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Sunday, March 23, 2008

Branding Alam Jaya

Barisan Elite's RM200 million Alam Jaya Commercial Centre in Bandar Puncak Alam, Shah Alam, hopes to draw the interest of Klang Valley folks

IT is not only the ultra high-end projects by big players that create an impression, but sometimes niche projects by lesser-known developers manage to catch the eye. One such project is Barisan Elite Sdn Bhd’s RM200 million Alam Jaya Commercial Centre (AJCC) situated in Bandar Puncak Alam, Shah Alam, Selangor.

The 46-acre leasehold mixed development comprises five products — AJ Wallstreet, AJ Boulevard, AJ Gallery, AJ Serene and the AJ Hypermarket, something that its general manager Ong Yen Lee (pix) says was planned from the start when the land was purchased five years ago.

"We wanted to offer a product unique to this area as the surrounding developments are mostly residential townships,” says the accountant turned entrepreneur. “Although the surrounding townships have their own commercial parcels, they usually cater for the neighbourhood with mostly clinics, hairdressers, launderettes and coffee shops. At AJCC, we want to attract not only the surrounding business, but draw in the crowds from KL, Subang Jaya and Petaling Jaya,” adds Ong.

Barisan Elite is a collaboration between three professionals in the various fields of architecture, property development and finance. The group’s first project in 1993 was Taman Usahaniaga in Bukit Mertajam, Penang. That project with 121 units of 4- storey shopoffices and 484 units of apartments was developed under Matrix Development & Construction Sdn Bhd.

The group subsequently undertook the development of other mixed industrial, commercial and residential projects of Taman Industri Teguh in Penang (1997), Taman Bangi Jaya in Semenyih, Selangor (1998), Taman Harmoni Indah in Balakong, Selangor (1999) and Taman Impian Indah also in Balakong (2002).

Its most recent project is the RM250 million Taman Industri Alam Jaya also in Bandar Puncak
Alam. This 300-acre project is adjacent to AJCC and was completed in 2004 with 152 industrial lots, 367 units of 2-storey terraced homes, 284 units of shophouses and 380 apartment units.

Ong said the group never had difficulty in delivering projects, even during the 1997 economic crisis and often relied on the partners’ strong business networks to market their commercial products.

The first phase, AJ Wallstreet has yet to be officially launched, but a takeup of over 85% has been achieved since Barisan Elite started marketing units mid-last year. The modern fa├žade AJ Wallstreet comprises 115 units of 2-storey shopoffices with spacious built-ups from 2,797 to 7,338 sq ft. The shopoffices are priced from RM318,000.

“We have not advertised much and are surprised by the good response as this proves that word-of mouth is an effective marketing tool. Some 15% are repeat buyers from the previous project, Taman Industri Alam Jaya, which has been fully sold. Also, our prices are competitive.

We know of similar shop offices in this area that are being marketed from RM400,000,” said Ong. AJ Boulevard (pix), the second product to be offered, was launched in January this year and to date 25% of the 262 units of 2-storey “streetmall” shops have been sold.

These shops have built-ups from 1,441 to 2,929 sq ft and are priced from RM249,000 to RM620,000. “The streetmall concept is not a new one as it has been popular for many years in China.

It provides patrons a comfortable shopping environment with a covered pedestrian walkway and
boulevard, making promotions and activities possible regardless of the weather," said Ong. She added that streetmalls provide an alternative for tenants who cannot afford to set up businesses in the luxury shopping malls with high rental as streetmalls have lower operating costs.

“To ensure full occupancy and vibrant business atmosphere, we will be managing the tenancy on
behalf of the buyer for a period and guaranteeing a 7% return of investment per annum for two to five years,” said Ong.

AJCC is strategically located at the fringes of Sungai Buloh, Klang and Shah Alam and is accessible via the Guthrie Corridor Expressway, Shah Alam-Batu Arang Highway, Jalan Meru and Jalan Kuala Selangor.

“In the near future, this area will be easily connected to Petaling Jaya, Mutiara Damansara. Damansara Perdana and Kuala Lumpur using the proposed New North Klang Valley Expressway. The fact that our project is served by many highways gives buyers confidence as one of the key criteria to look into when making an investment is road infrastructure,” said Ong.

AJCC is also near established townships such as Bandar Puncak Alam, Shah Alam II, Taman Puncak Alam, Taman Industri Alam Jaya, Desa Coalfields and Bandar Saujana Utama. There are
also many upcoming projects in this area such as Sunway Alam Suria, Alam Budiman, Cahaya SPK and Puncak Perdana.

“As AJCC is a new project, I have been asked whether there will be too many shops, but I do not feel that this is an issue as investors are forward thinking. The project is surrounded by matured townships and by 2010, the area is expecting a 700,000 household population. There will be added demand for properties when the nearby Universiti Teknologi Mara begins its first intake of students in 2009,” she said.

To be launched in July are 800 units of middle-range serviced apartments in AJ Serene and five units of 2-storey standalone showrooms in AJ Gallery. Units in AJ Serene are priced from RM90,000 with average sizes at 850 sq ft.

“The apartments are targeted at factory supervisors and executives in the industrial area, as well as UiTM lecturers and students. It would be a convenient living choice as eateries and shopping areas are just a walk away,” said Ong.

Meanwhile, the developer has positioned AJ Gallery as an ideal showroom for businesses to display their products. “Food and beverage outlets or even interior design companies can opt to set up offices here as there is high visibility, individual compounds and private car parking. The unit prices are from RM1.6 million with built-ups of 7,000 sq ft.”

As for AJCC’s final component, the AJ Hypermarket, Barisan Elite is in the midst of finalising the
agreements to have a hypermarket chain set up business by 2009. The entire development is expected to be completed by end- 2009 and the developer is planning for a mega opening carnival to create a publicity buzz.

In the pipeline for Barisan Elite is the development of a 300-acre land adjacent to AJCC. Project development for the commercial and industrial lots are set to commence by end-2008.

“We will be continuing with the Alam Jaya brand name as we aspire to have the whole area known as Alam Jaya. For the future project, there will be more industrial products than commercial because there is strong demand for medium-size factories in this area and we are going to capitalise on that. We still have a waiting list of buyers wanting to buy units from our previous development,” said Ong.

By theSun (by Allison Lee)

Are you landlord material?

“I HAVE to chase tenants for the rent.” “My tenants trashed the place.” These are common complaints that put people off the idea of becoming landlords. The inability to deal with these problems effectively results in sleepless nights, a feeling of helplessness and a situation where “the landlord is in effect paying the tenant to live in his property”.

So what’s involved in becoming a landlord and what are the tricks of the trade? Three seasoned landlords and a property manager give their take on how they manage tenant issues and remain die-hard landlords and property managers.

Have a cash cushion
If you want to be a landlord, don’t count on your tenants paying for all the expenses involved in the ownership of a property. You need to account for the costs of maintenance, lack of rental when the property is vacant and occasional failures to collect rent. The interviewees concur that they expect their properties to be vacant for two months a year when calculating the returns on investment.

“First, make sure that your income will be able to cover the loan repayment. Hence you can still manage during the months when your property is vacant,” says John Lee (not his real name), CEO of a Mesdaq-listed company. He has seven years’ experience in managing properties and lets out his five medium-range condominiums. Having started out with a bad investment in bungalow land in Sungai Long/Bandar Mahkota Cheras, he says the failure did not deter him. He has since reaped significant gains in property investment, netting about RM1 million from flipping properties.

In dealing with late payment of rent, the key is to act promptly, the landlords say. Renesial Leong, author of Property Jewels, stresses that a landlord must be prompt in acting against errant tenants. “If the tenant is one week late, the landlord should make a courtesy call to find out the reason for the delay,” she says. “I had a tenant who lost his job and could not pay the rental in the first few months of the tenancy agreement. So, I sat down with him to discuss his predicament. I suggested that perhaps it would be better for him to move into a smaller place, like a room. He took my advice and moved out in the third month.”

One way to reduce the risk of non- or late payment is to ask for advance rental. “For high-end properties, there is an emerging trend where company-tenants pay rental in advance. Some embassies choose to pay a year in advance and the rental could be quite high, like RM30,000 per month,” says Tan Joon Kai, head of property management at Eng Lian Enterprise Sdn Bhd. “By paying in advance, however, the tenant may ask for a discount if the landlord is not an established player in the market.” Tan has been managing the group’s portfolio of residential properties, shoplots and shopping complexes (Bangsar Shopping Village I and II) for the past seven years.

How much should a landlord spend on preparing a property and maintaining it? There are no hard-and-fast rules on how much to allocate, and it mainly depends on the tenant’s profile. “For students, I would just ensure everything is functional and clean. For high-end tenants, I may spend more, like allocate up to half a month’s rental to do up the property,” says Leong.

“I do not specifically put a maximum value for maintaining my properties. I believe that regular servicing will keep the maintenance costs low. As a rule of thumb, I may not spend more than RM5,000 a year to maintain a high-end property, and not more than RM3,000 for mid-range properties.

“In the higher-end market, tenants tend to prefer their own loose furniture such as beds and lounge sets,” says Tan. “So, we would usually just spend on the basics, namely the kitchen appliances and cabinets, bedroom wardrobe, air-conditioners and curtains and railings.”

When you target the lower-income group, the rule is to keep it simple. David Chong, owner of Infohan Sdn Bhd, a property management and investment company, rents out his threestorey 20-room bungalow in Petaling Jaya to factory workers. “I leave the rooms bare except for lights and fan.”

Chong bought the property below its market value and the seller had renewed the lease for 99 years. “I am continuing to look out for such buys,” he says. He also owns several commercial and landed residential properties, and has been investing since the mid-1990s.

“There is a lot of cleaning to be done in low-end properties. Hence, I visit my tenants and remind
them to be civic. It is important to talk to them in a friendly way,” says Chong. “I budget 5% of the rental income for maintenance and cleaning costs and hire a professional cleaner to clean the bungalow on a weekly basis.”

It’s a people business
In evaluating whether you are landlord material, remember this: While you shouldn’t need to constantly be on the watch, you shouldn’t be twiddling your fingers, waiting for the money to come in. Landlords need to find time to keep in touch with their tenants. “This is a people business where you must build rapport with your tenants. One must like working with people to become a good landlord,” says Leong.

“My current stable of tenants includes students, expatriates, McDonald’s, Tai Thong Restaurant, Secret Recipe and Angel Cake House. I support them in whatever way I can, such as giving business to them,” she says. “You see, building rapport and acting promptly on problems are the keys to managing tenants well.”

Chong finds the problem of collecting rent from the lower income tenants manageable. “Only about 5% to 10% of my tenants may be late in paying,” he says. “It is important to visit them immediately after payday.”

“In order to minimise problems in collecting rent, from the onset, you must be firm about your rules, and then build a rapport with your tenant along the way,” says Lee of middle-income tenants. “Send them gifts during festive seasons and be responsive to problems. Sometimes, I prefer to collect the payment personally to remain visible to them. Check the utility bills frequently to ensure your tenants are settling them promptly. Remind them immediately if any bill is overdue.”

For high-end units, Tan of Eng Lian says, “We have some expatriates, particularly the younger ones, who do not take the trouble of handing over units in good condition. So, it is absolutely vital to be diligent in checking the inventory listing when the tenants move out and deduct all repair costs from the deposit.”

If you lack the time, you can engage someone to handle the work. “It is advisable to engage somebody to help you manage if you have more than 20 properties because it can be very time-consuming,” says Leong, who employs two full-time staff to manage her tenants. “The fee to the property manager would be 9% to 10% of the rent collected for low-end properties and 7% to 8% for highend properties.

“In addition to this, you must have a team of people to help you such as lawyers, property appraisers, agents, insurance companies and handymen.”

This article first appeared in Personal Money, a monthly publication of The Edge.

By theSun (by Noelle Lim)

Luxury property expo targets RM300m sales

Property show organiser Exhibition Guide (M) Sdn Bhd is targeting its Malaysia International Luxury Properties Exhibition 2008 to generate sales of over RM300 million.

The event at the Kuala Lumpur Convention Centre, which began yesterday and ends tomorrow, showcases property projects by 60 local and international property developers.

Project director S.Y. Moey said over 15,000 visitors are expected to attend the exhibition.

To date, the company has organised more than 27 property exhibitions, with each registering average sales of about RM200 million, he said.
"At this exhibition, developers are showing their new high-end properties which we expect will attract more participants to this year's show," he said at the launching ceremony.

Moey said Exhibition Guide also planned to organise the exhibition annually to create a platform for local and international exhibitors.

"For 2009, we will travel around the world to promote this luxury property exhibition," he said.

For more related information about " Malaysia Luxury Property Exhibition 2008 "

By Bernama