The Kuala Lumpur mass rail transit (MRT) will likely become a structural catalyst for the increase in value of surrounding properties, with a stockbroking firm even expecting land values in hot spots to climb by up to six times over the next five years.
The blue line, the first of the three planned MRT lines, is due for completion in 2016, while the other two will possibly be completed by 2020.
The potential of the MRT in increasing the value of properties near stations is now under scrutiny.
The alignment of the almost 50 km “blue line”, which will run between Sungai Buloh and Kajang, is being determined and will be released for public feedback in March. The proposed stations and interchanges could be subject to changes before the start of construction in the middle of the year.
HwangDBS-Vickers said landbanks near the proposed interchanges that are reserved for high-density projects have the biggest advantage. It identified several key hot spots, such as KLCC-Bukit Bintang, Pusat Bandar Damansara, KL Sentral, Sentul and KL EcoCity-MidValley.
The company said in a report that the MRT would have a strong structural effect on KL property, considering that the area had been under-invested since the Petronas Towers, the last-mega development in the late 1990s. The government intends to invest tens of billions to boost the infrastructure, including about RM46 billion for a new MRT network, in an effort to make KL more competitive as a city for multinational investments.
HwangDBS said this is timely, considering the growing demand to live, work, learn and play “on the MRT line”, creating opportunities for high-density mixed developments, new suburban townships and urban renewal. This, in turn, has improved the potential for land prices to achieve new peaks, with more commercial developments and higher plot ratios.
Emerging areas that have the potential for multimodal interchanges will likely see the strongest gains on the back of a higher plot ratio, lower base and ability to leverage on adjacent matured areas.