Cover Story: Integrated townships to mark new beginning

This article first appeared in City & Country, The Edge Malaysia Weekly, on October 2, 2017 - October 08, 2017.

Double-storey terraced houses in Darulaman Perdana

BDB Hotel at the Darulaman Golf and Country Club in Bandar Darulaman

An artist’s impression of a bungalow in Bandar Darulaman

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Since becoming the group managing director of Kedah-based Bina Darulaman Bhd in 2014, Datuk Izham Yusoff has been working to diversify the company’s portfolio to boost its earnings.

In an interview with City & Country at his office in Kuala Lumpur, Izham notes that the strategy now is to grow the property development division, which, in turn, will invigorate the other divisions, namely road-building and quarry, engineering and construction, and golf and hotel. Its engineering and construction division has been undertaking external projects and currently has an order book of RM400 million.

In the past few years, Izham has been leading his team in transforming the company into a more focused and targeted entity, with an emphasis on offering contemporary products and services.

“Based on what we have now, the key segment that will drive the company’s earnings is property development,” he says.

“When this division grows, other divisions will benefit from it. The property developments we have done were on a small scale and not in an integrated manner.”

 

Integrated townships

From now on, Bina Darulaman plans to develop integrated townships and undertake more pocket developments. This move will not only enhance its positioning and earnings but also bring value to its customers.

Since its establishment in 1995, Bina Darulaman has launched three townships — Bandar Darulaman in Jitra, Darulaman Perdana in Sungai Petani and Darulaman Utama in Kuala Ketil.

“Our plan now is to have a good mix of affordable, medium-cost and high-end products. At the end of the day, Bina Darulaman is a public-listed company and we need to answer to the shareholders. The reason the company has been off investors’ radar is because the profit is not there.”

Izham, who is a Kedahan, believes that he knows what his home state needs. He says Kedahans will appreciate the township concept as they are now looking beyond owning just a home.

“We aim to capture the essence of a township with our two upcoming developments,” he explains. “We’ll make sure they encompass two things — activating life and celebrating life — and we hope these townships will mark a new beginning for Bina Darulaman.”

The new projects are Darulaman Saujana in Jitra and Darulaman Putra in Sungai Petani, which have a combined gross development value (GDV) of RM2.6 billion.

According to Izham, these townships will be future-proof as they will take 8 to 10 years to develop. He says apart from locals, the company is targeting buyers from outside the state, such as the Klang Valley and Penang, especially for its commercial properties.

“We are trying to attract young adults, young families and retirees,” he says. “A lot of Kedahans are now working and staying in the Klang Valley. If we can offer them products that meet their needs, I think they may move back to Kedah. Also, they can buy a bungalow in Kedah at a fraction of the cost of one in the Klang Valley.

“In the northern corridor, we are one of the early birds in this industry, so we have an advantage. We will strive to be at the forefront by reinventing ourselves and changing the way we see the property market.”

He says even without much marketing, 10% of the buyers are Kedahans working in the Klang Valley. This group may be thinking about retirement or investment, or buying for their parents, he adds. This has prompted the developer to launch the projects not only in Kedah but also in the Klang Valley.

As highways have shortened the travelling time from Sungai Petani to Seberang Perai, Izham believes that the new townships will also appeal to Penang folk.

He says it is just a matter of engaging with the potential buyers and telling them more about the company and its products. “At present, there is a mismatch between what we have and what people know about our products.

“So, we’ll tell them that they don’t have to look to the Klang Valley or Penang when they want to buy properties. They can get them in Kedah at a more affordable price and with more upside potential.”

New projects

In July, Bina Darulaman unveiled The Life Series — concept and lifestyle-themed townships in the northern region — in Kuala Lumpur. Darulaman Saujana and Darulaman Putra are under this series.

Dubbed “first of its kind in Kedah”, these self-sustaining townships are expected to trigger a new wave of interest in property in the northern region. Both developments, which are located along the North-South Expressway, will have institutions of higher learning, shopping malls and hospitals, among others.

Bina Darulaman is partnering architectural firm Veritas Group and landscape architect Clouston Design Studio for the projects.

With a GDV of RM1 billion and land area of 203 acres, Darulaman Saujana will comprise 1,500 homes — statutory housing, townhouses, link houses, semidees and bungalows. The commercial component will take up 90 acres. There will also be recreation outlets and facilities such as skateparks and rock-climbing walls.

“We are even thinking of having an ice rink,” Izham says. “It would be something different and we are not limited when it comes to ideas. I think if we have something different to offer, buyers will come. It is more of what we can do than what they are looking for. And once we start defining ‘home’ for them, they will go for it. We want to create the demand, rather than meet the demand.”

He says Darulaman Saujana is targeted at young adults who are working and living in the surrounding areas.

Izham also sees demand for short-term stays there and is looking at developing serviced residences. All these developments, he notes, will eventually lead to a clamour for retail outlets such as shops, eateries and entertainment centres.

Darulaman Putra will cover 232 acres and have a GDV of RM1.6 billion. It will comprise the state’s first botanical wetlands park and 1,620 homes — statutory housing, link houses, semidees, bungalows and condominiums.

With the target market being professionals, businessmen and retirees, Bina Darulaman plans to make the township synonymous with good food. Izham says the company is currently in talks with well-known food and beverage outlets in the Klang Valley.

Apart from township projects, the developer is also looking at pocket developments via its subsidiary, Kedah Holdings Sdn Bhd. “We are now acquiring land and will be launching three pocket developments in Kedah soon,” Izham says, adding two of them — Aman Perdana in Serdang and Bandar Sejahtera (Phase 1) in Pokok Sena — will be unveiled as early as next month.

Aman Perdana will comprise 11 units of 2-storey shopoffices and 132 single and double-storey houses. Bandar Sejahtera will feature 218 double-storey terraced home, 32 double-storey cluster homes and 40 units of 2-storey shopoffices.

Bina Darulaman is looking to expand its land bank outside Kedah. In July, it launched Puncak Harmoni, a pocket landed development in Kuala Kangsar, Perak, with a GDV of RM44 million. Occupying 8.6 acres, this project consists of 60 double-storey terraced homes, 20 double-storey semidees and four bungalows.

At present, Bina Darulaman has a land bank of about 2,000 acres, all in Kedah. Three parcels, totalling 200 acres, are located in Langkawi and are earmarked for property and leisure projects.

 

Existing townships

Izham says the company’s focus is not just on new township projects. It is also looking to improve its existing townships by adding amenities and parks. For example, it has spruced up a park in Bandar Darulaman.

“The park wasn’t well maintained, hence it did not attract many people. In the past few years, we have been sprucing up the facilities and landscape. It is now a popular spot,” Izham says.

“By the end of this year, we will be launching another attraction in the park — a water theme park. Kedah’s weather is hot at certain times of the year and people like to go to the pools, so there is a business opportunity. This theme park will occupy five acres and we will own and operate it ourselves.”

The developer will also bringing fast-food chain A&W and a petrol station to Bandar Darulaman. Izham is optimistic that these amenities will boost buyers’ interest in the township, leading to appreciation in property value.

He believes that growing the property development division will not only enhance the company’s profile but also bring value to buyers and contribute to the state’s growth.

“The GDV of the two new townships is RM2.6 billion in total, which translates into RM200 million to RM300 million a year. This will have a multiplier effect on the state’s economy,” he says.

“There will be more investments and economic opportunities. People will make more money and the economy will boom. We must remember that property development involves many industries, therefore the impact will be great.”

 

Challenges

However, Izham acknowledges that the challenge is executing the plans. “There are two areas here — one is the things we need do and the other is executing the plan. The latter is the toughest because our staff will have work closely with outside people. Overall, all our projects are progressing well.”

Many people often associate Bina Darulaman with affordable housing, but this is about to change. The developer is looking to build medium-cost and high-end properties in the near future.

“We cannot be doing only affordable housing because the margin is low. Other segments [such as medium-cost and high-end properties] usually offer higher margins. So, we will be launching a few premium products soon,” Izham says.

“However, affordable housing will remain the mainstay of the company.”

With various plans and strategies in place, there is no doubt that Bina Darulaman is all set to transform itself into a major player in the property development industry.