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RESURGENCE OF CITY CENTRE LIVING
by Rahim & Co Research Sdn Bhd

Changing trend

The madness of city centre congestion and the city becoming more like concrete jungle have propelled many city dwellers to purchase residential home out of KL city. City dwellers who can afford upmarket properties moved out of the city, preferring to reside in low-density residential estates such as Sierramas (Sungai Buloh) and Bukit Gita Bayu (Seri Kembangan) that were not favoured by many back then due to its distance from KL city centre and relatively undeveloped amenities. Today, the scenario has reversed with the development of infrastructure, residential townships and amenities that have increased the value worth of properties in Sungai Buloh and Seri Kembangan.

In the last five years, city-centre living has become alive again. There seems to be resurgence in city living with the mushrooming of condominiums and serviced apartments in the city centre. However, it is noted that the segment that is coming back to the city are mainly the higher income group as observed in the many launches of high-end properties in KL city centre over the past two years.

High-end condo

With the introduction of fashionable city living by high-end condos, more developments of similar nature are coming on stream in the next 3 to 5 years. Some of these new developments are under-construction and a few more are scheduled to be launched next year. The emergence of these new properties has breached the benchmark for capital value in KL city. For instance, the Marc Residence entered the market in 2003 at RM600-700 psf while Dua Residency was sold from RM540 psf onwards. Sales were brisk for these two projects indicating strong demand for high-quality projects in prime locations. The Binjai was also reported to make an entry into the market with RM1,000 psf, touted to be the most prestigious luxurious residence in KL city.

Joining the flight of new high-end condo are The Meritz, Park Seven, Suria Stonor, 2 Hampshire, IGB condo at Jalan Stonor and TA Condo. All these projects are located close to one and another and within 5 to 10 minutes walking distance to KLCC. With these projects, we also see mid-cost developer venturing into high-end development, taking for example, Glomac who purchased a 2-acre plot on Lorong Stonor for RM475 psf. It is anticipated that the launch price for Suria Stonor will be ranging from RM600 psf. Although all these projects belong in the high-end category, some developers are distinguishing their product by catering to a slightly different market of young families and young professionals by offering smaller units.

The larger units will appeal to a more matured market with larger families or those who simply prefer luxurious space, liken to the built-up in semi-detached or bungalow houses. The following table shows the built-up sizes of new condo projects and their expected pricing:-

Smaller Units

Name of Project

Developer

Built-up sizes

Price (RM psf)

CapSquare Residences

Bandar Raya Developments

1,072 - 6,300

450

2 Hampshire

Beneton Properties

1,400 - 6,000

500

The Meritz

Tanahnaga Sdn Bhd

1,000 - 1,500

680

TA Condo

TA Properties

800 - 1,700

Approx. 500

Larger Units

Name of Project

Developer

Built-up sizes

Price (RM psf)

The Binjai

KLCC Holdings

2,300 - 7,000

From 1,000

Park Seven

SDB Properties

2,500 - 7,000

640

Suria Stonor

Glomac Berhad

2,940 - 8,400

600

IGB Project

IGB Corporation

Not available

Not available

Serviced Apartment

Of late, it seems that not only condominiums that are gaining popularity but serviced apartment as well. Traditionally, serviced apartment developments are mainly located in city centre providing hotel-like services to their guests who are usually foreign business travellers staying on long term basis. However, the concept of serviced apartment has evolved lately to become more residential in nature, catering to local demand instead of business travellers. Hence, many serviced apartment projects in our market today are not purpose-built serviced apartment and operated by hotelier such as The Ascott, Lanson Place and Micasa Serviced Apartments. Instead, developers have adopted the concept of serviced apartment into their residential condominium development for land that is zoned for commercial development to capture the market segment of condominium dwellers.

Serviced apartment is fast gaining a strong foothold among house buyers in KL city, particularly young working professionals who prefer to stay nearer to work place. Some of the notable serviced apartment projects that are currently being developed in KL city are Berjaya Central Park, Goldhill Gardens and K Residence. Berjaya Central Park (located adjacent to Concorde Hotel) comprises of 1,402 units while serviced apartment in K Residence (opposite Petronas Towers ) is a 30-storey development with 298 units. Price range for these units are from RM500 psf to RM1,000 psf. The newly launched Berjaya Central Park has breached the RM1,000 psf mark for serviced apartment in city centre. Besides the high-end projects, there are also other more affordable units such as Nas Pavilion (Jalan Imbi), Scott Sentral (Brickfields) and Golden Avenue (Jalan Ipoh). Pricing for these units ranged from RM250 psf to RM500 psf. Brisk sales are reported for both these market segments, indicating a pent-up demand for these units in the Klang Valley .

Conclusion

Looking ahead, the resurgence of city centre living augurs well for Kuala Lumpur as this will improve its ranking of city living worldwide while encouraging more investment made in property development and significant rise in the standards of living such as improvement in transportation, health services, education and telecommunication services.

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