Glomac’s new projects target millennial buyers

Developer secures an international lifestyle retailer for its Glo Damansara Mall


Glomac Bhd plans to launch RM780 million worth of new development projects in its financial year ending April 30, 2019 (FY19), of which the group expects to sell up to 80% within the financial year.

Group MD and CEO Datuk Seri Fateh Iskandar Mohamed Mansor said the upcoming launches will be targeted at the mid-market and affordable segments, and aimed at millennial buyers who make up the largest first-time homebuyer demographic.

“We should be able to sell between 75% and 80% of the planned launches, as we did in FY18. About 65% of the homes to be launched in FY19 will fall within the affordable category, priced at RM500,000 and below,” he told reporters after the group’s AGM in Kuala Lumpur yesterday.

The planned launches in FY19 are significantly higher than the RM248 million worth of projects rolled out in FY18, which Fateh Iskandar attributed to the group’s strategy to focus on more affordable housing.

“We had to pull back last year because people couldn’t get loans to buy such properties. One project we pulled back was Plaza @ Kelana Jaya because we were planning to sell bigger units of around 1,500 sq ft to 2,500 sq ft priced between RM900,000 and RM1.4 million,” he said.

In June 2018, the group launched smaller units of between 450 sq ft and 750 sq ft, priced between RM300,000 and RM350,000. The first block of serviced apartments at Plaza @ Kelana Jaya has achieved a take-up rate of 66%.

Glomac has secured an international lifestyle retailer for its Glo Damansara Mall, which is anticipated to increase the mall’s occupancy rate to 75% from under 50% currently.

The unnamed retailer is a China-based company listed in both Hong Kong and Shanghai, with operations in the US, Australia and the Middle East. It hopes to commence operations at Glo Damansara Mall by early 2019.

Fateh Iskandar suggested the government revive the Home Ownership Campaign, which was implemented from 1998 to 1999 to help clear excess stock of residential properties through financing incentives such as stamp duty exemptions and lower financing costs for houses purchased during this period.

“The Real Estate and Housing Developers’ Association Malaysia (Rehda) has already proposed this in its Budget 2019 wishlist, specifically for properties priced at RM500,000 and below to help clear the overhang.

“We have met with the Ministry of Housing and Local Government and the Ministry of Finance (MoF), and they are supportive of this,” he said.

The proposal includes a stamp duty waiver for properties priced no more than RM500,000, lower interest rates and a longer tenure term for first-time house buyers.

According to data from the Valuation and Property Services Department, which is under the MoF, unsold completed homes in Malaysia jumped 18.3% over six months, bringing the overhang of residential properties to a record high of 29,277 units in the first half of 2018.