This article first appeared in City & Country, The Edge Malaysia Weekly on October 10, 2022 - October 16, 2022
Located in the heart of Kota Damansara in Petaling Jaya is Dataran Sunway, one of the oldest commercial hubs in the area. It consists of several development phases such as 3- and 4-storey shoplots, the Dataran Cascades mixed development, Sunway Giza Mall and the Sunway Nexis integrated commercial hub.
The predominant 3- and 4-storey shoplots are the pioneer buildings in Dataran Sunway. A typical intermediate single-floor shoplot unit has a built-up of 1,650 sq ft while a 22ft by 75ft 3-storey unit measures 4,797 sq ft. Sunway Giza Mall and Sunway Nexis were built later.
Sunway Giza Mall is a shopping-centre and shopoffice hybrid. The retail centre has been retained by the developer — Sunway Property — to lease out and is currently anchored by Village Grocer. The stratified shopoffices that surround the retail centre were once occupied by bars, pubs and other F&B outlets. However, the Covid-19 pandemic has altered the business mix: new F&B offerings and retail services today include Eat Sushi Sunway Giza, Nando’s, FamilyMart and Caring Pharmacy, just to name a few.
Meanwhile, although Sunway Nexis offers stratified retail units that are relatively newer than those at Sunway Giza Mall, these have undergone a few rounds of tenant changes. When the place first opened, the ground floor was filled with cafés and restaurants but is now occupied by the Sunway Specialist Centre, a few Chinese hotpot restaurants and some F&B outlets. The upper floors are mainly leased to professional firms and educational institutions.
In general, Dataran Sunway is a vibrant commercial area that faces the busy Persiaran Surian. It is surrounded by residential estates, commercial centres, medical centres and hospitals, educational institutions — including SEGi University, Sri KDU private school and the Malaysia University of Science and Technology (MUST) campus — as well as industrial areas such as Pusat Teknologi Sinar Damansara.
“Dataran Sunway is one of the largest commercial centres in Kota Damansara. It is a popular hangout among college students and young working adults, with an almost complete range of retail goods and services such as F&B outlets, hair and beauty salons, mini-markets and convenience stores, fashion and entertainment outlets, banks and clinics,” Firdaus & Associates Property Professionals Sdn Bhd managing director Datuk Firdaus Musa tells City & Country.
“The commercial hub is accessible via major highways such as Sprint Expressway, New Klang Valley Expressway, Damansara-Puchong Expressway and Penchala Link. The Surian MRT station on the Sungai Buloh-Kajang line is also nearby.”
Firdaus believes that one of the biggest draws of Dataran Sunway is the wide range of F&B outlets, including Chinese coffee shops, mamak restaurants, hawker centres, noodle houses, cafés, restaurants and bakeries. There are now a number of Chinese hotpot restaurants and a few always-crowded bakery-cafés, such as Champignons Patisserie, Wu Coffee & Gallery and Donutes Bakery, which are the new crowd-pullers in the area.
At the height of the bubble tea craze in the country five years ago, Dataran Sunway was the preferred location for many of these outlets. Similar to what the SS15 commercial area in Subang Jaya experienced, some of the bubble tea chains closed for good over the past two years, victims of the pandemic. However, big names such as Tealive, Chatime, Tiger Sugar and The Alley are still standing strong, thanks to high footfall following the opening of the Surian MRT station in May 2017, according to Henry Butcher Retail managing director Tan Hai Hsin.
Aside from bubble tea shops, Tan highlights that convenience stores and grocers have mushroomed in the area. “The growth of mini-markets and convenience stores in the last few years led to the emergence of this type of operator in this commercial centre. In addition to 7-Eleven, 99 Speedmart and KK Super Mart, there are also Giant Mini, Zugo Mart, FamilyMart, emart24, Nice to CU, MiX Store, Uncle Tim Grocer, Vegan District and NGO Grocer. There are also a few marts specialising in goods from China.
“Besides that, Dataran Sunway is crowded with hair and beauty salons. The other nearby commercial centre with many shops in these trades is Damansara Uptown. In comparison, there are more independent operators within Dataran Sunway, which makes the area more exclusive,” Tan points out.
Like any other commercial area in the vicinity, transaction activity involving shoplots in Dataran Sunway was badly affected by the outbreak of Covid-19 in 2020. Nonetheless, both average transacted price and asking price have remained stable.
“Despite a number of businesses closing down and moving out, and more units falling vacant in the past two years, transaction prices [of the shoplots in Dataran Sunway] between 2020 and 2021 remained stable,” Firdaus shares.
He says that in 2017, the average transacted price for a 3-storey shoplot with a built-up of about 4,797 sq ft in Dataran Sunway was RM3 million. The price dipped to RM2.83 million and RM2.74 million in 2018 and 2019, respectively, before climbing back to RM3 million in 2020. In 2021, the average transacted price rose to RM3.36 million.
“The transaction and occupancy rate [of shoplots in Dataran Sunway] were affected by the pandemic. However, as the overall property market has become more active since the end of 2021, it is also reflected in the performance of Dataran Sunway’s shoplots, with higher asking prices ranging from RM3.4 million to RM3.8 million, as well as asking rentals from RM2,500 (levels above ground floor) to RM8,000 (ground floor units) per month.
“Yes, there was a slight drop in transaction prices in 2018 and 2019, but they rebounded quickly in 2020 and continued to rise in 2021 and 2022 as the economic sectors reopened. Despite the pandemic, the area remained one of the choice areas for investors due to good long-term tenant profiles,” Firdaus comments.
He believes that demand for shoplots in Dataran Sunway will pick up further in the short term due to the overall improved market sentiment since the reopening of international borders and as people return to their pre-pandemic lives.
“It is a very prime location with good footfall and the right business mix, thanks to the easy access, and most of the businesses are well established with good reputations. This is one of the factors that continue to attract property buyers and investors, as well as tenants,” says Firdaus.
Nawawi Tie Leung Real Estate Consultants Sdn Bhd (NTL) managing director Eddy Wong concurs, noting that the prices of shoplots in Dataran Sunway have been fairly stable over the years.
“Recent transactions for the 3-storey shoplots are around the RM3 million to RM4 million mark, while the 4-storey shoplots are in the RM8 million to RM9 million range. Right now, the 3-storey shoplots are seeking between RM3 million and RM4 million, depending on location and frontage, and the ground floor units’ asking rentals are between RM3 and RM5 psf,” Wong shares.
He also expects prices and rentals to remain stable and competitive in the short term. “This location is an established commercial hub and serves the surrounding residential catchment area which is an affluent community, giving it a competitive edge compared to other suburban commercial hubs.”
While Henry Butcher Retail’s Tan shares the same outlook on Dataran Sunway as Firdaus and Wong, he is concerned about further price appreciation.
“This commercial centre is already mature. There is no upcoming major real estate development; nor are major population shifts and new population influxes expected soon. In addition, there is no new commercial centre (shoplots) to be built. Therefore, Dataran Sunway is likely to remain status quo for the immediate future,” Tan shares.
Furthermore, the recent opening of Tropicana Gardens Mall, which is across from Dataran Sunway, has not added value to Dataran Sunway as yet.
“Although both are opposite from each other, the opening of Tropicana Gardens Mall has yet to contribute any meaningful value to Dataran Sunway. Of course, the shopping traffic and occupancy rate of this mega shopping centre are still not 100% at this moment,” he notes.
The Surian MRT station is located between Tropicana Gardens Mall and Dataran Sunway with direct linkage to both the shopping mall and the commercial hub. However, Tan does not see the opening of this station benefiting Dataran Sunway.
“In my opinion, the (Surian) MRT station does not add immediate value to the retail shops in Dataran Sunway. Dataran Sunway was already a vibrant commercial centre before the MRT was completed. The trade and tenant mix of Dataran Sunway has not changed due to the existence of the MRT station. I believe the property value and rental rate in the area have not risen any higher since it opened,” he says.
Nonetheless, NTL’s Wong believes that as Dataran Sunway is a mature and established commercial hub with high footfall and a balanced business mix, it has a competitive edge compared to other suburban commercial hubs.
“The retail industry is going through an unprecedented period and those who can adapt to the changes in the industry will continue to do well. As for the property investor, it is advisable to adopt a longer-term view of the market. This may mean accepting a slightly lower rent now in order to retain and support your existing tenant. It is more important to keep the unit occupied than to risk having it vacant in an effort to achieve what you perceive to be the market rental,” he concludes.
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