Boasting good tourism appeal, strategic location, affordable property prices, as well as various iconic upcoming developments, will the historic city of Malacca rise as the next property hotspot in the country? Words by Isabelle Pinto
The Historic State of Melaka has always been well known for its historical and heritage buildings. With its capital Malacca City being listed as a UNESCO World Heritage Site since July 2008, millions of tourists have been flocking to the area to admire its well preserved age-old architecture. Combine this with a rich cultural heritage of various ethnicities as well as famous food and restaurants, Malacca is indeed a force to be reckoned with in our country’s tourism industry.
Rapid development of the state has also caused its property market to grow over the years. Previously a rather subdued area with very few tall buildings and mostly old buildings, the state’s landscape now features various modern commercial properties such as office blocks, shop-offices, shopping complexes and industrial lots with many new development projects in progress.
Residential properties include landed ones such as terraced houses, semi-detached houses and bungalows with apartments and condominiums also becoming increasingly popular. Moreover, there are also a number of international schools and good hospitals in the area, making it a good place to live in.
Besides Malacca’s good tourism appeal, another reason why the state makes a good investment location is due to its relatively cheap land prices which are not overly inflated. Current property prices remain very attractive, showing a lot of potential for growth in the area. Compared to Kuala Lumpur, property prices are cheaper here with a 3-bedroom condominium starting from RM400,000. Commercial units are also priced affordably despite prices inching upwards for the past few years.
Another point to note is the strategic location of the state. In fact, Malacca has been known for its strategic location since the 1400s. Located midway along the straits that linked China to India and the Near East, the state was perfectly positioned as a center for maritime trade. Today, located almost midway between Singapore and Kuala Lumpur, Malacca attracts holidaymakers and foreign tourists from both cities, boosting tourism within the state.
The historical state’s appeal as a quaint tourist attraction has made it popular amongst Singaporean investors who have been quite actively investing in its property market for years. Even towards the beginning of 2015, the launching of a new mixed development in Malacca called Harbour City@ Pulau Melaka by well-established developer, Hatten Group has sparked great interest among many Singaporean investors, drawn by its cheap prices amid a depreciating ringgit. Expected to be completed in 2019, the development features six floors of retail space, three hotels and a 500,000 sq ft theme park on Pulau Malacca, off the coast of Malacca.
In recent months, Malacca’s strategic location has attracted Chinese tourists, including Chinese leaders who see the state’s midway position along the busy Straits of Malacca as having the potential to become a future hub of trade and other service industries for the Southeast Asian region.
Subsequently, investors from China’s Guangdong province have expressed interest in setting up an industrial hub there, prompting Melaka Chief Minister Datuk Seri Idris Haron to declare the proposed hub the “Melaka-Guangdong Industrial Park”, which he envisions could be transformed into a free trade zone. The development of the proposed RM20 billion industrial park as well as a marine park; and the redevelopment of its port and harbour would be part of China’s “21st Century Maritime Silk Road” project.
Another very notable upcoming development in Malacca is Malacca Gateway Project by KAJ Development. Comprising one natural and two man-made islands, the 609-acre project features retail, leisure, residential and tourism components on 15 kilometres of waterfront. Highlights include an international cruise terminal, a theme park, 7-star hotel and the Malaysia Eye.
Recently, the Malacca government has also announced plans to take on a RM12.5 billion seafront reclamation and port development project with a green concept at the Sungai Linggi estuary, Alor Gajah. Expected to be completed within 10 years, the project is to be developed by Linggi Base Sdn Bhd on a 250ha area, and involves developing an island to provide oil and gas and shipping services.
Conclusion: Being a major tourist destination with relatively affordable land prices and a strategic location along the Straits of Malacca, the state of Malacca boasts huge upside for its property. This is further boosted by strong investments by Mainland Chinese and Singaporeans.