Ferringhi Residence 2’s low density, attractive pricing to woo buyers

FOLLOWING the encouraging response to Ferringhi Residence in Penang, Mah Sing Group Bhd is set to launch Ferringhi Residence 2 by year end.

The gated Ferringhi Residence, to be developed in three phases, is a freehold development comprising low-rise condo villas and high-rise resort condos on 61 acres of elevated land in Batu Ferringhi.

Mah Sing bought the parcel, which is located 1km from Hard Rock Hotel Penang, in 2010.

The first phase of Ferringhi Residence was launched in 4Q2012 and the units were priced at between RM870,000 and RM1.4 million.

Occupying 10.9 acres, Phase 1 offers 210 apartments with built-ups of 1,510 to 1,752 sq ft in a 5-storey block. More than 90% of the units are sold.

Daniel Law (pictured, right), the group’s senior general manager for the northern region, says the Ferringhi Residence development is targeted at families with children.

“About 25% of the buyers in the first phase are from overseas. They bought them as investment properties or holiday homes,” he says. “The rest are Penangites and Malaysians from other states.”

Sea view apartments

Ferringhi Residence 2 will also have low-rise condo villas and high-rise resort condos, but they will be smaller than those in Phase 1. The units will have built-ups of 1,208 to 1,565 sq ft.

Law expects Ferringhi Residence 2 to attract buyers similar to those of Phase 1.

It will offer 632 units in three blocks of 4, 10 and 32 storeys. With a gross development value (GDV) of about RM700 million, the units will have sea views and will be priced at between RM700 and RM750 psf.

The facilities will include a multipurpose hall, gym, tennis court, infinity pool, barbecue area and playground. In addition, there will be a man-made pond, a feature that will also be found in Phase 1.

“We realised that people like water features,” Law says. “There will also be a park where the residents can mingle in the evening.”

Following a preview in July, Ferringhi Residence 2 received 600 registrations in two weeks. “This is a low-density development [which is rare in Penang], and we try to make the pricing as attractive as possible,” Law explains.

Mah Sing expects a good take-up for Ferringhi Residence 2 as it believes the demand for properties in the middle high range is still strong.

Law notes that these days, consumers have specific needs and it is important that Mah Sing identify and accommodate them to stay competitive.

After Ferringhi Residence 2, the developer will move on to Ferringhi Residence 3, which will occupy more than 30 acres. It will comprise 410 resort condos, 80 town villas and 32 hillside villas. The launch date has yet to be confirmed.

Mah Sing’s medium and long-term business plan in Penang is to continue expanding its landbank. Currently, it has a total of 82 acres of undeveloped landbank in Penang. Apart from Ferringhi Residence, the group’s other key project in Penang is Southbay City, another high-rise residential development.

Slated for a preview by year end, Southbay City will offer units with built-ups of 530 to 1,200 sq ft at an indicative price of below RM1,000 psf. This project is still in its planning stage.

Mah Sing’s landbank in other parts of the country — the Klang Valley, Iskandar Malaysia and Kota Kinabalu — stands at 3,595 acres, which will keep the group busy for the next 8 to 10 years.

The developer expects some new launches in the Klang Valley by year-end. They include the final block of Savanna Executive Suites at Southville City in Bandar Baru Lembah Selatan, two blocks of residential suites (built-ups of 978 sq ft and above) at Lakeville Residence in Taman Wahyu and the final two blocks of serviced residences at D’sara Sentral in Sungai Buloh.

It also plans to launch landed homes, including link houses and semidees, as well as shops at M Residence and M Residence 3 in Rawang.

Market outlook

Despite the weak market sentiment, Law remains positive about the demand for properties in the country. “Demand is always growing in Malaysia, but it is the sentiment that affects the market. The main factor is still job security.”

According to data from the Department of Statistics, the nation’s unemployment rate rose 0.1% month on month to 3.1% in May.

Nevertheless, Law believes that properties will continue to be the preferred wealth preservation and investment option with healthy gross domestic product and household income growth, a young demographic and stable employment conditions.

He says about 70,000 to 80,000 new homes are completed each year while 200,000 units are needed by new households.

“Moving forward, demand will be from the mass market segment, but supply will still be from the high-end segment,” he adds. “Developers will have to match their products with demand and at the same time, have a strong cash flow and be innovative. They must also focus on after-sales service.”

He says Mah Sing will continue to focus on the target market — Malaysians aged 39 years and below, who make up about 70% of the population — as this group will set up new households, and therefore, require new homes.

As at January 2015, Mah Sing was in a net cash position of RM1.1 billion. Its current unbilled sales stands at RM5.1 billion.

Are you curious about properties in Batu Ferringhi after reading this article? 

This article first appeared in City & Country, a pullout of The Edge Malaysia Weekly, on Oct 5, 2015. Subscribe here for your personal copy.