Wednesday, December 31, 2008

Menara Bukit Ceylon

Menara Bukit Ceylon is located strategically at the junction of Changkat Bukit Bintang and Jalan Ceylon. This is a choice location for expatriates as Bukit Ceylon is close to their work places, shopping, food and the fast expanding playground called Changkat Bukit Bintang.

Menara Bukit Ceylon is one of the oldest condominiums here. Apparently it was developed by Tan&Tan some 15 years back. Units here are extremely popular for those going for a RM3500 to RM5000/month budget. As these units are old, expect the furnishings to be out-of-date and hence the low rental. However, some owners have taken to refurbishing their entire unit to collect higher rental. Nevertheless, the lower end of this budget is obviously the most popular choice for these 2 bedroom and approximately 1500sf units. Every unit has a small study, hence the oft-advertised reference to 2+1 room. The kitchen is also separated into the wet and dry parts.

Whether it is my (extremely bad) luck or otherwise, I bumped into many French tenants in this building. No offence to French people but I do find those I bump into extremely rude people.

Basically, Menara Bukit Ceylon is perched on a high point (not the highest) of Bukit Ceylon. Hence, even the lowest floor has a commanding view of Kuala Lumpur. Each floor has 6 units served by 3 very slow lifts. There are 3 variants, for argument sake, I will call them Type 1 for the biggest unit and Type 3, the smallest unit. Type 2, overlooking Jalan Alor and Times Square, does not have my favourite view. So, let's just focus on Type 1 and 3 for now.

Type 3 occupies the 2 "wings" of the building. I am extremely fond of the East wing as it has 3 views - of KLCC, KL Tower and Times Square depending on which part of the unit you are looking out from. The balcony faces KL Tower and KLCC, however in the near future it will also be facing the Vida Soho construction site which is likely to block this nice view. The West wing is worse off as it will be facing the Bolton construction site in the future. Type 3 is the smallest unit. This will not work to any advantage as the management charges a flat rate of RM350 for the monthly maintenance. While this may seem unfair to Type 3, this is nevertheless one of the cheapest rate in KL @ 23 sen psf.

Type 1 is nice and bright. It has a nice almost perfect square shape to it hence it looks significantly larger than the others. The dry kitchen is also large compared to the almost claustrophobic Type 3's kitchen. Both unit's balcony offers a nice view of KL Tower although the lower units may suffer being blocked by Vida Soho. The West unit will also have a double whammy in Bolton's site.

I think Menara is very nicely located. It does not have the ugly frontage that Somerset Seri Bukit Ceylon is suffering from. Menara Bukit Ceylon is directly opposite some of the most exclusive eateries in KL, Bijan and the ever popular Nero Viva. It also boast the only squash court in Bukit Ceylon and the largest swimming pool. The gym however is spartan and falling apart. The lawn is nicely tendered at the entrance of the building and security is tight. This is not a bad investment as some units been advertised at around RM550k. I have also seen some ambitious owners asking for RM660k and RM750k respectively but I am not certain if they have been sold at this high price. But for sure, sub-sale units are quite hard to come by.

Tuesday, December 30, 2008

新年快樂 , Selamat Tahun Baru, Happy New Year, สวัสดีปีใหม่ , Glueckliches Neues Jahr , お正月

It's that time again and phooh... how time flies. As we greet 2009, let's reflect on 2008. This is the year property prices were at its' highest in Kuala Lumpur, especially the CBD area and mostly the expatriate concentration areas such as Bangsar, Mont Kiara etc. We have seen launches touching RM2000 psf and we have seen sub-sale prices double or in some cases quadruple. Many people managed to cash out, many became millionaires (in the case where they are already not). Unfortunately for some, thousands of units came into the market or are preparing to go into Vacant Possession as we slid into recession.

Whatever 2009 brings, I don't think anyone of us will be able to predict but one thing for sure, we will not be able to see major increases. We can be sure that Malaysia will go into deeper recession (although our Government is still in denial that we are already in recession), thousands become retrenched and many businesses will close. Thousands of expatriates goes home, leaving the rental market into oversupply and free fall. That, I think we can be very sure about.

Although I cannot predict what is going to happen, I think one of the following scenarios will occur:

1. Interest rates goes up - thousands of purchasers, especially speculators will be burnt and forced to sell below cost or go into bankruptcy. Property prices plummet as a result

2. Interest rates goes down - the government tries to flush money out into the market to revive the economy. Suddenly, money in the bank has become a liability. Inflation at more than 10% forces thousands of cash rich people to spend their money in tangible investments - gold, commodities, properties... Not forgetting that tenants are on the decline, the rental market depreciates, high costs of maintenance and installments kicks in. At the same time, many speculators and property owners who are wage earners get retrenched or for some difficult reasons, they are forced to sell. There is a debate among friends now how this will affect prices but my take is, it will go for a free fall but not as bad as the 1st scenario

Well, Idaman Residence by TA Properties and 231TR by Urban Delta will be ready in a few weeks time. I am a little surprised that agents are quoting more than RM1000 psf (which is almost 80% appreciation from launch price). Let's wait and see...

Tuesday, December 9, 2008

Villa Inai - Who?

There are these 2 patches of green land on either side of Jalan Bukit Bintang. One patch enclosed by Jalan Ampang and Jalan Tun Razak. And the other one enclosed by Jalan Imbi and Jalan Tun Razak. The one by Jalan Ampang is of course what we know as KLCC today and it's is wildly successful with properties being quoted in the millions. This other patch, still within the 1km radius of the Petronas Twin Towers is less well known and less developed. But within the intricate mesh of streets criss-crossing this patch of land, there are a few interesting properties. Of course, first of all we have the Bintang Goldhill, The Forum and soon to be completed 231TR. These are well known because they are situated right beside Tun Razak and highly visible. I am talking about those hidden within this patch of land.
Among them is Villa Inai. A small and niche condo. Within walking distance is the Imbi Market and various touristy outlets selling chocolates and some interesting eateries. There is even a bus station here which caters to Singapore express buses.
About 8 floors in total, Villa Inai only has about 30 units of 3 bedroom family sized units. The land area is really compact and as you can see in the picture below, most of the parking lots are double decker, operated with a lift.

Facility-wise, there is nothing to shout about. Just sauna, multipurpose room, gym, a small swimming pool and multipurpose hall (room?).

The apartment units are quite nicely laid out. Every unit appears to be a corner unit, very bright and airy. The floor materials are top class, marble floors and wood for the bedrooms. The kitchen is separated with a door, just the way my mom would like it so she can do those high-powered cooking. Very practical for Asian families. The major pity is the lack of balcony because the view is actually quite nice whichever way you are facing. Whether it is KLCC or Bukit Bintang or Times Square.
I learnt that the rental is around RM3500 which should very popular considering the location and the sizes of the units. I can say the management is Grade A but it should not be too difficult to manage such a small property. Being small also means the per unit share of the maintenance fee is high.... around RM600 per month.
Being small also means there aren't many units being sold in the sub-sale market. Currently there is a lack of competition in the area, so less tendency for people to compare prices.
You either like this place or you don't. And frankly, I would buy it for own stay. Most tenants are very discerning nowadays and they would go for those newer locations around KLCC but for RM3500 per month, what else can you get?
What about the price? Being niche, and less competition to compare, owners can really quote whatever they want and hope a suitable and willing buyer comes along but need to bear in mind that a 2 bedroom unit in nearby Goldhill Bintang is asking for RM600k to RM800k. So, naturally, the price for these 1600sf units in Villa Inai should not exceed RM450k. But sometimes, owners have very high expectations....

Jalan Ampang - 202 DC

202DC is strategically located along Jalan Ampang, sandwiched between the Spanish Embassy and a furniture shop. Developed by E&O more than 10 years ago, 202DC consists of 3 to 4 bedroom condominiums suitable for a small family.

Each unit fetches rental between RM4500 to RM8000 depending on the size and where they are facing. Naturally the units facing the inner quadrangle with a beautiful free form tropical pool and those facing the Spanish Embassy (hence KLCC) are the more popular ones, while those facing busy (and noisy) Jalan Ampang and the AKLEH elevated highway are probably less attractive.
The management has been handed over to the residents some time back and it seems they are doing a good job keeping the place in good shape considering the age. The major attraction appears to be the inner quadrangle with the free form tropical pool.
The location is superb and should attract many tenants among the diplomatic corp and expatriates. But lately there has been many owners trying to sell their units. My recent visit also revealed that there are many vacant units. Surprisingly, the security guards told me so.
So, what happened to this place. It doesn't look too bad to me. Nice place, good management, clean, beautiful gardens, good facilities etc... My guess is probably the competition from the new KLCC developments. 202DC is within the budget of the mid-level officers i.e. from 2nd Secretary below. We've only got so few embassies and their diplomat staffs. There are now newer and more attractive condominiums such as Hampshire Place, Meritz, Marc Residence and the many new condominiums along Jalan Ampang Hilir to choose from for this budget range. 10 years ago, there probably wasn't that many choices.

However, there is no denying the charm of the place. What would be good is if the sale prices could be nudged a few notches downwards. Currently we are looking at between RM650,000 up to a million for the bigger and "nicer" units. As they are old, the owners probably much much older, many units need a change of tiles, flooring, furnishing and fittings to give them a fresh look. Obviously one needs to spend at least RM50k to RM60k to accomplish this mission. So, sellers need to be realistic. I also found some owners have done some really terrible and old fashioned renovations in order to "spruce up the place" ready for rental or sale. Of course, this is usually a big mistake because at their age (and attitude), the taste is usually totally out of touch.

What do I mean by attitude? Many of the owners invested in 202DC for rental income and make the mistake of thinking since it is for rental purposes they do not need to spend so much to do up the place nicely and tastefully for tenants. This is very true in the case of older owners because they thrived in an era where there weren't many choices for tenants. But today, there are many choices. We are going to get almost 15,000 units flooding the market in the next 2 years!
So, those 1980s furniture bought from Old Klang Road will have to go. One will also need to look at the latest showrooms for designer kitchens, bathroom fittings and probably wood (not laminate!) flooring to replace the old tiles.

Alright, I've probably insulted many home owners reading this but I think this is an honest opinion. Tenants spending in excess of RM5k a month are getting more and more discerning. Expats and diplomats included. Those 2nd level officers in the diplomatic corp are in their mid thirties or early 40s.

Like it or not, 202DC will have even tougher competition going into the next couple of years. These are large units and one cannot leave them vacant for too long because the maintenance fees is expensive. There has to be more than it's perfect location and immaculate management to lure tenants.
Those units facing the Thai Embassy and the AKLEH highway also risks having a towering construction site in the near future as these look like private land. And with land such a valuable commodity in this part of KL, it is going to be inevitable. One really have to consider properly about this investment. After scouting 202DC for so long, I am certainly thinking twice.

Ampang 971

Now I've ventured into Ampang Hilir which is one of the property hotspots in KL. Ampang Hilir has always been very popular with expatriates with family because it is close to many International Schools and obviously there are also many foreign embassies operating in this area. Ampang Hilir is also a short drive from KLCC and various country clubs such as the Royal Selangor Golf Club and The Raintree Club. Although I hate the traffic crawl that Jalan Ampang is so notorious for, I must say I am quite impressed with the tree-lined streets mesh within this area, especially on the southern part of Jalan Ampang.
We've been talking about condominiums and apartments all these while and Ampang 971 is going to be a breath of fresh air. This is no condominium. It is a strata-titled freehold town-house concept consisting of large duplex 3 to 4 bedroom units fit for an average family with maid. They are basically 2 double storey terraced units stacked on top of each other. The price ranges from RM700k for an intermediate upper floor unit while the lower floor corner units fetch well over a million.
As mentioned, this is a family-oriented development. So, the typical unit consists of a living room, master bedroom and 2 bedrooms on the upper level while the lower level consists of a large kitchen, separate dining area and maid's room. The upper units are 4 flight of stairs up, with no lifts. So, if you have some heavy stuffs to move, do think twice. It is bad enough a chore climbing all those steps coming home every day.

The developer owns a number of these units which they kept for rental income. At the time of my visit, it appears like there are many vacant units looking for tenants. So, the developer seems quite keen to dispose off their units at a low price. However, most of their units are facing TNB's land with a very visible electric grid less than 50m from the back of the properties.

The set-up of the area is indeed quite attractive, with gardens, swimming pool, squash courts and certainly a lot of space for the kids to run about. However, the developer could have done more justice to the place by better managing it. The gardens are not well tendered, the children's play area is overgrown by mold and slippery and the reception area felt like a low class PD resort.

Typically, the rental goes for around RM4500 to RM8000 depending on the size of the units, the location within the community and the quality of furnishings. I am sure Ampang 971 has seen some glory days and the introduction of new properties literally next door and down the road have drawn away many of its' tenants. Under the present management, I doubt if this place would ever catch up and certainly in a short time, the prices both sale and rental will be adjusted downwards. If you can catch a bargain here, I think it's not too bad for own stay or to attract tenants looking for a place to rent in this area for less than RM5000, even at the level of RM3000/month. The density for a start is very low and it is literally walking distance to the Gleneagles medical center and the Great Eastern Mall. At any rate, certainly its' land would be worth something in years to come.

Saturday, November 29, 2008

Bangkok Lumpini Phahon-Saphan Khwai

Lumpini Phahon-Saphan Khwai condominium is quite strategically located at a working class and matured part of central Bangkok. Bangkok? Isn't that in Thailand? This is Realty Malaysia Blog, then what the hell am I doing blogging about a property in Bangkok. I stayed here the past week and for me to write to share with all of you about it shows how impressed I am with this place. This is a medium cost condominium equivalent to Casa Mutiara or Maytower in KL but yet it is so well designed, well built, well occupied and very very very well managed which totally can put even the top end condos in KL to shame.
First of all, the location is superb. It is within walking distance of the famous Chatuchak weekend market. There is also a shuttle service that takes you to the nearest Sky train station which is Saphan Khwai, the Chatuchak market, the Otokor wet market, the Bang Sue (pronounced Bang Ser) underground train station and the Big C hypermarket.
picture above: View of Chatuchak Market and the Saphan Khwai neighbourhood
picture above: The Big C Hypermarket
picture above: The shuttle van that takes you around the neighbourhood

How is the investment sentiment in Thailand?
This week has been a very bad week for Thailand. Anti-government protesters are taking their last stand to force the resignation of their Prime Minister by literally invading and occupying all their international airports. As of today, more than 100,000 foreigners are stranded as all flights out of the 2 city international airports are cancelled amidst talks of looming violence and another possible bloody coup de tat to end it all. I chose to fled Bangkok today when Malaysia Airlines announced sending 2 planes to the little U-Tapao military airport 200km from Bangkok to help our evacuation. The scene at the airport this morning was chaotic. Arriving at 7.30am, I only managed to check-in at 12pm and the flight only took off at 4.30pm. Such is the extent of this review being brought to you through Realty Malaysia!

picture above: The chaos outside U-Tapao airport, our only escape route that morning

Picture above: Thousands of passengers crowding a small airport built to cater to 300 passengers

picture above: Boarding the flight

Back home in KL, I saw headlines screaming "Bangkok Dangerous". But really, apart from the chaos at the airport, I throughly enjoyed my stay and the city was just as peaceful yet vibrant. The troubles were mainly confined to pockets of Bangkok probably representing less than 0.00001% of the total square foot of the city. Really there was no reason for me to "evacuate" as I said but rather for the need to get back to work in KL.

Currently, the property market don't seem to be taking much hit. Bangkok has somewhat reached saturation point a few years ago. The rental market has been reduced to low returns due to the competition. Typical returns are in the low 4-5% yield per annum. Yet, property sale prices hasn't really fallen but this situation is not likely to continue into next year as Thailand is badly affected by their export market and of course, their volatile political situation. My good friend who is in the senior management of a Thai bank doesn't agree with me. According to her, there are many large foreign and local funds currently waiting to grab any cheap sale that may come along next year and hence property prices may not be falling very much.

Anyway, back to the main story. In my opinion, there is much for us to learn from this developer in Thailand. LPN specializes in low to medium cost condos which are located near public transport i.e. Bangkok's BTS and MRT system (a better and more resilient version of our LRT system). The target market are middle income earners but some of these locations become so popular, the prices have increased up to three fold and fetching many 1st owners good rental income from expats as well as locals.

The condo I stayed at have mostly studio units and most of these are occupied. From the information I received, they are also very fast moving as they provide very convenient, clean and comfortable accomodation for the young and increasingly trendy executives of Bangkok.

The design of the studios is suited towards the Asian lifestyle. The main feature is the separated dry and wet kitchen from the rest of the studio allowing for some heavy duty cooking if required. the larger 650sf and 900sf, 2 bedroom and 3 bedroom units respectively adopts this feature too.

picture above: the fire escape plan shows the floor layout clearly

picture above: Inside a typical studio unit, the door to the left is the bathroom and the right is to the kitchen

LPN is really good at what they do. As they have the demand and volume, the high density of their condos trade off with better facilities which includes a shuttle service to the stations and hypermarkets, 2 restaurants, 2 laundreattes, full club house facilities and 24 x 7 security (see pictures).

The most amazing feature I think of most managed condos in Thailand is the army of workers - cleaners, security guards, receptionists etc. As I regularly used the clubhouse, I noticed every morning the cleaners wiping the leaves of the potted plants with a special chemical, this is after their routine cleaning of all the facilities. They even bothered to put cut flowers in the bathrooms and flower petals in the foot pool (where you clean your feet before entering the swimming pool). when you walk home with a lot of shopping, the receptionist or the security guard will run up to you to help carry your things to the lift! They smile and greet you every morning when you step into the lobby.... All these for RM90 a month in maintenance fees!

picture above: A 24 x 7 convenience store conveniently at the main entrance to the condo

picture above: The spa

picture above: The library

picture above: Security center and reception

picture above: Post boxes

picture above: Recycling bin at every floor

picture above: The community notice board inside the elevators are regularly maintained

picture above: 2 laundreattes operate here and seems busy competing with each other picture above: Basketball shooting ring pictures above: The dry sauna and steam room rotates between men and women usage on alternate days picture above: well equipped fitness room

picture above: Security key card required to enter parking

picture above: The swimming pool and the club house

In my opinion, the Thais excel very much in the service industry. They are so good at it which makes Thailand such a pleasant and fun place to live in. I believe despite all the shortcomings of Thailand, tourists and investors will continue to go there. The country holds much future and is developing fast, despite one recent coup de tat and emergency rule. This is a sign of investor confidence.

picture above: An odd couple spotted in The Paragon shopping mall in center Bangkok

picture above: A more natural couple....