 4, 5 and 6, along with its new residential development comprising 901 units under the ‘Rise Series’, known as Aspira Hills.
There are about 16,000 homes planned for development with 5,745 homes to be launched by 2030, he explained.
“The revised master plan of Gerbang Nusajaya entails the conversion of 361.2 acres of land from residential to industrial land use.
“We are expecting the industrial component to contribute more than 20% out of the total Gerbang Nusajaya gross development value potential of RM45bil,” he told StarBiz.
On top of that, UEMS has recognised the demand for residences relatively close to Singapore, especially from those who work there.
Sufian said UEMS had constructed a RM152.3mil interchange that provides a direct link from Gerbang Nusajaya to the Tuas checkpoint on the Second Link Expressway.
“The construction was completed early this year and is currently in the process of being handed over to the authorities, prior to its opening in the third quarter of 2024.
“Another important facility that we are currently building is the Gerbang Nusajaya Sales Village, a venue to showcase the masterplan in the 15-year horizon,” he said.
Its Senadi Hills project in Iskandar Puteri, Johor, is also expected to boost the group’s position in the property market there.
Sufian said to-date, 88% of Senadi Hills’ Phase 2A & 2B had been sold, with one of its key drivers being easy access to Singapore.
“The development is located alongside Lebuh Kota Iskandar and Coastal Highway. It also boasts a wealth of amenities and facilities from schools, shopping centres to medical facilities and others,” he said.
Sufian added this has also worked in favour of the government’s plans to turn Johor’s Forest City into a financial zone.
He said the government’s bid will boost investment and economic activities in Johor.
“For that reason, UEMS will be benefiting from the spillover effects of increasing investments and job opportunities in the region over the longer term, focusing more on catalytic developments which potentially shift towards the Malaysia-Singapore Second Link area, given the vast land resources and well-developed infrastructure.
“Additionally, UEMS can actively engage in marketing and promotional activities to sustain continued interest and demand among its target market,” he said.
Sufian acknowledged that while the local property market presents both opportunities and challenges, observations have highlighted encouraging trends.
In 2023, data revealed that 399,008 property units were transacted in the market for a total value of RM196bil.
Units transacted were 2.5% higher, while the total value surged 10% compared to 2022.
“We are generally optimistic and expect domestic demand to continue to prop up the market, however with a reasonable amount of caution as there remains a number of headwinds and risks,” he said.
According to Sufian, while inflation has somewhat moderated, interest rates have been recorded at relatively high figures.
The industry also continues to face supply chain challenges and labour shortages, due to the protracted consequence of the Covid-19 pandemic, compounded by the on-going geopolitical tensions in Europe and the Middle East, ultimately resulting in building cost inflation.
“Our upcoming launches will be predominantly landed residential projects in Johor and Selangor. We are confident our products, which have been meticulously designed and curated to specific market needs and requirements, will deliver the best value to our customers,” he said.
Meanwhile, MIDF Research maintained a positive call on the property sector in a recent report, as there was an uptick in loan applications, signalling a stronger demand for property.
The report noted the sector has continued to improve with further decline in residential overhang in first quarter of this year (1Q24) to the lowest level since 2018.
“We opine that the loan approval should remain encouraging going forward on the back of higher loan applications. That should translate into better new sales prospects for developers,” it said.
The research house stated in the recent reporting season, four out of six property companies under its coverage had posted earnings that came within expectations.
“Overall, earnings growth in the 1Q24 for property companies was positive, driven by higher recognition from property projects as the labour shortage issue was resolved. Besides, the overall improving new property sales has also supported earnings growth.
Additionally, new property sales in 1Q24 of property companies are largely on track to meet expectations as buying interest on property remains healthy,” it noted.
