PROPERTY developer Tambun Indah Land Bhd is looking for joint-venture (JV) partners to spread its wings out of Penang where its flagship project is based.
“We would like to expand into the Klang Valley, but our focus will be more on the outskirts like Kajang and Rawang where there is still plenty of land,” managing director Teh Kiak Seng says.
The company is in “several discussions” with landowners for this purpose, he says but nothing has been firmed up.
Tambun Indah, which claims to be the first to introduce the concept of guarded and gated (landed property) in Seberang Prai, made a net profit of RM23.6mil for the financial year ended Dec 31, 2011 against a net profit of RM25.2mil a year earlier.
“I personally believe that prices on the island, the highest at about RM1,200 per sq ft now from about RM800 per sq ft in 2010, will not go up further due to increasing competition. We intend to benefit from that,” he says.
The mixed residential and commercial township sits on a 1,001-acre site which is expected to be fully developed by 2020, complete with a business park which will house schools, hotels and hypermarkets.
So far, 450 acres have already been developed into residential and shop units.
There are plans to launch two more projects within Pearl City this year.
“We are enjoying a spillover of buyers from the island where property prices have skyrocketed since 2010,” Teh says.
For example, a terrace house on Penang island now costs around RM800,000. On the mainland, the same type of house would cost some RM300,000, he says.
“We see the gap (in price) eventually closing,“ Teh says, attributing it to new infrastructure coming onstream such as the Second Penang Bridge and the Double Track Commuter Train which will enhance connectivity between the island and mainland.
The proximity of the Pearl City development to more than 10 industrial parks, which are capable of generating thousands of job opportunities, will also play a part in ensuring that its properties enjoy a steady price trend as workers buy up units to live in, according to Teh.
He says that apart from the two residential projects within Pearl City that Tambun Indah will launch this year, there are three more, namely the RM39.3mil BM Residence in Bukit Mertajam, RM41mil Carissa Villas in Bagan Lallang, and the RM180mil Straits Garden in Jelutong on the island.
The funding of Tambun Indah's new projects will be through the issuance of 88.4 million shares through a rights issue which will raise RM44.2mil.
The two-for-five rights issue, which was approved at a recent shareholder meeting, is expected to be completed in June. It would also effectively increase Tambun Indah's share capital to RM154.7mil, comprising 309.4 million shares.
After these new projects are launched, Tambun Indah will have more than 600 acres of undeveloped land, mostly in Pearl City and some on the island.
The company currently has 10 ongoing projects, mainly residential that it launched over the past two years.
“These have had an average take-up rate of more than 80%,” Teh says.
Gross margins stand at about 30%, he adds.
Tambun Indah, which claims to be the first to introduce the concept of guarded and gated (landed property) in Seberang Prai, made a net profit of RM23.6mil for the financial year ended Dec 31, 2011 against a net profit of RM25.2mil a year earlier.
“I personally believe that prices on the island, the highest at about RM1,200 per sq ft now from about RM800 per sq ft in 2010, will not go up further due to increasing competition. We intend to benefit from that,” he says.
On average, Tambun Indah's Seberang Prai properties are selling at below RM300 per sq ft. More than 90% of its property development projects are located on the mainland. - The Star
