This article first appeared in City & Country, The Edge Malaysia Weekly on April 10, 2023 - April 16, 2023

Kampung Sungai Penchala is a small Malay village located on the fringes of northwest Kuala Lumpur and close to the upmarket residential areas of Taman Tun Dr Ismail (TTDI), Bandar Utama, Mutiara Damansara and Damansara Perdana.

Regardless of its neighbours, the area still retains much of the rustic charm of Malay village living set against a backdrop of lush hills and greenery, and is home to popular Malay restaurants and eateries including Sambal Hijau, Restoran Puteri Pencala, Rasta TTDI, Muhibbah Seafood Restaurant and Villa Zamara.

Kampung Sungai Penchala also enjoys good accessibility and connectivity via internal roads as well as major highways such as Penchala Link, Sprint Expressway, Damansara-Puchong Expressway (LDP), New Klang Valley Expressway (NKVE) and Duta-Ulu Kelang Expressway (DUKE).

Henry Butcher Malaysia chief operating officer Tang Chee Meng says Kampung Sungai Penchala’s appeal lies in its rustic village feel. It comprises a mix of stalls, shops, workshops, mosques and schools against a backdrop of greenery despite being close to modern urban conurbations.

“The area has largely maintained its character as a Malay village, as it is gazetted by the government as Malay Reserve Land (MRL). Many buildings in the area still preserve the traditional Malay kampung house architecture,” says Tang.

Nonetheless, Kampung Sungai Penchala has seen a handful of new developments in recent years. “Urbanisation and development have caught up with the area and new properties have come up, including modern terraced houses, semi-detached houses, bungalows and condominiums,” says Tang.

He notes, however, that owing to the MRL nature of Kampung Sungai Penchala, property developers that intend to embark on any projects in the area will have to tailor the products and pricing to meet the specific needs of the community. “For example, new developments such as low-rise apartments and landed properties like terraced houses, semidees and detached houses may be more suitable for this area,” he says.

Metro Homes Realty Bhd executive director See Kok Loong considers Kampung Sungai Penchala a semi-developed township. “The area has good amenities with a good location next to Mutiara Damansara, TTDI, LDP, Penchala Link and the new DASH (Damansara-Shah Alam Elevated Expressway).”

Even the land facing the LDP has been deve­loped into car showrooms and service centres such as Proton, BMW and Honda, he adds.

An ongoing development in the area is Rencana Royale by CK East Group. The two-acre freehold Malay reserve commercial development, which has a gross development value of RM380 million, comprises 622 suites in two 13-storey blocks, 13 retail lots and a food court. According to Henry Butcher data, the selling price of the suites ranges between RM700 psf and RM800 psf. According to a CK East representative, Rencana Royale is 80% sold and slated for completion by year’s end.

A newly completed project in the area is YT Residence, located across from Rasta TTDI and near Restoran Puteri Pencala. See says the waqf project comprises 141 apartment units and is awaiting the certificate of completion and compliance.

Another recent completion is the 2-storey bungalow villa project at Jalan Puncak Penchala, which See notes has asking prices of RM3.2 million to RM3.5 million.

See foresees limited growth in terms of develop­ment in Kampung Sungai Penchala. “Most lots are individually owned and too small for development, which is why there is a limited number of high-rises in the area,” he says, adding that the MRL status also limits the growth potential of the area.

Based on a 2015 case study in the City, Territory and Architecture journal titled “The challenge of rural life nostalgia: barriers in redevelopment of Malay Reserve Land (MRL) in Klang Valley” by Hanif NR, Azriyati W N, Abdul-Rahman H, et al, See notes the majority of land owners in the area rejected the idea of further developing the land.

He says: “[They] preferred to maintain the village status quo and were satisfied with the current development level in the village. Only a minority of respondents agreed that the land should be developed, as they perceive that redevelopment is able to raise their quality of life.” The immediate redevelopment of the area is thus not warranted because of the general preference of the landowners, he adds.

According to See, Kampung Sungai Penchala, which carries the 60000 postcode and measures 291.65ha, has a population of 5,000 and a density of 17 people per hectare. “In respect of the status of ownership, a large number, or 64.5%, of properties in Kampung Sungai Penchala are individually owned and a further one-third is jointly owned with family members of the original family,” he says (see Table 1).

Nonetheless, See has a positive outlook for Kampung Sungai Penchala because of its appeal, mainly in terms of its freehold land status, accessibility and location. He says: “The outlook is great, as the infrastructure will continue to improve and land is limited. For Malays who are keen to build their own bungalow, the area is one of the better areas to do so, as it is still affordable compared to the neighbouring TTDI and Mutiara Damansara areas.”

In terms of transactions, mostly land, semidees and detached houses were observed to have been transacted over the past few years, says Henry Butcher’s Tang. According to him, land with sizes of around one acre have been transacted at prices ranging from RM100 to RM140 psf, while smaller plots below 10,000 sq ft have changed hands at higher prices of RM140 to RM160 psf.

“Detached houses are common in this area and their transacted prices ranged from RM1.2 million to RM3.5 million from 2020 to 2021; they have land sizes of between 5,000 and 9,000 sq ft. Before 2019, there were transactions of larger bungalows with a land size of half an acre to more than an acre at between RM4.9 million and RM8.1 million.”

He adds that there were also 3- and 4-storey detached houses being put up for sale for RM3.5 million to RM9 million. Semi-detached houses saw transactions of between RM2.3 million and RM3.5 million (see Table 2).

According to Metro Homes’ See, residential land plots ranging from 5,000 to 10,000 sq ft were transacted at the current market value of RM150 to RM200 psf from 2019 to 2022. Prior to 2015, prices ranged from RM100 to RM120 psf (see Table 3).

“The price variance is big because of the nature of each individual lot in terms of the direction in which the parcel faces, accessibility and more. Owing to the nature of land in the area, some of the plots have small inner roads while some are unsuitable for building high-end bungalows,” he explains.

See says a popular property in Kampung Sungai Penchala is Mas Kiara Residences, located on Jalan Datuk Sulaiman and at the border of TTDI. The condominium development was abandoned in 2003 by Pinggir Kiara Sdn Bhd before it was taken up by Intan Permata Properties Sdn Bhd in 2007 and completed in 2010.

The 246-unit freehold development has two blocks 16-storey, with typical units ranging from 1,281 to 1,539 sq ft in built-up and penthouses measuring 3,000 to RM5,000 sq ft. See says: “At launch, the standard units were priced starting from RM345,000 while the penthouse suites went for about RM2.3 million.

“The project received a lot of attention because of its strategic location and facilities. The condominium has attracted different groups of residents, from professionals to families, and the accessibility of this property makes it a great choice for people who work in the city and prefer to reside in a nearby township.”

Over the last two years, Mas Kiara Residences has seen transacted prices of RM226.40 psf to RM562.08 psf (see Table 4). In a recent transaction recorded last November, a 1,280 sq ft unit was sold for RM650,000. Earlier, in July, a similar unit was sold for RM720,000.

Tang notes that the rental market in the area is not that active, as most of the residents in Kampung Sungai Penchala are owner-occupiers. “There are not many properties advertised for rent in this area. We understand, however, that the tenanted houses in the area are mainly kampung-type dwellings, which provide affordable rental accommodation.”

The restricted land ownership in Kampung Sungai Penchala will limit the saleability and rentability of MRL properties as well as the potential for capital appreciation, says Tang.

He notes that MRL is regulated by the Malay Reservation Enactment (FMS Cap 142) (formerly the Malay Reservation Enactment 1913 and Malay Reservation Enactment 1933), which prevents state land in Malay reservation areas from being disposed of by any means to non-Malays and to prevent any private dealings between Malays and non-Malays. “The state, through the land offices, will be able to monitor and prevent any transfers or dealings from Malays to non-Malays.

“Owing to the Malay Reserve status of the land, the area does not enjoy the same robust market conditions enjoyed by its neighbours such as Taman Tun Dr Ismail, Bandar Utama and Mutiara Damansara,” he adds.

Nonetheless, Kampung Sungai Penchala remains a popular residential area in view of its convenient location, says Tang. “The property market for this area in the mid to long term will generally be positive and stable, as most of the properties here are owner-occupied and there is not much speculative buying activity.

“Public transport infrastructure such as MRT and LRT connectivity will be a good addition to Kampung Sungai Penchala.

“Further improvements such as widening of roads will resolve traffic congestion and provide smoother access for its residents.”

See says: “DBKL should look into improving the infrastructure and town planning rules in Kampung Sungai Penchala. Perhaps what can be looked into is allowing a certain percentage of non-Malay ownership for certain developments, say, 30% of the entire building.”

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