Wednesday, 11 December 2013
More Excitement In Seberang Perai Selatan
Mahsing officially joins Seberang Perai property feast by acquiring 76.38acres of freehold land in Jawi for RM42.6mil, or RM12.80 psf.
The land which is said to be opposite the Bukit Jawi Golf Resort, will be developed into a mixed township with an estimated GDV of RM400mil known as Southbay East.
Southbay East... It is quite confusing with its Penang island development, isn't it?
The location of the land should be very close to IJM Land's recent acquisition in Jawi (70 acres at RM18.50 psf).
Ecoworld (60 acres at RM30 psf) and Tambun Indah (24 acres at RM14 psf) recent land purchase is at a totally different area, which is close to Tambun toll, while IJM & Mahsing's land are close to Jawi toll.
With two powerful developers in Jawi, it is expected that the roads connectivity of this area to Batu Kawan & Penang Second Bridge will be improved. Currently if you wish to go to Batu Kawan or second bridge from Jawi or Nibong Tebal area, you need to enter North-South Highway via Jawi toll and exit the upcoming Batu Kawan toll.
If you do not want to pay for the toll, you need to travel a long way north to Tambun area, which is not worth the time and petrol money spent. In the future, there might be a route joining Changkat area (between Jawi & Nibong Tebal) to the south of Batu Kawan.
For me, the location of Mahsing's land is the least strategic among all 4 developers mentioned. It is like in the middle of nowhere. If other ABC developer wish to launch high-end project there, I guess it will have a hard time selling it.
I estimate that a standard size double storey terrace in a gated community in this area should be about RM300k. If Mahsing is going to launch the project now, RM400k a unit is not a surprise. However, Southbay East is expected to be launched only in year 2015.
Since it is Mahsing who has a lot of fans and builds premium quality homes, surely it will not face a big problem selling its products there.
Bukit Jawi Golf Resort
What I am more concern is, how will the recent influx of branded property developers into mainland Penang affect Tambun Indah's Pearl City?
From experience, township planning & ability to attract business investment point of view, I think Tambun Indah may lose to Mahsing, IJM and Ecoworld.
The advantages that Pearl City has include big land size, location and overall lower land cost, which translates into more competitive selling price.
Fortunately for Tambun Indah, the lands owned by the other 3 developers are not very big and can't be developed into a true mixed township that include shopping complex, medical center or large commercial area. So this is an advantage of Pearl City.
However, Tambun Indah may not have the same ability as Mahsing & IJM in attracting good business investment into its Pearl City business park.
Proposed Pearl City Mall
Secondly, the location of Pearl City is closer to Bukit Mertajam and those many industrial parks in Seberang Perai Tengah such as Penang Science Park, Bukit Minyak and Perai. Ecoworld shares the same benefit but Mahsing and IJM don't.
In term of distance to Batu Kawan & Penang Second Bridge, all are quite similar but Ecoworld and Tambun Indah have the slight benefit of no need to pay for extra toll.
Ecoworld, IJM and Mahsing surely will build gated & guarded communities which are likely to be priced higher. Thus, Tambun Indah who build gated and non-gated community, can have more flexibility in its pricing.
For me, Tambun Indah will get better if property outlook in Seberang Perai Selatan gets better.
Asas Dunia is another major mainland developer that should not be overlooked, although it has been privatized. It has lots of land in Seberang Perai Selatan bought at very low cost and also starts to build better quality houses to target middle income group. Thus, Asas Dunia is probably the ultimate winner in Seberang Perai Selatan property boom.
Asas Dunia: 1,118 acres land in SPS