5 reasons why first-time homebuyers should consider buying a home in Bandar Seri Alam
Located within the Eastern Gate Development Zone of Iskandar Malaysia, Bandar Seri Alam boasts a number of good schools and is dubbed the 'City of Knowledge'.
By Khalil Adis
Bandar Seri Alam is one of Johor's best-kept secrets.
Home to 16 educational institutions and located in between Pasir Gudang and Permas Jaya, the township has a growing young population of around 220,000.
We list down some of the attractive points about living in Bandar Seri Alam.
#1: Located in the growth corridor of Flagship Zone D of Iskandar Malaysia
Also known as the Eastern Gate, this is the third phase of Iskandar Malaysia's next growth.
There are a few catalytic projects currently happening here, namely Iskandar Halal Park (formerly known as Johor Halal Park) and the Pengerang RAPID Project.
First announced on 19 November 2015 by the former Chief Minister of Johor Dato' Khaled Nordin during the Johor Budget 2016, it is part of the state government's effort to promote entrepreneurship in Johor.
A 50:50 joint venture collaboration between UMLand and the Johor State Government via Johor Biotechnology & Biodiversity Corporation (J-Biotech), the private-public initiative aims to put it as an international halal park and is one of the catalyst projects in Eastern Iskandar Malaysia.
Recently, IHP scored a major coup among when US based-company, Chocolat Moderne from New York, picked JHP as the manufacturing site to set up its first business in Asia.
Meanwhile, the Pengerang RAPID Project will be the largest oil & gas hub in Malaysia that will create around 40,000 to 50,000 job creation in the construction industry, 400 jobs for engineers and 4,000 jobs for trained technical.
#2: Education is a recession-proof industry
One of the attractive factors about Bandar Seri Alam is it is home to a number of higher learning institutions such as Universiti Teknologi Mara campus, Universiti Kuala Lumpur campus, the Masterskill University College of Health Sciences campus as well as international schools.
While the Iskandar Puteri/Medini and Johor Bahru/Danga Bay areas boast a number of catalytic industries such as tourism and finance, they are not immune to economic down cycles.
Bandar Seri Alam is 100 per cent focussed on education, particularly among the local population.
This makes it even more attractive as education in an evergreen industry.
One of the oldest and biggest schools in Malaysia, Foon Yew High School is set to open its third campus in Bandar Seri Alam in 2021.
#3: Homes are still affordable with the potential for capital appreciation
According to data from Brickz, prices of homes here were transacted at a median price of RM320 per sq ft from Jan 2018 to Dec 2018.
In comparison, homes in Iskandar Puteri/Medini and Johor Bahru/Danga Bay are priced at around RM900 per sq ft.
Being a relatively new township surrounded by various property booster will give room for capital appreciation for homes here.
This, plus the price point, make it suitable among first-time homebuyers.
#4: Master planned by a reputable developer
Bandar Seri Alam is one of United Malayan Land Bhd's signature projects developed by its subsidiary company Seri Alam Properties Sdn Bhd.
Thoughtfully developed across 3,762 acres by its subsidiary, Bandar Seri Alam has been planned as a self-contained township with a mix of freehold residential, commercial, industrial and hospitality offerings.
At the centre of this township lies a bustling commercial arena with various exciting and attractive retail features and green elements.
Some of the world's best brands can be found here including Starbucks, KFC, Burger King and Subway.
#5: Growing population
Bandar Seri Alam is a thriving township which boasts a population of more than 220,000.
As Iskandar Halal Park and the Pengerang RAPID project are currently being developed, we can expect the population to increase in the next 10 to 15 years as more jobs are being created.
As we speak, a new RM500 million Pasir Gudang Hospital will also be constructed as part of the government's announcement under Budget 2016.
The game-changing project has been hit with a series of delays since the newly minted Pakatan Harapan government took power last May. With the property market in Iskandar Malaysia already in doldrums, we analyse the possible impact this may have on real estate on both sides of the causeway.
By Khalil Adis
When Pakatan Harapan took power in a landslide victory at the Malaysian general election last May, the ruling coalition government went to work by immediately addressing one of its election manifestos - reviewing major infrastructure projects which involve a foreign country.
Singapore was no exception.
Iskandar Malaysia, which was already feeling the heat from the sluggish property market, saw the High Speed Rail project at first being cancelled and then postponed.
Meanwhile, the controversial Forest City project bordering Singapore was initially announced as off-limits to foreigners but was subsequently changed to build affordable homes for locals.
The former is an important impetus that many developers had banked on to move their inventory amid a severe housing glut the state is facing.
According to recent data provided by the Valuation and Property Services Department (JPPH), Johor recorded the highest number of residential overhang at 13,767 units followed by Selangor and Kuala Lumpur at 7,233 and 5,114 units respectively.
The mismatch in the supply for homes versus what Johoreans can actually afford plus their inability to get financing have further exacerbated the property market situation in Iskandar Malaysia.
The only saving grace is the cross-border rail link service linking Woodlands and Johor Bahru.
Although not cancelled, the Johor Bahru-Singapore Rapid Transit System (RTS) link project is "not progressing well” as Transport Minister Khaw Boon Wan puts it.
Just last week, Acting Transport Minister Dr Vivian Balakrishnan gave an update in Parliament that “further delays” are likely as Malaysia had missed the deadline in confirming its partner three times - first until September 2018, then until December.
However, on December 28, Malaysia had asked to be given until February 28 this year to do so.
It had missed this deadline as well.
As a result, this will delay the opening of the link which was initially scheduled to be ready by December 31, 2024.
Some developers, particularly in the JB Sentral area, had banked on the RTS Link, to move their unsold units.
With the project now in limbo, here are the possible impacts on the property market both in Singapore and Johor:
#1: Possible higher development cost around Woodlands North station
In May 2012, it was announced that AECOM Technology has been awarded a US$42m contract for the design and engineering study of the RTS Link by Malaysia’s Land Public Transport Commission and Singapore’s Land Transport Authority (LTA).
Under the deal, the company will provide an architectural and engineering consultancy study for the proposed RTS Link.
Construction is well underway for the Thomson-East Coast MRT Line (TEL) with a plot of land allocated for the link at Woodlands North station.
The station is slated to be opened in December this year.
The Urban Redevelopment Authority’s (URA) master plan for Woodlands North Coast shows a mixed-use precinct for office and business parks along signature green boulevards within the station’s immediate vicinity.
The delay could mean higher development cost for the terminus due to opportunity costs and inflation.
#2: Higher fares
The higher development cost arising from the construction delay could also mean higher fares for the RTS Link which may be passed on to consumers.
However, whether or not this happens, commuters will likely switch to taking the RTS Link across the causeway as it will mean greater convenience as opposed to driving in or taking the bus.
For example, commuters need to clear customs and immigration only once when they depart from either Singapore or Malaysia.
Using one’s own vehicle or taking the bus will require a two times clearance with the possibility of being stuck in traffic.
#3: Potential capital appreciation for existing housing developments near Bukit Chagar RTS station affected
The Bukit Chagar RTS station will be located at the open car park next to the Sultan Iskandar Building complex.
Surrounding the station are landed terrace homes and condominium towers TriTower Residence and Bukit Chagar Apartments.
According to data from Brickz, from May 2017 to Jan 2018, the average per sq ft pricing for the landed homes in the area was RM354 per sq ft.
Meanwhile, the average per sq ft transacted pricing for Bukit Chagar Apartments from Mar 2017 to Dec 2017 was RM395 per sq ft.
There is no data for TriTower Residence built by SKS Group, formerly known as Maha Builders Group or MB Group.
With the delay, the potential capital appreciation arising from the spillover impact from the RTS Link will take a longer period beyond 2024.
Despite this, market talk is SKS Group has plans to build a covered link to the Bukit Chagar RTS station.
If this is true, investors of TriTower Residence will stand to benefit the most.
#4: Developments around JB Sentral affected
The delay will also impact surrounding developments in JB Sentral as it will mean longer gestation period for the commercial, property and tourism sectors.
The game-changing project could provide a much-needed boost to complement Johor Bahru’s ambitious RM1.8 billion rejuvenation programme that was unveiled by former Malaysian Prime Minister Najib Razak in 2010.
This is because it will bring an inflow of investments from Singapore that will benefit the sectors mentioned.
Although the Sungai Segget rehabilitation is now completed, the project proved to be quite a letdown.
The project was spearheaded by the Iskandar Regional Development Authority (IRDA) with a reportedly whopping RM20 million consultation fee.
The entire cost is an estimated RM57 million.
The project was supposed to provide a booster to the nearby malls such as Johor Bahru City Square and KOMTAR JBCC as well as shophouses.
It was also supposed to be a tourist attraction much like Clarke Quay as it was modelled after South Korea’s Cheonggyecheon river restoration project in South Korea.
This explains why developers like UMLand had acquired land banks near to Jalan Wong Ah Fook for the opening of Suasana Iskandar Malaysia.
Given the high cost, naturally, the expectation among stakeholders was high.
However, some developers, shop owners and retailers were reportedly not very happy about the way the river cleaning project had turned out.
While the river no longer emits an odour, littering is still common.
The only saving grace for the river is a miserable small fish pond with a fountain in the middle of it.
Surely the river rejuvenation project can do much better.
#5: Ibrahim International District as the potential jewel of Johor
Delays and disappointments aside, there is a gateway district coming up in Johor Bahru that will mirror the one at Woodlands North station.
Called Ibrahim International District, the project is named after the Sultan of Johor.
Under his auspices and blessings, His Majesty has set the target of making Johor Baru the second biggest city in Malaysia after Kuala Lumpur.
As such, we can be sure the project will receive the state’s 110 per cent commitment to make it shine as the jewel of Johor.
With a gross development value of RM3 billion, Ibrahim International District is an ambitious mixed-use development that will comprise six towers -– a hotel, a hotel with residences, an office, medical suites high-rise and two serviced apartment towers and a mall with an estimated gross floor area of 80,000 sq ft.
The district is currently under construction.
There are plans to build a linkway from Persada Johor to Coronation Square at Ibrahim International District.
However, there is no word yet if the district will be connected to the future Bukit Chagar RTS station.
If it does, it will enhance property values in the area, albeit beyond 2024.
#6: One Bukit Senyum as the current property booster
Nevertheless, there is light at the end of the tunnel as the only property booster around JB Sentral is the One Bukit Senyum project by Singapore Exchange-listed Astaka Holdings Limited.
Home to the tallest residential towers in Southeast Asia, Astaka, One Bukit Senyum will be Johor Bahru’s new central business district when fully completed in 2021.
One Bukit Senyum will be developed in two phases.
The first comprises The Astaka, with a total of 438 units.
The development, which is Johor’s most luxurious condominium development by far, was completed late last year.
Phase two will comprise Johor Bahru City Council’s new headquarters, a 450-room five-star hotel, 1012 residences, 254-key serviced apartments, a 1.5 million square feet shopping mall and a Grade A office building.
The JB-Woodlands RTS Link is a complicated matter as it involves the state and federal governments.
Nevertheless, it will be a win-win situation for both Singapore and Malaysia to continue with the project as it will mean and inflow of investments, particularly for Johor.
It will also ease the daily commute among Johoreans who are working in Singapore.
The spirit of good neighbourliness should prevail.
An independent analysis from yours truly