City & Country: LRT boost for Real Estate

By Racheal Lee

Sunday, 27 December 2009

LRT lines bring smiles, and fears

The government’s recent announcement that Klang Valley’s two light rail transit (LRT) lines would be extended by 34.7km has brought smiles to beleaguered commuters in areas like Subang Jaya, USJ, Kinrara and Puchong.

While they are looking forward to better public transport when the project is completed, targeted for 2012, owners of real estate near the proposed new LRT stations are eagerly anticipating a welcome fillip for property values.

On the flip side, there are concerns that traffic woes, parking problems, noise pollution and insufficient public bus services to cope with the anticipated influx of commuters could put pressure on the value of their properties.

One of them is Jalil Sutera resident Ooi, who is worried that the new LRT station (STN01 of Ampang line) will be built too close to his house.

“It (the extension) is good but if there are not enough parking spaces at the LRT station, users may just simply park their cars on our doorstep,” says the 43-year-old contractor, who went to view proposed alignment of the extended lines recently.

The proposed alignment of the extension to the Kelana Jaya (formerly Putra) and Ampang (formerly STAR) lines is on public display from Sept 15 to Dec 15. Public feedback will be channelled to the Department of Railways before finalisation of the cost and commencement of work.

The display is held at five venues — Department of Railways (Ministry of Transport), Kuala Lumpur City Hall, Petaling Jaya City Council, Subang Jaya Municipal Council and Shah Alam City Council.

The Finance Ministry-owned Syarikat Prasarana Negara Bhd (SPNB) is expected to spend an initial RM6 billion to RM7 billion to build the extended lines. According to a recent news report, SPNB launched the pre-qualification tender for the civil works of the LRT extension on Nov 3, a month later than earlier scheduled. The tender will be open till Dec 16. The package comprises the main civil and infrastructure works and other sub-packages.

It has also been reported that SPNB has yet to invite bids for the systems and rolling stock portion, which is being eyed by international as well as local companies.

Concerns of homeowners like Ooi are not baseless. He says he was told at the Department of Railways that the LRT station would be built about 100 metres away from houses in his neighbourhood.

However, when City & Country visited the existing Ampang station (S01) in Selangor, it was found to be just next to a row of 2-storey terraced houses in Taman Dagang, less than 100 metres away.

Commercial use

It is ironical how the winds of fortune can blow. Back in 2003, Adrian Wang, managing director of CBD Properties Sdn Bhd, had problems selling a bungalow at the back of the Taman Bahagia LRT station in Petaling Jaya. He even suggested to the owner to reduce the RM1.1 million tag but the owner refused to budge. As it turned out, the property is now worth about RM1.8 million because its land use has been converted from residential to commercial.

More and more bungalows near LRT lines, such as those on Jalan SS2/3, are being used for commercial activities, including a confinement centre and kindergarten. A visit there recently revealed that at least three of the bungalows were up for rent. One of them, sized at 2,000 sq ft and with the LRT line at the back, was asking for RM5,000 a month.

Interestingly, according to Wang, the 1-storey terraced houses opposite the Taman Bahagia LRT station are sought after irrespective of their micro location, tagged at RM280,000 to RM290,000. He attributes this to the limited supply.

Stable

Quoting past transactions, Chan Wai Seen, director of research and consultancy of JS Valuers Property Consultants Sdn Bhd, says values of properties near LRT lines, such as those along Jalan SS2/3, have not dipped.

Only homes located near LRT stations, and not LRT lines, have commercial use potential. Since the new lines will cut through developed areas, the provision for car parks and access roads to the stations may be restrained by space, he says.

Proper planning of LRT stations is important for reasons such as prevention of crime, adds Chan, who hopes the stations will be able to optimise their retail potential, as seen in the KLCC station.

“The LRT has benefited both commuters and the property market while reducing traffic congestion. The extension is a long overdue project that should have been undertaken many years ago, he adds.

Generally positive

Property consultants are also generally positive about the LRT line extension. They play down problems like traffic congestion, noise pollution and even double-parking, saying that the pros outweigh the cons.

Khong & Jaafar Sdn Bhd managing director Elvin Fernandez says such inconveniences are unavoidable while the extension will benefit a larger group of people. In Subang Jaya for example, he says, the project will further enhance its growth as a hub for education, tourism and medical facilities. He hopes the lines will soon be extended to areas like Klang, Cheras and Kajang.

Most of the proposed new LRT stations are within housing areas like Bandar Kinrara, Taman Wawasan in Puchong, Puchong Perdana, Taman Puchong Prima, Subang Jaya and USJ. They are also close to several national schools in USJ.

Naturally, shopping destinations like Giant Kinrara, Jusco Bandar Puchong (IOI Mall), Tesco Puchong, Giant Puchong, Cold Storage (Subang Parade) and The Summit Subang are poised to benefit from the extension.

SPNB group managing director Datuk Idrose Mohamed has reportedly said that more details on the proposed new line to link Kota Damansara and Cheras will be revealed this month.

The Kota Damansara-Cheras line is expected to stretch about 50km, longer than the 45km that had been reported earlier. There will also be an underground portion that is said to run about 10km, but could eventually be longer.

In another development, several community representatives in Subang Jaya have reportedly formed an ad-hoc action group to address concerns related to the proposed Kelana Jaya LRT line extension into Subang Jaya.

They will gather feedback from residents and those working in the Subang Jaya, USJ and Bandar Sunway communities. Based on these, recommendations will be submitted to the Department of Railways and SPNB.

SPNB has projected that the capacity of the Kelana Jaya extended line will expand to 400,000. Currently, there are about 350,000 people using the lines — 180,000 for the Kelana Jaya line and the rest for the Ampang line.

The proposed extension of the LRT reach will benefit commuters but owners of property in their vicinity may or may not immediately strike gold.

This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 783, Nov 30 – Dec 6, 2009.