The recent exclusive showcase in Kota Kinabalu by the Hatten Group featuring its latest mega project, Harbour City, has helped familiarise Sabah investors with Melaka's vast potential as a tourism and business destination of the future. Cassandra Tio, head of marketing and sales of the Hatten Group, pointed out that Harbour City is just one of the products that are driving Melaka's mission to position itself as the latest and hottest property investment hub in Malaysia.

According to Tio, the similarity between Melaka and Kota Kinabalu which are both waterfront cities makes it easier for Sabahans to identify with the environment and feel more at ease investing in Melaka. She however noted that Sabah investors are still a bit reserved and want to do more research on the project before committing themselves.

"The main question they often ask themselves is "why invest in Melaka?” as there are more matured property markets in Peninsular Malaysia such as Kuala Lumpur and Johor Bahru, "she adds.

Tio explained that Melaka is going through a development growth that started in 2008 when it was declared a UNESCO World Heritage, resulting in a tourism industry boom that continues to rank it among the top revenue generators for the state today.

The formation of Invest Melaka Berhad, a government initiative to encourage investment in the industrial and manufacturing sectors, began to show results soon after with billions of ringgit in local and foreign investment coming in to date. A clear indication of this success is the setup of international banking services such as Citibank to cater to the growing number of expatriate businesses and personnel in Melaka. Familiar names such as the Boon Siew Group that assembles Honda cars in Malaysia, Hard Rock Café, YTL and retail brands such as Uniglo and H&M entered the market after 2010, effectively raising Melaka's profile as an emerging commercial and tourism hub in Malaysia.

In 2012, Melaka was rated the number one fastest growing economy in the country in terms of gross development value (GDV) which rose from 4% the year before to 7%. This is a significant number as compared to other state where there was an increment of only 1% - 2%.

Tio is enthusiastic about the prospects of Melaka developing into a preferred investment destination as it is starting from a very basic level.

"Unlike Penang or even Kota Kinabalu where there is a very defined central business district (CBD), Melaka is loosely made up of shoplots surrounding the central padang. Banks that opened up offices here would rent out the shoplots and not construct their own building like in Kota Kinabalu. It is still raw in Melaka in terms of a city and financial centre which doesn't truly exist yet" says Tio.

This gives Melaka the advantage of pulling in interest and investment from developers to engage themselves in executing the state's development blueprint which focuses on finance, hospitality, hospitals and international schools. Melaka Gateway is a government initiative setup to spearhead the development and construction of these infrastructures. Its development site is located next to Harbour City on Pulau Melaka.

"Medical tourism is a big draw in Melaka particularly among Indonesian and Singaporean tourists. The Singaporeans also find Melaka an ideal holiday destination during school and long breaks as they feel it has a safe environment," says Tio.

"The Chinese come here mainly for the heritage site and business opportunities" she adds. On average, foreign tourists make up 60% of tourist arrivals in Melaka.City and will play a crucial role in supporting the Melaka Gateway initiative which in itself will offer a theme park development, marina and jetty to cater to the expected increase of tourist arrivals in the next few years.

Harbour City will be the only retail mall on Pulau Melaka and its hotel suites will greatly benefit from this and the two theme parks in the vicinity.

"Property prices have gone up so capital appreciation is not as high as it used to be" opines Tio about the current property market.

"Investors who are used to enjoying huge capital appreciation rates now have to be content with a smaller percentage. Alternatively, they can look for new opportunities to improve their investment returns.

"The entry level for a hotel unit in Harbour City is just over RM200,000 or about RM800 per sqft which is very reasonable. Sabah investors are quite savvy when it comes to tourism properties especially since they live in a waterfront city like Melaka. They can easily appreciate the value and attraction of a waterfront city to investors."

Harbour City is conceptualised as a self-sustaining, fully incorporated "city of amusement which infuses three vibrant elements - Retail, Theme Park and Hotel, to cater to every element of leisure, entertainment and relaxation.

The leisure component is a 6-storey themed shopping mall which is topped by five floors dedicated to a vast indoor and outdoor water theme park for absolute entertainment.

Completing the project is three hotel blocks for premier relaxation - a thematic hotel, Hatten Resort Hotel and the International chain Hotel.

Each shopping floor is designed to reflect the life on different oceanic levels rising from "The Trenches” (Lower Ground Floor) up to the "Coastal Layer” (Level 4). The mid-section of Harbour City consists of a 780-room "cruise ship” themed hotel. Each room is designed to look like a ship's cabin complete with bunk beds and nautical-inspired interiors. With 14 suite layouts ranging in size from 365 sq. ft. to 1,267 sq. ft., the thematic hotel is an extension of the fun and adventure of the island setting.

The highlight feature of this development opens out onto a massive 500,000 sq. ft theme park podium which rises over five floors. This element alone is expected to attract more than 1.5 million additional tourists annually to the island of Pulau Melaka.

Elevating the tourism viability of the Harbour City development is the two premium hotel towers - the 500-room Resort & Spa Hotel and the 250-room, International tower which will feature a hotel built and managed in collaboration with Hyatt Group of Hospitality. The entry of the international hotel will create a higher placing for all hospitality ventures in the vicinity while offering top world-class accommodation for guests.