By IZZAT RATNA / Pic By ISMAIL CHE RUS
Sunway Group is taking advantage of the current softer property market environment to seek new land, especially assets located near transit-oriented developments.
Sunway Property Malaysia and Singapore MD Sarena Cheah said there are always new opportunities to boost the group’s portfolio when the market is slow, as landbanks are offered at lower and fair valuations, while continuing to appreciate in time according to the country’s overall recovery.
“In the next few years, we will continue to focus our land expansion within the central region, where most of our audience profiles are. It is essential for any developer to constantly replenish its land- banks to remain competitive.
“We are also not planning to scale back our developments and growth projection plans because we are confident that our product offerings are aligned with the market’s demand,” she told reporters at the launch of Sunway Velocity Hotel (SVH) in Kuala Lumpur yesterday.
Nevertheless, Cheah said the group is also a bit more cautious in the current challenging operating environment, which has also resulted in some delays in its scheduled launches.
“We are still in the planning stages to do a few new launches next year, but for now, I cannot divulge any further information on our immediate prospects for 2018. We will make the necessary announcements closer to the launch period,” she said.
Currently, the group’s total landbank size stands at approximately 1,335.46ha with a total gross development value (GDV) of RM55 billion.
The group’s latest acquisitions include three new landbanks located in Wangsa Maju, Subang and Kajang, which have a combined GDV of RM2.36 billion, spanning across about 9.58ha of land slated for proposed mixed developments comprising residential and commercial schemes within the next five years.
For the accumulative nine months of this year, Sunway’s total land GDV is expected to exceed RM5 billion, in tandem with its earlier purchase of a parcel of freehold land measuring 1.83ha in Jalan Belfield, Kuala Lumpur (KL), less than a month ago after acquiring a 3.42ha piece of land in Jalan Peel, KL in February.
Meanwhile, Sunway Hotels and Resorts, the hospitality division of Sunway Group, is targeting approximately 75% occupancy rate in the first year of the recently launched SVH.
The 351-room new hotel, which is a 59:41 joint venture (JV) between Sunway Bhd and Fawanis Sdn Bhd, has an estimated gross development cost of RM146 million. It is located within the RM4 billion, 9.31ha Sunway Velocity KL development.
At the launching ceremony, Cheah said the hotel would further improve the high traffic within the Sunway Velocity Mall and would also benefit from the commercial units, which are about 98% sold and will house about 500 businesses.
“While we plan the development of the upcoming 3.42ha, RM2 billion Sunway Velocity TWO, there is actually a 95% take-up rate for the entire Sunway Velocity development,” she added.
Sunway Hotels and Resorts cluster director of operations Kelly Leong said the group is anticipating about 60% corporate and 40% leisure base to contribute to SVH’s projected annual visitor traffic.
“We are confident that we can achieve our target, based on the integration, the connectivity, market size and our competitive pricing.
“Cheras is a mature market, with a generous business population, especially in the trading and industrial segments,” she said.
The new development is also expected to enjoy the soon to be ready catchment provided by tenants of the office towers and healthcare tourists from the upcoming financial city of the Tun Razak Exchange, Bukit Bintang City Centre, and the KL City Centre.
Leong added that hotel guests will have access to over 500 retail stores, 150 food and beverage outlets, making it an ideal destination for travellers who are looking for convenience.
SVH is also part of Sunway hospitality division’s RM875 million redevelopment and expansion plans to its collection of hotels across Malaysia, Cambodia and Vietnam.
Sunway Hotels and Resorts now operates a total of 11 hotels, bringing a total of 3,388 rooms under the group’s hospitality division.
Upon the opening of the RM300 million 240-bed Sunway Medical Centre in the first quarter of 2019, SVH is also expected to welcome healthcare tourists.