An artists’ impression of M Vertica.
Location of M Vertica in Cheras.

DEVELOPERS should re-strategise their businesses during an economic downturn and look for opportunities to expand.

Mah Sing Group Bhd announced last week that it was axing two deals inked three years ago to focus on affordable properties instead of luxury real estate.

The developer is aborting a plan to develop 35ha at the Sultan Salahuddin Abdul Aziz Shah golf course in Shah Alam.

It is also disposing of 51 per cent equity in Convention City Development Sdn Bhd, which is slated to develop a 3.4ha land next to Sabah International Convention Centre for about RM6.6 million.

Mah Sing now plans to acquire land in Cheras and Bukit Mertajam, Penang, where there are active property transactions.

It will acquire 4.5ha of leasehold land in Cheras for RM263.5 million (or RM538 per sq foot) and 4.4ha of freehold land in Bukit Mertajam for RM43.8 million (or RM92 psf).

Disposing of assets and land during the current weak market will allow Mah Sing to realise a gain of about RM4.9 million.

Meanwhile, the land in Cheras and Bukit Mertajam is being sold at a discount of 21 per cent and 3.3 per cent at the market value of RM333.2 million and RM45.3 million, respectively.

Mah Sing plans to undertake a residential development called M Vertica in Cheras. It will feature affordably priced serviced apartments with built-up areas of 850 sq ft to 1,000 sq ft. Prices will start from RM450,000.

The five-year development is expected to yield a gross development value (GDV) of RM2.2 billion.

For the land Bukit Mertajam, which is located along the southwest of Jalan Permatang Tinggi, Mah Sing intends to develop an industrial business park comprising light industrial factories and shop offices.

This industrial business park is expected to generate GDV of RM150 million over three to four years.

“It is important for us to understand the market’s needs and offer the right products in the right location, at the right time and, most importantly, at prices that are affordable for all,” said Mah Sing group managing director Tan Sri Leong Hoy Kum.

He said the company would continue to streamline its portfolio of landbank to fit its business strategies and match the current market demand.

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