City&Country: More than 20 launches in the pipeline for IJM Land

One of the biggest property developers in Malaysia by market capitalisation, IJM Land Bhd is known for its large-scale housing projects. Among the townships it is developing are Taman Gombak Permai and Bukit Mandarina in the Klang Valley, Bandar Utama in Sandakan, Seremban 2 in Negeri Sembilan as well as The Light Waterfront project in Penang.

The developer is also launching more niche developments, including Maritime and D’Fairways in Penang, Permatang Sanctuary in Permatang Tinggi, Seberang Prai, and a condominium project in Likas, Kota Kinabalu.

New launches
More than 20 launches are scheduled for FY2011 ending March 31, its managing director Datuk Soam Heng Choon informs City & Country.

“Our townships are selling quite well because they are quite mature and thriving … people can see what is there in the townships. For some niche projects, we are targeting the middle to upper-middle market. Like the projects in Penang — they are actually middle to upper-middle market as we are selling them at RM500 psf.

“We are going to launch more than 20 projects throughout the country this year (FY2011)… in Penang, the Klang Valley, and Johor, and then Sabah and Sarawak. Some are brand new projects, while some are phased projects in our existing townships. All these launches will have a total gross development value (GDV) of more than RM1 billion,” he says.

IJM Land has launched two projects in FY2011 thus far — The Light Collection 1 in Penang Island and the Bukit Raja Phase 2 commercial shoplots in Sham Alam. Sixty-five shoplots Bukit Raja Phase 2 released for sale in May.

The Light Collection 1, part of IJM’s flagship waterfront project, The Light, in Penang, was also soft launched in May. Half of the non-bumiputera units at the 7.2-acre project comprising condos and villas have been sold since their soft launch.

The Light Collection 1 is the first of four in The Light Collection series, which offers 24 units of 4-storey water villas and 152 condos in four 8-storey blocks. The condos have built-ups of 1,371 to 1,582 sq ft while the built-up of the water villas is 3,132 sq ft. The units are priced from RM823,600 to RM3.18 million. The developer has not fixed any date for the official launch of the project.

With a GDV of some RM5 billion, The Light is a 152-acre freehold waterfront development that will be built over the next 12 to 15 years.

New markets
This financial year also marks the developer’s maiden foray into new territory, namely Seberang Prai and Kota Kinabalu. By year-end, a landed project called Permatang Sanctuary is expected to be launched in Permatang Tinggi, Seberang Prai.

Soam says the developer has over 100 acres in Permatang Tinggi and the freehold project will feature seven phases to be completed over five to six years. Upon completion, the project will see a total of 1,082 residential units, including low-cost flats, and village malls being built.

The low-cost flats will be priced from RM35,000 (indicative pricing) while the landed homes will be sold from RM400,000 onwards. The first phase worth RM36 million will offer 78 units of 2-storey semi-detached homes.

A condominium project will also be built in Likas, Kota Kinabalu. The 7.4-acre freehold project will offer 96 condos in two blocks, with built-ups of 2,500 to 6,200 sq ft. Once completed, it will be the tallest building in Kota Kinabalu as it is sited on elevated ground 210ft above sea level.

Another niche product, expected to be launched in December, is the leasehold D’Fairways — a RM113.5 million project in Bukit Jambul, Penang — which will consist of 124 condos and 24 duplex lofts.

The 5.4-acre site is located next to Equatorial Hotel and the Bukit Jambul Country Club. The units will be priced from RM625,000.

Of its numerous niche developments, the leasehold Maritime will be launched in August. Located at the newly completed Waterfront Promenade in Penang island, this RM142 million mixed development will comprise 240 serviced suites in two high-rises on a 2.79-acre site. There will also be 68 units of 1-storey shops, 2-storey shop-piazzas and 3-storey shopoffices.

The size of the serviced suites ranges from 883 to 1,130 sq ft while the 1-storey shops offer built-ups of 753 to 2,088 sq ft. The 2-storey shop-piazzas are 1,873 to 2,939 sq ft in size while the 3-storey shopoffices offer 3,616 to 6,394 sq ft.

The serviced suites will be priced between RM359,000 and RM483,000 while the shops will be from RM400,000 to RM2.18 million

July will also see two launches, valued at RM96 million in total, in Johor. They are a cluster-home project in Nusa Duta and the Suriamas Suites Block C apartment project.

Next on IJM’s list is the launch of another seven projects in the Klang Valley: Riana Green East, Bandar Puncak Alam, two in Taman Gombak Permai, SHNG Villas, Laman Granview and Bukit Mandarina. Other locations that will see launches by the developer include Bandar Utama in Sandakan, Seremban 2 and The Light.

Going forward
“Property is always cyclical and it is getting shorter and shorter … suddenly up then suddenly down. It is a very short cycle now. I think it is because of the dramatic changes brought by the sudden economic downturn,” Soam says.

With undeveloped landbank of close to 5,000 acres in the country, the company’s direction going forward in the long term will be overseas, even as its core market remains Malaysia. It is looking at countries like Indonesia, in which the market is moving fast.

“We are now focusing on delivering our current projects … overseas ventures will be for our long-term strategy and currently we are focusing on our home turf. There is always higher risk and we have to be careful. There is a learning curve and it is better for us to start off small overseas and progress from there.

“We are looking at some emerging markets, but we are not there yet. These are the countries with big populations … it means more opportunity to sell houses and [potentially] the take-up rate is fantastic. The number you can sell in mature countries is very small,” Soam adds.

The property arm of IJM Corp Bhd made its foray into the Vietnamese market in May this year after entering into a share sale agreement with existing shareholders of Sova Holdings Sdn Bhd (SHSB) to acquire a total of 210,000 ordinary shares of RM1 each. This represents a 70% equity interest in SHSB, for a cash consideration of RM18 million or about RM85.71 per share.

The deal also allows IJM Land to jointly undertake a development comprising four blocks of high-rise residential apartments with retail and commercial components on a 2.85ha parcel in Phu Hoi commune, Nhon Trach City Center (NTCC), Dong Nai Province, Vietnam, with Thai Duong Co-Sunco (Sunco), a state-owned company incorporated in Vietnam.

NTCC is located close to six major industrial parks and is within the vicinity of four international-standard golf clubs. Sunco, being the landowner, is entitled to 15% of the GDV of the project in consideration of land cost.

The development is estimated to generate total GDV of US$150 million (RM498 million). Piling work for the initial phase is in progress and the maiden sales launch is expected in 3Q2010.

Canal City in Shah Alam, Sebana Cove in Johor and Seremban 2 (including its 1,500-acre extension called S2 Heights) take up the bulk of IJM Land’s 5,000 acres of undeveloped landbank, along with 600 acres in Nusa Duta, Penang and Sandakan, says Soam.

The developer plans to develop Canal City and Sebana Cove in FY2012. Sebana Cove was acquired in August 2008 and IJM Land plans to redevelop the 1,188-acre tract into an upmarket residential area catering to foreigners, primarily Singaporeans, due to its proximity to the city-state.

IJM Land is sorting out the land matter for Sebana Cove and is drafting a new masterplan for the project.


This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 813, July 5-11, 2010