KL grapples with overdevelopment
Roznah Abdul Jabbar 

In the property market, it is an acknowledged fact that location is key as it determines the value of the development.

Property developers tend to flock to areas which are seen to be in strategic locations and most of the time, this can result in overdevelopment.

Take the scenario in the Kuala Lumpur city centre as an example. The vicinity of the Petronas Twin Towers or KLCC has seen an increase in terms of land value and development activities.

There are reports that the area is overdeveloped as developers and land owners are trying to reap maximum profits.

Former Valuation and Property Services Department (JPPH) director-general Datuk Mani Usilappan says density is high in that area as land value has been on the rise and developers have to utilise the land and maximise its value.

He points out that the plot ratio is often increased as per the developers’ request in an attempt to fully capitalise the parcels of land.

“Reasonable control is definitely needed in terms of building height, proximity and density. Plot ratio for that area is pretty high,” he tells FocusM.

He feels that city planners such as Kuala Lumpur City Hall (DBKL) should look into measures to make sure the design and overall usage of the buildings serve their purpose and do not appear overcrowded and highly dense.

Mani notes that the connectivity of a place is of concern although public transportation such as the Light Rail Transit (LRT), Mass Rapid Transit (MRT) and Monorail are available.

“DBKL has to control the developments in the area and check the flow of the buildings, car park availability and sustainable measures before approving any increase in plot ratio, with certainty of arrangements and plans to ensure smooth traffic flow in and out of a project to avoid adding to the congestion,” he says.

He suggests that a good scheme provided by DBKL should improve the traffic movement in that area and control congestion.

Commenting on the prices of the properties in the vicinity, Mani says although there is an oversupply of residential and commercial units, it could not be the only reason for price decrease as the market in general is currently sluggish and has resulted in a slower pace of development.

“A drastic drop in prices has not happened for properties in KLCC although demand has fallen,” he notes.

He cautions that the situation could get worse if more high-rises are allowed in that area.

However, an improved transportation system could ease the current congestion and allow for more developments to co-exist.

A field check by FocusM of the area within a kilometre radius of KLCC shows that it is often congested, even during non-peak hours, and the traffic flow density in and out is unpredictable and a bane for road users.

AJM Planning and Urban Design Group Sdn Bhd managing director Norliza Hashim, who is a former president of Malaysian Institute of Planners (MIP), says KLCC and its vicinity is overdeveloped and has to be looked into by the authorities.

“The overdevelopment in the area is in terms of the number of buildings, plot ratio, availability of public transportation and connectivity,” she adds.


KL Draft City Plan

According to her, The KL Draft City Plan 2020 (KLDCP) has an optimum plot ratio which should be imposed on all the buildings in that area but, since it has not been gazetted, developers had taken the opportunity to apply for an increase in plot ratio and built taller buildings.

Enforcement of the KLDCP could have made things clearer on what has been and is being planned.

“From the consumer point of view, the overdevelopment is evident as physical effects such as congestion, lower occupancy rate and less demand in retail are there,” she says.

She points out that the infrastructure and management of the traffic flow are in dire need of improvement; otherwise, the perception of the city centre would only worsen.

“For instance, when you are driving in the vicinity on a non-congested road, you are invariably diverted to a congested road and forced to endure the traffic snarl.

“The city does not allow you to move around. There’s something synergically wrong there,” Norliza contends.

However, she understands that overdevelopment is needed in cities such as KL, as the density and available properties are needed to contribute to the country’s economy.

“KL is one of the biggest contributors to the country’s gross development product (GDP) and we have invested a lot in the city.

“It is fine to be compact and of high density but the infrastructure should follow through as well,” she insists.


Walkable city

She feels that walkways, cycle paths and good connectivity between adjacent buildings are much needed to encourage the public to move around comfortably.

Currently, people are driving out for lunch and to run errands. That, she says, should not be happening in big cities such as KL.

“It should be walkable and management is needed in this matter. Other cities of the world have always been looking into minute details and found the solutions to improve liveability,” she says.

One example is Orchard Road in Singapore where the density is higher than that of KL and has a large amount of footfalls, but has successfully achieved sustainability where people can walk from one rail transit station to another with ease.

Norliza says Klang Valley has two places with good examples of efficient accessibility management - Mutiara Damansara and Sunway City in Petaling Jaya, where most buildings in the vicinity are linked via walkways and the whole area is readily accessible by foot.

On whether it is too late for KL city centre as it has never undertaken comprehensive planning since its inception, Norliza believes the city can still establish good connectivity and infrastructure and make it conducive for the public.

“One good example is the KLCC LRT station, where there are linkages to some buildings and people walk from one building to another without even coming out of the subways,” she notes.

Research by several universities and organisations show that walkability in cities has benefited the retail sector.

A publication by Gregory Hodkinson, chairman of Arup Group, called Cities Alive: Towards a Walking World, says businesses and property owners can benefit from more walkable places, with research showing that pedestrians spend about 65% more than drivers.

“Walkability has been proven to boost prosperity, support local business, promote tourism and encourage inward investment - attracting investors and private companies that in turn feeds higher employment, property values and more.

“Furthermore, investing in better streets and spaces for walking can provide a competitive return compared to other transport projects. Cycling and walking are estimated to provide up to US$11.80 in return of investment per US$1 invested,” the paper says.

Norliza adds that people are generally walking in the streets of cities like London and Singapore and the visual impact of what’s available in stores on those streets increases the chances of purchases by them or of them coming back to the place.


Improving sustainability

She feels that although overdevelopment in inevitable, KL could have adopted a slower pace. There is high density in the KLCC area for economic reasons but some developers have probably gone overboard in terms of height and design as they want their buildings to stand out.

“Most developers took the opportunity to build more units and sell for an average price rather than build fewer units to sell at higher price,” she says.

In her opinion, the city, with the current infrastructure, should not be seeing any new development and the local authorities should instead be looking into improving the sustainability of the city.

“Our main plans should be to make KL achieve a certain population ceiling and make it a great city,” she adds, pointing out that about seven to 10 years ago, the developments in the city centre accelerated by allowing for a higher plot ratio, which affected the skyline view of the city.

Norliza, who was in the committee of KLDCP, says while the draft was in progress, there were some 11 locations for good views of the city and just three years after, “we lost three of the locations due to overdevelopment.

“The beauty of the city has to be taken into consideration as well. Some of it has been badly disturbed.”

On enforcement of the KLDCP, she is disappointed that the draft has yet to be gazetted and points out that there were about 60 official engagements with the public prior to producing the plan.

“Without the gazetting, there will be lack of enforcement and nothing to comply with in order to have a sustainable city,” she laments.

The rental rates of office and high-end units in KLCC area have reportedly dropped and the vacancy numbers are feared to have increased, especially with new mega projects such as the Tun Razak Exchange coming up.

The increased supply of office units in the city centre is expected to result in a significant rise in vacancy rates and Bank Negara Malaysia has even warned of an impending oversupply in coming years.


Demand to remain strong

Sunway University Business School economics professor Dr Yeah Kim Leng says KLCC and its vicinity is a high-end market and the strong demand will sustain.

“The area will continue to attract investors, both locally and internationally, as the area is of high value and land is scarce,” he believes. He notes that the overdevelopment is because of the high land value and that developers need to preserve the value of the land.

While Yeah acknowledges that congestion is a problem in that area, he points out that cities in other countries have also suffered and survived the same problem.

“Congestion and overdevelopment tend to prevail because of the maintenance in the city. Cities can’t escape this kind of situation,” he says.

He adds that the drop in property rental prices of the area could be because of oversupply, but it is a normal market cycle as growing cities often tend to experience low occupancies and low rentals at times. FocusM

This article first appeared in Focus Malaysia Issue 296.