Property Hunter Magazine September Issue 2014 | Page 60

/// East Malaysia Property News Inaugural Sabah Property Report released by Knight Frank From left; Knight Frank Malaysia’s managing director Sarkunan Subramaniam, Sabah’s Resident Branch Manager Stephanie Wong and Associate Director Ginn Lai Knight Frank Malaysia released it’s first-ever Sabah Property Market Report at its new Sabah branch office in KK Times Square on 7 August, 2014. The report reviews the high-end residential, office and retail markets in Kota Kinabalu in 2014 and gives an outlook for the second half of 2014. According to the report, the Kota Kinabalu property market has remained buoyant and stable during the first half of 2014 despite recent negative factors primarily the tightening of mortgage lending, tariff hikes on electricity and fuel, and the impending Goods and Services Tax (GST) in 2015. The city’s southern corridor would be significantly transformed with the completion of major projects this year including Imago shopping mall, The Loft apartments, OCEANUS waterfront mall, Pelagos Suites, Riverson and Gleneagles private hospital – bringing about a positive impact on the modernisation of Kota Kinabalu. Mr Ginn Lai, Associate Director of Knight Frank Malaysia (Sabah Branch) says that they expect the second half of this year and early 2015 to pick up in terms of new major development launches 60 www.PropertyHunter.com.my and announcements, particularly in the new development precincts of the old Jesselton port area and TanjungAru Eco Development. “We are also seeing pressure as a result of land scarcity and rising land costs which will push future landed property supply to be contained outside of 15km from the city centre,” he adds. The outlook for the second half of 2014 will see a handful of new residential projects officially launching. Given a lack of new inventory this year, we expect take up rates to be solid albeit subject to affordability and the availability of end financing to buyers.” There has been no new supply of new office space over the 2012 and 2013 period and the same is expected this year. Pent up demand for city office space will be met in 2015 with the completion of several notable projects namely Menara Hap Seng, Aeropod, Sutera Avenue and Riverson Suites, totalling approximately 814,613 sqft – an average of 3% new supply per annum. “Based on current market values, yields are achieving an average of 5% per annum. The development of purpose built and signature offices continues to uptrend and replace traditional shoplots at Kota Kinabalu’s commercial sector mature and modernises.” The Sabah Property Report also mentioned the unprecedented supply of retail malls that are coming to completion over the next three years, adding another 2.65 million sqft (5 malls) of new supply to the existing 4.6 million sqft (17 malls) and further cementing Kota Kinabalu’s position as Borneo’s getaway city. According to Lai, tenant take up rate could be slow, but the sector is expected to perform in the mid- to long-term. www.PropertyHunter.com.my 61