Property poser down south

ISKANDAR Malaysia (IM) has come under heavy fire in recent weeks from analysts, valuers and the media for the apparent free fall of the property market here. They claim developers who were eager to make their presence felt in IM early this year are now beating a retreat because prices have slumped to an untenable level.

This scary prognosis is naturally turning away prospective investors, resulting in lacklustre property launches of late.

The media, especially that across the Causeway, has been publishing stories of developers pulling out, delayed property launches or projects with virtually no takers.

They have been relentless in their coverage, with the bad press focused on almost all "sick projects" stretching from Madini in Nusajaya to Danga Bay and Tebrau Coast on the eastern corridor of Johor Baru.

Even giant China players with enormous capital at their disposal have not been spared, with reports suggesting that they may also be in trouble as they had been "over confident" about prospects in IM and are now reeling with disbelief as they had become "over exposed".

By all accounts, it looks like a well-coordinated and calculated "attack" by the foreign press to keep investors away from parking their money in the property market here.

What is sickening about all these is that even our local people, including property valuers and analysts, have joined the chorus.

Real Estate and Housing Developers Association chief, FD Iskandar was quoted by the Singapore media as saying late last month that "a looming housing glut in IM may weigh down rental yields, with homes being left empty".

If this is not enough to frighten potential investors, then listen to this: UEM-Sunrise Bhd – one of the prime movers of IM – now wants to restrategise and replan its property projects in Johor.

How can a purpose-built economic corridor, touted as Malaysia's best hub to live, work and play, now suddenly become so wrong that everyone wants to make an exit.

If even the "anchor" tenants in IM call it quits at the slightest sign of trouble, then we might as well pack up and abandon IM all together. This special economic zone was not created for players seeking short-term gains.

China's Shenzhen took over 35 years to become what it is today – a bustling metropolis with a population of 15 million. By the same token, IM has only been about eight years in the making, and already we are giving up. What a shame.

The point is all these negative reports about the seemingly sluggish IM property scene are not necessarily true. Take last week's launch of Aquaint Danga Residensi in Danga Bay for instance.

The sales drew scores of visitors over the weekend, with one tower block completely sold, while another recording an incredible 80% sales.

When confronted with such surprisingly good results, our valuers suddenly change their tune and now claim there is still demand for "selected properties".

Incredible as it may seem, this is what one JB-based valuer told the media: "The market generally remains unchanged. But we know that properties that are priced reasonably are able to sell well."

But the Aquaint luxury waterfront condos secured solid sales in spite of the fact that selling prices (RM900-RM1,200 per sq ft) were 30% higher than prevailing prices for similar-type units by the China developers.

How do you explain that? In fact, location wise, Aquaint is sandwiched between the Country Garden condos and the soon-to-be-launched apartments by the Greenland Group along the Danga Bay waterfront belt.

What is sad about this unfortunate episode is that the custodian of IM – the Iskandar Regional Development Authority (IRDA) – is not speaking up. Neither is the Johor Government, which has so much at stake in ensuring the success of this southern growth corridor.

Not a word has come from them to rebut or challenge the negative assumptions and prognosis.

This attitude is shocking considering that IRDA has promoted IM worldwide as an ideal investment destination.

Roy, a long-time resident of JB, is a keen watcher of economic, political and social trends on both sides of the Johor Straits. Comments: letters@thesundaily.com