Last updated on 08/07/2014 – 07:34
KOTA KINABALU: The surge in migration to Sabah’s capital, Kota Kinabalu, has brought an economic growth spurt to its satellite towns, attracting savvy businessmen seeking to cash in on the trend. While most plunge into residential development and some into industrial, commercial or mixed development, Grand Merdeka Development Sdn Bhd (GMD) has bigger plans.
The property development company under the Wisma Merdeka Group (WMG), a 36-year-old property developer, has begun work on a large-scale development encompassing a mall (GM Mall), hypermarket, fast-food drive-through, home-furnishing mall, corporate suites, medical centre and a hotel, with an estimated gross development value of RM1 bil, catering to the middle- to low-income group.
This three-stage development planned over eight to 10 years covers a 19-acre plot along Jalan Tuaran, between the towns of Menggatal and Telipok, hailed as the next phase of development expansion after Inanam.
Property development manager Chew Fei Sean tells FocusM the unique feature of this development is that every structure in each of its phases will be linked via a basement carpark and possibly a skybridge, similar to the connectivity between The Curve, Ikea, the IPC Shopping Centre, the Curve NX and the Surian Tower commercial development cluster in Mutiara Damansara in Petaling Jaya, Selangor.
“It will be an open-mall concept as we will use green technology for cooling instead of air-conditioning. As high-tech as it sounds, our target market is the middle- to low-income group so we will feature local brands so the products and services are within economic reach of the area along the Tuaran bypass, between Menggatal and Telipok,” says Chew, who prefers to be known as Sean.
Her father, Chew Sang Hai, is one of Grand Merdeka’s four directors. The others are Sabah’s first Accountant-General James Voon Kyam Kiun, Wong Kuin Mai – Voon’s daughter-in-law – and Tong Kok Wui, owner of Tong’s Departmental Store, a homegrown apparel retailer.
Voon, now 82 and still actively involved in the business, pioneered mall management in Sabah with the development of Kota Kinabalu’s first mall, Wisma Sabah, modelled after Lucky Plaza in Orchard Road, Singapore. Voon via WMG went on to create Sabah’s first entrepreneur mall Wisma Merdeka, dubbed KK-Sungei Wang. He is also the man behind Segama, the first shophouses in Sabah connected via corridors. Segama, built in the 1970s, is still a major part of Kota Kinabalu’s cityscape.
Sean notes that as the town develops, many five-star malls have popped up in the CBD, and there are many in the pipeline owing to the rise in tourist arrivals. Malls such as 1Borneo Hypermall, Suria Sabah, Asia City Complex, Centre Point and Karamunsing Shopping Mall target tourists.
Similarly, seeing the huge potential in Kota Kinabalu, the third-most-lucrative market in terms of retailer turnover after the Klang Valley and Penang, more major malls are in the pipeline – Oceanus Waterfront Mall, Imago Mall at KK Times Square, Lifestyle Mall@Jesselton Waterfront, Aeropod@Tanjung Aru and Pacific Parade@PacifiCity .
PacifiCity, previously planned as KK Mega Mall, was twice abandoned before KP Kuok of the Robert Kuok “sugar dynasty” clan swooped in via Pacific Sanctuary Holdings Sdn Bhd with a planned revival of the 25 acres encompassing two malls, residences and office suites with a gross development value (GDV) of RM4 bil. Jesselton Waterfront is a RM1.5 bil redevelopment of Kota Kinabalu Port, since its operations were moved to the Sepanggar Bay Container Port. This spanking new tourist magnet is said to be modelled after the Victoria & Albert Waterfront in Cape Town, South Africa.
With so much attention on the tourist market, Sean says the company has chosen to cater to the less affluent in the suburbs, leaving the CBD to developers with deep pockets as the price of land in the town centre was simply too high.
According to a market report by CB Richard Ellis, Kota Kinabalu’s 17 malls contribute a net lettable area (NLA) of 4.59 mil sq ft. This is estimated to balloon to 6.45 mil sq ft by year-end and 7.39 mil sq ft by 2016. The report also states that occupancy rates at malls have hovered at about 85% since 2008, while rentals – the highest being in the 1Borneo Hypermall, Wisma Merdeka and Center Point Sabah – are 20-25% of top retail rentals at the KL City Centre and 40-50% of rentals in suburban areas of KL.
Sean also reveals GM Mall will have 800 units of shoplots in its NLA of 271,000 sq ft, about a quarter of the NLA at the 1Borneo Hypermall. GMD plans to hold about 60% of the NLA, selling the smaller units of 103 to 457 sq ft which will be strategically located between the anchor and junior anchor tenants. The lowest retail price is RM89,000, with prices starting at RM650 per sq ft.
For full story, go to www.focusmalaysia.my, which also targets other Malaysian businesses.
