The story of Iskandar Malaysia (IM) has gone through several iterations since its inception in 2006. Conceived as a special economic zone within the southernmost state of Johor in Malaysia, IM stretches across an area of 547,832 acres (2,217 sq km) or three times the size of Singapore.
Within IM are five zones, with Iskandar Puteri (formerly Nusajaya) being the administrative center earmarked as one of the investment destinations for both local and foreign investors—with catalytic projects such as LEGOLAND® Malaysia Resort launched in 2012 and Gleneagles Medini Hospital that was opened last year.
The sheer size of the economic zone has created more room for other catalytic developments. Rising to the challenge is United Malayan Land Berhad (UMLand), one of Medini Iskandar Malaysia (Medini)’s key developers, which will be rejuvenating an existing lake and promoting lakeside living.
Medini Iskandar Malaysia—Inclusive Smart City
Medini, one of Malaysia’s largest urban developments with a gross development value (GDV) of US$20 billion, is envisaged to be the new central business district for Iskandar Puteri. The 2,230-acre mixed development zone will be designed as a smart city incorporating financial, residential, leisure and healthcare components.
“A smart city is a place where technology is leveraged to improve urban issues such as mobility, energy usage, public safety and convenience. It is also about liveability—less time commuting, ample space for leisure activities, more time spent with the family and so on,” says Datuk Ir. Khairil Anwar Ahmad, managing director and chief executive officer at Medini Iskandar Malaysia Sdn Bhd (MIM).
“For us to build a smart city, we need to be inclusive and that means encouraging community participation to improve the quality of life. For instance, Amsterdam took just seven years to become one of the world’s smartest cities and that is an inspiration for us.”
From Master Planner to City Builder
MIM has been tasked with putting Medini on the world map. Established in 2007, it began as master infrastructure planner and manager before evolving into a commercial building developer and township management service provider.
“The shift in MIM’s role is to ensure a balanced supply of product offerings to meet market demand. As development within Medini progresses, we are looking at creating an inclusive smart city by working with real estate developers, investors and the community. We encourage talented knowledge workers from Malaysia, Singapore and abroad—from business incubators and startups to technopreneurs and creative individuals—to come to Medini,” explains Khairil.
Over the past nine years, Medini has attracted more than 10 real estate developers to build residential, commercial and retail properties; and corporate tenants such as Huawei and Samsung; in addition to LEGOLAND® and Gleneagles Medini Hospital. Surrounding Medini, there are other big names such as Pinewood Iskandar Malaysia, Newcastle University Medicine Malaysia, University of Southampton and Marlborough College Malaysia, among others.
MIM works closely with the federal and state governments, Iskandar Regional Development Authority (IRDA), local councils and other key stakeholders to ensure that the region stays on course to becoming a smart city.
MIM is jointly owned by Khazanah Nasional Berhad and Iskandar Investment Berhad through Jasmine Acres Sdn Bhd that holds 60% share, United World Infrastructure (20%) and Mitsui & Co., Ltd (20%).
Incentives for Investors
Six sectors have been identified as pillars of growth within Medini, namely health & wellness, education, financial advisory, leisure & tourism, creative and logistics.
“We are now promoting the six sectors to investors and SMEs who have their sights on the longer term. Not many people know this but there is a 10-year tax break for those who set up businesses here under those clusters,” says Khairil.
The unique leasing scheme for Medini projects was initially a bone of contention for early investors and financial institutions. “We have been explaining to investors to look at the complete ecosystem, the entire benefits such as the tax exemptions and not just focus on the leasing scheme. Since then, investors and banks are now more receptive to Medini projects.”
Unlike conventional properties, purchasers in Medini units do not get a title deed. What they get is a leasing right coupled with incentives like tax exemption and waiver of the minimum RM1 million (US$238,000) investment required for foreigners. The leasing right is for 99 years with an option to extend.
Qualified investors doing business in IM can also apply for government incentives like full foreign ownership of businesses, flexibility in employing foreign knowledge workers, and waiver of duty on car purchase.
Coming up in 2018 is the 30-acre Medini Lakeside development, an important leisure and commercial component within Medini. “We have engaged one of the world’s best designers to revitalize the lake and make it a hive of activity in the future with concerts and music festivals. Surrounding the lake will be jogging and bicycle paths, bridges and rest areas. Our aim is to create a vibrant community with an enviable lifestyle revolving around the lake,” says Dennis Ng, group managing director of UMLand, the developer of the project.
UMLand has allocated US$4.8 million to beautify the 13-acre lake and worldrenowned Aecom—known in Malaysia recently for its work on the ‘River of Life’ project in Kuala Lumpur—has been appointed for the task.
“The state government wishes to officially grant our full endorsement to the lake rejuvenation efforts which will be carried out by UMLand in collaboration with MIM,” said Johor’s chief minister Datuk Mohamed Khaled Nordin during the UMCity ground breaking ceremony last year.
Taking pride of place fronting the lake is UMCity Medini Lakeside, an award-winning integrated mixed development project on a five-acre plot. UMCity, with a GDV of US$285 million, is the developer’s flagship commercial component comprising a premium office tower; a three-storey retail mall, and three hotels.
UMLand is also working with other global partners such as Samsung in a ‘smart partnership’ to incorporate smart home applications for a connected lifestyle, Ascott, Onyx, Regus and Roca on areas like construction, hotel management, sanitary fittings and others.
Complementing UMCity will be the Viridea Medini Lakeside project. Viridea is a US$185 million GDV mixed development comprising three blocks of serviced apartments (440 units); SOHO suites (120 units); and a three-story retail shop-office (16 units).
UMLand is no stranger to Medini. Last year, it completed the Somerset Puteri Harbour serviced apartments located at the waterfront and marina precint near Medini.
In Johor Bahru city center, UMLand will be launching a premium project called Suasana Iskandar. The freehold development with a land area of 1.42 acres will comprise two tower blocks. First is a 35-storey tower block housing the retail and entertainment components, as well as 339 residential units. The other block (18-storey) will house the four-star Amari Hotel managed by Onyx. Suasana’s main selling point is its strategic location alongside the Segget river which is currently being rejuvenated as part of the city transformation plan and poised to be a tourist attraction. Suasana is also within walking distance from the Johor Bahru (JB) Sentral Customs, Immigration, and Quarantine Complex (CIQ), a checkpoint for visitors from Singapore.
“We have a long term view on real estate development and the current slowdown offers us a chance to re-organize and streamline our operations to come up with bet ter investment products,” says Ng.
The Next Lap
Khairil believes that 2017 onwards will be a watershed for MIM and Medini, as more owners take delivery of their homes and offices.
“We will be seeing more leisure options being offered to enable residents to enjoy a better lifestyle. The vibrancy will be more evident.”
“MIM has completed the infrastructure groundwork, the construction of two purpose-built office buildings and currently building two high-rise office buildings. We see Medini as a long term project with a development time frame of between 25 and 30 years.”
“With the completion of the Coastal Highway Southern Link (CHSL) by the middle of 2017, driving distance between Medini and Tuas checkpoint (Singapore) will be halved to 5.6 miles (9 km), making it even more convenient for commuters.”
A report released last year by global property consultancy firm Knight Frank Malaysia revealed that IM continues to register positive growth with cumulative investment of US$44.6 billion as at November 2015. It added that catalytic infrastructure projects, namely the Johor Bahru-Singapore Rapid Transit System (RTS) and High Speed Rail (HSR), are expected to spur further economic growth in the longer term.
RTS is an extension of Singapore’s Mass Rapid Transit (MRT) rail system and is expected to connect with Johor Bahru by 2019.
The 233-mile (375 km) HSR link, a joint government initiative expected to be implemented by 2026, will cut travel time between Kuala Lumpur and Singapore to just 90 minutes. There will be a few stations along the way, including one at Iskandar Puteri.
“Our geographic location alone makes us unique,” Khairil says when differentiating IM from other economic zones in Malaysia and referring to the close proximity with Singapore. Standing at Puteri Harbour, one can look across the Johor Strait to Singapore just 800 yards away.
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