Rosnah Abdul Rashid Shirlin (middle) witnessed the signing of MOC between Ahmad Asri Abdul Hamid (left third) and Soam Heng Choon (right third).

KUALA LUMPUR: The Construction Industry Development Board (CIDB) Malaysia and the Real Estate And Housing Developers’ Association (Rehda) Malaysia signed a Memorandum of Collaboration to promote low-carbon and sustainable practices.

In today’s ceremony held at Wisma Rehda, 40 developers have pledged to theMalaysian Carbon Reduction and Environmental Sustainability Tool (MyCREST) pilot project and 20 have attended the event to receive the participation certificate.

The signing ceremony was represented by CIDB Malaysia chief executive Ahmad Asri Abdul Hamid and Rehda deputy president Datuk Soam Heng Choon, and witnessed by deputy minister of Works Datuk Rosnah Abdul Rashid Shirlin.

20 developers have attended the event to receive the participation certificate for MyCREST.

“The collaboration is an example of how private and public sectors can work together to push the government's green growth agenda,” said Rosnah.

She added that MyCREST is a sustainability rating tool that emphasises on the measurement of carbon emission, and is adopted in all JKR public projects above the value of RM50 million, including the pilot projects of Kolej Kemahiran Tinggi MARA Selama in Perak and the Hulu Terrengganu Polytechnic.

She said the government hopes to encourage more private companies to adopt to MyCREST, and that all public and private projects above the value of RM100 million would be subscribing to this rating tool by year 2020.

The deputy director-general of Public Works Department Datuk Dr. Roslan said that the MyCREST system consist of 3 component, namely planning and design, construction and operation, the participant could get star ratings for each stage, although they would have to complete the 3 stages to get the complete accreditation.

When asked about the earthquake happened in Indonesia in the press conference, Roslan said that since the Sabah earthquake last year, all the current and future development projects in Sabah were built adhering to the Eurocode 8 standard.

On the other hand, Soam mentioned that Rehda and the government have been working together to develop more affordable housing projects, but cautioned that it has to be well planned to avoid an oversupply.

He pointed out that the real estate market had been soft for the last twelve months and although it was seen as a global phenomenon, homebuyers in Malaysia are also affected by the difficulty to apply for their desired margin of financing.

He added that the fallout rates of buyers in affordable areas are very high, whereas the consumer sentiment for high-end property buyers are not good, which will result in a soft market trend for the first six months of 2016.

He also said that the properties this year in Malaysia have seen none or negligible rises in their prices, and that real estate market in Malaysia faced different situation from the other countries.

“In other countries, the land component contributed around 70% of the pricing, whereas in Malaysia it only contributed to around 30%, the rests are consist of factors such as construction cost and compliances cost,” he said.

CIDB’s chief executive Ahmad Asri said the Industrialized Building Systems (IBS) that was highly encouraged by the government has seen a low adoption rate thus far as the conventional method is still cheaper due to a lack of demand.

IBS is a construction process that utilises techniques, products, components or building systems that involve prefabricated components and on-site installation.

He said that the government has not forced the IBS policy on the private sector, and since the demand and market volume is not there, the price to adopt the system is higher.

“The developers compared the construction cost between IBS and the conventional method, and decided that the conventional method is the cheaper alternative, but unfortunately it was a short term perspective,” he said.

He said if the IBS is adopted, the construction time could be shorten from 2 years to 1 year, and opportunity cost should also be considered as the building could be used earlier and generate more profit.

“IBS is now required to be used in 70% of the government projects, and if 100% of the government projects take up the IBS system, the price and volume will be there,” he said.

Soam added that Rehda has been encouraging its members to adopt to the IBS, as the economies of scale will lower the cost, and eventually lower the cost of construction.

He said that the government has allotted RM500 million loan to the developers and the contractors for the promotion of IBS through SME bank.

“We have met with the bank and discuss with them, and they will soon announced the details after it is green lighted by the government,” he said.