With various upcoming landmark projects, Penang’s property industry has not lost its lustre; on the contrary, huge upside is expected once the market turns around. Text by Isabelle Pinto
As of late, the island-state of Penang has been seeing various landmark projects coming its way. Firstly, being the main manufacturing and service hub for electronic and electrical items, there has been a need to provide more space for industrial growth. Therefore, projects such as the IT-BPO at Bayan Lepas, and BPO Prime at Bayan Baru and Changkat Byram, south of Batu Kawan, are expected to contribute to this growth.
Another essential project that is bound to bring major transformation to Penang is none other than the all-encompassing Penang Transport Master Plan. Expected to be completed in 2030, the RM27 billion project will include a light rail transit (LRT) track across the sea forming a fourth link between Penang island and the mainland. The proposed track would be built near the Penang Bridge connecting Gelugor on the island and the Prai Industrial Estate on the mainland before continuing northwards to Penang Sentral in Butterworth. Besides this fourth link, the Master Plan also includes several other LRT routes on the island and mainland, trams for the heritage zones, highways, as well as water taxis.
The development of new convention centres such as the Subterranean Penang International Convention & Exhibition Centre (SPICE) in Relau, and the RM346 million Penang Waterfront Convention Centre (PWCC) by IJM at the Jalan Tun Dr Lim Chong Eu Expressway is also expected to transform Penang into a Meetings, Incentives, Conventions, and Exhibition (MICE) tourism hub, attracting business people as well as tourists to Penang. The SPICE project is expected to be completed by the end of 2016 while PWCC’s expected completion is by 2017.
Additionally, the first IKEA store in the Northern region will be built soon, as well as a state-of-the-art Art Regional Centre; also coming up are Penang Heritage
Arts District – Ilham Penang at Sia Boey, Creative Animation Triggers at Wisma Yeap Chor Ee; and Komtar refurbishment, all of which will cement Penang’s position as a centre of shopping and the arts in the Northern region of Peninsular Malaysia.
The State of Penang which consists of Penang Island and the mainland (Seberang Perai), has always been known for its productive economy, good infrastructure, great food, unique mix of culture and friendly people, making it not only a top destination for tourists but also a top choice for people to live and retire. The state has been awarded numerous accolades, including the 8th most liveable city in Asia, a great place to retire in, an island to explore before you die, etc. Penang contributes 21.8% of the balance of Malaysia’s trade surplus, specialising in machinery, transport equipment and miscellaneous manufactured articles. It is no wonder that investors are continually being drawn to the state.
‘Manufacturing’ more land
However, massive developments especially on Penang Island have made land scarcity a major problem on the island for years. Due to limited space on the island, vast areas of land have been reclaimed in order to make way for development. One notable land reclamation project is the Seri Tanjung Pinang (STP) project by Eastern & Oriental Bhd (E&O) which involves the reclamation of a massive 980 acres of land along the Tanjung Tokong shoreline. Reclamation of Phase 1 of the project which comprises 239 acres was completed in 2005 whereas reclamation of Phase 2 involves 760 acres of sea land that will feature a 5km extension to the existing first phase of STP as well as 2 man-made islands. Endorsed by the State government in 2014, STP2 would be transformed into a mixed development including a marina, and is expected to be completed in phases within 30 years.
Another major upcoming land reclamation project on Penang Island is IJM Corp’s Light Waterfront Phase 2 project covering a 13.26ha site in Gelugor which is to be developed into a large-scale integrated waterfront mixed-use development comprising a shopping mall and thematic shops, residential towers, an office tower, two hotels and a convention centre.
Limited land space on the island has also caused developments to further expand to the mainland and the opening of the Second Penang Bridge in 2014 has been a major catalyst to this. Vast property growth has been seen especially in the Batu Kawan area which is directly linked to Batu Maung on the island via this second link. It has spurred expansion initiatives from high-tech manufacturing firms from the US and the European Union in the Batu Kawan industrial area.
With numerous major developments underway, such as the Transport Master Plan, the IT-BPO Hub as well as massive land reclamations by big property developers, Penang is indeed experiencing unprecedented growth in its property industry. Further, with the opening of the Second Penang Bridge, growth has spilled over to the Mainland. Therefore, despite the current slowdown, Penang’s property market is expected to remain resilient with huge upside once the market turns around.