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Branding is the edge. Actions follow recognition.

I have many favourite brands. Of course not just for shoes, clothing and smartphones but it includes supermarket brands, electronic goods and even properties. Ever wondered why certain developers are able to command a premium over others? Branding lah. Of course, they could also be using better materials etc but when the price is just 10% extra, it is not so much of those better tiles etc. It is who you believe that matters. MRT Sungai Buloh – Kajang would be fully operational on 17th July. Within these stations, there are four stations which will be ‘owned’ by those who were willing to pay for it. They are The Damansara Town Centre station will carry the name Pavilion Damansara Heights – Pusat Bandar Damansara (licensee: Jendela Mayang Sdn Bhd), and the Semantan station will have the name Manulife – Semantan (licensee: Manulifge Insurance Bhd).  The Bukit Bintang station, meanwhile, will be known as Pavilion Kuala Lumpur – Bukit Bintang (licensee: Kuala Lumpur Pavilion Sdn Bhd) and the Maluri one will be named Aeon – Maluri (licensee: Aeon Co (M) Bhd). Full article in TheStar here.

How much are they paying for this privilege? According to MRT Corp director of commercial and land management Datuk Haris Fadzilah Hassan, successful licensees were chosen based on the highest bids with licensing fees for stations starting at RM1.5mil per year for a minimum of three years, or RM1.2mil per year for at least five years. (Yes, it is in the millions…)  What the winners get would be a right for its name, logo or product brand to be associated with a particular station on the SBK Line by having it prefixed to the station’s name. The licensing duration would range from 3 to 10 years. (MRT fares will never be able to cover all costs. MRT Corp must think of even more ways to cover more of their costs. Hong Kong’s MTR would be a very good model to follow). An earlier article here: MRT and rental starts at the same time. Good Haris further shared that these four stations are just the first batch. There would be more stations being open up for renaming in the future. MRT Corp also shared that the ridership of the SBK Line was estimated to reach 400,000 users per day. Full article in TheStar here. 
Branding gives any brand an edge over its competitors. It ensures that the brand recognition is high and the brand is always top of mind. I think it’s good to start and in fact when we look at the potential earnings from just these new stations, the potential earning is already easily RM50 million a year! If we assume all stations would average around RM1 million per station per year. Besides, these brands would help to wrap the stations to look more interesting than just a coat of white paint for example. I told my wife a few days ago that when the new MRT SBK starts, I will ride it to office. At least for a few days. When I do, will report. Asfor now, I think MRT Corp has done the right thing. Keep earning more. As for the rest of us, please ditch our cars whenever possible and start a new public transportation revolution. Cheers.
written on 13 July 2017

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Charles Tan The Founder The Writer Kopiandproperty
Charles Tan

Charles is Founder of kopiandproperty.com He writes from his investment experience for the the past 20 years in investments including property, stock, unit trust and more as well as readings and conversations with many property gurus in the industry. kopiandproperty.com is an independent property blog which is not affiliated to any media company, property developer or even real estate agencies.

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