Occupancy of purpose-built office sub-sector moderates

PETALING JAYA: Occupancy rate for purpose-built office sub-sector moderated to record 84.1% during the year compared with 85.2% in 2009.

The take-up space was lower at 180,556 sq m (2009: 519,244 sq m).

Kuala Lumpur led with the highest take-up of 68,996 sq m, followed by Malacca (46,121 sq m) and Perak (37,156 sq m), according to the National Property Information Centre’s (Napic) property market report 2010.

Four states recorded negative take-up, including Selangor (minus 5,025 sq m).

On the supply front, the market showed mixed performance. Completions dropped to 431,450 sq m (2009: 568,244 sq m) but starts increased substantially by more than four-fold to 603,355 sq m (2009: 142,992 sq m).

New planned supply contracted to 201,423 sq m (2009: 328,185 sq m). As at year-end, the total existing supply of office space in the country stood at 16.56 million sq m offered by 2,227 buildings.

The industrial property sub-sector was the least active, contributing 2.6% to the overall market activity. There were 9,838 transactions worth RM9.83bil in 2010, with volume increasing 22.1% from 8,059 transactions in 2009.

Terraced factory/warehouse was the most favoured property type with 3,359 transactions worth RM1.19bil. The figure contributed 34.1% to the market volume. Vacant plots followed suit by forming another 32% (3,148 transactions).

By price range, industrial units priced between RM250,000 and RM500,000 remained the most sought after, as indicated by its 26.6% share (2,616 transactions) of total industrial transactions, said Napic.

Selangor remained the nation’s largest contributor with 3,124 transactions, followed by Johor with 1,518 transactions.

On the construction front, there were lower completions (595 units) and starts (683 units) from 1,092 and 703 units respectively in 2009.

However, new planned supply recorded increased activity with 872 units (2009: 562 units).

Semi-detached units dominated with 50.4% (300 units) of completions and 49.4% (315 units) of starts, while terrace units dominated with 43.1% (376 units) of the new planned supply.

The country had 93,139 existing industrial units with another 7,654 units incoming supply and 22,289 units in planned supply.

The agricultural property sub-sector was the second-most prominent sub-sector, registering 21.5% (81,030 transactions worth RM11.38bil) of total volume of transactions.

The volume increased by 16.8% in 2010 while the value recorded a higher growth of 36.4% from a year earlier. Perak led the agricultural sub-sector, accounting for 17.6% (14,256 transactions) of the country’s total volume of transactions.

Johor and Sarawak followed with 16% (12,962 transactions) and 15.2% (12,329 transactions) respectively.

By type, vacant agricultural land remained the most actively transacted with a 42.8% (34,682 transactions) of market share.

Oil palm land followed at 16.7% (13,528 transactions), rubber land 14.5% (11,765 transactions) and paddy land 11.4% (9,266 transactions).

The leisure property sub-sector showed a lacklustre performance despite increased tourist arrivals. For the year, 24.6 million tourist arrivals were recorded which noted a 4.2% growth against 2009 (23.6 million).

However, average occupancy of three to five-star hotels declined to 53.1% compared with 55.6% recorded in 2009.

During the year, six new hotels were completed to offer another 1,028 rooms to the market (2009: 19 hotels; 2,534 rooms).

By The Star