Unsold properties widespread in Kuching city

By TANIA LAM

KUCHING: These days, commercial shoplots are mushrooming at an accelerated pace all over Kuching, but overhang (completed but vacant units) is becoming a rampant issue.

According to the Valuation and Property Services Department (JPPH), the Malaysian property market as of last year showed good progress, recording an increment of 0.6 per cent in volume and 0.3 per cent in value compared to 2017.

However, the shoplot overhang situation has not improved – there are many fully constructed units remaining unoccupied still. This is observable in various regions of Kuching itself.

Statistics of Malaysia’s property overhang status by state (Valuation and Property Services Department).

As of previous year, Sarawak had 1,759 units of property overhang based on statistics collected by JPPH, amounting to RM839.68 million in costs.

A reliable source commented that even commercial developments within Kuching’s golden triangle area such as Tun Jugah Mall house many vacant units.

The source also stressed that unoccupied commercial shoplots were also plentiful in regions further from Kuching’s city area such as Demak Laut, Matang, Batu Kawa, Pending and Samarahan.

According to the source, a few key factors affecting the occupancy rates of commercial centres are rates, area population density, security and accessibility. Also important is the nature of business carried out by the prospective tenants in the area.

Another aspect that comes into consideration in this modern age is internet connectivity.

A significant shift in bargaining power from landlords to tenants has been observed nowadays as landlords struggle to meet market price rentals, the source noted.

The source concluded on a hopeful note by saying that rental rates for commercial premises had been generally lower and that strategic areas could still command good rates.