Bandar Puteri Puchong Shop Office by IOI Properties Bhd
by CL
12 Nov 2007

Introduction
Another winning township starting at the mid of 90s, till now prices of the properties in this township escalate more then 50% - 100%. For the entire Puchong itself, the growth has been very encouraging and probably the fastest growth township in Klang Valley these few years. The overall Bandar Puteri Puchong project is massive and yet to be fully developed in the coming few years. It is also branded by IOI Properties Bhd as "IOI-lnteIliCity commercial centre". We will take a look at the good and bad about this township.

Location
Driving alongside from Sunway Toll towards Putrajaya, Bandar Puteri Puchong is visible at your left hand side. There are few blocks of modernized high rise are under construction. By the time of these commercial blocks completed, you will never miss the junction to turn into this township. However, in the pass few years, due to its overwhelming growth, I believe most of the people in Klang Valley will know where the location of this township.

Strategically located at the middle between Kuala Lumpur, Petaling Jaya, Cyberjaya and Putrajaya, the accessibility of this township is very convenient. Even without going to neighboring township, Bandar Puteri Puchong is a self sustained township.

It is also surrounded by developing projects from well-known developers like SP Setia with Setia Walk is also going to be another commercial high light. YTL Lake Town, Hillcrest - Taman Puchong Utama and more, this becomes like a population generating engine that probably will touch an estimated around 300,000 to 500,000 population for the entire area.

It has Giant within Bandar Puteri Puchong and Tesco within reach from the township and it is connected via LDP from Sunway to Putrajaya and LRT project that has been planned by the authority, Bandar Puteri Puchong is enjoying a high flow of visitors besides of its own residence.

Developer
IOI Properties Bhd, a property arm of Malaysian largest market capital value listed company (November 2007) - IOI Corporation Bhd. Need not to say about its credibility in term of reliability. It has many projects on going similar to Bandar Puteri Puchong in Klang like Bandar Puteri Klang, Putera Klang and also has another project in Puchong-Bandar Puchong Jaya. I think the strength of them as a developer is on its overall smart vision to make the master plan happen. They have been doing well in term of bring in bankers like Citibank, OCBC, Ambank, Alrajhi Bank, Standard Chartered Bank and upcoming Public Bank and Hong Leong Bank. They develop the township by attracting residence, follow by banks, retail market like Giant and wet market and recently are the modernized offices and more to come.

Special
The very special of Bandar Puteri Puchong is the Population within and surrounding areas are massive. The flow of visitors because of it strategic location next to the heart of Governmental agencies - Putrajaya and the heart of MSC Cyberjaya and of course its visionary master plan of the entire township. Mix income level with medium class being the most with good consuming power will boost commercial activity in this area.

Understand from the developer that more modernized concept commercial spots are coming up besides of the already successful IOI Mall, Giant, Tesco. It will definitely a high yield investment option given the master development may be just half way of its overall plan.

Against
Traffic, traffic, traffic! Again is traffic and how can all these build in already a crowded area. More expansion is needed in order to house the entire master plan and we hope this will not be a turning point against Bandar Puteri Puchong and continue to enjoy its high growth rate for its investors.

Security is also a concern as the township is not a gated society. There are also many reported criminal cases reported in Puchong. We would advise to investor that not count on the developer alone and do your best with security measures required to protect against any possible criminal activities.

Conclusion
From this point, the average prices of shop offices bid from 1.6 Millions to 2.8 Millions depending on the size of the shop office. The latest launching of Puteri Square priced from 2.4 Millions and above. We see there is still a reasonable capital growth to around the region of 3 - 5 Millions within the next 5 years depending on the progression of the master development. By the time, the price is still in catching mode in compare to some mature areas like Damansara Jaya, Damansara Utama and Taipan Subang Jaya.

Given the strengths we have analyzed, the rental income and occupancy rate will be very positive. We would recommend a buy for this property as we have even excluded "asset revaluation" due to the rising cost of construction.