From vegetable farm to township

Eight years ago, if you had driven to Penang island from the Penang Bridge heading towards George Town, a vegetable farm would have been among the first things you saw as you cruised along towards the Udini underpass. Today, that vegetable farm is MetroEast — a thriving self-contained development by IJM Land Bhd.

The 30-acre freehold MetroEast site is part of the 324.9 acres allocated to IJM Corp by the Penang government in exchange for the construction of the 4.8km Jelutong Expressway, a toll-free highway allowing alternative access into the city centre. It is surrounded by the Bayan Lepas Industrial Park and the George Town central business district and is located at the end of Jalan Udini and at the beginning of the Jelutong Expressway.

The completion of the Jelutong Expressway has spurred tremendous growth in the surrounding area. The skyline — a squatter settlement and a solid waste dumping ground 10 years ago — has now been transformed by the development activities of IJM Land, the property arm of IJM Corp. MetroEast, with a gross development value (GDV) of RM1 billion, was built as a self-contained township, IJM Corp deputy CEO and deputy managing director Teh Kean Ming told City & Country. Teh was formerly IJM Properties' managing director. Divided into six precincts, MetroEast comprises the Tesco building (which has been acquired by Quill Capita Trust (QCT), a real estate investment trust (REIT) for RM132 million), e-Gate, Bayswater condominiums, IJM's corporate office and the Platino and Pearl Regency condominiums. The entire development will be completed in 2011. So far, 60% of the project has been developed; the Platino and Pearl Regency condominiums are still under construction.

"From a piece of land cultivating vegetables, we came up with the concept of a living and vibrant metropolitan with residential and commercial developments.

"We also realised that we could succeed in creating a thriving and bustling commercial destination if we brought in a hypermarket as there was a ready catchment area due to our strategic location near the bridge. Though it took us a year to clinch the deal, we managed to bring in Tesco with a structured deal to design, build and lease the building for 30 years.

"It was a record for us as it took us less than four months to obtain approval and a year to complete the building. That is how Tesco came to Penang," says Teh.

The building has a net lettable area of 275,020 sq ft with 1,050 parking bays. Earlier this year, the building was acquired by QCT.

"Quill is a reputable company with experience in managing retail centres. Its participation will add value to the overall MetroEast development," says Teh.

The sale was also an opportunity for IJM to unlock the property's value to fund its upcoming projects here, including The Light, a RM5 billion project on 152 acres located on Penang's eastern waterfront coastline, directly opposite MetroEast. "As a developer, IJM was not keen to accumulate other portfolios. We are good at property development, so we will stick to that," Teh adds.

MetroEast's e-Gate commercial project was developed concurrently with the Tesco building. The 5-storey building with a GDV of RM46 million was completed at end-2004 and, since then, has become a popular electrical and electronic products retail hub, and entertainment, retail and commercial centre. Several alfresco dining outlets have also set up shop here. With a net floor area of 151,000 sq ft, all the 58 shops and 95 offices have been sold. The alfresco row on the ground floor, which was sold at RM450 psf in 2002, is now valued at RM700 psf on the secondary market, while the office units which were RM250 psf can now fetch RM380 psf, according to Teh.

e-Gate spearheaded the rest of MetroEast's development. The year that e-Gate was completed, the developer launched Bayswater, a high-end 26-storey twin-tower condo project with a GDV of RM127 million, comprising 396 units which have since been completed. From the launch price of RM250 psf, the units with sizes ranging from 1,173 to 1,636 sq ft are now going for RM350 psf, says Teh.

Recently completed was IJM's new 16-storey corporate office with a GDV of RM45 million. IJM will take up six floors and lease out the rest at between RM2.80 and RM3 psf.

Currently under construction is the high-end Platino condominium project the design of which is based on the "four seasons garden" concept. The units, with built-ups from 1,800 to 6,400 sq ft, are priced from RM718,000 to RM2.62 million. These 228 units will be completed in June 2010, says Teh. Launched last November with a GDV of RM190 million, 60% of the units have already been sold.

IJM will soon launch the final precinct called the Pearl Regency, a mixed development, which is targeted at expatriates under the Malaysia My Second Home programme. The project, which is located on a 5.1-acre site, is scheduled to be launched in Korea on Oct 10. There are 574 residential units with sizes from 950 to 1,800 sq ft. The indicative pricing is from RM685 psf with a GDV of RM535 million. The project is expected to be completed by 2011.

By Regina William (The Edge Daily)

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