The 4th National Physical Plan addresses the issue of placing residential areas at a considerable distance from job centres and city hubs.

TODs provide so much more than just transportation

By Yanika Liew

As cities continue to expand alongside Malaysia’s rising population, states see an increase in urban property developments and infrastructure, resulting in increased traffic congestion and heightened carbon pollution.

“Traffic congestion is a serious and worsening problem in many cities across the globe resulting from rapid urbanisation, high population density, high level of private vehicle ownership and inadequate infrastructure amongst other factors,” Knight Frank Malaysia research and consultancy senior executive director Judy Ong said.

Ong noted that according to the Malaysian Automotive Association (MAA), sales of new vehicles in the country grew 6% to 71,745 units in August 2023 with 67,609 units. Traffic congestion in Malaysia, particularly in Klang Valley, has worsened following the full reopening of the country’s economy since April last year, surpassing pre-pandemic levels.

Transit-oriented developments (TOD) act as an alternative to the current urban climate, to create a sustainable, efficient future for cities. Developers have begun to market their developments with access to public transportation as a valuable market asset, but how does the value of these developments compare to the value of property developments unattached to public transportation?

“According to the Malaysian Valuation Standards, the market value of a property is normally based on the amount that a willing seller and willing buyer would pay in an arms-length transaction after proper marketing wherein each party has acted knowledgeably, prudently and without compulsion,” Royal Institution of Surveyors Malaysia (RISM) president Adzman Shah Mohd Ariffin said.

The value of a property can indeed be enhanced by its accessibility, particularly its proximity to public transportation systems. This results from high demand from potential buyers and strong rental demand from tenants, as Adzman added.

Concentrated areas of demand

According to Malaysia Institute of Planners advisory council member Datuk Ismail Ibrahim, Transit-Oriented Developments (TODs) have been slow to gain traction in regions outside of Kuala Lumpur and the Klang Valley. This is mainly due to the fact that in other areas, public transportation relies on stage bus systems, which, in turn, cater to the physical development and population growth in those regions.

“MIP is of the view that it is the time for cities of conurbations within Malaysia to plan and build their respective public transport system to meet their economic, physical and population growth. They include Georgetown, Johor Bahru and Kuching,” he said.

He pointed out that in 2024 and beyond, it is anticipated that the Kuala Lumpur and Klang Valley regions will continue to adopt the TODs.

“Other towns and cities in the country, when experiencing economic and population growth, will slowly adopt the TODs as they develop their respective public transport systems,” Ismail added.

In the context of the 4th National Physical Plan and its focus on spatial sustainability and climate change resilience, thrust 2, Action KD1.1B highlights the importance of prioritising TOD in conurbation areas, global cities and urban zones.

“This approach offers diverse transportation options to local residents, reducing their reliance on private vehicles and encouraging alternative modes of transportation, such as cycling and walking,” Ong said.

She noted that one of the aspects that developers should consider when working on TOD planning is the promotion of transit, pedestrian and bicycle-friendly environments, particularly in high-density areas, to address the recurring issue of traffic congestion while minimising road infrastructure costs.

“By fostering pedestrian and bicycle-friendly neighbourhoods, transportation expenses can be significantly reduced, which is particularly beneficial for marginalised groups such as the B40 and M40,” she pointed out.

TOD communities not only create vibrant neighbourhoods but also support local businesses, encourage community interactions and enhance overall urban safety. The development could also be complemented by mixed-use development activities, further encouraging walking and cycling as preferred modes of commuting to workplaces.

Similarly, Adzman noted that these TOD properties can achieve better value if it has convenience and comfort under one roof.

“Under the purview of 4th National Physical Plan, thrust 3, which is dedicated to fostering a liveable environment and an inclusive community, Action KD1.1B addresses the issue of placing residential areas at a considerable distance from job centres and city hubs, resulting in increased transportation expenses for residents,” Ong said.

“To confront this challenge and alleviate transportation costs, particularly for the B40 group, there is a pressing need to prioritise the development of affordable housing, Rumah Mampu Milik, in proximity to public transportation transit nodes, especially in urban areas,” she added.

This strategic approach would allow residents to reduce their reliance on private vehicles while contributing to the creation of a more accessible and inclusive community.

“As a valuer, location can be a key factor which enhances the value of property. Location in a strategic and prime locality, in its highest and best use, with easy access to highways and proximity to public amenities such as transit system, schools and services are among the criteria which can improve the value of the property,” Adzman said.

“A built property can be in high demand if located within walking distance to a public transit station compared to those located further away which therefore can push up the price,”

While these might seem common sense statements, Adzman pointed out that the market value of a home also relies on the transactions of similar comparable properties within similar locations. 

“One should note that the value of the property to a particular buyer who appreciates the property more than the rest may be willing to pay a higher price for it,” he said.

According to Adzman, the public transportation system generally increases accessibility and convenience, especially in congested localities.

“TODs are normally given incentives by the planning authority in terms of higher plot ratio, for example, more developable floor area, less parking to be provided and encourage mixed-use development comprising service apartments, commercial and retail components,” he said.

“As the traffic congestion and cost of car ownership get worse, more people are opting for public transportation. Therefore, staying in a property with convenient access to the public transit system is a plus point even if the system is not considered efficient enough.

“There is a lot of opportunity for optimisation of use of land and space around and above public transit stations. The local authority should look into this in order to plan for the future of the major cities and urban areas,” he added.

(It is the time for cities of conurbations within Malaysia to plan and build their respective public transport system, Ismail said.

The high value would be due to high demand by buyers and also strong demand for rental by tenants, Adzman said.

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