River Tropics in Seberang Jaya sees 70% take-up

The Edge, City & Country, 13th - 19th June 2016

Penang-based developer New Bob Group is building the first green condominium in Seberang Perai. The company had made its foray into the hospitality industry last April with the opening of Tido Penang Hostel, catering for flashpackers, on Argyll Road in George Town. Flashpackers refer to tourists who want to travel on a budget but still desire comfort and stylish accomodation.

“We wanted to start a green movement on the mainland – and River Tropics condominium is the first (project of its kind). There were no incentives to do green projects on the mainland. After we launched the project, we engaged the state government and now, it is looking at reducing contributions for such developments in Seberang Perai,” New Bob Group director Dr Lee Ville tells City & Country, “But nothing has been finalised yet.”

As for Tido Penang Hostel, Lee says it is meant to buffer the ups and downs of the property cycle. “We wanted to do something with recurring income,” he says. “I thought this would be something long term for us. We are trying it out and hopefully, we will be able to open a few in Penang and branch out to other states,”

River Tropics condominium

Situated just off the North-South Expressway close to Tesco Extra Seberang Jaya, the 18-storey River Tropics was officially launched last December. To date, 70% of the 148 units available have been sold.

Lee says most of the buyers are locals but he expects the condominium to attract more people from Sungai Petani after the higher floors are constructed and it becomes more visible.

Sitting on three freehold acres, River Tropics offers 140 units with built-ups of between 1,350 and 1,483 sq ft and eight duplex units – four on Level 5 (built-up : 2,500 sq ft) and four on level 18 (built-up: 4,000 sq ft with a private garden). The units are priced from RM400,000 or RM350 psf, and the project is slated for completion in mid-2018.

An innovative design feature is that the units do not have back-to-back party walls, or shared walls – akin to a semi-detached house.

The RM75 million project is aiming to obtain Singapore Building and Construction Authority (BCA) Gold certification. Passive and active green features include cross ventilation for all units, the use of low VOC paint for internal sections, water-efficient fittings and ec0-friendly tiles. Others include heat-reflective paint on external walls, energy-efficient fittings and ec0-friendly tiles. Others include heat-reflective paint on external walls, energy-efficient lifts, rainwater harvesting system and recycling bins in designated areas. The units are also aligned to face north or south to avoid the morning and evening sun.

Facilities include a rooftop community garden, multi-purpose hall, swimming pool and community facilities as well as gym, Jacuzzi and meditation room. There is a Tesco Extra nearby while the Sunway Carnival Mall is a 10-minute drive away and the Seberang Jaya Hospital, five minutes.

Lee says an app – the Smarter Sustainable Community App – is being developed for the condominium. Residents and the management will be able to use the app for easier communication, book facilities and receive announcements, among others.

Tido Penang Hostel

The latest addition to the New Bob Group stable is the 16-room Tido Penang Hostel on Argyll Road in George Town. The demand for hotels in Penang’s capital – a Unesco heritage site since 2008 – has risen over the years.

Lee saw an opportunity to tap the growing market. He was alerted by the group’s real estate arm of an abandoned 5-storey office block – unused since the 1997 Asian financial crisis – being put up for sale. He bought the building in 2014 for RM6 million and spent another RM4 million to retrofit it in 2015.

Tido, which offers 88 beds, threw open its door in April. Fees are charged for the beds, not the rooms. Guests can choose to stay in any of the eight double rooms, or eight dormitories. The bed rate for the double rooms is RM100 per bed, and for the dormitories, RM45.

Each double room has a king-size bed. Additional beds requested will cost an extra RM30. As for the dormitories, each has eight beds. The hostel has a gross floor of 10,000 sq ft, with rooms measuring about 200 sq ft.

Lee categorizes Tido as a “flashpacker” hostel, mid-way between a budget and full-fledged hotel.

The inspiration for the hostel came from his travels during his student days as a backpacker in Europe.

“When I was studying in Dublin, I spent about a month backpacking around Europe. Some of the places I stayed at were really dodgy, and I slept on the floors, he laughs. “But some were nicer, and I thought this was missing in Penang.”

He explains that the hostel targets a younger demographic. Guests can be assured of security with guards on duty, CCTVs and a female-only floor on the first level.

A coffee shop is just across the street and a bicycle rental service is available.

An artist was engaged to paint a map of George Town on a feature wall, with places of interest clearly marked as a guide for tourists.

Lee says this is an experiment the group is trying out and if it does not take off, there is a plan to convert the hostel into an office, possibly with a shared office concept.

However, the demand for Tido’s beds have been positive so far.

Helping hand

It is not news that the country’s property market is experiencing a slowdown, and Penang is no exception. In general, 2016 is seen as a challenging year for property development, Lee says.

Cooling measures have made it harder for buyers to get loans. For New Bob Group, about 20% of its purchasers see their housing loan applications rejected.

“They are very keen to buy but they cannot get the margin of loan they require, ” Lee says.

One measure New Bob Group – which has a money-lending license – is considering is for the company to finance up to 20% of the downpayment so that buyers can qualify for a loan of 60% to 70% of the property value.

Meanwhile, they have been some changes to another of New Bob Group’s projects, Tropics 8. Formerly known as Tropics Suites, it is located in Jalan Gottlieb, not far from Gurney Drive.

Besides the name change to capitalise on the number eight, the group has reduced the number of units it wishes to sell in the serviced apartment development from 40 to 20.

The remaining 68 units will be retained for recurring income to house medical tourists, Lee says.

“Medical tourism is one of the core areas for the growth of Penang,” he explains. “Penang has captured two-thirds of medical tourism in the country, with the majority of medical tourists coming from Indonesia.” Via Tropics 8, the group intends to provide services to complement the facilities provided by hospitals after treatment has been closed.

The closest hospitals to Tropics 8, just five minutes away, are Penang Adventist Hospital and Adventist Medical Centre, which are next to each other.

The rooms at Tropics 8 have built-ups of 500 to 800 sq ft. The units for sale are priced from RM500,000 with guaranteed returns of 7% per annum for six years. The units will be fully furnished, with the fittings costing RM80,000.

Lee says other projects have been placed on the back burner for the moment. These include six units of gated bungalows and town villas in Pulau Tikus, and 88 units of commercial suites in Butterworth.





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