Tuesday, December 25, 2012
Bolton to replicate Puchong success at Sungai Long
PETALING JAYA (Dec 25, 2012): Bolton Bhd, which is targeting RM1 billion in sales within two years, wants to replicate its success in Puchong with its proposed 252.9ha township in Sungai Long.
"Sungai Long is now ready to be changed, like what Puchong was 10 years ago. As you know, Cheras is quite stressed out, it is busting at its seams already and because Cheras began development easily 30 years ago, it grew continuously but infrastructure was not there from day one," said its executive director Chan Wing Kwong.
"Nowadays, it is different, people want better planning and better environment. Sungai Long is a big opportunity for us to do something special again. We'll not only transform the area but become market leaders in terms of trends and pricing," he told SunBiz in an interview recently.
Chan said it is now inviting planners, both local and foreign, to submit proposals, and it will evaluate the proposals and fine tune the numbers before introducing the concept to the market.
He said with the sizeable piece of land, plans will definitely include commercial, institutional and a mix of residential products but the percentage of the mix is yet to be decided.
"It will take us easily 10 to 15 years to develop Sungai Long. The early gross development value (GDV) is RM8 billion to RM12 billion, which will anchor our future earnings.
"We're still looking for more land but we're lucky because while many developers have to continuously look for land to replenish landbank, we've had sizeable landbank already to anchor the whole group's performance while the rest of the land that comes in are like icing on the cake that will give us the additional 'kick' in earnings," he added.
Bolton is looking to start work on Sungai Long some two years from now. The land, which is currently quarry land, was given to the developer under a quarry lease 20 years ago and Bolton has now bought over the land.
Chan said it is confident in transforming the area, similar to what it achieved with its 121.4ha Taman Tasik Prima in Puchong which began in 2001.
When it first started the project with the first phase of link houses in 2001, the area was quite "in the backwaters" with products such as single story residential and industrial units.
"It was not exactly the nicest part of town but Bolton saw an opportunity there. With 121.4ha, we were quite confident that we would be able to transform the whole area.
"Over the years, we've been building a lot of landed properties there. About five years ago, we started doing the townhouses and that market was doing well, selling at a good price, which gave us the confidence to change our plan," he said.
Taman Tasik Prima's initial plan included mainly residential units and limited commercial units, all surrounding a 80.9ha lake with a GDV of RM500 million.
"We redesigned the remaining land and a bulk of it was The Wharf. That was about 6ha with a few components – three-storey shops, flexi suites (2-in-1 units,
can be used for residential and commercial) and all share a multi-level carpark. On top of the carpark are three condominium blocks," he said, adding that there are a total of 1,200 condominium units.
These units are connected to a 530,000 sq ft shopping mall via a sky bridge. The neighbourhood mall supports daily necessities with eateries and a supermarket. The whole component, named The Wharf, has a GDV of RM600 million.
"From RM500 million, the entire GDV has almost tripled to RM1.4 billion after the changes we made in the plans. We will complete the whole project in three to four years' time, but even with completion, there are still pockets of land on which we plan to build different products.
"Because we were so aggressive in the area, we became a trendsetter there. Everyone looks at us in terms of setting the trend and what products to sell.
Secondly, we are also the price leaders," said Chan.
According to him, purchasers have been enjoying healthy capital appreciation of between 20% to 25% on a yearly basis while rental yields are also increasing.
Units launched earlier at RM350,000 are now selling at RM600,000 and while the first launch of three-storey shops four years ago was at an average price of RM750,000 to RM800,000, the latest shops are now sold at RM2.5 million.
"A lot of people who buy our properties come from surrounding areas like USJ, the upgraders and they are mostly from the upper middle income," he said.
Already in the last phases of Taman Tasik Prima, Bolton is now looking for more land in the vicinity.
"We have made a few offers but the sellers are holding out for better prices. We can be patient because there are other places that we can invest in," he added.
Its current projects are located in Kuala Lumpur and Penang. It also recently announced its maiden project in Sabah, a joint venture with Mobuild Sdn Bhd to develop luxury condominiums in Kota Kinabalu.