http://www.nst.com.my/red/offices-play-cat...erjaya-1.317587Offices play catch-up in Cyberjaya
By Vathani Panirchellvum
BOOM-IN-WAITING? As connectivity improves in Cyberjaya and central Klang Valley gets pricier, more people will be lured to work and live there, thus increasing occupancy rates
Cyberjaya has the highest average annual supply growth rate compared to other localities in the Klang Valley.
In recent years, Cyberjaya has grown from being a relatively isolated township inhabited mainly by ICT employees and university students into a well-planned township which will continue to attract more developers and investors. According to a recent survey done by Cyberview Sdn Bhd, Cyberjaya has recorded strong office supply growth, with the office stock growing at the highest average annual supply growth rate compared with the other office sub-localities in the Klang Valley, at 18.5 per cent between 2002 and 2012. This was followed by another growth hotspot, the Bangsar/Pantai locality, which is home to KL Sentral.
Of the various office sub-locations in the Outside Kuala Lumpur City (OKLC) area, Cyberjaya has the second largest office stock representing 24 per cent of the OKLC stock, after Petaling Jaya, which accommodates 11.01 million sq ft (or 38 per cent) of OKLC office space. As of end 2012, the existing supply of purpose-built office accommodation in Cyberjaya was 7.113 million sq ft all of which was prime grade space.
“The impact of the various initiatives under the Economic Transformation Program (ETP) is starting to gain momentum, which bodes well for Malaysia’s target to reach developed nation status by 2020. As such, the strong economic growth driven by both domestic and foreign investments has been quite encouraging for Cyberjaya. Cyberview Sdn Bhd, together with other developers are further developing various projects, both commercial and enterprises to cater to current and future demand. We constantly engage with our stakeholders to build on the existing eco-system that has flourished whilst enhancing Cyberjaya’s attractiveness as an ideal investment location,” says Faris Yahaya, Managing Director of Cyberview Sdn Bhd, the landowner and Cybercity Manager of Cyberjaya (CCM).
Low density
Ruby Mohd Lana, Senior Manager of Sales and Marketing from Emkay Group adds that with the current congestion in the city centre, many companies are moving to city fringes, like Cyberjaya. “That is the trend currently. Many prefer setting up businesses here as it’s almost jam-free in Cyberjaya. The fact that Cyberjaya and Putrajaya are neighbouring each other also adds to the attraction especially for government agencies and multinational companies (MNC) like Dell, IBM, Hewlett Packard and many more.”
Ruby adds that there are many universities nearby, within 3km to 16km radius, making it easy for companies to source for fresh graduates. “Cyberjaya is a low-density area, where 48 per cent of the land is covered by greenery. It also has a Healthy Air Quality with less pollution compared to most areas where only 10 acres of the total 7,000 acres will be used for light industrial.”
The average market price of offices in Cyberjaya is estimated to range between RM450 and RM550 psf, says Faris of Cyberview. Ruby agrees and adds that prices have gone up by 10 to 15 per cent within the last two years. “Some of the features used to lure tenants include MSC-status, green and intelligent features and the fastest broadband connectivity in Malaysia using 100 per cent fibre optics. There’s hardly any problem in securing tenants and the feedback that we receive from any promotional activities has always been encouraging.”
Oversupply?
On the office oversupply situation, Faris admits that there is a substantial supply of unoccupied office space in Cyberjaya. “In the medium to longer term, this is expected to result in a steady average occupancy rate and therefore an oversupply scenario will continue. In the immediate term, new supply entering the market is limited and although a general supply-demand imbalance scenario prevails and the more recently completed offices take some time to become fully occupied, the occupancy rate is expected to remain around the 70 per cent mark in 2013.”
Foreign MNCs and Malaysian MSC-status companies, which form a large proportion of Cyberjaya’s target demand, have generally delayed any short-term expansion plans. However, steady and stable demand will be driven by tenants’ relocations from older office buildings to newer buildings with better specifications, attractive rentals and incentives, Faris continues.
According to research done by YY Property Solutions Sdn Bhd (YYPS), a property consultancy, the lacklustre demand for office space in Cyberjaya has resulted in higher vacancy rate during 2Q 2013 (2Q13: 21 per cent vs. 1Q13: 12 per cent) and lower average gross asking rent (2Q13: RM4.75 psf vs 1Q13: RM4.93 psf).
Despite the rather unfavourable outlook, a big impetus that could shift the office supply dynamics could be the much-anticipated proposed MRT Line 3 which includes extending the line from Selayang to Putrajaya which ends at Cyberjaya/Putrajaya ERL station.
There is also a planned new transport terminal which will connect to the future Putrajaya Monorail extension. This ease of accessibility is expected to attract more people to live and work in Cyberjaya, thus filling up its many offices, residential and commercial units. A number of new shopping malls are in the pipeline as well. Thus, in five years’ time when most of the malls are completed, we might see an entirely different, more vibrant and self-sustaining Cyberjaya.
Read more: Offices play catch-up in Cyberjaya - RED - New Straits Times
http://www.nst.com.my/red/offices-play-cat...7#ixzz2Yn0gQUcG