YNH has been pretty aggressive lately. It's hard to imagine, this one time contractor from Sri Manjung, Perak has grown to become an established luxury condo developer in the KL City Center. They've even established a trade mark for themselves, aligning with a reknown Serviced Apartment brand such as Fraser.
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My brush with YNH was when they launched Lot 163 with a fully-furnished studio unit going for as low as RM333,000. That was the time when one can get a unit at Parkview or Somerset SBC for less than RM300k. I recall I was looking at a 1-bedroom higher floor unit at around RM580k. When I went back to place the booking a week later, they have increased the price to RM800k. Clearly, shortly after that YNH announced that Fraser will be managing Lot 163 as serviced suites. What I can't comprehend is, when launched, YNH was touting an 8% 5 years guaranteed rental return for Lot 163. So, with the increased price, obviously the returns would be much lower - down to about 5%. And yet people are still buying for investments...
So backed by this experience, YNH is at it again with 188 suites. Honestly speaking, this is probably the worst location there is for a "KL City Center project". The site is flanked by a Muslim graveyard on one side and a busy elevated highway on another side. 188 is located directly opposite Cendana which has not really been doing very well. At least Cendana is shielded from the graveyard by another project, The Crest and thanks to 188 suites, Cendana will soon be shielded away from the noisy AKLEH highway as well. Cendana also has a direct link to the popular Rennaisance hotel next door.
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The biggest drawback is also the narrow one way access from Jalan Sultan Ismail. Unfortunately, the access entrance is only 50m away from the Jalan Ampang junction which is one of the most congested intersection in KL. So, you would imagine getting stuck in traffic on your way home and on your way out in the morning. If you have left the access road and realized you left something at home, you'll have to make a huge turn via Jalan Ampang and Kampung Baru to get back - a journey that would easily take you 45 minutes during the rush hour.
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Yet, it is odd to find that besides Cendana, The Crest and now 188 Suites, there will be at least 2 more new luxury project coming up in this Leasehold location. Developer Sunway and PV both have plots next to 188 Suites. The pricing of 188 Suites which starts from just over RM900psf for a larger 1200sf unit to over RM1300psf for the popular studio units is not quite surprising. Not surprising not because the property will be managed by Fraser, but the attractive 8% guaranteed returns over 5 years. That would give you a positive cash flow of over RM2000 per month over 5 years which totals RM120k - which means a contribution by the developer of more than RM200k for the smallest unit. So, as the smallest 610sf unit is priced at RM790k, it means the real value should really be RM590k.... the "smart developer" has built the "Guaranteed Rental Returns" into this purchase.
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Buyers would be attracted by the 0 entry cost because during this pre-launch period, the developer is offering a 10% discount which is taken off the down payment and interests absorption during construction. Investors will see no upfront investment and will be able to reap at least RM120k worth of rent over 5 years and hopefully will be able to flog it off with a 20% capital appreciation at the end of the 5 years. This is the exact modus operandi of the other successful YNH project at Lot 163 which is now known as Fraser Suites. However, the risk is in what happens after the 5 years and what happens if Fraser packs it in...
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Flippers would find it tough to off-load at a premium due to the limit on the Guaranteed rental return. And in the 1st 5 years, one is not able to rent it out except via Frasers. It will be bound by an exclusive contract. The 8% returns has also not deducted costs. And obviously, one has to look into the burden of re-investing to patch up wear and tear after the initial 5 years...
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Having said all that, most of the choice units especially the studios facing the swimming pool have all been snapped up by repeat YNH buyers...
.
My brush with YNH was when they launched Lot 163 with a fully-furnished studio unit going for as low as RM333,000. That was the time when one can get a unit at Parkview or Somerset SBC for less than RM300k. I recall I was looking at a 1-bedroom higher floor unit at around RM580k. When I went back to place the booking a week later, they have increased the price to RM800k. Clearly, shortly after that YNH announced that Fraser will be managing Lot 163 as serviced suites. What I can't comprehend is, when launched, YNH was touting an 8% 5 years guaranteed rental return for Lot 163. So, with the increased price, obviously the returns would be much lower - down to about 5%. And yet people are still buying for investments...
So backed by this experience, YNH is at it again with 188 suites. Honestly speaking, this is probably the worst location there is for a "KL City Center project". The site is flanked by a Muslim graveyard on one side and a busy elevated highway on another side. 188 is located directly opposite Cendana which has not really been doing very well. At least Cendana is shielded from the graveyard by another project, The Crest and thanks to 188 suites, Cendana will soon be shielded away from the noisy AKLEH highway as well. Cendana also has a direct link to the popular Rennaisance hotel next door..
The biggest drawback is also the narrow one way access from Jalan Sultan Ismail. Unfortunately, the access entrance is only 50m away from the Jalan Ampang junction which is one of the most congested intersection in KL. So, you would imagine getting stuck in traffic on your way home and on your way out in the morning. If you have left the access road and realized you left something at home, you'll have to make a huge turn via Jalan Ampang and Kampung Baru to get back - a journey that would easily take you 45 minutes during the rush hour.
.
Yet, it is odd to find that besides Cendana, The Crest and now 188 Suites, there will be at least 2 more new luxury project coming up in this Leasehold location. Developer Sunway and PV both have plots next to 188 Suites. The pricing of 188 Suites which starts from just over RM900psf for a larger 1200sf unit to over RM1300psf for the popular studio units is not quite surprising. Not surprising not because the property will be managed by Fraser, but the attractive 8% guaranteed returns over 5 years. That would give you a positive cash flow of over RM2000 per month over 5 years which totals RM120k - which means a contribution by the developer of more than RM200k for the smallest unit. So, as the smallest 610sf unit is priced at RM790k, it means the real value should really be RM590k.... the "smart developer" has built the "Guaranteed Rental Returns" into this purchase.
.
Buyers would be attracted by the 0 entry cost because during this pre-launch period, the developer is offering a 10% discount which is taken off the down payment and interests absorption during construction. Investors will see no upfront investment and will be able to reap at least RM120k worth of rent over 5 years and hopefully will be able to flog it off with a 20% capital appreciation at the end of the 5 years. This is the exact modus operandi of the other successful YNH project at Lot 163 which is now known as Fraser Suites. However, the risk is in what happens after the 5 years and what happens if Fraser packs it in...
.
Flippers would find it tough to off-load at a premium due to the limit on the Guaranteed rental return. And in the 1st 5 years, one is not able to rent it out except via Frasers. It will be bound by an exclusive contract. The 8% returns has also not deducted costs. And obviously, one has to look into the burden of re-investing to patch up wear and tear after the initial 5 years...
.
Having said all that, most of the choice units especially the studios facing the swimming pool have all been snapped up by repeat YNH buyers...
5 comments:
both located on less favorable spot in KL
will not chose YNH becos it is much more expensive than Sunrise
BRDB's one already launch long long time ago right...still good to go?
OKT
188 suites location really sucks - right beside the Muslim graveyard. but capsquare is not that bad. the place is strting to pick up
Visited the office today and 90% sold off, despite the bad comments. PV is building another tower beside, and it will be launching in the region of 1k psqft. Is it really not a good investment? Success in lot 168 is proven story, seeking comments.
Yup. The offer is quite attractive. Pay nothing for 5 years. In fact, developer pays you! But it's what happens after the 5 years I'm worried about. And if you flip before the 5 years is up, the developer does not extend the GRR to the buyer.
Yea true, developer paying you instead, and after 5 years is a concern. But main issue is still the cemetery just right beside the development. All about location, location, location...
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