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Tuesday, February 5, 2008

Properties to get boost from growth region

The East Coast Economic Region (ECER) can boost the property sector and property prices in the long term, industry experts and real estate consultants say.

"It's a long term game and the higher impact would be on industrial development in buildings and land for industrial," Henry Butcher Malaysia's property research director Fahariah Abdul Wahab said.

It is learnt that Kuantan can sustain another 150,000sq m of retail space, Kota Baru some 110,000 sq m and Kuala Terengganu some 135,000 sq m.

Fahariah said although the ECER hold about 14.8 per cent of Malaysia's population, it only recorded up to 9.1 per cent of residential, 6.5 per cent of commercial and 8.3 per cent of industrial property transaction in the country in 2006.

In terms of value, the residential sector in ECER only constituted 4.2 per cent of the national total.

"The ECER has the capability to create the needed mass and demand to propel property development in the region," Fahariah said.

She said if all ECER's initiatives are implemented smoothly, it would also give an advantage to the tourism industry and prospects for new hotel and resorts in the region.

"There are a lot of players interested in investing in hotels in the region.

"I believe before investing they will be looking at land prices and viability, because in terms of hotels, the region still lacks good quality hotels on the mainland where you need five to six star hotels to attract foreign and business tourists," she said.

Meanwhile, Ho Chin Soon Research Sdn Bhd director Ho Chin Soon said even though he sees some constraints in land sales and the impact skewed towards the oil and gas and agriculture sectors, the ECER will have positive spillover effects to property prices and property development activity in the region.

DPZ Asia's urban design consultant Kamal Ariffin Zahrain said he believes there is good development potential for the region as ECER's masterplan is structured to take full advantage of it.

"We see good viability as the master plan is well integrated and flexible enough to allow new ideas and changes to be made in future," he said.

By New Straits Times (by Azlan Abu Bakar)

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