ACKNOWLEDGEMENT

Assalamualaikum, First of all, I would like to thanks to Allah s.w.t because of His
Guidances and Blessings to us that make our assignment can be completed and be done
during the period given by our lecturer. Additional to, because of His Blessing for given us
very good health and good conditions that make us to complete our fully assignment.
Secondly, we also wish to acknowledgement to our lecture, Miss Nur Nazihah Binti
Chuweni, for allowing and supporting us to produce this work. Also reviewing the
manuscript and offering many helpful comments regarding its arrangement and content. A big
thanks to on her opinion and sharing some of her experience. Not least, for Encik Encik
Salman Bin Mohd. Idris who is officer at Majlis Daerah Perak Tengah for wanting to give
full cooperation and commitment to us during the process of completing this assignment.
Besides that, thanks to the officer at Unit Jabatan Perancangan Bandar dan Desa, Pejabat
Tanah dan Galian, Ipoh, Perak Darul Ridzuan that have spent their time and helped us by
providing the evidence to further strengthen our assignment work.
Thirdly, we would like to thanks our family members, thank you for the love and
support throughout the journeying producing this assignment. They have done many
sacrifices to make sure that our assignment can be finished. Without them, we may have a
problem especially for the financial problem. Because of them, all the problems have been
solve and can be deterred.
Lastly, we also to thanks to ourselves because can be a good partner and do this
assignment together. Last but not least, a big appreaciation to our fellow friends because of
their big idea that they have shared with us. We have spent very special time together while to
finish our assignment. We are very hope that our friendship will be not last. Lastly, a special
big thanks to all those that has helped us.

1.0 EXECUTIVE SUMMARY

Information below is about the feasibility study project a residential development (double
storey terrace house) PT 9349 H.S.(D) 8034, Bandar Sri Iskandar, District of Perak Tengah,
Perak. Our company, Suria Property & Co. have been instructed by our client Miss Nur
Nazihah Binti Chuweni to prepare and make a Feasibility Study on the prospects for the
development of Double StoreyTerrace House. This is some information about the
development:
CLIENT

: Miss Nur Nazihah Binti Chuweni

PURPOSE

: Feasibility Study

PROPERTY TYPE

: Double Storey Terrace House

TITLE NUMBER

: H.S (D) 8034

LOT NUMBERS

: PT 9349

TENURE

: Leasehold interest for 99 years ( remaining 90 years)

SURVEY LAND AREA

: 6 Acre

CATEGORY LAND USE

: Building

The research aims are to identify and determine the potential market for the proposed
double storey bungalow development and to gain understanding about the viability and
profitability of the project. There are many factors to be considered to determine the viability
of a project which include site assessment, property market analysis, socio economic analysis
and the calculation in term of residual method.. The development will bring good prospect to
the developer in the future and profitable investment for a long term basis. The project
viability is dependent on the ability of the projects development to capture existing and future
hospitality market in the area.

2.0 INTRODUCTION
A preliminary study undertaken before the real work of a project starts. In general, it
is a documents that provides of a comprehensive analysis and the concrete data and
information on the market. Usually, the feasibility studies will cover all the information on
the market, technical, environment, managerial and administrative, financial, economic,
social, cultural, politics aspects of a project. Besides that, a market analysis searches for the
intersection of demand and supply that will create a market for a product at a given price.
Feasibility analysis tests whether a certain product will meet certain financial or social goals
in the market.
Before a decision is made to undertake any real estate development so it is imperative
that a feasibility study is carried out as to the viability of the project in relation to the existing
and future market conditions. The feasibility study was undertaken by the Suria Property
& Co for the client Miss Nur Nazihah Binti Chuweni pursuant to the instruction dated on
23rd January 2013 to develop the landed residential scheme. The objective of the feasibility
study is to determine the viability of the landed residential scheme project in Sri Iskandar,
Perak Darul Ridzuan. Besides that, the objectives of preparing the feasibility studies is for
to identify and qualify the potential market and scope of the work development in relation
with the potential buyer in Sri Iskandar. Moreover, it is to look out the trends, patterns,
designs the outlook of the house and causes for better judgement about potential use of
property. That is one of the studies to determine the current requirement of potential buyer
and also for the potential tenants that have the purchasing power towards of the future landed
residential development in Sri Iskandar.

2.1 OBJECTIVES
There is some objective of market study which is:
1. To determine the viability and feasibility of the residential housing at district Bandar
Universiti, Perak Tengah, Perak Darul Ridzuan.
2. To determine the most suitable and efficiently viable of the subject property.
3. To clearer understanding of the market about socio economic factors, policy and plan in
the development and property sector on the subject property.
4. Market study also help the plan development for knowhow of building to build
according to guidelines, selling time, construction period, the period, the price of
building and marketing.
According to the clients instruction, the following have been defined to be the scope of
work for the above feasibility studies:
i.
ii.
iii.
iv.
v.
vi.
vii.

Site Analysis
Property Market Analysis
Socio Economic Analysis
Competitive Analysis
Swot Analysis
Proposed Development
Conclusion and Recommendations

By gathering the information, the findings of feasibility study of the project could be used
to determine based on the combination of the several factors such as physical factors that
include the location, size, soil and environment factor while the technical factors will
consider the project management and construction technology. The aspects of project costing,
pricing, loan and equity will be implemented on the financial factors. Moreover, the market
and economic conditions will determine the demand and supply, competition, interest rate,
inflation and economic cycle. The social factors will be applied on identify the people
sensitivity and culture.

2.2 METHODOLOGY

For the purpose of carrying out the feasibility studies, the following methodology was
adopted such as:a) Face to face interview. For example, we as an interviewer and researcher have made
the direct questionnaire with the officer at Land Office and District officer. We have
make an interview with Encik Salman Bin Mohd. Idris to get more information on
the initial development process such as the conversion of the land use and planning
approval. We ask normally from questionnaire and record the responses.
b) Make enquiries from other relevant authorities. The example of the enquiries
authorities are Survey Department, Technical Department and Town and Country
Planning Department. It is as initiative to know about the land use and zoning of the
site project.
c) Make a references to several relevant officer publications pertaining to the landed
residential scheme such as Property Market Report, publications of population
growth, age & household size, income level, occupation profile, employment,
demand and supply rate from Jabatan Perangkaan, Ipoh, Perak Darul Ridzuan.
Our feasibility study covers only the above mentioned property and/or sub-sectors in the
locality of the subject property and its surroundings. Besides that, the information obtained
from the third parties have wherever possible been verified to the best of the ability to be
correct at the conducted. The certain information were classified as confidential and were not
available to us. This feasibility study has been prepared with the objective of advising the
client and shall not be used for other purpose with prior consent of the company. Official data
are available are up to 2011, as published by Valuation & Property Service Department,
Ministry of Finance

3.0 SITE ANALYSIS

3.1 SITE LOCATION AND DESCRIPTION
5

-Location
Our proposed site is part of the Bandar University Seri Iskandar and is located about
2 kilometers to the main road connecting highways Ipoh - Lumut at traffic light junctions
between Bandar Universiti or Taman Maju and it is located about 40 km from Ipoh. It is also,
located in Pentadbiran Majlis Daerah Perak Tengah. The proposed site is located in Mukim
Bota, Perak Tengah District where the lot number is PT 9349. Standard sheet number is 720
and the proposed site has an area of 6.00 acres.
-Topography Condition
Proposed site topography is flat. Although, the location of the land is quite low
compared to the surrounding area and swampy. So there is no any significant problem for this
landed residential development schemes.

Figure 1: The plan of proposed development

- Existing Drainage System

Based on surveys of site, there are existing drains along existing roads in the south
and east of the site. This site is part of the pond area. Therefore, the water can be channeled
directly into the drains and retention pond nearby.
- The Current Land Use
Current state of the site is vacant land covered with green grass and trees. Part of this
site is swampy.
a) LOCATION PLAN

Figure 2: The location plan for proposed development

b) SITE PLAN

p
SUBJEC
T SITE

Figure 3: The site plan for proposed development

c) SATELITE IMAGE SITE AREA

IpohLumut
Highway

Bandar
Seri
Iskandar

Subje
ct site

Bandar
Baru
Universiti

Figure 4: The satellite image site area for proposed development

d) KEY PLAN
8

Figure 5: The Key plan for the proposed development

e) SUBJECT SITE

JALAN
BANDAR

SUBJECT
SITE

Figure 6: The subject site for proposed development

3.2 DOCUMENT OF TITLE PARTICULAR

For our proposed development located at Bandar Universiti, District of Perak Tengah,
the particular of tile for the proposed subject are as follows:Contents

Details

Lot No.

PT 9349

Title No.

H.S.(D) 8034

Town

Mukim Bota

District

Perak Tengah

State

Perak

Land Area

6 Acres

Tenure

Leasehold Interest For 99 Years (Remaining 90 Years)

Category Of Land Use

Express Condition

Building
Business Private Educational Institution

Restriction In Interest

No

Encumbrance

No

Table 1: The description of particular title for the proposed development located at Bandar
Universiti, District of Perak Tengah.

10

3.3 NEIGHBOURHOOD ANALYSIS

Neighbourhood analysis is an important factor that should be included in making a
feasibility study for the proposed site because it describes the facilities and utilities available
in the surrounding area of the proposed site. This is a factor to attract home buyers, whether
the locals who live in District of Perak Tengah or people from outside the county. Here, we
can list a few items that need to be considered in the analysis of neighbourhood:- RESIDENTIAL AREA
There are many residential units at the area of such Taman Iskandar Perdana, Taman
Maju and Bandar Universiti Lakeville. The most common type of residential being built in
area of Seri Iskandar is Single Storey Terrace, Single Storey Semi Detached and Double
Storey Terrace Houses.
- COMMERCIAL AREA
There are many commercial building has provided in area Seri Iskandar. Firstly
commercial area has a Taman Iskandar Perdana Shop-lot thats provide a commercial centre
for the people in Taman Iskandar Perdana and near it. Second commercial area is Taman
Maju and Bandar Universiti Shop-lot thats also provided many shops to easier people the
surrounding to find the basic need. Lastly, TESCO, its provide to easy the residents at that
surrounding to buy anything that they need or want. All of this will make Seri Iskandar more
attractive.
- INSTITUTIONS
There are some institutions that are provided for residents at Seri Iskandar. The
example of institutions that exist at this area is such Universiti Teknologi Mara(UiTM),
Institusi Kemahiran Belia Negara(IKBN),Kolej Polytech Mara, Universiti Teknologi Petronas
and others. Besides, there are also two schools at this area which is Sekolah Kebangsaan
Bandar Baru Seri Iskandar and Sekolah Menengah Kebangsaan Agama Sultan Azlan
Shah.This institution provides education for residents and increase their level of life and its
also will attract many people to living around the proposed site because there have many
opportunity in order to study or gain the money with do the business.

11

- FACILITIES
Local government has provided many facilities to the resident in order to fulfill their
basic needs of residents. The facilities that are provided in the area in Seri Iskandar such as
petrol station, police station, post office, bus stop, fire station and many more. The facilities
that were provided can make a resident to do all their activity with easily. All of the facilities
are provided can attract many people from the other area to living at Seri Iskandar, especially
at the proposed site.
- INDUSTRIES
There are several factories that located at Bandar Baru Seri Iskandar that near with
purposed site such Idaman Pharma Manufacturing and Pharma Safe Manufacturing. This
factory will helps by giving job opportunity and develop the economy of Bandar Seri
Iskandar.

12

f) SATELITE IMAGE FOR 10KM RADIUS

Figure 7: The location covered 10km radius from subject site.

-10 KILOMETERS RADIUS
Below is facilities and utilities are taken in 10 km radius from the subject site;
1) Facilities and utilities located to the North from the proposed site;
- Universiti Teknologi Petronas
- Petrol station
- Sekolah Kebangsaan Tronoh
- Tronoh police station
- Klinik Kesihatan Tronoh
- Akademik Pembangunan Belia Malaysia
2) Facilities and utilities located to the Southwest from the proposed site;
Idaman Pharma Manufacturing Sdn. Bhd
3) Facilities and utilities located to the West from the proposed site;
- Petrol station
- Hentian Seri Iskandar
- Bank Islam
- Pejabat Kesihatan Seri Iskandar
- Klinik Kesihatan 1 Malaysia
- Hotel Putra
- Universiti Teknologi Mara
13

Kompleks Pentadbiran Daerah Perak Tengah

Ibu Pejabat Polis Daerah Perak Tengah
Masjid Daerah
Balai Bomba Daerah Perak Tengah
Sekolah Menengah Kebangsaan Seri Iskandar
Sekolah Menengah Kebangsaan Agama Sultan Azlan Shah
Institusi Kemahiran Belia Malaysia
Pejabat Pos Malaysia
Lembaga Air Perak
Dewan Serbaguna Seri Iskandar
Sekolah Rendah Agama Rakyat Integrasi KAFA

4) Facilities and utilities located to the Northwest from the proposed site;
- Shophouse
- Tesco
- Bank Rakyat
- Kentucky Fried Chicken

3.4 ACCESSIBILITIES
The location of the proposed site for landed residential development scheme at PT
9349, Mukim Bota, District of Perak Tengah, Perak Darul Ridzuan is very strategic because
this area located at Bandar Universiti that can be access by main road that connecting
14

highways Ipoh - Lumut at traffic light junctions between Bandar Universiti or Taman Maju.
The residents and people outside the area of Mukim Bota can be easily access to the subject
property through the highway Ipoh Lumut. At the junction to Bandar Seri Iskandar which
located Tesco at the road frontage then turn left, then go straight about 1.5 kilometres and
access to frontage Jalan Bandar U-34 through the subject property.
3.5 UTILITIES
There are several utilities that are provided at the area of Bandar Seri Iskandar and
also at the proposed site. The district of Perak Tengah is control Majlis Daerah Perak Tengah,
and the public utilities that provided for this district is such as electricity, water supplies and
telephone. The entire utilities make the construction work easier and it also will make the
construction period goes smoothly.

3.6 PLANNING PARTICULAR

Based on the surrounding development is residential and it forms part of the Bandar
Universiti Seri Iskandar, so residential development scheme is very suitable on this site.
15

Based on the Strategic Planning Development District of Perak Tengah 2020 (Draft of
Structure Plan Negeri Perak 2020), Seri Iskandar or Bandar Universiti has been marked as the
main township and Semi Central Zone Regional. Therefore it is appropriate to put forward
proposals to meet the above requirements. Below are planning requirements for terrace house
that suitable for the proposed site;

Subject
Site

Figure 8: The picture above shows the proposed site was zoned as a residential area.

I. Fraction of Land Use / Type of Development

- Proposed layout plan submitted contains the following items:16

Use of Land
Double Storey Terrace

Unit
78

Size (acres)
3.11

Percentage (%)
51.83

(22 X 70)
Open Space
Water Tank
Electrical Substations

0.60
0.30
0.09

10
5
1.5

Reserve
Road Reserves
Total

78

1.9
6

31.67
100

House

- Proposed residential areas involving 51.83% of the total site acreage. While the rest is in the
streets, lanes, water tanks, open space, and electrical substations.
II. Proposed road
- This proposal provides the following items;
a.
b.
c.
d.

Main Road
Housing Slip Road
Front Road Terrace House
Back and Sides of The Lanes

66
40
40
20

III. Development Charge

- A Development Charge will be imposed on the developer for change of zoning and
increase of floor area.

3.7 INFRASTRUCTURE
- Present Infrastructures
There are some present infrastructures that are provided for residents at District of
Perak Tengah. The existing of infrastructures in the area of Bandar Universiti gives facilities
to the residents surrounding that area. Some infrastructures have at the area of Bandar
Universiti for residents such as Hentian Seri Iskandar, Tesco, shop house, bank, petrol station,
17

tabika kemas and others. Besides, there have many education facilities at the area of Bandar
Seri Iskandar such as Univesiti Teknologi Mara, Institut Kemahiran Belia Negara, Sekolah
Kebangsaan Bandar Baru Seri Iskandar and Sekolah Menengah Kebangsaan Agama Sultan
Azlan Shah and others. Other than that, the existing of roadways that is highway Ipoh-Lumut
helps the residents at this area easy to go anywhere. Street light is also provided at the area.
Telecommunication system such as Celcom and Maxis help the residents to connect.

- Future Infrastructures
Future infrastructures will be built at surrounding the purposed site is Pedestrian Mall
and Kentucky Fried Chicken (KFC) drive-thru, this project besides Tesco which located near
the highway Ipoh-Lumut and the junction of Taman Maju. There also some future big project
which faced with the proposed site which is Iskandar Square. It will be the first shopping
mall exists in the area of Perak Tengah. The shopping mall will provide many shops such as
Billion, Cinema and bowling centre. This will help resident at Perak Tengah can save their
time because no need to travel to Ipoh to buy their needs and want and to find entertainment.
Other than that, it will be the main attractions to people to live in Seri Iskandar are in the
future. So that will give many advantages to proposed development. For the project
development of residential area there are project will done by MRCB which are under the
construction ,the project was consist single-storey terrace and single storey semi-detached
houses.

4.0 OVERVIEW OF PROPERTY MARKET ANALYSIS IN MALAYSIA

Malaysia is a country with enhanced human capital investment which
insures the well being of all Malaysian people. This is due to this fact that
a great focus is given to the competitiveness of the nation. Market of
Malaysia including real estate property market is indeed a glittering silver
market with lots of opportunities for everyone. There is a great demand of

18

luxury items including the demand of fabulous homes and offices. This
shows that Malaysia property maker trend is growing day by day.
For 2012, Malaysias property market shows an optimistic outlook
based on a positive buying sentiment demand to own home and need for
housing. Also, the favourable interest rate (current base lending rate (BLR)
is 6.6%) environment, healthy employment market and the fact that
property investments are a proven reliable asset class will continue to
sustain and drive the property sector.
By property type, terraced house continued to dominate the new
housing market. This property type represented 56.6% (19,084 units) of
the national total. Single storey terraced unit made up 27.7% (9,344 units)
whilst 2-3 storey terrace formed another 28.9% (9,740 units). The
condominium/apartments constituted another 13.1% (4,410 units) of the
total. The 2-3 storey semi-detach and single storey semi-detach formed
8.5% (2,867 units) and 8.1% (2,743 units). The number and value of
property overhang (completed units which have remained unsold after
nine months of launching for sales) decreased from the previous quarter.
There were 29,003 completed units worth RM6.740 billion which remained
unsold in the market. These overhang units comprised 22,422 residential
units ,5,931 shops and 650 industrial units.
The Malaysian property market improved in tandem with the growth
of its economy. There were 376,583 transactions registered in 2010
with a total worth exceeding RM100 billion mark at RM107.44 billion.

4.1

RESIDENTIAL LAUNCHES

A launch is an event made to start market a number of property

units of various types in a project by a developer at a given time. A
19

project/phase of a development can be offered for in the market in one or

more launches. Sales performance refers to the percentage of number
of units sold from the total units launched for a specific type of property in
the review period.

Source: Property Market Report

Based on the property market review from the year 2006 until the
year 2010 shows that the growth of the development within that period is
moderately increased and decreased. The highest number of unit
launched is at the year 2007 while the lowest number is at the year
2006.while, the number unit of sold shows the slightly differences with the
number of launches. On the year 2006, the number of unit launches
shows 38,526 unit while the number unit sold on that area is at 15,630
unit. Besides that, at the year 2007, it shows the large gap when the
number of units launched is at 52,664 unit while the number of unit sold is
at 23,749 unit. At the year 2008, it is 21,725 units have been sold by the
48,830 unit residential house have launched. It continue with the year of
2009 with the 45,909 units launched and 22,955 unit sold. For the last
2010, the number units that have been success to sold is at 21,799 unit
and the number of units that have launched is at 47,698 units.
20

Launches of Residential

Units of houses

18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0

Units launched
Unit sold
Sales performances (%)

Quarter period

Quarter

Q2 2010

Q3 2010

Q4 2010

Q1 2011

Q2 2011

Units Launched

15,574

12,291

14,625

12,189

6,909

Unit Sold

2,412

1,637

2,346

1,123

1,449

Sales Performance (%)

15.5

13.3

16.0

9.2

21.0

Table 1: Summary of New Launches from Q1 2010 to Q1 2011

For the property transaction within the quarter 2 until quarter 4 on
2010 show the property transaction between the number of units
launched and the number of unit sold is moderately decreased and
increased. The number property that have launched at Q2 2010 shows
15,574 unit and number of unit sold is 2,412 unit with the 15.5% sales
performances. While for the Q3 2010, the sales performances turns
decreased to 13.3% when the number of success to sold is at 1,637 unit
by 12,291 unit launched. But, at the Q4 2010, the sales performances are
rapidly growth at 16.0%.
The number units have launched is at 14,625 units and the number of
units sold is at 2,346. Moreover, when the Q1 2011, the number of units
that have launched is at 12,189 units and the property success to sold is
at 1,123 units with the 9.2% sales performances. And at the Q2 2011, the
units launched turns become decreased to 6,909 units and the number of
unit sold is at 1,449. The sales performances of that year shows at 21.0%.
21

Table 2: Summary of New Launches of Residential Units As At Q2 2011

State

Units

WP Kuala Lumpur

453

WP Putrajaya

WP Labuan

Selangor

619

Johor

99

Pulau Pinang

1,015

Perak

722

Negeri Sembilan

882

Melaka

537

Kedah

578

Pahang

567

Terengganu

139

Kelantan

184

Perlis

314

Sabah

Sarawak

800

MALAYSIA

6,909

Source:JPPH
For the period of Q2 2011, the highest state that have launches new
residential units is Pulau Pinang. The state of Pulau Pinang have rapidly
growth of development and have produced 1, 015 unit of residential on
that period. Secondly, it is followed by the state of Negeri Sembilan which
have launched 882 unit of residential that is almost similar with the state
of Sarawak that have launched with the 800 units. While, the state of
Perak have consistently at 722 unit of residential at the quarter 2 of the
year 2011.

22

4.2

THE TRANSACTION OF PROPERTY

Sources: Property Market Report (2006 2010)

In 2010, the house price within RM 2500,000- RM 500,000 as well as
RM 1,000,000 and above formed 23.2% (RM 11.741bil) and 23.1%
(RM11.669bil) respectively, constituting the biggest portion in term of
transaction value. Both the volume and value of transaction recorded
double digit growths of 11.4% and 32.6% respectively (2009: 338,089
transactions worth RM81.02 billion).

23

4.3 RESIDENTIAL OVERHANG IN MALAYSIA.

Significantly, residential overhang phenomena would be happen when the residential
units with Certificate of Fitness For Occupation (CFO) or Temporary Certificate of Fitness
For Occupation (TCFO) or Certificate of Completion and Compliance (CCC) but remain
unsold for more than 9 months.

Sources: Property Market Report (2006 2010)

24

The number and value of property overhang (completed units which have remained
unsold after nine months of launching for sales) decreased from the previous quarter. There
were 121,265 completed units worth RM28.472 billion which remained unsold in the
market.. All sub-sectors recorded better performances by registering lower number of unsold
units and value. The number of unit unsold at 2006 is 25,645 turns to decrease at 23,866 units
which decrease on 6.9% but within the year 2007 to 2008 shows the increasing at 9.1% when
the number of unsold units increased at 26,029 unit. While, there is decreasing at 13.2% to
22,592 unit. At the year of 2010, the number of unsold unit became increase to 23,133 unit at
2.4%.

4.4

OVERVIEW OF PROPERTY MARKET ANALYSIS

FOR

PROPOSED

DEVELOPMENT.
4.4.1

GENERAL PROPERTY MARKET ANALYSIS IN PERAK

The delivery of residential properties in Perak is expected to hit about 10,000 units

this year compared with 4,582 units last year.The delivery of housing units in Perak was
9,747 in 2007, 6,513 in 2008 and 8,496 in 2009, according to a recent Finance Ministry
property market report.Real Estate and Housing Developers' Association Perak chapter
chairman Datuk Francis Lee told StarBiz that there was significant change in the attitude of
consumers in Perak towards the purchase of properties since the beginning of the year.
The property prices in Ipoh have increased by about 15% over the past one year. The
price of a double-storey terraced house has surpassed the RM200,000 mark, selling at around
RM240,000 in the Kinta district area, which is within 8km radius from Ipoh town. There are
10 districts in Perak. About 60% of the new property launches are located in the Kinta
district.The Larut, Matang, Selama and Manjung districts are the other areas where new
properties are being targeted for development.
The increase in property prices is largely caused by higher land cost, bureaucratic
compliance fees, and construction cost.Despite the rising property prices, developers in Ipoh
were not making additional margins from development. The projects include 300 units of
shop-lots with GDV of RM210mil, 500 units of double-storey terrace houses with GDV of
25

RM100mil, the RM135mil AEON shopping mall, and the RM80mil Pantai Hospital
Manjung. Despite having gone through a few recessions, Manjung has generated a steady
annual income of RM25mil to RM30mil to the group for the past 20 to 30 years,
The Royal Malaysian Navy Lumut base and dockyard is a strong source of support for
properties in Manjung. The residential property market in Perak is expected to remain to be
stable. New properties will be priced slightly higher because of rising building material
costs.The bulk of property purchasers are still locals. But in recent years, we are seeing more
buyers from other states, as the value of property in Ipoh is appreciating, he added.The
company has about RM55mil worth of properties to be launched in the second half of the
year in Bandar Baru Sri Klebang, compared with the first half of 2011 which saw RM65mil
worth of new launches.
4.4.2

PROPERTY SUPPLY MARKET ANALYSIS AT PERAK TENGAH.

4.4.2.1 The Existing Stock

The determination of the property market analysis are based on the location of the
proposed development which at Bandar Universiti under district of Perak Tengah.The
performances of the existing stock in Perak Tengah have been interpreted based on the
performances of property market analysis to the nearest district of proposed development that
Distrct of Kinta and Manjung. The existing stock refer to the supply of particular type of
property which already in the market.

26

Year
200
7
200
8
200
9
201
0
2011

Number of existing
stock
197
242
304
304
383

Double Storey Terraced House

450
400
350
300
250
200
150
100
50
0

2007

2008

2009

2010

2011

2012

Existing Stock

Figure 1: The existing stock for Double Storey terrace house in Perak Tengah.

27

Based on Property Market Report, the performances of existing stock in Perak Tengah
for the type of 2-3 Storey Terraced House shows the increasing of growth. On 2007, the
existing stock shows at 197 unit while increase to 242 unit at 2008. At the year of 2009 and
2010, the bar chart shows the number of existing stock are consistently with 304 unit. Single
storey terrace houses supply also very consistent and keep on increasing that shown that of
residential are still in demand in the area of Perak Tengah. At the year of 2011, the number of
existing stock increase to 383 unit of house. It differences to the nearest district which Kinta
that show the existing stock on that area is at 53,957 unit while in Manjung have 7,157 unit.
The location of the development also have been affected to the number of existing stock.
4.4.2.2 The Completion
The completion of the building are referred to that property when the building of it
construction works are completed and a CF/TCF/CCC is issued within the review period. The
figures in completion are not accumulated from the previous quarter but represent only one
review period. The figure below shows the performances of the completion building in
Malaysis within the period of 2006 to 2010. )

Double Storey Terraced House

Years

100

2007

80

units

Number of
completion
0

60

2008

45

40

2009

62

20

2010

2011

79

2007 2008 2009 2010 2011

period

Figure 2: The completion for Double Storey terrace house in Perak Tengah.
Based on Property Market analysis, shows that the performances of completion
building for the period of 2007 until 2011 have a fluctuation and do not consistently growth..
At the year 2007, there is no completion house with 0 units. While at the year of 2008, the
number of completion started to be increase which 45 units. Next, the number of units
28

followed to increased by 62 units at the year 2009. At the year 2010, the number completion
units have spun to 0 units. The number of units started to increased at the huge amount which
increase at 79 units that differences with the completion unit building at near district which
Kinta and Manjung that shows the 1,854 and 409 unit at the year 2011 respectively.. Thats
shown the demand of this type of residential has started to be recover. Even though the
number of completion single storey terrace houses not so consistent but the demand are
always have and started to be increase for the next year that shown that type of residential is
have good demand in the area of Perak Tengah

4.4.2.3 The Incoming Supply

The incoming supply refers to the property that still under construction but not fully
finished yet. It is the properties that have an owner which has booking before the construction
started. It can become the advantages to the developer to build on that other proposed
development. It involves the units where the building plans have get approval obtained from
the local authority.

Years
2007
2008
2009
2010
2011

Numbers of incoming
supply
304
370
373
449
406

29

Double Storey Terraced House

500
450
400
350
300
250
200
150
100
50
0

Incoming Supply

2007 2008 2009 2010 2011

Figure 3: The incoming supply for Double Storey terrace house in Perak Tengah.
From the overview of the Property Market Report from year 2007 to 2011, the
number of incoming supply single storey terrace houses shown there are fluctuated. From the
year to 2007, the incoming supply started to 304 units and become increasing over the year to
year until 2010. At the year 2008, the number of units increasing by 60 units from the
previous year total of 370 units. Then, on the next year the total of incoming supply
increasing to the 373 units and become decreasing to the 449 units on the next year which at
2010. Even though the number of completion single storey terrace house was inconsistently
but the demand that type of residential have good demand in the area of Perak Tengah.
Besides that, the incoming supply the nearest district which Kinta also shows the increasing
at 8, 135 unit on the year 2010.

So that, from the incoming supply of single storey terraced

houses in Perak Tengah, the conclusion can be made is this type of residential are still in
demand and also have potential to be built. On the year 2011, the incoming supply situated at
Perak Tengah turns to decreased at 406 units.
4.4.2.4 The Planned Supply
The determination of the planned supply in Perak Tengah is the one of the important
aspects that can conclude the future planning on that area. The future planning can interpret
the new development that will built up on that area. The planned supply can also be
determine as any development that do not construct yet and obtained the approval from the
local authority but that development has under planning by the developer or consultant.
30

Years
2007
2008
2009
2010
2011

Numbers of
Planned supply
504
424
359
393
357

Double Storey Terraced House

600
500
400
300
200
100
0

2007

2008

2009

2010

2011

Planned Supply

Figure 4: The planning supply for Double Storey terrace house in Perak Tengah.
Based on the Property Market Report from the year 2007 until 2011 shows the
number unit for the planned supply is fluctuated over year to year. The highest number unit
31

shows at the year of 2007 while the lowest number of unit shows at the year of 2011 which at
357 unit. The number of units from the year of 2007 weak and show a decrease to 424 units
at the year 2008. And on the next year, the number unit of houses for planning supply shows
decreasing to 359 units. It may cause of delays and other reasons may rise. And it continues
to arise at 393 unit of planned supply residential at the year 2010. It prove that the
construction and development still running smoothly. At the year 2011, the number units of
planned supply turns to decrease with the small gap by 36 units from the previous year. For
the near district which Manjung show at the year of 2010, the planned supply turns to 501
unit of 2-3 storey terrace house. And the number unit of planned supply expected may
increased over year to year until now.
4.4.3

PRICES OF RESIDENTIAL UNIT IN PERAK TENGAH

Price is one of the important and syndication aspects that must be considered while to

value the property. The prices of the house are fluctuated and differences for each type of
property. There are varieties of aspects that can consider determining the market value for the
house. As our proposed development located at Bandar Universiti, the price range for the
Double Storey terrace house is taken to determine the value of our proposed development.
The price is also taken refer to the newly launched residential unit in Perak Tengah that by the
references from Property Market Report from the year 2007 to the year 2011.

DOUBLE STOREY TERRACED HOUSE

300,000
250,000
200,000

2007

150,000

2008

100,000

2009

50,000

2010

2011

32

Figure 1: The price range for Double storey terrace house in Perak Tengah
Based on the Property Market Report from the year 2007 until 2011 and the location
that covered for the area of Perak Tengah shows the price range within that year is fluctuated
and changes from year to year. Refer to property market report in 2011, the unit of newly
lunches at Perak Tengah on that year is at 70 units with the floor area range at 137 square
metre and the building area range at 121 sq. metre. The price range on that year show at
RM178,000- RM 199,800 with the 7.7% sales performances. While at the year 2010, the
sales performances for the newly launches residential increase at 43.1% with 51 units new
residential house. The floor area range is at 132 sq. metre and the building area range is at
167 sq. metre. The price range on that year is between RM167,800 to RM174,000.
On the year of 2009, there are 31 units of new residential house that have launches on
that year. The sales shows the growth at 61.3% of sales performances and the floor area range
is at 121 sq. metre. The building was sold at the prince range RM169,000 with the building
area range at 167 sq. metre. The performances on the year 2008, the price range for the new
residential house was at RM125,000 with the 50 units sold on that area. The floor area range
with the property that sold at RM125,000 is at 130 sq. metre and the building area at 104.09
sq. metre. Refer to the number of statistics in Property Market Report, the 59 number units
involve of newly lunched for the residential and type of Double Storey Terraced House with
the building area range at 207 sq. metre. The price range for that property shows at between
RM132,800- RM188,100 and the floor area range of the property for that price is at 207 sq.
metre. Refer to the PMR, the floor area range of the newly residential house on that year was
not available.
Summary of the Prices Ranges between year 2007 to 2011.
Year

2011
2010
2009
2008
2007

Units

70
51
31
50
59

Floor area

Building

range(sq. m)

area range

137 sq. m

(sq.m)
121 sq. m

RM178,800-

%
7.7%

167 sq. m

RM199,800
RM167,800-

43.1%

167 sq. m
104.09 sq. m
207 sq. m

RM174,000
RM169,000
RM125,000
RM132,810-

61.3%
10.0%
42.4%

132 sq. m
121 sq. m
130 sq. m
NA
33

Price range

Sales
performance

RM188,100

4.4.4

RENTAL VALUE FOR THE PROPOSED DEVELOPMENT

To determine of rental value for the proposed development, the rental amount of

similar type property which 2-3 storey terrace house was taken as the analysis. Besides that,
the factors of location also as one of the aspects that have considered to determine the rental
value. The similar type of property located at Perak Tengah was taken as subject comparable
to determine the rental value.

Three types of comparable was taken as subject comparable located at Bandar

Universiti. The transaction price of three types of comparable is different each other. They
may cause of the finishes and condition existing on that property. Based on the comparable 1,
the location of the house is located at the same place to subject property with the transaction
price RM368,000. The amount rental for that property is RM1, 450 for a month and the rate
of return to rent out their property is at 4.7%. For the second comparable, the transaction
34

price is at RM370,000 with rent out at RM1,500 per month. It is a double storey terrace house
with the rate of return at 4.9%. For the last comparable, the property was reant out for the
RM1,600 per month with the transaction price at RM373,000. The rate of return for that
double storey terrace house located at Bandar Universiti was at 5.1%. for our proposed
development, we have assumed that, the amount of rental out was at RM 1,550 per month.
4.4.5

THE YIELD FOR PROPOSED DEVELOPMENT (RATE OF RETURN).

Yield was referring to the rate of return to rent out for that property. It is the estimated

amount that can be enjoyed by the owner to rent out for the property. Reversionary yield was
referring as the ratio between the current rental value and capital invested. It is determined
based on the amount of percentages. The amount of rent out will affect to the owner to
purchase the property and rent for that property. As the proposed development was expected
to rent out at RM1, 550 per month with transaction at RM265, 305 per unit
Solutions:Current Rental Value

X 100%
X 100%

Capital Invested
Price range
RM 265,305

Rental (RM)/ Month

RM 1,550 per

Rate of Return (%)

7.01%

month/RM18,600 per annum

Yield of the property must be high because to attract the investor and potential buyer.
The yield of the area Perak Tengah is affecting the demand and it will cause the whole area
for example is will be increase in market value. The yield Double storey terrace house is at
7.01%. So, the investor should take these opportunities to invest to get more profits.

35

5.0 SOCIO ECONOMIC ANALYSIS

5.1 Malaysia Economy
Malaysia, a middle-income country has transformed itself since the 1970s from a
producer of raw materials into an emerging multi-sector economy. Under current Prime
Minister, Dato Seri Mohd Najib Bin Razak, Malaysia is attempting to achieve high-income
status by 2020 and to move farther up the value-added production chain by attracting
investments in Islamic finance, high technology industries, biotechnology, and services.
The Prime Minister administration also is continuing efforts to boost domestic
demand and reduce the economy's dependence on exports. Nevertheless, exports particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the
economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices,
although the rising cost of domestic gasoline and diesel fuel, combined with strained
government finances, has forced Kuala Lumpur to begin to reduce government subsidies.
The government is also trying to lessen its dependence on state oil producer Petronas.
The oil and gas sector supplies more than 40% of government revenue. The central bank
maintains healthy foreign exchange reserves, and a well-developed regulatory regime has
limited Malaysias exposure to riskier financial instruments and the global financial crisis.
Nevertheless, Malaysia could be vulnerable to a fall in commodity prices or a general
slowdown in global economic activity because exports are a major component of GDP. In
order to attract increased investment, Dato Seri Najib has raised possible revisions to the
special economic and social preferences accorded to ethnic Malays under the New Economic
Policy of 1970, but he has encountered significant opposition, especially from Malay
nationalists and other vested interests.

Year

2009

2010
36

2012

Population

27.9 million

28.3 million

28.6 million

Labour force

12.1 million

12.4 million

12.6 million

Employment

11.6 million

11.9 million

12.2 million

Unemployment
rate

3.7%

3.4%

3.3%

Year
2009
Real GDP (RMmillion)
522.0

2010

2011

559.6

588.4

Growth rate (%)

-1.6

7.2

5.0-5.5

Real GNI
(RM million)

497.4

516.8

545.5

Nominal GDP
(RM million)

679.9

766.0

847.3

Nominal GNI
(RM million)

665.3

739.5

820.2

Income per capita,

curent (RM)

23,850

26,175

28725

National Product

37

Economy of Perak
Perak was one of Malaysia's wealthiest states during Malayas colonial period, as
much of Malaya's mineral deposits were situated here. The tin industry here subsequently
flourished under the auspices of the British fuelled by the ongoing Industrial Revolution then.
The global tin industry collapsed in the 1980s, subsequently forcing the closure of many local
tin mines concurrently crippling Peraks economy.
This turn of events led the local state government to diversify the economy's base
towards commodity-based manufacturing. The mid-1980s witnessed a large influx of
electronics SMEs from Taiwan to Silibin and Jelapang industrial estates, but these have
relocated to China in the 1990s as a result of outsourcing. A local car manufacturing hub
called Proton City at Tanjung Malim has been developed with the establishment of state-ofthe-art car manufacturing facilities which is the largest manufacturer of Proton cars.
However, the economy has never fully recovered from the decline of the tin industry.
Agriculture is also one of Perak's main industries, especially those concerning rubber,
coconut and palm oil. Tourism is a growing industry given the state's abundant natural
attractions.
Perak is set to become the second state after Kelantan to introduce the gold dinar and
silver dirham as official currency
38

5.2 Employment

180
160
140
120
100
80
60
40
20
0

39

This is employment in Perak Tengah which is the most highest is service worker &
shop and market sales workers, so their can be highest prospect buyer for our residential.
Second is skilled craft related trade workers and follow with plant and machine operators. We
are targeting the highest group of employment is Government servant, the reasons is our area
is near with many administration centre, example is UITM, UTP and MARA and also many
of government office, example Pejabat Daerah Perak Tengah and fire station. Beside that we
also targeting private servant worker, example is worker factory, bank staff and KFC workers.

No
1.
2.
3.
4.
5.
6.
7.
8.
9.

Category
Legislator, Senior Officer and Manager
Professional
Technical and Professional Associates
Clerical Workers
Service Workers, Shop and Market Sales
Agriculture
Skilled craft related trade workers
Plant and Machinery Operator
Elementary Workers
Total

5.3 Population of Perak Tengah

40

(000)
64.3
38.3
113.2
77.3
178.9
103.5
105.7
112.5
97.9
891.6

(%)
7.8
5.6
7.3
7.1
9.6
8.2
9.3
9.1
7.9
8.2

120,000

100,000

80,000

60,000

40,000

20,000

Population

Average annual population growth rate

No.
1.
2.

Year
1991-2000
2000-2010

%
0.93
1.59

Based on the data, we can see that the number of population increasing years to years,
in years 1991 the population in Perak Tengah is only 75574 populations, but in years 2000 the
numbers is increase by growth rate which 0.93% population that means in years 2000 number
of population is 82,153. In years 2010 the number of population increased rapidly, the
number of population in that year is 98,897. So we are confident to build the residential at our
site because the number of the population is increasing and the demand is high.

Number of Household in Perak Tengah

41

25,000

20,000

15,000

10,000

5,000

1991

2000

2010

The number of household in Perak Tengah shows a great increase from years 1991 to
years 2010 because of the rapid development in Perak Tengah, other than that the increment
of the number of household also may cause by many person in Perak Tengah which they need
their own property.
So the chances to our property being sold are high because the number of household
here is greatly increased. The comfortable environment in Perak Tengah which has complete
infrastructure also one of the factor to attract people to live here.

Age Group for Male

42

140,000
120,000
100,000
80,000
60,000
40,000
20,000
0

No
.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.

Range

Number of Population

0>4
5>9
10>14
15>19
20>24
25>29
30>34
35>39
40>44
45>49
50>54
55>59
60>64
65>69
70>74
75>

81,769
112,079
120,271
121,594
111,629
84,524
75,133
70,922
72,915
73,477
69,208
58,730
48,316
32,971
26,210
27325

Male age group in Perak Tengah was shown the most dominant age is 15-19 years.
But for the target group which is adult group the dominant age group for male in Perak
Tengah is 35-39, 40-44 and for this group of people, they will start to think about want to
own a property for their family and their golden age, so this age group also can increase the
number of prospect buyer for our property.
43

Age Group for Female

140,000
120,000
100,000
80,000
60,000
40,000
20,000
0

No
.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.

Range

Number of Population

0>4
5>9
10>14
15>19
20>24
25>29
30>34
35>39
40>44
45>49
50>54
55>59
60>64
65>69
70>74
75>

82,626
110,394
119,521
122,220
101,924
75,013
68,763
68,474
73,904
71,741
67,434
58,405
49,675
32,661
29,079
33,881

Age group for the area of the Perak Tengah show the most dominant age group for
female is 15-19 years. However for the age group that we target to buy our property is adult,

44

which is 30-34 and 35-39 the dominant age that started to plan their life so, this age group
also can increase the number of prospect buyer for our property.
5.4 Income Level in Perak Tengah

10%

15%
Below RM1,000

15%

RM1,500-RM2,000
20%

RM2,500-RM5,000
RM5,500-RM7,000
RM7,500 and above

40%

Income at Perak show the highest range of income is RM2500- RM 5000. This show
the level of living standard of Perak started to increase. Other than that this group of income
are afford to buy our house, according to Bahagian Pinjaman Perumahan Perbendaharaan
Malaysia, the qualification to get loan for income RM 2500 to RM 2999 can reach to
RM280,000 while our prospective price only about RM 175,000-RM 200,000. So this can
guarantee the prospect buyer for our properties.

5.5 Ethnic Group in Perak Tengah

45

Malay
Bumiputera
Chinese
Indian
Non-Malaysian citizen
Others

The highest ethnic group in Perak Tengah is Malay which is 92,096 of peoples.
However, our target ethnic is Chinese which is 1,291. This is because the Chinese like to buy
the property especially house. So this can guarantee the prospect buyer for our properties.

6.0 COMPETITIVE ANALYSIS

Aim of this section:

46

To study the demand rates of similar type of property situated within

the study market.

The existing terrace houses developments situated within the
selected market will be analysed based on the following criterion: Detailed listing of competitors facilities, attractions and other
relevant information.
Existing and future

competitive

development

nearby

neighbourhoods such as Hua Yang Berhad, Malaysian

Resources Corporation Berhad (MRCB) and Dikir Maju
Sdn Bhd are analysed to provide an analysis on unit sizes,
pricing, type of property developed, brief tenancy profiling,
take-up or occupancy rates and status of development.
The competitor analysis can be divided by two types which is direct
and indirect competitor. In this analysis, we also include their
weakness and strength which is important to recover this project
development.
6.1 Direct and Indirect Competitors
6.2.1 Direct competitor
A direct competitor means the project development which has
similar characteristic such as type of property has been develop by
other developer in the surrounding of proposed development. For
the first competitor is Malaysian Resources Corporation Berhad
(MRCB) their project is consisting of Single storey terrace houses,
Double Storey Terrace Houses and Single Storey Semi Detached.
Their project are more in Taman Teknologi Seri Iskandar area or
know as SIDEC which is about 2 Kilometre from the site. The project
is consist of Single Storey Terrace Houses and Single Storey SemiDetached Houses the project is located at SIDEC. While, the Double
Storey Terrace Houses is located in Taman Iskandar Perdana, and
Taman Gemilang. In Taman Gemilang, the design of houses is very
good but they poor in accessibility while in Taman Iskandar Perdana,
they use low quality of hardware although their location is strategic
due to next UiTM Seri Iskandar. The current price for Double Storey
Terrace Houses tag by MRCB is reach RM 304,058.00 per unit.
Malaysian Resources Corporation Berhad (MRCB) also in process
selling a new residential area. It is a bonus for this competitor due to
its proximity to UiTM Seri Iskandar but poor of their workmanship.
47

Other direct competitor is Agro-Mod Industries Sdn Bhd which

own by HUA YANG BERHAD. The project of this competitor consist
Double Storey Link Houses, Double Storey Terrace houses,
Single Storey Terrace Houses, Single Storey Semi-Detached, Double
storey semi- Detached Cluster and Double Storey Semi-Detached.
This competitors projects are likely more in Bandar Universiti which
is near to commercial area such as Tesco, Kentucky Fried Chicken
(KFC) and Secret Recipe but their site area is former mining land.
The project of competitor area is near to project development.
This competitor also keep on develop new housing scheme in
the area of Seri Iskandar refer to the demand which keep in
increasing. In addition, the location of our project is surrounding of
HUA YANG houses which Taman Jasmine, Lily, Gardenia and Iris. For
example there are project of HUA YANG BERHAD which is Single
Storey Terrace Houses and Double Storey Terrace Houses which
are under construction. The selling price for Double storey houses
price tag by HUA YANG is from RM196, 800 to RM 333, 810 per unit.
6.2.2 Indirect competitor
The indirect competitor means developer of competitors built
different types of property such as the propose development is for
industrial and commercial purpose or other than landed residential
scheme

such as

Flat,

Apartment, bungalow and office.

For

development of commercial purpose currently there are two main

blocks which consist of the shop lot area.
Firstly, Shop Houses in Bandar Seri Iskandar has been develop
by Malaysian Resources Corporation Berhad (MRCB). Currently, this
place had high demand because in front of residential area such as
Taman Iskandar Bestari in SIDEC and located next to educational
area such as Universiti Teknonologi Mara (UiTM).
Besides that, there are also have other competitors such as
Dikir Maju Sdn Bhd. This competitor under develop new project
namely Seri Iskandar Business Centre (SIBC) .The project is located
between area of Bandar Universiti and Taman Teknologi. The project
will be recorded as first shopping mall in the area of Perak Tengah.
This project can give benefit to other developer who built residential
48

scheme because Dikir Maju project will increase job opportunities

and indirectly increase the demand for houses in that area.
Agro-Mod Industries Sdn Bhd which own by HUA YANG
BERHAD also has develop commercial area which is located at
Bandar Universiti and near to Taman Maju. This commercial area
give high potential to gather high demand because the places are
located near with residential area such Taman Maju and Educational
Area such as Universiti Teknologi Petronas (UTP). From our research,
they want to named their area as Pedestrian Mall. They are also in
process to build bungalow houses surrounding project development
in Bandar Universiti.

6.2 Taman Bandar Universiti by HUA YANG BERHAD

Figure 1: Taman Jasmine in front of project development

49

Figure 2: Double Storey Shop Office in Bandar

Universiti

Figure 3: Example of Double Storey terrace House by HUA YANG BERHAD

6.3 Bandar Seri Iskandar or SIDEC by MRCB

50

Figure 4: Shop Houses in

SIDEC

Figure 6: Taman Gemilang

Figure 5: Taman Iskandar Perdana

6.4 Proposed Development by DIKIR MAJU

51

Figure 7: Broacher of proposed

development by Dikir Maju.

Figure 8: Show room of Seri Iskandar Business Centre (SIBC)

7.0 SWOT ANALYSIS

Strength
Weakness
52

Opportunity
Threat

WHAT IS SWOT ANALYSIS?

S.W.O.T is an acronym for the words: Strength, Weaknesses, Opportunities, and

Threats. A SWOT analysis evaluates a proposed projects strengths, capitalizing on

them in order to mitigate its weaknesses.

It also helps target opportunities to minimize a proposed developments threats from

direct and indirect competition.

The S.W.O.T analysis presents a key summary of data relevant and crucial to the
proposed development. In addition to presenting a clear and quick guide to the
projects inherent attributes, such analysis also highlights positive features that can
effectively be used for marketing purposes.

7.1 THE STRENGTHS

i

Location

53

The construction area is the perfect location for the project of

purposed build residential area. Subject site is located near Taman
Lakeville, Seri Iskandar, and Perak. To access to this place is through
Ipoh-Lumut highway Located about 40 km from Ipoh, the township is
close to the proposed site is Bandar Seri Iskandar. The distance
subject site from Taman Maju / Bandar Universiti and the distance
subject site from Main Road/Highway Ipoh-Lumut is 2 km.This
strength of this site because there are in the area which is rapidly
developed with many facilities and comfortable environment.
ii

Surrounding development
At the proposed site we can define the surrounding have the
mixed development namely industrial, residential, higher institution
and also commercial making it the centre of attention after Ipoh.
The proposed site for development is also near to Local Government
Offices such as Pejabat Daerah Perak Tengah and Headquarters of
Perak Tengah Police. Besides that, have more residential area such
as Taman Maju, Taman Lakeville and Taman Iskandar Perdana.
Furthermore, subject site is also located nearer to Bandar Universiti.
At Bandar Universiti it has a higher institution such as Universiti
Teknologi Mara (UiTM), Universiti Teknologi Petronas (UTP) and
Insitut Kemahiran Belia Negara(IKBN). It contains of lecturer,
students and staffs. They will be choosing the house is nearer to
that institutions. The commercial area such KFC, Hotel Sri Iskandar
and Petronas also near with proposed our site.

iii.

Accessibility
This site is has very easy access. This site can be access
through the highway Ipoh-Lumut. There is also no congestion in this
area because of the very good road system. Furthermore, it also
makes easy the suppliers of construction materials to send the
construction materials such as cement, sand, and others to the
construction site for the construction works. Other than, the future
buyers also can easily go to the proposed site because of the very
54

good of access. The propose site also near to other residential with
the completed infrastructure and facilities like road, lighting road
and signboard.
7.2 THE WEAKNESSES
i Environment
The environment at the site is near with a factory, but the factory was operate
for operation of light industries .So it wasn`t give too much effect to the resident.
Other than that this site also will be a bit busy, it is because near the site build the
Tesco and Billion and also has manufacturing it will make the area of our site become
more crowded and full with people and transport such as cars, motorcycle, and lorry.
ii Topography
The topography of this site is mining land and flat land. Because of that, the
developer should do many processes to get approval for the land. Need much capital
requirement and equipment to begin this project. Fill in works working should be
done. It requires long term process to fill in work. Developers should ensure safety
of land to live and proper planning should carry out, so this give disadvantages
when developer do a construction and will increase cost of site
clearance.

7.3 THE OPPORTUNITIES

Our subject property is located at near to Taman Lakeville, Seri Iskandar, and Perak
which is new town that is introduced to develop the area of Bandar Seri Iskandar. Our
surrounding area is fully with development which can attract buyer and people to come for
55

live and work in Bandar Sri Iskandar. The location is very strategic for build the purposed
build residential building because it is easily accessible via Ipoh-Lumut highway located
about 40 km from Ipoh; the township is close to the proposed site is Bandar Seri Iskandar.
This is about 2 Kilometer.
The opportunities of subject site can be identified as follows:
i.

Housing Needs
Seri Iskandar town is majority occupier with government servant because the area is

administrative centre .So, supply for housing scheme are needs for lecturer, police, teacher
and others. That is because many higher institution such as Universiti Teknologi Mara
(UiTM), Universiti Teknologi Petronas and IKBN. The supply of houses also will be needed
for student. The total numbers of student increase time to time so that the developer required
providing more housing. The increasing of the population and household are makes the
housing need is increasing.
ii.

Economy
The major sectors of economy in Seri Iskandar are commercial, and manufacturing.

Commercial is still the main economic sector, providing the majority of the population's
employment.The commercial sectors are such as KFC, Hotel Sri Iskandar and Petronas.
Business activities in Sri Iskandar include wholesale, groceries and services. People will go
to Bandar Seri Iskandar to get job and they need housing to live. So this will be attracting the
prospect buyer in the future.

iii.

Industrial
In the surrounding area of subject property found any industrial which not far away from

the subject property. Distance from the subject property to industrial in range about 4 km
only. Furthermore, this industrial offer many job opportunities to the public and also to the
56

resident that live at our residential area, so with job opportunities that offer by this industrial
may be the ratio of the unemployment in this area will decrease and the income level will
increase and directly the purchasing power to purchase our property that are double-storey
terrace houses will increasing.

7.4 THE FUTURE DEVELOPMENT

From the analysis, this site is suitable to develop the residential area because there are
a lot education institution such as UiTM, IKBN, UTP and public schools. So our residential
houses will get the high demands from lecturers, teachers, staff and students at UiTM, UTP
and IKBN. There also have a lot of commercial area at our residential area. Besides, Billion
and shophouse will be built at SDEC so that will attract people to live in that area because
completed infrastructure and facilities. So that will increase the demands for our houses will
automatically increases.

7.5 THE THREATS

i.

Competitors

57

Competitor is one of threat in the proposed development at this

area it is because a lot of residential area at this area such as at Taman
Maju, Taman Lakeville and Taman Iskandar Perdana. The other residential
area will challenge our future residential area in the context of selling the
houses. Even though the demand is high at our site area, the supply of
houses also getting high because the developer likes to make the
development of residential scheme at Bandar Universiti.
i.

Category of land
Land status that result for building land which is for commercial land

(private institution education). Category of land which is stated for building so it is

requires longer time to convert the category of land into residential.

8.0 Proposed Development

58

To prepare site for double storey terrace house medium cost that comfortable, fully

with facilities and with attractive design.

To prepare additional residential room for workers in Perak Tengah district
To develop the site from vacant land because the original planning is for commercial
building site-private institutional education is not suitable, and better if this site

became a residential place compared with private institutional education.

To develop the land to be more economical and can give high return to state authority

and Majlis Daerah Perak Tengah and other agency involve.

To build 78 units of double storey terrace house medium cost with size area 22x70

a) Purposed house design

59

b) 1.Ground floor

60

Double storey terrace house

Structure
concrete

: reinforce

Roof structure
tile

: concrete roof

Ceiling
plaster ceiling

: skim coat/

Wall

: ceramic wall

Door
timber door

2. First floor

:front : decorative
:bath room : PVC door
:others door: timber

door
Window : front : aluminium frame with
glass
: back : adjustable louvered
window
Wall finishes : kitchen

8.1 Facilities

61

: half tiles

Public service and utilities is important thing that have to consider by every developer

before doing development, especially for residential purpose

It is to make sure our resident feel more comfortable with public service and facilities.
For our development, there are no facilities provides in our development
We only used existing public service and facilities nearly our development as to
economize the cost development.

8.2 Selling price

62

The selling price of property is affordable and reasonable with surrounding people. It is
affordable for the residents or potential buyer so that the property can be sold successfully.
The selling price is considered suitable and it has been compared with others double storey
terrace house medium cost near our development to make sure the property is avoidable.
After consider all aspect, we have made decision the selling price for our development which
is double storey terrace house medium cost RM 265 305. The selling price of this project are
not accordance with the past selling price in the Property Market Report because our
company consider , the selling price for this project not suitable to be use for transaction or
selling price . This is because, this development involve high cost due to the increasing of
materials and equipments prices. Moreover, this place is became more strategic due to rapid
development growth occur in this area with several new development such as Pedestrian
Mall, Billion shopping mall, Commercial building and other.

8.3 Rental Value

63

The rental value can be determined by comparing the price with similar property in
surrounding development area. We did not use Property Market Report as to determines the
rental value for our development because there is no data about rental value for double storey
terrace house in Perak Tengah. So, we have used sales evidence as to determines our
development rental value. We have analysts several sales evidence around Bandar Universiti
which located near to our development as to determine our development rental value. After
make analysis with the comparable, we have considered that our rental value for this
development is RM 1550 per month.

8.4 Target Market

Every developer has their target which means target people that will purchase the project. For
Our company, we have target market for this development comprises of local people,
businessman and government servant that work around Perak Tengah District especially in
Bandar Universiti. The location of our development and surrounding give us specific target to
focus.
Our main target market is owner of the shop house shop office in the Bandar univesrsiti. We
also target the lecturers from UiTM Seri Iskandar and Universiti Teknologi Petronas which
located near our development. Besides, the teachers from school nearby our development also
been targeted as our purchaser. Moreover, we also others target government servant likes
police, Pejabat Perak Tengah Staff, doctor and others. Lastly, we also target investor outsides
from Perak Tengah.

8.5 Project schedule

64

After considered all aspect, the period of our proposed development will takes about 3 years.
First stage will take nine to ten month for site clearance and foundation works in our
proposed site. For the second stage, it will take time about seven months which is for houses
structure works such as column and beams. For the next six and seven month is for
construction of the wall, building frame and other structure of the houses. For the other five
to six month is for infrastructure works, such as build road, painting, cement and other
installation for the houses. The final stage is for the testing of all the services for the
development. If any lacking in the services or appliances in the building, developer can
charge, repair or fixed it

Stages
1

Times ( month )
9 - 10

Work
Foundation: Site clearance and

foundation work.
Building structure:

6 -7

column and beam.

Construction: built walls, frame

56

and other structure buildings.

Infrastructure : paint, cement,

45

wiring, and etc

Final stages: testing all service in

4
5

constructed

the building.

8.6 PROCESS REQUIRED FOR PROPOSED DEVELOPMENT

Development is a process that involves changing or intensifying the use of land to

produce building for occupation. It is not the buying and selling of land for a profit: land is

65

only one of the raw materials used. Others include building materials, infrastructure, labour,
finance and professional services. (David Cadman and Rosalyn Topping, 1995).
In general, before any developments wants to construct on that area the approval from
the Local Authority must be ensure first. The developer must have got the planning
permission from the regulatory bodies to make sure the developments that want to develop
on that area is legal with the approval for permission. There are a few steps that must be taken
along the planning process. The summarization about the planning is as follows:The first practices that involves on the land developments process is to get vacant
land from the authorities such as the Land Office or get with the purchase of vacant land from
parties or any individuals. The explanation of the circumstances and the land must be proved
by a title of the land. This is to ensure there are no barriers or obstacles that occur during or
before the construction work is done. If there is several limitations to be done with the
express condition instant conversion and release all the restrictions that arise.
Any particular project either a land development, or a mixed residential project, or a
simple building project requires authority approval at various stages of its development. A
landed residential is one of the several technical components of the projects that needs
approval authority. An efficient approval system for the project development is ideally
required. Documentation of the approval requirements is essential and all requirements
should reflect uniformity in standards and practises. The approval systems should be efficient
and transparent. The form G is be submitted to the director General within 14 days of making
an application of development to the relevant authority.
At the second stages, a developments proposal involves four main stages which
require approval applications for the land matters, planning permission, building plan and for
earthworks plans and road and drainage plans. Each applications process is provided for
under the various related legislations namely National Land Code 1965, Town and Country
Planning Act 1976 and Street, Drainage and Building Act 1974.

66

Table 1: The planning process

At the third stages, all the documentations and applications need to submit to
Sacreteriat of One Stop Centre. The One Stop Centre (OSC) Sacreteriat shall check and
examine all documents submitted based on the checklist prepared. The checklist is covered
for the simultaneous applicants for conversion and subdivision under section 124A National
Land Code (NLC) or application for Surrender and Re-alienation under Section 21 4D
National Land Code. Besides that. The OSC will also examine the application for planning
permission, building plan approval, earthworks plan and application for Road and Drainage.
If the application is incomplete, the OSC will request the applicant to submit necessary
documents or plans.
67

At the fourth stages, the Secretariat of OSC will distributes Application to the relevant
departments. It will accompany documents to the relevant departments for processing. For the
simultaneous application for conversion and subdivision will be processing by the Planning
Department of Local Authority on that area. Land use conversion is a standard procedure that
needs to be carried out first in any land/property development. Application for land use
conversion must be comply with the National Land Code and must be lodged with the
District Land Office. A proposed development shall be compatible with the established
Structural or Local Plan of the locality. It is good practice for the developer, or the
consultants, to meet with and consult the approving authorities to determine their
requirements prior to submission. This will reduce the time for review, comment and
processing of the application.
Submit
application

District Land
Office

State Land and

Mines Standing
Committee
(STANCO) Review

Valuation Department,
Town and Country
Planning Department &
Local Authority
Department of
Environment, State
Economic Planning Unit

State Executive
Council (EXCO)

Figure 1: the approval process flowchart for land use conversion

A developer may apply to the State Authority for alteration or imposition of category
of land use, removal from the land title expression to which the land is subject or the
rescission or amendment of any express condition or restriction in interest to enable the
developer to use or develop the land accordingly and for purpose other than that allowed at
present (s.124 NLC). The form O will be submitted to the Director General on a monthly
basis before the 14

th

day of the following month. This form applies to category of land use in

relation to building and industry only.

68

Where the State Authority approves any applications for the alterations of a category
of land use s.124(1)(a), the State Authority shall direct that the category of land use applied
for shall be endorsed on the document of title to the land and that the existing category (if
any) shall be deleted. Furthermore, the State Authority may at its discretion impose such
conditions as it think fit in addition to the payment of a further premium and the reservation
of a new rent. In this instant, the State Authority has no power to direct that approval of
applications for conversion of category of land use and subdivisions is conditional upon the
registered proprietor surrendering his title in perpetuity in exchange for a 99 year State lease.
Section 124A allows applications for conversion and subdivision to be made
simultaneously. This is aimed at speeding up the development of housing projects as upon
land being converted, it needs to be subdivided into individual smaller separate title suitable
for housing and for purpose of selling it to purchaser. The application must be forwarded in
accordance with the relevant applications form, registration fees which RM 50 for per each
unit, official search and copy of the land title.
Subdivisions of land is a process whereby land held under final title is sub-divided
into two or more portions and each portion to be held by the same proprietor but under
separate title refer to sec. 135 (NLC). The conditions for approval of sub-divisions lands that
any necessary approval of planning authority has been obtained and that the shape of each
subdivided lot will in the opinion of the State Authority suitable for the purposes for which it
is intended to be used. For submission purposes, a development layout shall be proposed and
signed by a Registered Planner. The application must be made in the statutorily form P and
upon its approval, survey fees and land titles issuances fees must be paid in advance by the
applicant.
For the processing of Planning Permission Application by the Department of Town
Planning Local Authority, the process was referring to Development Plans and Planning
Guidelines. Besides that, it will refer to the State Planning Committee and the National
Physical Planning Council if required. They will prepare recommendation paper to the One
Stop Centre Sacreteriat. The Director of Town Planning Department shall table the
recommendation paper in the OSC Committee Meeting

69

At the fifth stages, the next step after land use conversion and subdivision is to apply
Building Plan approval. The application shall be submitted to the Local Authority concerned
and referred to the Departments of Fire and Rescue Services, Water Supply Corporation,
Department of Sewerage Services, Tenaga Nasional Berhad and other related technical
departments. For the building plan approval, the officer in the Building Department shall
undertake the following process such check Form A refer to Schedule IIU Uniform Building
By Laws 1984, receive comments from technical Departments and coordinate comments with
the agreed layout plans. The Director of Building Department shall table the recommendation
paper in the OSC Meeting.
The next stage taken is receiving comments by technical departments or other related
agencies. The relevant departments will receive complete documents from OSC Secretariat
and check the application. They will prepare and submit comments to relevant processing
departments according to application and comments on land development submit to Land
Office, comments on planning permissions and submit to Town Planning Department of
Local Authority. Besides that, they will comment on building plan and submit to Building
Department of Local Authority. The process take 14 days if a local plan is available.
The One Stop Centre Secretariat shall compile and coordinate all recommendations
paper and issue letter of calling for meeting with meeting agenda to all members of the OSC
Committee to consider and make decision on the application for planning permission and
building plans. Moreover, the committee shall make recommendations for pre-computation
plan and application for simultaneous subdivision and conversion. These documents shall be
signed by Director of Planning Department of Local Authority.

Within 24 days, the Land Administrator shall prepare a recommendation paper to the
State Director of Land and Mines to be tabled at the meeting of the State Executive Council
for decision. The State Director of Lands and Mines shall inform the States Decision to the
Land Administrator and make copy of the decision to the One Stop Centre Secretariat. On the
next 5 days, the Land Administrator will inform the Applicant of the Decision on the Land
Development Application of the subdivision that has been approved. Besides that, they will
inform for every subdivision, the category, conditions and expressed condition (if applicable)
as directed by the State Authority. additional premium rate and quit rent for every subdivision
70

as well as other payments that need to be made. At the same time, the period for the payment
of additional premium, quit rent and others and other conditions of approval as imposed by
the State Authority.
As the same time, the Land Administrator need to present the notice in Form 7G
requesting the applicant to make the necessary payments within the stipulated time as
follows:i.

Surveying fees if the survey is to be done by the Department of Land Survey; and

ii.

Payment for the preparation and registration of the Qualified Title for every lot in the
subdivision.
For section 204D, the Land Administrator shall inform the applicant of the following:-

i.

The terms of the approval for each unit that shall be re-alienated;

ii.

The additional premium and tax rates for each unit that shall be re-alienated;

iii.

Period of payment of the additional premium, tax and other payments that is charged;
and

iv.

The amount of premium in Form 5A in relation with each unit. The survey charges
shall not be included in Form 5A if the survey is to be undertaken by a licensed
surveyor and the Land Administrator has been given the assurance by the Board of
Surveyors.

At the next stages, the One Stop Centre secretariat shall inform the approval to the
applicant on the decision of the application enclosing the approved layout plan, building plan
and other related plan. Besides that, the OSC shall collect the approved documents signed by
the YDP or through empowerment to the Director of Planning, Director of Building and
Director of Engineering. The total time frame for the processing of simultaneous application
is suggested as 92 days (3 months and 2 days). If the application falls within an area with the
gazetted local plan, the normal time to process shall be 67 days which 2 months and 7 days).

71

An applicant for a housing developer license under the provisions of section 5 (3) of
the Act shall submit his application in the form as may be determined by the Controller from
time to time together with such documents and apply such other relevant particulars or
information as may be required by the Controller. The fee payable upon every application for
a license shall be fifty ringgit. Any misinterpretation of the particulars or information of this
regulation shall be an offence under these Regulations. The Controller may, in his discretion,
grant a license with or without attaching any condition or conditions thereto or refuse to grant
a license. Moreover, the fee payable for a license under this regulation shall be one thousand
ringgit per year or part of a year. A license shall be required in respect of each housing
development and where a housing development is to be developed in phases, a license shall
be required for each phase of such housing development. Besides that, a license issued under
this regulation shall be in the form as may be determined by the Controller from time to
time.
No advertisement or sale shall be made by any licensed housing developer without an
advertisement and sale permit having first been obtained from the Controller. Any
advertisement and sale shall be in accordance with the advertisement and sale permit as
approved by the Controller. An applicant for an advertisement and sale permit shall submit
his application in the form as may be determined by the Controller from time to time and
shall supply the following:
(a) a copy of the approved building plans;
(b) two copies of the proposed advertisement including the brochures containing particulars
(c) particulars containing selling price of every unit of housing accommodation in every
housing development;
(d) such other relevant particulars or information as may be required by the Controller.
The fee payable upon every application for an advertisement and sale permit shall be fifty
ringgit. Any misleading statement, false representation or description of the particulars or
information required under paragraph (2) of this regulation shall be an offence under these
Regulations.
72

9.0 CONCLUSION AND RECOMMENDATION

As a conclusion, a feasibility study is a comprehensive analysis which provides

concrete data and information on various aspects of a project so that an investment decision
can be taken. The viability of a project is feasible when the real estate analyst determine that
there is a reasonable likelihood of satisfying explicit objectives when a selected course of
action is tested for fit to a context of specific constraints and limited resources Prof. James
Graaskamp (University of Winconsin).
The implementation of residual method to in financial analysis is to determine capital
funding required and its sources. Residual method is implemented when determine the value
of real estate which can be subject to development. Besides that, it used as magnitude and
timing of cash flow and outflow. The proposed development must be a project that can gain
profit to the parties and bring benefits to the owner. By that, using the financial analysis can
examine whether the project can sustain its financial obligation with adequate working capital
and generate enough funds to ensure adequate cash flow.
Moreover, the calculate of financial analysis as a reason to final capping of a complete
feasibility study and the returns of the design analysis. It can be as a guidance to the
developer to proceed on that proposed development if it will bring the profit or can take other
initiatives to make the way to solve the problems if any.

73

The calculation of residual method are as follows:Gross Development Value (GDV)

Unit

Double
Storey
Terrace
House

78

Total

78

Price

Total Price

per unit

(RM)

RM265,

RM20,693,7

305

90

Total

RM20, 693,

GDV

790

Less (-)
Gross Development Cost
Land Cost

6 acre

Site
Preparation
Cost
i)Clearing
site
ii)Cutting,
filling and
levelling
the site
Building

RM 30 per square =
metre.

RM728,400

RM80,000

=
RM80,000

78 unit

RM 1,000 per unit

74

subdivision
survey
Preparation 78 unit
of title
Infrastructu 78 unit
re Cost
Constructio
n Cost
i)Double
Storey
Terrace
House
Professiona
l Fees
i) Architect
ii) Engineer
Administrat
ive
Overhead

78 unit

RM78,000
@

RM50 per unit

=RM 3,900

RM5,000 per unit

=RM390,00
0

00

1.5%

Construction cost

=RM175,50

3.5%

Infrastructure cost

GDV

=RM13,650
=RM413,87

2%

5
@

Contributio

Construction cost &

=RM604,50

infrastructure

0
=

to

authorities
Finance

=
RM11,700,0

Contingenci 5%
es

RM 150,000 per unit

RM

130,000
9%

Full

cost,

half =RM1,932,

cost

development

906

Developer

period(1.5 year)
GDV

=RM3,104,

Total GDC

067
=RM19,354

15%

s profit

,798

Gross Development Value-Gross Development Cost= Residual Value /

Net Profit
RM20,693,790 - RM19,354,798 = RM1,338,992.
75

Market value of the Land= Residual Value X PV @ 10% for 3 years =

RM 1,005,985.
Profit on Value
Profit/GDV@100%
6.47% Say 6%

RM1, 338, 992/RM20, 693,790@100 =

Profit on Cost
Profit/Cost @ 100%
6.92% Say 7%

RM 1, 338, 992/RM19, 354,798@100 =

Based on the findings of the study, a conclusion will be made on the market potential
and viability of the proposed residential project at Bandar Universiti, district of Perak Tengah,
Perak Darul Ridzuan and the land area is 6 acres (24,280 square metres). The project viability
is dependent on the ability of subject development to capture existing and future residential
market in the area. Based on the calculation, the development is positive profit of the
development. After the calculation, the profit on cost shows a percentage at 7%. Besides that,
the profit on gross development value is at 6% respectively. Therefore, this shows that this
project will gain profit if the project is to be realized. It shows the profitability of a
development that used feasibility studies where land cost or value is a known factor and is
used as an item in developments costs. The residual value is the profits of the project where
the development potential of a property is based on its highest and best use.
As a recommendation, we are strongly recommend to our client which Miss Nur
Nazihah Bt Chuweni to proceed on that proposed development because it shows the big
potential if the construction work is continued. From the observations shows that the area of
Sri Iskandar will be rapidly growth on the future and the residential house scheme will be
more develop on that area. By these big opportunities, we are advice to our client to not miss
to this opportunity. It is a compromise between individuals needs and social requirements.
This proposed development shows technically possible, legally permissible, and financially
viable.

76

10 Appendices

77

11 References

Miss Nur Nazihah Binti Chuweni

Encik Salman Bin Mohd. Idris, an officer at Majlis Daerah Perak Tengah
Officer at Town Planning Department, Departments of Land and Mines, Ipoh.
Statistician at Bangunan Persekutuan Ipoh
Quantity Surveyor at MRCB
Data from Property Market Report 2007 2011

78