SP Setia is launching its third project in Melbourne, Australia. The speed of the launch is pretty fast because it had acquired the land just 6 months ago for A$6.68 million. (RM20.2 million) The project is called Maison Carnegie and it would be completed towards end of 2017. Another amazing speed, when compared to the usual time lines in Malaysia. The gross development value (GDV) is A$32mil (RM97 million). In this case, the land cost comes to 21 percent of GDV. Hope some of my friends would understand why I think the margins for developers in Malaysia remain healthy thus far when compared to the usual margins in developed markets.
The great thing about these more advanced markets is the speed. Thus, on an overall basis, perhaps a lower margin remains to be good versus higher margin over a longer construction and delivery period. No wonder sombre suggesting that if speed of approvals can be faster, homespun be made cheaper. Read here: You make it faster, I make it cheaper The project is made up of 48 affordable luxury units in a low density of four-storied apartments and the properties are being priced at an average price of A$667,225. Starting price looks acceptable to me, at just A$452,000. The median price in Melbourne is already far higher. Read here: Be reminder, median price is A$690000 today According to the report (I have not been to Melbourne), Carnegie is an established residential location in south-east Melbourne, located 12km from the city’s central business district (CBD).
The targeted buyers according to SP Setia’s Melbourne Choong Kai Wai (pic), the chief executive officer of S P Setia Australia are local buyers, especially first time home buyers. This is because of the attractive lower entry price point. Choong said: “Carnegie is also close to the rail network, has good amenities and is within food and retail precints and schools. There is also the Caulfield campus of Monash University and the Chadstone shopping mall, which is Australia’s largest. The value in this area will appreciate and this will be a key driver for buyers to invest here.” This is the third project for SP Setia in Melbourne after two sold out projects earlier, Fulton Lane and Parque. There are two more pieces of land that SP Setia has acquired too. One 1.02-acre plot of land in the east end of Melbourne’s CBD for A$101mil and another smaller piece in Prahran, south-east Melbourne, for A$10mil. Happy reading success stories of successful Malaysian developer in advanced property markets.
written on 18 June 2016
Next suggested article: SP Setia: Launching RM4.7 billion GDV for 2016. Nice
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