Despite the challenging market conditions, Eupe’s expansion strategy to KL remains firmly on track, with the company's footprint in Malaysia’s capital continuing to consolidate and grow.

Dato’ Beh Huck Lee, Kedah-based Eupe Corp Bhd’s group managing director and CEO, says the company’s key projects in Kuala Lumpur — Novum @ South Bangsar and Parc 3 @ KL South — are doing well.

Market response to and the take-up rate of Parc 3 have been good, with about 75% of its 793 serviced apartments snapped up to date. The project was launched last year.

“This is a really pleasing result, given the market conditions and that we’re still a relatively new entrant into Malaysia’s most competitive property market. “It shows our unique product offering in KL – blending innovative design, affordability and sustainability — is very attractive to buyers.”

Comprising 729 serviced apartments, Novum, which was launched in 2016 as Eupe’s first KL project, is expected to obtain its CCC at the end of this year.

A Growing Project Pipeline

Beh says the company is hoping that the final approvals for Vivus in Seputeh will be obtained in the second half of the year. The RM685 million development will comprise 821 serviced apartments and villas in three towers in one of KL’s most sought-after locations.

“This project is in a very strategic location and we need to carefully monitor the market conditions before we make a final decision on the timing of our launch, so that we can maximise the project’s upside potential,” he says.

Eupe recently announced that it is in the process of acquiring two contiguous commercial parcels measuring 2.85 acres in total in the Petaling Jaya Commercial City (PJCC) area. The acquisition is expected to be finalised by July.

According to Beh, the land is strategically located between Sunway Pyramid and OUG, where property pricing is around 40% less than in the aforementioned areas.

He says the PJCC acquisition is a strategic response to the current market conditions, and will have a lot of upside potential because it taps into a key market trend – affordable housing.

Hence, the planning for the land will focus on addressing this particular demand.

“The demand pattern and demography are quite unique and different from our other KL projects. We feel it will be a very attractive project for an area where potential buyers will want to upgrade to a better home but who still place a premium on affordability.

“The project will allow us to directly engage with a large and growing part of the KL property market where affordability continues to be the focal point,” he says.

Beh says he is working to hasten the design and approval process for the PJCC project, adding that there is a possibility that its launch date will be close to that of Vivus.

Making the Most of Consolidation

Beh predicts the property market’s current consolidation period will last for another 18 months, He adds, though, that overall demand for property will remain healthy if the job market continues to be strong.

He says the growing demand for affordable homes, while viewed negatively by some in the sector as it puts pressure on returns, has a wider benefit for both the industry and buyers.

 “This transition is necessary to ensure that long-term market growth is sustainable and the benefits of property ownership and investment through improved affordability are spread more widely,” he says.

 “The demand for affordable homes is also forcing property developers to become more efficient and innovative in order to stand out and give buyers what they want,” Beh points out.

The most effective response to what is a persistently challenging market, Beh says, is focus on prudence.

‘As a company, we will continue to focus on expanding our growth opportunities in KL by looking actively for land, which underpins our project pipeline.

‘At the same time, to remain healthy in the long run, it is crucial to improve efficiency across all our operations,” he adds.

Efficiency the Key to Success

“Our key focus over the next 12 months will be to improve our efficiency. If we focus strongly on this area and achieve the results that we want through greater competitiveness and performance, growth will take care of itself.”

Beh said the company’s northern operations are going through a transition as a result of structural changes in the market and there is a need to improve in certain areas that were not critical to its performance in the past.

“This is a big but positive challenge as it will help reposition our northern property division for sustainable growth in the long term,” Beh says.

Eupe unveiled six projects in Kedah last year, all of them landed residential.