Dato Yau | The Edge - 6 December 2019 - New development vibrancy at GENTING HIGHLANDS
Sitting l,800m-high atop Mount
Ulu Kali, on the border of Pahang and Selangor, Genting Highlands is a popular
spot for leisure and recreation amongst Malaysians and foreign visitors, with
several hotels, theme parks, shopping malls and a cable car system, thanks to
Resorts World Genting (RWG).
According to Genting Group's
annual report, RWG welcomed 25.9 million visitors in 2018, a 9.75% increase
compared with 23.6 million in 2017. In 2018, visitors comprised 27% hotel
guests and 73% day-trippers.
In 2013, Genting Group embarked
on a 10-year master plan - Genting Integrated Tourism Plan (GITP) - to
reinvigorate and transform RWG. A few notable completions under the GITP master
plan, which includes First World Hotel (Tower 3), Awana SkyWay cable car,
SkyAvenue mall, Genting Highlands Premium Outlets (GPO) and Skytropolis Indoor
Theme Park, have attracted many repeat and first-time visitors. After a few hitches,
the company is looking forward to the opening of the new outdoor theme park.
Gohtong Jaya and Genting Permai
located along the main access road at mid-hill are also gaining interest among
visitors.
Renewed interest in properties
Genting Highland’s popularity has
attracted property developers as well.
Nawawi Tie Leung Property
Consultants' data shows that at least 3,800 high-rise residential properties
have been completed at Genting Highlands over the past five years. Among the
projects that were completed this year were OSK Group's Windmill Upon Hills and
geo38 Residence by Pesat Bumi Sdn Bhd. Yet, there is no sign that the pace of
development will pause anytime soon as more than 4,200 units in new and
upcoming projects are expected to add to the current supply. (See Table 1.)
Why are people and property
developers making a beeline to Genting Highlands? Considering the country's
heat and humidity in general, the top draw to this place is its cool hilltop
climate, making it a favourable weekend getaway and a coveted holiday home
destination.
Rahim & Co's survey reveals
that most of the people residing in Genting Highlands work there while the rest
are transient visitors who only stay there on weekends and holiday seasons.
"These short-term visitors usually come from Kuala Lumpur, Kuantan, Penang
as well as Singapore and Indonesia," Rahim & Co International Sdn Bhd
Director of Research Sulaiman Saheh tells EdgeProp.my.
Nawawi Tie Leung Property
Consultants director and regional head of research and consulting Saleha Yusoff
believes that once the new outdoor theme park opens, RWG will garner more
visitors and there will be more job opportunities, subsequently creating a
spill-over effect on the demand of residential and commercial properties within
the vicinity.
"Resort-type developments
are not only suitable for holiday getaways but also for retirement villages.
Compared to the US, medical costs in Malaysia is 65% to 80% lower and this has
attracted medical tourists from many countries. Genting's cool atmosphere and
proximity to the KL city centre are plus points for an integrated medical
tourism development.
“Diversifying product offerings
would make the property market in Genting Highlands even more vibrant,” she
notes.
New and upcoming developments
Newly-planned and ongoing
developments here include Grand Ion Majestic and Celestia Genting Highlands on
the hilltop as well as Tropicana Grandhill, Pavilion Genting Highlands, IBN
Highlands City, Geo Antharas, Geo Royal and Geo Elite located close to Genting
Permai. (See Table 2.)
"Midhill Genting has
attracted major developers which are planning huge mixed developments such as
the 112-acre Tropicana Grandhill and the 280-acre Pavilion Genting
Highlands," TSK Realty senior real estate negotiator Ben Foo Tien Choy
says.
Tropicana Grandhill will consist
of residential, commercial, wellness, education, park and silver-hair
components, while Pavilion Genting Highlands will have resort apartments,
luxury villas, parks, commercial and retail properties as well as resort
hotels.
To draw more visitors to frequent
the midhill, developers are actively trying to create commercial activities
there. For example, the 20-acre IBN Highlands City in Genting Permai will have
a retail mall, says Foo.
As housing demand is largely
driven by tourism and rental, new developments in the area commonly offer
fully-furnished units to lure buyers. A few projects such as geo38 Residence,
Ion Delemen as well as the upcoming Grand Ion Majestic have even partnered
short-term rental management companies to help homeowners rent out their units.
Secondary market yet to gain
momentum
With RWG gaining popularity and
the success of GPO, psf prices of newer high-rise residential developments are
catching up with Kuala Lumpur's prices.
Looking at high-rise projects
completed in the past five years, there were very limited secondary
transactions in 2018 and 2019 while more transactions are seen among the older
developments, although the number is still small.
Nevertheless, Foo believes the
secondary market will slowly gain momentum as more new projects come on stream.
Transacted prices of some old
apartments have seen a drop between 2017 and 2019, owing to competition from
new supply. However prices of those located close to RWG such as Kayangan
Apartment and Ria Apartment are holding up better, while Genting Permai Resort
Apartment at the midhill has also seen a 27% increase in average transaction
price based on seven transactions across three years. (See Table 3 and 4.)
Competition rolling in
No doubt, one of Genting
Highlands' main attractions is its entertainment and leisure component while
its limited accessibility by road as well as its altitude have deterred people
from staying there for the long term, apart from those who work there.
"Therefore, the rental
market is limited to tourists or visitors who come for short-stay. With all
investors eyeing the same target market, rent is very competitive," Saleha
says.
Foo concurs and adds that with
more supply coming into the market, yields and occupancy rates could become
more challenging.
"However, I believe that
those who have the ability could still buy property here as their holiday
homes, because Genting Highlands is one of the top tourism destinations in
Malaysia," he says.
In terms of rental yields, Foo
says certain apartments offer healthy yields. He cites geo38 Residence which
received yields of between 5.1% and 5.76% while data from the National Property
Information Centre showed that rental yield of Ion Delemen was 3.7% in 2017 and
2018.
Sulaiman of Rahim & Co points
out that the main challenge would be sustaining occupancy and attractiveness to
potential tenants and short-stay guests. "In light of this, some new
developments are offering sale-and-leaseback as well as guaranteed rental
schemes," he adds.
Notwithstanding the guarantee and
the financial backing of the guarantor, many investors are still wary of risk
after the guaranteed period ends. As such, they'd rather do it themselves.
"Many house owners are trying to rent out directly through online rental
platforms, while at the same time being supported by property management
professionals or informal unit custodians to take care of their units," he
elaborates.
"Investment performance will
depend on the management quality of the premises, on top of tourist arrivals.
Fortunately, Genting Highlands is expected to continue drawing visitors both
locally and regionally," he says.
Other concerns among property
buyers include the traffic and human congestion that occur during peak seasons
as there is only one main access road up and down the hill. Apart from this,
landslides that occasionally occur on the hillsides, especially after a major
downpour, could also deter property investors.
New Rainbow Restaurant- New
Rainbow Restaurant is one of the first shops opened at Gohtong Jaya. The
20-year-old shop is famous for its delicious fresh wild river fish sourced from
the rivers in Pahang, as well as various other seafood dishes. Loved by both
Locals and foreigners, the eatery recently opened a branch at Genting Highlands
Premium Outlets. The Chai family who operates the shop rented the three-storey
shop office at Gohtong Jaya for RM6, 000 per month when it first started
business in 1997, but the rental has increased to RM12, 000 per month now.
According to data from JPPH and NTL Research & Consulting, there is only
one shop office transaction recorded at Gohtong Jaya in the past two years. The
4,164 sq ft shop office was sold with a price tag of RM2.90 million or RM697
psf.
Happy Bee Farm- Happy Bee Farm,
Insect World & Butterfly Wonderland allows visitors to experience how a bee
farm is operated and check out a collection of bug specimens with peculiar
forms and colours. Visitors can also walk through the Butterfly Wonderland, a specially
built garden filled with beautiful butterflies.
Genting Strawberry Leisure Farm-
Genting Strawberry Leisure Farm is a family-friendly attraction that lets
visitors pick strawberries from the orchards. It is also famous for its
astounding Lavender Garden that provides colourful photo opportunities.
SkyAvenue Mall- There are more
than 100 brands, shops and restaurants at RWG's SkyAvenue Mall, along with
entertainment outlets such as SkyCasino and Picture House Cinema. Must-try
restaurants include Beauty In the Pot, Burger & Lobster and The Laughing
Fish by Harry Ramsden.
Awana SkyWay cable car- A ride in
Awana SkyWay cable car would be a memorable experience.There are spectacular
views and a fresh breeze enters the gondola while you drift past the 130- million-
year-old rainforest and the many attractions ad hotels in Genting Highland.
Genting Highlands Premium
Outlets- Genting Highlands Premium Outlets is a great open-air shopping
destination. It offers a collection of over 150 designer brands and stores, a
food court and a wide range of restaurants and cafes. The mall opens daily from
10am to 10pm.
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