KUALA LUMPUR: Property developers are excited about the Johor real estate market, which is being fueled by rapid infrastructure development, such as the JB-Singapore Rapid Transit System (RTS) Link.
Tan Wee Tiam, head of research at KGV International Property Consultants, predicts that commercial and mixed-use development landbanking will grow in JB.
"Due to the RTS project, among other developments, the market is trending towards commercial landbanking within JB city. Because of the anticipated demand in JB from all of the ongoing infrastructure projects, developers are looking to build serviced apartments or mixed developments," he told NST Property.
The 4.2-kilometre RTS link is expected to be completed by the end of 2026.
It is a cross-border rail service with a large capacity of up to 10,000 passengers per hour per direction and a journey time of about five minutes between JB's Bukit Chagar station and Singapore's Woodlands station.
The seamless connection between JB and Singapore will help boost economic activity, attract more investors, and create more job opportunities.
Mass Rapid Transit Corp Sdn Bhd and Hong Kong-based MTR Corp Ltd's recently proposed mixed development along the RTS link will most likely be JB's first and most comprehensive transport-oriented development (TOD).
The mixed development will have a gross development value (GDV) of at least RM3 billion and will be built on a six-acre plot of land with three million square feet of gross floor area.
MRT Corp chief executive officer Datuk Mohd Zarif Hashim said in July that the planned mixed development will transform the Bukit Chagar station area into an appealing destination for both local and international investors by leveraging Hong Kong's "rail plus property" model.
The project will take at least five years to complete, with the masterplan expected to be unveiled by the end of this year.
Lands along the RTS link are expected to benefit from such integrated developments, as the population in JB is expected to grow gradually over the medium term due to increased activities.
Tan said that more transactions and developments are expected in the Johor market as a result of the convergence of other factors, which bodes well for the overall real estate market.
Crescendo buys land near to the RTS station
Crescendo Corp Bhd announced this week that it will purchase two plots of freehold vacant land in JB for RM72 million in cash, capitalising on the "good development potential" in the area.
In a filing with Bursa Malaysia, the group said that its wholly-owned subsidiary, Crescendo Landmark Sdn Bhd, has entered into sale and purchase agreements (SPAs) for the acquisition with Bewell Realty Sdn Bhd.
The total gross land area is about 3.272 acres and is located in the heart of JB, near the RTS terminal at Bukit Chagar.
Crescendo said that with such convenience, the RTS will act as a catalyst to revitalise JB city centre, while property developments near the Bukit Chagar terminal will benefit.
"Such development is expected to attract more home buyers and investors, both local and international, to purchase residential properties at the Bukit Chagar terminal's surrounding area as a result of the increased population in JB.
"With an efficient public transport system in place, it will encourage Malaysians who work and rent a place in Singapore to either purchase or rent a place near the Bukit Chagar station for a cheaper rate than renting a place in Singapore," it said.
However, given the high property overhang situation, particularly in the high-rise housing segment, the market will take some time to absorb the completed houses, it said in the filing.
Crescendo believes that the completion of the RTS link will entice young and middle-income Singaporeans to buy or invest in JB properties.
The first plot of land is about 2.9 acres in size and costs RM71.5 million, while the second plot is roughly 0.384 acres in size and costs RM500,000.
According to Crescendo, the first plot has been approved for the construction of 1,090 units of serviced apartments with a gross development value (GDV) of RM726 million.
The estimated development cost, including land costs, is RM535 million, which will be financed through internal funds and loans.
Crescendo anticipates that construction will begin in the first quarter of 2024 and will be completed in three years.
It said the acquisition will increase its landbank for property development and will contribute positively to the group's long-term growth in terms of cash flows and profitability.