Titijaya Land Bhd is the latest in a cluster of notable developers that are making a move into the affordable housing segment, indicating that the industry is now gradually aligning itself with current market demand.
The move by Titijaya Land comes in the form a proposed RM2.4 billion project that will take shape in the Bukit Raja vicinity in Selangor. The yet-to-be-named project is expected to kick off by the second quarter of 2017.
According to Titijaya Land’s managing director Tan Sri Lim Soon Peng, the proposed project is in line with the group’s business transformation initiative, which will see stronger focus on this relatively untapped housing segment.
The land was acquired via the company’s purchase of NPO Builders Sdn Bhd, which owns two tracts of land measuring a total of 46.2 acres. The land is earmarked for commercial developments, serviced apartments and affordable housing units.
“The affordable units will range between RM300,000 and RM450,000. In this regard, I would like to highlight that almost 90 per cent of our ongoing property projects are priced in the range of RM100,000 to RM599,000, which are not affected by the recent hike in stamp duty fees for purchases of properties priced above RM1 million,” Lim said.
He added that the group has a sufficient land bank which was sourced at a relatively low cost, making the land cost-to-GDV ratio an attractive prospect. The company is also open to collaborating with government agencies to build more affordable projects in the future.
Currently, Titijaya Land is involved in a land swap deal with the Education Ministry.
In November last year, Titijaya announced plans to swap lands with government land owners, or negotiate for attractive terms via direct acquisitions or joint ventures with landowners.