The Perak property market does not have a clear direction due to the threat of war in Iraq according to Goh Tian Sui, the deputy Managing Director of CH Williams Talhar and Wong (WTW). People are generally looking for bargains and they are more cautious on spending, adopting a “wait and see” attitude. This is because war is not necessary bad news for the property market as it could create opportunities to purchase properties at a bargain.

Among the five sectors – office, retail, residential, industrial and hospitality & leisure – only the residential market is facing an upswing. Low and medium cost houses are in demand, coupled with attractive offers by banks such as low interest rates and attractive payment terms have helped to improve the market condition.

Overall, the office market in Ipoh is performing badly with a surplus of supply compared to demand. The most famous choice for office location is the Greentown Business Centre  due to its strategic location of being surrounded by various government departments that include the Federal Building, KWSP Building, City Council, hotels and security firms. Many corporations and business owners have shifted their office from Ipoh’s old town to the Greentown Business Centre causing the rental value of the latter to suffer substantially.

Compared to the year 2002, the retail market in Ipoh is stable with established shopping complexes such as Kinta City and Ipoh Parade enjoying almost full occupany, 100% and 80% respectively. There was no major project completed since the Pengkalan Emas Mall located along Jalan Pasir Puteh in 2001. The popularity of a retail centre depends largely on the presence of anchor tenants or a good tenant mix and most of such buildings has an average occupancy rate of 70%.

The most badly affected sector in the Perak is the industrial market with both demand and supply at a low end. Prices for industrial properties are expected to remain stable in the more established areas such as Silibin and Menglembu while other lesser known locations will suffer from a downward trend.

As for the hospitality and leisure sector, performance is mediocre with famous tourist destinations such as Pangkor Island and Lumut enjoying only modest occupancy rate. Tourists prefer to stay in economy hotels with room rates ranging from RM50 to RM70 per night. There are currently no plans for any expansion of existing hotels or new hotels being built throughout Perak.

Unless the Perak state government gets involved and takes the necessary action to attract investors, the property market condition will remain static without any improvement.