By Kent Tan
The Malaysian Property Market 2014 report by the Valuation and Property Services Department under the Ministry of Finance has been concluded with Consumer Sentiments Index (CSI) at 83 points, which is the lowest in the year, leading to a moderate performance by the commercial sub-sector.
Last year, the commercial sub-sector faced an uphill battle, laden with stringent bank loans and new cooling policies. Although an increase of 3.6%t totalling 35,528 transactions was recorded, the value of transactions decreased by 10.5% to RM31.84 billion.
Leading the transactions were Selangor at 23.7%; Johor, 16.3%; and Kuala Lumpur, 13.4%. These states also contributed double-digit growth in terms of volume, standing at 13.4%, 18.7%, and 13.4% respectively. Penang also contributed 7%t in volume while Perak declined by 16.7%.
In terms of value, among these five leading states, Johor recorded the greatest downfall by 42.8%. Selangor was down by 1% and Penang by 3.5%. On the other hand, Kuala Lumpur and Perak recorded an increase of 14.3% and 5.3% respectively.
Overall, shop transactions contributed the most with 56.7%t in total transactions and 47.1% in total value. A total of 20,133 transactions worth RM14.99 billion were recorded. The activity showed a decline of 0.3% against 2013 but saw an increase of 6.3% in value, translating to shop prices being sustained.
In terms of transaction volume and value, Selangor and Johor remained at the lead with 22.8% and 16%t respectively for the former and 24.6% and 22.9% respectively for the latter.
Several states saw a decline in market activity with Kuala Lumpur down by 10.8%; Selangor, 4.8%, Penang, 1.5% and Perak, 16.9%.
Of these, two-and-a-half-storey shops top the list at 53.9%t, followed by three to three-and-a-half-storey shops at 28.5%.
The overhang situation has been improving, from 4,849 units in 2012, 4,676 units in 2013 to 4,324 units worth RM1.5 billion in 2014. The volume went down by 7.5% against 2013 but value has gone up by 7.9%. Unsold under construction units increased to 7,987 units or 32.2% while unsold not under construction units went down by 30% to 1,257 units.
A low tone was also reflected in the construction activity with completion down by 1.5% to 9,520 units whereas starts were only up by a mere 1.7%t to 17,429 units. New planned supply went up to 43.2%. A total of 405,015 existing shops is recorded while 78,763 units are incoming and 68,649 units are in the planned supply.
For shopping complex, six transactions worth RM353.9 million were recorded. The occupancy rate rose slightly from 80.1% with 5,176,418sq ft in 2013 to 81.3% with 6,433,643sq ft. Every state saw positive take-up except Labuan, Terengganu and Perlis. Kuala Lumpur led with the highest take-up rate of 2,470,295sq ft.
The occupancy rate was good, with 10 states scoring above 80%t. Perlis have full occupancy while Kuala Lumpur and Selangor rose 87.7%t and 84.7% from 83.3% and 81.7% respectively. Johor was down to 74.1%t from 75.6% while Penang dropped to 66.1%t from 70.3%.
Construction rate for the sub-sector recorded 27 new completions totalling 7,426,904sq ft while starts recorded 22 complexes at 4,071,653sq ft against 16 complexes or 4,862,521sq ft in 2013.
Existing retail space totals 139,715,557sq ft from 904 shopping complexes. Another 69 complexes at 13,562,527sq ft are in the incoming supply and 45 complexes or 10,010,436sq ft are in planning.
18 office building transactions were recorded, marking an increase from 82.7% to 84.9%. All states recorded positive take-up except Sabah and Kedah while Kuala Lumpur scored the highest. 14 States recorded more than 80%t occupancy rate.
A total of 23 office buildings were completed, offering 4,558,182sq ft, more than double from 1,525,084sq ft in 2013. However, the starts went down from 3,127,486sq ft in 2013 to 1,644,413sq ft last year. Existing office space totals 210,434,448sq ft from 2,408 buildings. Another 80 buildings with 18,406,286sq ft are in the incoming supply and 24 buildings with 5,812,511sq ft are in the planning stage.