Tuesday, February 23, 2010

St Mary Construction Has Begun

So, E&O has sorted themselves out and begun the construction of St Mary. As of today, they are at the Ground level, having already done 3 levels of basement car park.

These pictures were taken from the neighbouring MAS building. It seems from the picture below, the wall of the MAS building tower is quite close to Block C.

The ground level actually starts from the 1st floor of the MAS building and I have been adviced that the 2nd floor units will clear the pointed roof of the MAS podium block by almost 1.8m. This means, the lobby of Block C will actually be quite high, considering that the top of the podium block of the MAS building is at level 5 or 6.

Where the meshed wire wall is at today is the wall of Block C. You can imagine the closeness and this will obviously mean no view at all for those units facing the MAS tower...

My remedy would be to use horizontal shutters. Since we are not going to get any view, might as well get a nice looking window. This would be quite good as it actually prevents people from spying inside the apartment.

Monday, February 22, 2010

When Communities Become Gated - What Impact Does It Have On Your Property Investments?

Earlier I posted a letter from a concerned relative about implementing gated communities. Now we need to address how this will impact our investments. People who are in support will argue that gated communities provide a safe haven and security for their property and family. However, there has been cases where houses in gated communities has been broken into. There was a case last year whereby a resident successfully sued the management of Sierramas in Sungai Buloh after his house has been sacked by robbers. Perhaps, instead of eliminating crime, gated communities may reduce crime. But that just means that when one community becomes gated, the criminals may move to other communities until they become gated as well.
Those against the implementation of gated communities fear their freedom will be curtailed as many entrances, exits and passages will be blocked. This may become a problem if a fire occurs and the fire rescue is hampered by road blocks such as big oil drums. The Selangor government has also just announced that a new guideline is being drafted and this includes:
1. A requirement for at least 85% support from the community
2. Local authorities will not provide maintenance services such as garage collection, grass trimming etc
In my opinion, this will surely impact property value. Whether negatively or positively, time will tell. I would certainly not purchase a property which is gated. There are many issues. What if the collection of monthly fees falls short, it means the security company won't get paid? Our grass will grow taller than the trees? Garbage will stink and pile up? Even well-established condominiums have defaulters and there will always be people who won't pay because they don't agree with the concept or simply because they just wish to become free loaders. Who will do this unthankful job of collecting dues on a long term basis? As we see it, in Malaysia, strata living tends to deteriorate over time... we are still short in that mentality.
And how do we gauge this 85% support? There is a case in USJ whereby the "Residents Association" sent out questionnaires to every household but only received 25% of them back. But they went ahead to put up security posts and hired guards. So if the property value is affected negatively by this move, can the property owner sue the Residents Association and all the office bearers for a defaced valuation?
Then again, what happens when enough people are fed up with the crime rate and decided to sell out and move to a proper gated community such as Sierramas, Desa Parkcity etc etc - would this force the property value down? On the other hand, it is a known fact that property values in established gated communities have always appreciated. But this theory is untested in areas which is not originally a gated community.
There are many issues. Frankly speaking, if we have a more professional police force in this country, we would not have to come down this path at all. For the first time in this country, we witness the police force taking sides in politics and not doing what they are supposed to do. I personally have experience in this. I've seen the police appearing in large numbers to arrest people staging a peaceful candle light vigil and carry out unncessary road blocks to discourage anti-government protest gatherings. They claim to be short on resources but they can deploy very quickly and in large numbers against the Opposition. Then some months ago when one of my tenants got robbed, I helped to call the police. The police refused to come down to investigate unless we go to the station to make a report first. The station was almost 10km away, in a traffic jam that would take us an hour to get there. By then, any investigation would be just a procedure as the robbers would have run away and probably sold the loot by then.

Friday, February 19, 2010

Bangkok Across The River - The Fine Condo

The Bangkok city center that we see today is the new Bangkok. The capital city of Thailand or Siam, what the country was known back then moved to Thonburi (across the river from today's Bangkok) from Ayutthaya after the Burmese sacked the place for the umpteenth time. The Burmese continued to sack Thonburi and hence, the capital moved across the river to where it is today.

Owing to a lack of land, many residential projects are now taking place in Thonburi. The BTS or the Bangkok Sky Train has even extended across the river deep into Thonburi, sparking some very interesting projects.

Unlike the other side of the river, Thonburi is less hectic. However, nobody can escape the famous Bangkok traffic jams which you can't see from the pic below because it was taken on a quiet Sunday.

Before the BTS extended into Thonburi, pedestrians either take the bus or walk across the Taksin bridge or take one of the many ferries either offered by the Bangkok Metropolitan Authority or there are free ones by 5-star hotels.

Ferries or river taxis also ply along the river. This one below goes all the way up and down the river and it is a staple transport for many people to get to work or home.

Just across the river from the busy Bangrak area, made famous by ethnic Cantonese cuisines, the Shangrila hotel and the former BTS terminal station, Saphan Taksin is Charoen Nakhon, the gateway into Thonburi. One of the interesting projects that I am interested in is the Fine Condo, which is located just by the river.

The road entrance of the condo is over at Charoen Nakhon road, the road that runs along the Chao Phya river on the Thonburi side. At the same time, the developer has also made a river entrance and they will soon start a ferry service to take residents across to the Saphan Taksin boat and BTS stations.

The beauty of the project is the niche-ness... It offers tranquility and quality away from the busy Bangkok life. One can imagine coming back to this everyday and every weekend...

The condo consists of 2 blocks and about 100 units from small 35sqm studios right up to 2, 3 bedroom units and penthouses facing the Chao Phya river. Each block have their own gym and the car parks are just beneath which worries me about the frequent flooding. Since I don't own a car in Bangkok, I guess this is alright :)

The main block below is built around an inner quadrangle which will soon be furnished as a lobby/waiting area.

Many of the units are furnished for rental and also sub-sale. I am not too keen on some of their furnitures but I guess this is one of those dilemmas by investors who has just taken vacant possession - they need to furnish in order to rent and at the same time try to sell it in the sub-sale market. So, it's one of those try not to spend too much syndrome...

The kitchen is absolutely conducive for Asian style cooking. It is well ventilated and is a separated room. Only problem it is a bit too narrow.

This corner 2-bedroom unit which was eventually sold for about RM450k has a nice view of the river. But the afternoon sun facing was too over-whelming for me especially during the Thai Summer.

Overall the fittings is nothing to shout about, but the layout is nice. Every unit comes with developer fitted Air-conditioning. The maintenance fee is not cheap, around RM5 per square meter but rest assured, Thais have a very good maintenance culture compared with Malaysians.

So, in the end, OK location, great project, nice layout and acceptable pricing - but there are too many choices... So take the sweet time and look around a bit more...

Tuesday, February 16, 2010

For Sale: Mutiara Villa 1br/1bath 580sf bright renovated unit with view of KLCC

SOLD 8/5/2010

One bedroom unit in Mutiara Villa, located in the heart of Bukit Bintang for sale. It is within walking distance to Jalan Alor, directly faces the row of Tengkat Tong Shin restaurants and has a 7-eleven and a Carrefour Express within its vicinity. The neighbourhood has been transformed with a mix of brand new luxurious boutique hotels and back-packers inn. A favourite place for expatriates and locals alike as the well-patronized Changkat Bukit Bintang pubs and restaurants are within a 100m radius. Unlike the P Ramlee area, Changkat Bukit Bintang is not noisy. However, the weekend nights traffic jams can be annoying although one should be extremely happy to live within a stones' throw of everything - the monorail station, Lot 10 and Pavillion are only a 15 minutes walk away.

Condo facilities include a swimming pool, jacuzzi, barbecue pit and 24x7 security which has recently been upgraded with key card access to the lifts and common areas, car park gantry and CCTV systems.

The unit has recently been renovated. It consists of a bedroom, bathroom, living room and kitchen. The floor is entirely laminated wood with oak finish. The ceiling is plastered with stylish square downlights, the bedroom has built-in cabinets and a mix and match of teak antique-finish and modern furnishing. The bathroom was completely retiled, fitted with rain water shower and centralized 25 liter tank water-heating.

Unit is currently tenanted, monthly rental is RM1800. Contract has recently been renewed for 2 years ending December 2012.

This is the 1st ever property I bought and now I want to sell it. The reason I am selling it is because I bought it with a partial withdrawal of my EPF savings. In my old age, my EPF has accumulated and I wish to make further withdrawals to invest in other properties. However, I am not able to withdraw any more of my EPF savings for another property unless I sell this current one.

In fact, I have put this unit up for sale since November last year. But the motivation to sell it is lacking because I have a very good tenant and it is being rented out for a good price. It is also difficult to arrange viewing as I do not like to disturb my tenant too much.

I managed to organize a viewing in late January. My asking price was RM300k. After the viewing, a potential buyer offered me RM280k which I turned down. Later, he called me to offer me RM300k and I thought I had a sale. However, he refused to pay a booking fee. Instead, he requested for my documents so he can start applying for a loan. He would only place the deposit if his loan is approved. I find this practice bizzare but it's not uncommon... usually people who are not serious would do this and desperate sellers would accept it.

But I'm no desperate seller. I think I am offering a good deal, as this property is rare for the location. It is extremely easy to find a tenant. In fact, for the past 10 years that I have had it, it has never been vacant. The beauty of it is, I have never needed to engage a real estate agent to rent this unit as it is in such high demand. Meanwhile, as long as I am still trying to sell it, I am collecting rent and very happily, I have been adviced that RM300k is under-priced. I should really be asking for RM320k. Since it is a small unit, the maintenace fees is really low at only 24 sen psf i.e. RM139.20. So, the returns are maximized at 6.2%. As there is no more land in this area, this freehold unit's value can only go up.

It is also important to note that the strata title has been issued and the condo is under the management of the owners' committee. As a result, the conditions of the common areas and facilities have improved tremendously, most noticeably the security.

If anyone is keen on this unit, please get in touch - sinleongng@yahoo.com. But please be serious as it would be terribly inconvenient for the tenant.

Saturday, February 13, 2010

Happy Chinese New Year 2010

Wishing all a happy year of the Tiger!

Monday, February 1, 2010

Empire Subang

picture above: The office tower of Empire Subang on the right flank of the building housing large office sizes 2000sf and above

When I was young, I used to exercise and jog along the park opposite Subang Parade in Subang Jaya SS16. There were outdoor gym equipment and a jogging track which in later years were not maintained and overgrown with weeds. It always crossed my mind that one day, this piece of prime land will be developed. So today, the whole stretch has been built. Due to SS16 being the frontage of Subang Jaya from the Federal Highway, the change in landscape cannot be more obvious. 2 of the most recently completed projects here are Saujana Residency and Empire Subang.

picture above: The main shopping mall entrance of Empire Subang. In the background is Saujana Residency

Empire Subang is located slightly off-opposite Subang Parade, flanked by the KTM railway track and Federal Highway on one side and the ageing Wisma Tractors on the other side. This is a very prime location. There are plans for the Kelana Jaya line LRT track to swerve close to Empire Subang and stops at the main road just off the McDonalds drive-through at SS15 which is just under 400m from the building.
picture above: The proposed Kelana Jaya line extension passes near Empire Subang but stops almost 400m away

Although close to Subang Parade, the building itself is self sustaining. The development consists of a shopping mall, an office block and residential cum business SOHO type units and there is also going to be a hotel. To top it all up, with a mix of types, the building is completed in a very modern and comfortable style. As seen from the Federal Highway as one drives past into Subang Jaya, the decorative facade and modern high ceiling glass windows of the units reflects a very stylish outlook to attract the modern and the young (or the young-wannabe-s). This is a contrast to the image of Subang Jaya.
picture above: The front drive-way
picture above: The lift lobbies at each of the floors are breezy and nicely adorned with motifs
picture above: However, the main entrance lift lobby is dark and dinghy
picture above: Bridge linking the SOHO units and the office tower
Subang Jaya started out as a suburban neighbourhood, with the typical family style living. The country's 1st ToysRUs set-up shop in Subang Parade (but then closed shop) and as their children grew up into the internet age, Subang Jaya also saw the nation's first internet cafes and colleges. The college kids have since graduated, have their own kids, many successful with their careers and as Subang Jaya aged with their parents, they soon moved out to more modern suburbs like Desa Park City, Kota Kemuning etc. This generation is probably moving from their career and venturing into business now and Empire Subang reflects the phases and changes that Subang Jaya is evolving through. The SOHO concept is really apt for this.
picture above: Facade fronting Subang Jaya
Apt as it is, this is a very daring venture. Subang Jaya is no Mont Kiara (probably not yet). Launched a couple of years ago at over RM350psf, the SOHO units will soon be handed over and units are resurfacing for sale at more than RM550psf. The SOHO units are duplexes. The ground floor is around 600sf and the mezannine, laminated wood floor supported by Iron H-beams adds a further 200sf. Fortunately, maintenance fees (RM0.25psf) is calculated on the concrete floor space. So, each unit pays around RM150 per month. Not too bad one would think but with no recrational facilities and car park included, one would wonder what's the maintenance fees for?

picture above: The SOHO unit mezzanine floor overlooking the Subang Jaya view

Picture above: The SOHO unit as seen

picture above: The stairs up to the mezzanine

pictures above and below: 2 toilets and showers, one on each level

picture above: The low ceiling greeting the entrance of each SOHO unit may be a Feng Shui issue

Fitness First is setting up a gym in the building and will also manage the pool. But using these facilities will attract extra costs - basically the gym's fees. Nevertheless, with 2 baths cum toilets in each unit, they can be converted into residential lofts for the modern you...

The SOHO units are all identical, neighbour units are mirror images while corner units have the added wrap around window. Density is quite average but I wonder if the Mont Kiara level prices is attracting any sub-sales? Just a couple of months ago, they were going around RM280k per unit. Now, the asking price has climbed up to RM350k. But seeing that some owners have advertised at RM300k, it seems there are owners who are holding out hoping to get a good return while there are also those who don't mind letting go as quickly as they can. But what's more obvious in a diverse pricing subsale market is, there might not be many takers.
picture above: The air-con ledge connects to the unit next door

Agents claim the rental for a bare unit can fetch as high as RM3000/month. I think certainly the concept is unique and there isn't any credible competition in this part of the world. But to ask for RM3000 rent for a small 600sf+200sf office is very confident. Empire Subang is banking on that lifestyle image. This is no traditional office cum shopping mall. Even Starbucks has rushed in to establish their foot print.
picture above: Starbucks one of the first to put their foot print here

I would remain cautious. Cautious at the expense of missing out if this project goes off as a flying success. But even if it is not going to be a flying success, I doubt it will end up a failure. The only kink is, buyers in this high sub-sale market might get stuck for a very long time.

pictures above and below: The views from units facing the Federal Highway. The noise from the traffic can be heard but not so obvious when windows are shut. Nevertheless, the units also face a sewer plant across the highway (circled)

picture above: Units facing Wisma Tractors may be slightly better. No noise from the highway. However, there are large aircon compressors directly beneath the units which may introduce heat and can be potentially noisy if maintenance lack. The arrow points to the Wisma Tractors rubbish dump. You can't win them all...