UM Land’s Strong Foothold in Iskandar Malaysia

It sees potential growth, more than ever before.

By : Eunice Ng

Johor has been a real estate playground for many developers in the recent years. Not only has Johor plenty of land for potential development, the state government’s concerted effort that help seeded infrastructure growth, especially in Iskandar Malaysia has led to more developers coming in to ply their trade. Still for some, they remain unshaken; the soil beneath is not unfamiliar.

Having stepped foot here in the 1990s, United Malayan Land Bhd (UM Land) has been involved as the master creator of their first flagship township Bandar Seri Alam. This sterling jewel is now known for the several education institutions within its hold. Not resting on their laurels, the Group is growing a stronger presence, especially within the Iskandar region.

To date, UM Land has marked its presence across the four of five Iskandar flagship zones. With it, a total of over RM5 billion of Gross Development Value is waiting to be realized over the next few years.

“We see the growth potential in Iskandar Malaysia,” says Zulkifly Garib, Director of Operations of UM Land.

“There’s still plenty of land in Johor and it’s all about developing with a bigger picture in mind. Not just a bigger picture of your own development, but there is a need to look at what is the big plan of Iskandar Malaysia.”

The amount of infrastructure put in by the state government is undeniably visible especially in the last few years. The fact there is always an economic spillover from Singapore is still yet to be fully tapped.

The Makings

The educational hub we see now in Bandar Seri Alam was not in the developer’s original plan, and it is not by chance either that it went its course until it took a step back four years ago to relook at its value creation strategy.

“We have put in a lot of effort to steer Bandar Seri Alam from a medium cost township to where it is now – a home to several institutions of higher learning.”

As a result, four universities, a college, an art school, an international school along with 6 public schools have all made their base here.

“You don’t just sell for the sake of selling the land; you sell to the right people that you want to have in your township.

“The idea is to bring value. It’s always about increasing value not just for us as a developer but for the buyers and other stakeholders in terms of value appreciation.”

Apart from creating a sustainable population, the developer too has pumped in a substantial amount to build the infrastructure and develop certain parts of the township. The roads are evidently wider, dotted with generous landscaping (see Shining Bright at Bandar Seri Alam on page 16).

Perfecting that which was started 20 years ago did not hinder UM Land from seeking to develop greener pastures. It marks its presence in the very new Puteri Harbour in Nusajaya with two parcels of land to be jointly developed with UEM Land by a subsidiary company, Nusajaya Consolidated Sdn Bhd.

A waterfront development, Zulkifly reveals the first parcel as a two-acre stylish boutique serviced apartment that sits on one of the three contiguous components by the marina. The serviced apartments will be sold to individuals and to further enhance its value, The Ascott Ltd, a wholly owned subsidiary of CapitaLand Ltd, Singapore, is engaged to run and operate these residences under the Somerset brand.

“Currently, we have already completed construction right up to the basement level.”

The other two components remain as Traders Hotel by Shangri-La Hotels and Resorts and a family indoor theme park, developed by Themed Attractions and Resorts Sdn Bhd, a wholly owned subsidiary of Khazanah Nasional Bhd.

Imagine now, Somerset Puteri Harbour, a quayside lifestyle sanctuary, complete with lifestyle stores, fine dining restaurants and alfresco cafes lined by popular children’s characters from Hello Kitty to Thomas and Friends, and the Legoland theme park just 10 minutes away.

Buyers will enter into a leaseback agreement for a guaranteed return for a few years, after which the returns will be market dependent, he adds. Some of the price points of newly released apartments in the vicinity are already treading RM700 per sq ft, with that he expects Somerset Puteri Harbour to sell at about RM800 per sq ft to RM900 per sq ft. Though still in its early stages, Zulkifly hopes it will be a catalyst for future developments.

In the Pipeline
The second piece of land is also be a 50-50 joint venture with UEM Land and is right across from the family indoor theme park. With an area of more than six acres, Zulkifly reckons the product offerings and value will be far better due to the larger land size.

Over in Johor Bahru City Centre, UM Land will also be embarking on a mixed development comprising a hotel, residential and retail components on Jalan Wong Ah Fook.

“Our plans are ready. We are just waiting for the right time to develop. We also know that the state government intends to beautify and upgrade Johor Bahru City Centre, so we are waiting for that to be finalized.”

Not far from the city centre is the 500-acre Taman Seri Austin, another of UM Land’s township within the Tebrau Corridor, a development hot spot for the discerning purchasers which will soon be complemented by the Eastern Dispersal Link (see Your Friendly Neighborhood, Seri Austin on page 20).

And in the fourth zone, UM Land’s stake is seated across 630 acres in Pulai Jaya, located at the intersection of North South Highway and the second link highway with access to Johor Bahru City Centre, Senai Airport, Port of Tanjung Pelepas, Singapore and Nusajaya.

“We have basically planned out the master plan of the development and waiting for the approvals to
be through.”

But that’s not all, Zulkifly confesses to eyeing “a few parcels of land in Medini Iskandar” as well.

Better Acceptance
“We know that the property market in Johor is better than it was before.”

The market acceptance of Johor’s price points has improved, says Zulkifly, even the apartments are performing better than they were before.

“There is growing demand for apartments whereas these were considered relatively undesirable four years ago.”

Comparing apple to apple, he believes Johor properties are of better value and quality at a relatively lower price when compared to the Klang Valley.

“Dollar for dollar, you get higher value and better quality in Johor Bahru properties than you do in KL even.”

As the world awaits the completion of several notable projects here in the next few years, there is still quite a fair bit to be done on the infrastructure, “To me, phase two of Iskandar Malaysia is to bring in whatever they’ve been preparing. Now it’s only the base, the basic infrastructure. You’ve done the roads, so now you’ve got to bring in the buses, the public transportation.

“The potential now (in Iskandar) is more realistic. Timing wise, it is great. That’s why you see all the other boys who have never been in Johor Bahru are now coming.”

With key projects coming to completion, year 2012 has been identified as the tipping point for Iskandar among industry players, and there are skeptics still amidst promising sights witnessed today. But as the foothold of UM Land being firmly and deeply rooted in this southern state, little will derail the plans of this developer, especially after having planted itself here for more than
20 years.

UM Land’s Key Presence in Iskandar Malaysia

Flagship A – Johor Bahru City Centre

• Location – Jalan Wong Ah Fook
• Niche mixed development of hotel, residences and retail
• GDV – RM305mil
• Estimated launch – 2012
• In proximity – Seri Austin, 500 acres, Total GDV, RM1.4bil, remaining 287 acres with GDV of RM0.9bil

Flagship B – Nusajaya

• Somerset Puteri Harbour, a JV with UEM Land Bhd, 2 acres; GDV, in excess of RM220mil; Estimated completion, mid-2013
• Another 6 acre parcel to be developed into mixed commercial, residential and retail development. 

Flagship D – Eastern Gate Development

• Bandar Seri Alam, 3,762 acres, Total GDV, RM5.8bil, remaining 1,310 acres with RM2.9bil
• Flagship E – Senai-Skudai
• Location – Pulai Jaya, located at the intersection of North South Highway and Second Link with access to Johor Bahru City Centre, Senai Airport, Port of Tanjung Pelepas, Singapore and Nusajaya.
• 630 acres
• Commercial/logistics/transportation hub, industrial park and residential development.
  
• GDV, RM658.5mil

UM Land in Klang Valley

• Bandar Seri Putra, Bangi, township – Remaining 222 acres with GDV RM0.8bil.
• Suasana Bangsar, condominium – 190 units serviced apartments in the suburb of Bangsar (Completed)
• Suasana Bukit Ceylon, residential serviced apartments – 310 units serviced apartments in the enclave of Bukit Ceylon, GDV of RM315mil.