Iskandar usually gets the headlines in the Malaysian property story but Penang's real estate market has had a bumper year.
Prices have surged 17 per cent from 2013 to the end of last year, according to a Credit Suisse report, easily exceeding the Malaysia-wide rate of 11 per cent.
The region accounted for 9 per cent of properties sold in 2013, making it the country's third-largest market behind Klang Valley and Johor. Ms Christina Lau, head of marketing and sales at Malaysian-listed property group Eastern & Oriental in Penang, credited the strong performance in part to the policies of the state's government.
She cited the Penang Paradigm, a 10-year development blueprint released in 2013 that focused on three elements of development: economic dynamism; liveability and sustainability; and social development and inclusion.
Additionally, Penang had been successful in carrying out its plans through public-private partnership, said Ms Lau. She also highlighted initiatives to improve the state's infrastructure, such as the RM27 billion (S$10 billion) Penang Transport Master Plan.
This aims to overhaul the state's transport system by building highways and improving public transport. The area's good economic prospects have played a part as well.
Ms Lau pointed out that multinational corporations such as Citigroup, flash memory storage manufacturer SanDisk Corporation and furniture company Ikea have all located facilities in the state.
She told The Sunday Times that Eastern & Oriental's properties in Penang continue to receive a strong response from non-Malaysian buyers, including Singaporeans. Singaporeans were the biggest group of its non-Malaysian buyers in Penang as well as Kuala Lumpur and Johor.
Ms Lau said Singaporean investors were attracted by prices for prime property that would be "unattainable" in Singapore and other countries. She added that some buyers bought under the Malaysia My Second Home programme, which grants long-term residency to foreigners who meet certain financial requirements.
Ms Lau said foreign buyers made up about one-third of Eastern & Oriental's buyers, adding that they purchased various kinds of homes. People intending to invest, for example, often preferred condominiums for their rentability, while frequent travellers favoured serviced residences.
Eastern & Oriental's latest Penang project was launched in January. 18 East at Andaman is a 278,784 sq ft development on the northeastern-most cape of Penang Island. The firm has more exposure to Penang than any other large developer, according to Credit Suisse, with 79 per cent of its land bank located in the state last year.
This article was first published on April 26, 2015.
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