Image sourced from Sime Darby Property Bhd
Transit Oriented Development (TOD) is the latest catchphrase to hit the Malaysian property scene, seemingly to hold the key to lowering the number of road commuters, and encouraging homeownership for those wanting to live and work close to the city centre.
What Do the Experts Say?
Property Guru’s Property Outlook Report 2017 revealed that TODs are an effective means of revitalising property values spurred on by the injection of rail infrastructure.
“As TOD developments emerge, this will, in turn, foster growth for future integrated property developments which will, ultimately, transform the way Malaysians commute and by default, their lifestyle, employment patterns and more,” according to PropertyGuru.
In fact, it appears that any property development targeted at the middle-income segment, will soon need to adopt a TOD concept to sustain any sort of consumer interest.
Research powerhouse CBRE|WTW’s Real Estate Market Outlook 2017 declared that in the past year, the concerted efforts to re-focus on and organise the mass rapid transportation system (LRT & MRT) in Kuala Lumpur, has helped shore up a growing sense of confidence the city has what it takes to make it into the top most liveable cities by 2020.
Rahim & Co Research’s Property Market Review 2016/2017 echoed this, stating that the reformation and evolution of technology will change the way the urban dwell, impelling people to choose to work from home and seek alternative mobility options – a win-win situation being that both are signiﬁcant ways to cut down on both the cost of living as well as reduce one’s carbon footprint.
“TODs and Transit Adjacent Developments (TAD) equipped with a high speed and stable internet connection may be the spark to ignite the property market,” added Rahim & Co.
How will incorporating TODs locally provide all the beneﬁts associated with liveable communities?
TOD to Curb Congestion
To ease traffic congestion, DBKL is offering incentives to developers building high density developments within TODs or to those who have devoted at least 30% of the development to the so-called Park ‘n’ Ride scheme (building car parks next to train stations to encourage Malaysians to park and ride the train to Klang Valley) – incentives like a 30% discount on development charges.
Meanwhile, under Budget 2016, RM900 million has been allocated to reduce traffic congestion.
DBKL is, additionally, planning to ease traffic congestion by adopting a 60:40 public transport versus cars ratio as it currently stands at 30:70 for public transportation versus cars (though it should be said that this rate has significantly improved by 30% over the last couple of years).
TODs improve the quality of life
Market watchers have seen how TODs have created vibrant, liveable, sustainable communities for many in the United States, Japan, Korea, Taiwan and Singapore.
Prasarana Malaysia Bhd aspires to boost the quality of life, health and productivity of Malaysians by eliminating the stress of travelling on congested roads and highway through TODs.
These include the creation of pedestrian-oriented, mixed-use communities centred around high-quality train systems, helping provide a balanced and reduced stress lifestyle for dwellers, lessening the need for a car for mobility and survival.
The company’s group managing director Datuk Azmi Abdul Aziz said emphasis will be placed on TODs that integrate housing, office and retail elements within a walking distance to public transportation to encourage transit ridership.
“What we are planning is for LRT users to have all their activities, both private and social, within that area,” he said.
Can TOD Pave the Way for Affordable Housing?
Current TOD housing developments especially KL Sentral are unaffordable for the middle-income segment. Many developers hoard strategic lands suitable for TODs instead earmarking them for standalone projects.
Therefore, to allow for affordable housing, DBKL has set development guidelines for developers to build some homes at TOD spots that are around 800sq ft. and priced below RM450,000.
This is achievable through a public-private partnership i.e. building on government-owned land to reduce land acquisition costs, leading to lower development costs.
Additionally, Bandar Malaysia in Sungai Besi will be an enhanced version of KL Sentral’s model as it will be the site for not only the High Speed Rail station linking Singapore and Kuala Lumpur, but two additional MRT stations.
DBKL will introduce 30,000 units of homes to be delivered to 120,000 residents within Bandar Malaysia for a start.
CBRE|WTW managing director Foo Gee Jen said there were many plots of land along the Sungai Buloh-Kajang line of the My Rapid Transit with the potential to be developed into sites for affordable homes.
These include Kota Elmina near Sungai Buloh and government-owned real estate in Jalan Duta and Taman Suntex, he said, pointing out that they were underutilised in terms of plot ratio and density.
Where will TODs emerge?
KL Sentral was the first TOD hub spearheaded by Malaysian Resources Corporation Bhd. They are planning to emulate this in PJ Sentral, Cyberjaya City Centre, Kwasa Sentral in Sungai Buloh and the northern transport hub of Penang Sentral as well.
Sime Darby Property has banked on the new Subang Jaya LRT station to introduce a mixed-use development that will incorporate a Park ‘n’ Ride facility.
Sunsuria City with a direct link to the Salak Tinggi ERL station will have a lifestyle TOD.
Meanwhile, Prasarana is undertaking joint ventures with private developers to build TODs starting with Latitud8, a mixed development above Dang Wangi LRT Station together with Crest Builders Holding Bhd.
Other LRT stations that are be developed into TOD projects are Ara Damansara, Awan Besar, Kelana Jaya and IOI Puchong Jaya while Brickfield’s Tun Sambanthan monorail station and a Taman Tun Dr Ismail MRT station would also be incorporated into TOD projects.
In the pipeline, also, are Bandar Malaysia, Tun Razak Exchange, KL118 (formerly known as Warisan Merdeka), KL Metropolis, DC Residency Kuala Lumpur, Kwasa Damansara and D’Sara Sentral.
With the support of the community and the relevant authorities, TODs will become a staple, help promote economic growth and public transit, whilst boosting quality of life for people.