Corporate Notes by Gurmeet Kaur
WHILE we wait with bated breath on how the Employees Provident Fund (EPF) is going to develop the Rubber Research Institute (RRI) land in Sungai Buloh, here is a wish – that the whole project be turned into an affordable housing project. Here’s why.
At 942.92ha, the RRI land development is the city’s largest suburban property project. Using a high plot ratio and if the units are priced at, say, RM400,000 and below, this would be a huge help to the young urban crowd who are looking to buy their first property.
We all know the difficulty that just about every wage earner is facing in the Klang Valley – the ability to afford a decent home.
File photo of Rubber Research Institute grounds in Sungai Buloh, before it was sold to EPF.
Migration to urban centres coupled with the fast growth of the population has created a big demand for houses in and around major cities, especially in the Klang Valley. But at the same time, private property developers have shifted their focus to high-end housing, obviously attracted by the higher margins.
This has left a big gap in the middle-income housing supply. It is estimated that the middle-income sector makes up half of the country’s population. So, a solution to their housing woes would surely go a long way in tackling the affordable housing problem in the country.
To be fair, there are already initiatives by a few agencies under the Federal and state governments implementing affordable housing schemes. They include Syarikat Perumahan Negara Bhd, Projek Perumahan Rakyat 1Malaysia and Government-linked housing developers like Sime Darby Property.
But given the sheer size of the RRI land bank, the supply of units that would come from its development would be massive and could easily serve much more than the 15,000 population target that the EPF is envisaging.
So, rather than trying to figure out complex joint ventures with high-end developers, the EPF should just tender out construction works for building affordable homes after a solid development plan has been put together by the experts.
The EPF can take a leaf out of the books of countries like Japan, which have good planners for this type of high-rise affordable homes.
No doubt, quality planning is important so that the development does not end up like one of those terrible places where developers’ shoddy planning and greed have created almost “ghetto-like” enclaves in creating their version of affordable housing.
With a 7.5-km green park of 64ha being the highlight of the RRI development, the township could be the model of an affordable housing project.
What makes the RRI land more suitable is the fact that it is going to be an MRT hub. So imagine all the thousands of families living there and using the MRT to work. Wouldn’t that be great to reduce congestion in the city?
File photo of progressed earthworks in preparation for the MRT depot at Sungai Buloh.
But then again, why should the EPF do it?
If the EPF does take this approach, would it mean that it is going to be losing money on this project? After all, the EPF’s subsidiary Kwasa Land Sdn Bhd – the project’s master developer – paid a high sum of RM22.50 per sq ft or RM2.3bil for the land in RRI from the Malaysian Rubber Board.
Still, with this land cost, one can make a decent return on the investment if the development is done in a prudent and efficient way. There are many options available to EPF to ensure that it gets a decent return and yet build the massive number of homes at affordable prices. For example, the commercial development aspects of the project could cross-subsidise the affordable aspect of the project.
So, the EPF should not miss out on this opportunity to have a huge positive impact on one of the most nagging problems among us KLites.
Source The Star, June 27, 2013
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