What new initiatives is Trinity Group involved in?
KEAT: Trinity is a boutique property developer in Malaysia focusing on delivering high-value property projects in high growth locations with good infrastructure and amenities. In the last three years, our priority was mainly to strengthen our presence in the local property market. This year, we intend to solidify our position in the high-rise residential segment by introducing two new projects, Zeva@Equine South and USJ 19, which are scheduled for launch in the second and fourth quarter of the year. Moving forward, we intend to move up the property value chain by expanding our market share beyond Klang Valley region.
Currently, Trinity’s projects are all located in the Klang Valley. In what geographic areas are you most keen to expand development?
KEAT: Others areas which we are aggressively looking at are Johor and Penang, which are high growth areas supported by good infrastructure and a strong demand for quality properties, not only by the locals but also an international audience, especially investors from Singapore, Japan and China. Besides these locations, we will also look into the Asian region with the aim of expanding our business overseas. But of course, the expansion will take its course depending on our growth and development.
It is expected that rising land, labour, and material costs will continue to pressure property prices. How will these factors impact sales? What is Trinity Group doing to alleviate such pressures for the medium-term?
KEAT: The rise in land, labour and building material costs will continue to drive the cost of property prices upwards. However, this trend is not unique to Malaysia alone and is also happening in other parts of the region. To continue to do well in this industry, we need to differentiate ourselves effectively from our competition by looking at all aspects of our product offerings from product features to styling, design and layout to meet the needs of today’s home-buyers. Innovation is key at times like these. We need to move up the value chain and provide more in terms of product quality, design, facilities and features than what they would have earlier to lock in sales and to differentiate ourselves in the market place. All Malaysians are driven by the overarching hope of owning a roof over their head so the demand for affordable and high-value properties will always be there. We just need to come up with the right product with the right price point to cater to the unfaltering demand from this group of buyers. At the same time, we need to keep costs down and be very disciplined in buying land. Part of the strategy to keep prices down is to develop in secondary areas with good infrastructure and connectivity in the Klang Valley.
What is the level of competition in the local property development market? How would you describe competition among regional real estate markets for foreign investment?
KEAT: Competition in the local property market is getting very stiff. There are consistently new entrants coming into the marketplace. This will lead to increased competition in the industry resulting in improved product quality and features, which is good for the industry. In order to do well, Trinity will continue to set new benchmarks in terms of quality standards and value creation for our customers. Malaysia has the potential to become a prime investment destination in the region as it has one the best policies in terms of purchase of properties by foreigners such as no restrictions on the number of properties purchased for properties above RM500,000 ($160,000) per unit. Additionally, foreigners can buy freehold properties in Malaysia and can take out property loans. However, foreign investors in Malaysia make up 2 percent of total residential house buyers here. To bring in more foreign property investment into Malaysia, the Government needs improve Foreign Direct Investment (FDI) in the country and to promote Malaysian’s potential as a prime investment destination to foreign investors. I believe we are on the right track as Malaysia has moved into the international investor’s radar and the nation’s FDI hit an all-time high of RM33bn ($10.6bn). We have to make KL a more livable city by raising the standard, encouraging international schools to grow, as well as improving our public transportation and infrastructure.
To what extent do foreign investors contribute to the growth and development of Malaysia’s real estate market?
KEAT: Currently, foreign investors in Malaysia make up 2 percent of total residential house buyers here. This figure may be small at the present moment but Malaysia has huge potential as a prime investment destination due to its stable property market which is domestically-driven, with consistent demand coming from buyers buying for own use. On top of this, Malaysia is a politically-stable country, financing is easily available and property prices in Malaysia are positioned as one of the lowest in the region. All these factors will drive Malaysia towards a prime investment destination in this region.
Currently, foreign investors in Malaysia make up 2 percent of total residential house buyers here. This figure may be small at the present moment but Malaysia has huge potential as a prime investment destination due to its stable property market which is domestically-driven, with consistent demand coming from buyers buying for own use.
Malaysia’s real estate market has grown an average of 5.3% over the past 20 years. Do you expect this trend to continue?
KEAT: The Malaysian property market over the past 20 years has grown at an encouraging level, fueled by healthy domestic demand as Malaysia has a young demographic base. It is expected that Malaysia’s property market will continue to move upwards, supported by Malaysia’s healthy economic growth and the Government initiatives such as ETP (Economic Transformation Programme), MRT (Mass Rapid Transit), LRT (Light Rail Transit) and, most importantly, the Government’s plan to transform Malaysia into a high-income nation by 2020. All this will lead to sustained demand for quality and high-value properties in strategic locations across the country.