High Demand for Factory Lots Could Push Up Space P...

Posted on: 2015-11-26

PETALING JAYA: Prices of factory space could be on an uptrend by next year, spurred by upcoming infrastructure projects outlined under Budget 2016.

CH Williams Talhar & Wong's (WTW) managing director Foo Gee Jen said that several projects announced under the budget would boost demand for factory lots in the country.

'The industrial property sub-sector is poised for good growth. The various infrastructure projects lined up for Sabah and Sarawak, for instance, will open up opportunities for the (industrial) sector,' he told StarBiz.

Among the notable highlights was the RM12.8bil funding for the Pan Borneo Highway, beginning with the construction of the route linking Sindumin in the west coast to the east coast of Tawau.

A proposed rapid bus transit system had also been announced for Kota Kinabalu. Also outlined were the proposed highways of DASH and West Coast and light rapid transit line 3.

Foo believed that the industrial property sector was underrated as buyers and investors preferred to look to the residential and commercial sub-sectors.

'Over the past five years, selected lots within the Klang Valley that ranged between RM1 and RM1.40 are now more than RM2.

'There has also been good growth in Johor and Penang. Yields growth in some places has been better compared with the residential and commercial sub-sectors,' he said.

Midas Properties negotiator Justin Tia said that the industrial sub-sector was attractive to investors.

'There are buyers. If it's a good buy, people are willing to pay. However, there are owners that are able to hang on to a property even if there are no tenants.'

Tia said prices of factory space within the Klang Valley had dropped slightly, as some buyers held back purchases following the implementation of the goods and services tax on April 1.

According to him, prices for old buildings in Shah Alam had dropped to RM1.40 per sq ft from RM1.60 per sq ft previously, while prices of new buildings hovered around the RM1.80-mark.

Tia added that the average price of factory space in Klang had dropped to 88 sen from 98 sen previously for old buildings; while prices of new ones were down to RM1.15 per sq ft from RM1.30 per sq ft initially.

According to WTW's industrial property report there are 119 units of factories in the first half of 2015, bringing a cumulative supply of 41,387 units in the Klang Valley.

'Rental rates in general remained stable in the first half of 2015 between RM1.10 per sq ft and to RM2.80 per sq ft.'


Source From: thestar.com.my

Other News & Articles

Understanding Property Investment Basics to Get You Started

Investing in property can be a great way to build your net worth, diversify your investment portfolio, generate cash flow, or build your retirement fund....

Posted on: 2019-10-23

Lower Property Price Ceiling for Foreigners: Crunch Your Numbers Here

PETALING JAYA: The Budget 2020 announcement that the threshold for foreign ownership of high rise property would be lowered from RM1mil to RM600,000 caught many by surprise....

Posted on: 2019-10-23

Budget 2020 Real Estate Highlights

To assist those who are unable to pay 10% deposit and to secure the access of home purchase financing, the government will be working with financial institutions to introduce a Rent-To-Own (RTO)...

Posted on: 2019-10-15