Chua
KOTA KINABALU: Sabah Housing And Real Estate Developers Association’s (Shareda) new president, Datuk Chua Soon Ping has outlined a set of initiatives to revitalize the real estate economy in Sabah over the next two years.
Speaking to reporters after Shareda’s annual general meeting on Wednesday, Chua said he hopes to implement short to long term strategies that focus on survival, services and sustainability in the state’s property market.
He lamented that Sabah’s potential is going to waste adding that the global pandemic and imposed movement restrictions have made a major impact on the state’s tourism industry and therefore the real estate industry.
The negative impact, he said, affected more than 140 up and downstream businesses.
“To tackle this issue, we must first double-down on the overseas investment opportunities in Sabah.
With the help of the Shareda board and relevant parties, we have the vision to ensure the state not only survives these challenging times but thrives.
“The first step to recovery is putting into action short-term measures for immediate relief and I propose two main approaches that involve inviting large-scale overseas investors to pump mass resources back into the economy,” he said.
Shareda, he said, proposes a ‘Sabah My PR’ scheme which mirrors the Malaysia My Second Home scheme and allows foreign investors to obtain permanent residency by investing in the state.
“Only 10,000 applicants over a five-year period (2,000 per year) will be accepted for this scheme. This staggered approval of entry balances the supply and demand of resources needed to accommodate the incoming residents,” he pointed out.
To qualify for the scheme, foreign investors looking for Permanent Residency in Sabah must invest RM4 million (USD750k) into Sabah Development Bank (SDB), he said.
“RM600,000 can be used to buy property, RM400,000 can be used for automobiles, medical insurances and education fees,” he said adding that a RM3 million bond will be issued by Sabah Development Bank.
The scheme can also be used to attract professionals in engineering, informational technology, agriculture and fisheries to come to Sabah and to qualify, each applicant must invest only RM600,000 in Sabah property and have one local guarantor.
Chua pointed out that in five years, 10,000 applicants depositing RM4 million each under the business migration scheme will instantly produce RM40 billion investment into SDB.
This, he explained is called passive investment migration.
With a five times spin-off effect, RM200 billion will eventually result from this initiative and Sabah will be one of the richest states in the nation, he added.
“By lowering the threshold for professionals, whereby they only need to invest 600k in property, we broaden our pool of expert talent while also driving up capital in the state. Talent is what we need in Sabah,” he said.
According to Chua, Shareda, during a meeting with Chief Minister Datuk Seri Panglima Hajiji Noor late February, has informed the latter of this proposal.
“The Chief Minister took note of the proposal and informed us that he will bring the matter up to the state Cabinet for discussion,” he said.
For the second segment of the survival initiative, Shareda announced that they will be hosting Sabah’s largest property exhibition, Propex 2021 from November 26 to 28, at the Sabah International Convention Center.
“It will be a three-day event for hungry buyers to attend and delve into the business opportunities available in Sabah real estate,” he said.
Chua also said that as Shareda president for the 2021-2023 term, he aims to amend the issues existing in the market.
Malaysia including Sabah’s biggest problem is that there is an overhang of properties unsold and it stems from the mismatch of properties available for home-seekers and the challenges in end financing, he said.
He explained that a mismatch of properties happens when the supply of housing does not match the demand.
“Homes are being built rapidly that do not meet the public’s capacity and desires to buy. This then leads to difficulty in obtaining financing loans from banks as there is an over-supply of what the banks consider as high-risk properties such as the high rise investment alike property. It is a nation-wide dilemma.
“The answer to this lies in zeroing in on the actual data and statistics of supply and demand. If the Ministry of Local Government & Housing can practice big data sharing for projects planned over the next 5-10 years, developers can project and evaluate zoning before committing to construction and applying for APDL (Advertising Permit and Developer’s License),” he said.
Moving forward, this will correct the oversupply of mismatched properties, he said adding that to target and understand the demand, institutions and the department of statistics should conduct market surveys.
This practice will guide developments in Sabah to follow a market-driven demand, he opined.
This, according to him is the way to reduce the risk of abandonment before construction commences.
“We will be the first in Malaysia to have such big data analysis across the industry, shared with developers and other stakeholders like banks. It is very important we follow this to eliminate the possibility of mismatched properties and end financing issues.
“We request the state to streamline the government policies and simplify the guidelines to make it more conducive in doing business in Sabah, so that the overall development cost will be reduced due to smoother efficiency and overcoming holding cost element thus making homes more affordable,” he said.
Chua said Shareda’s vision for its involvement in the industry exceeds the board’s term of just two years. The long-term initiatives will sustain the industry for generations to come, starting with the youth of Sabah.
The key movement for sustainability in the industry is to educate the workforce so Shareda will be collaborating with an institution to construct a highly-specialized diploma program for real estate development, focusing on the upstream side of the scope of business, he said.
“Why property financing? Leveraging is the key to successful property development and education is the key for forward-thinking,” said Chua adding that he and the board members are well-versed and trained in the area of upstream property development and this sector knowledge is what is lacking and needed in Malaysia.
Currently, there is only one other course in the country that focuses on upstream real estate development and that was created by Rehda in West Malaysia while for downstream development, there are plenty of courses available, he said.
“The course will be a part-time sandwich course where developers can send their staff to study for the diploma while working at the same time. Additionally, to raise up the next generation of industry players, Shareda has appointed a new youth chairman and invited two youth members to join its regular council meetings,” he disclosed.
Chua added that sustainability in real estate development is important to Shareda and to the future of the Sabah economy and environment.
The first green practice they are promoting is net metering.
This is an electricity billing mechanism that allows consumers who generate some or all of their own electricity to use it at any time, instead of relying on Sabah Electricity Sdn. Bhd. (SESB) to generate the entire supply. Any leftover electricity can be sold back to SESB.
He suggests that government buildings should be the first to implement this practice.
“They also wish to introduce rainwater harvesting. Being in a tropical climate, there should never be a shortage of water and yet, this is an issue Sabah often encounters. This method allows residents and businesses to collect and store rainwater from rooftops for supplementary supply,” he said.
Shareda’s line up for the 2021-2023 term are Chua (President), Datuk Chew Sang Hai (Immediate Past President), Datuk Johnny Wong Chen Yee (Deputy President), Wesley Chai Meng Kong (Vice President 1), Datuk Quek Siew Hau (Vice President 2), Benny Ng Su Pei (Secretary General), Emily Chew Fei Sean (Treasurer General) and Council members Datuk Pengiran Saifuddin Pengiran Tahir, Reggie Sua, Francis Wong Liong Teck, Joanne Wendy Chung, Roy Chiew Min Hann and Sophie Liw Meow Yin.
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