Dorsett Place: Hotel operator in trouble over apartment plan

There has been a lot of talk about the car parking (..or lack of) issue for the Dorsett Place Waterfront. This week, they've decided to sell their car parks at RM28,000 per piece. This cost will be added into the purchase price in the S&P agreement. Before all the dust can even settle, something else has kicked in...

Hotel operator in trouble over apartment planPublished: Fri, 30 Mar 2012
SUBANG JAYA: A hotel which is allegedly offering buyers service apartment units may be violating its Planning Permission (PP) obtained from the Subang Jaya Municipal Council.

“I received brochures in my email about the hotel inviting people for a property preview this weekend,” said Subang Jaya (MPSJ) councillor Dr Loi Kheng Min.

He made the revelation during the MPSJ full board meeting yesterday and called for the council to take action against the hotel.

If found guilty, the hotel could have its PP forfeited and would have to refund any deposits made by guests during the property preview.

A PP needs to be acquired from the local council before any developments are carried out. The main difference in the PP requirements of a hotel from a service apartment is the allocation of parking space.

Earthworks are being carried out for the alleged service apartments.

Council president Datuk Asmawi Kasbi. said MPSJ will be meeting hotel officials next week for clarification.

UPTOWN RESIDENCE by See Hoy Chan

As 600 of the Mayland's Dorsett Place Waterfront 2000 units were selling like hotcakes despite all the bad points about this developer, See Hoy Chan comes in with their Uptown Residence and shows everyone what quality and value for money is all about.

Uptown is considered the main commercial area of the Petaling Jaya-Damansara "city". It can be comparable to Subang Jaya SS15. Where SS15 have colleges and large student population, Uptown has Grade A offices with multinationals such as Tetrapak, Orange, Agilent etc. etc. So, despite the massive congestion in this area where public transport is absolutely useless, Uptown continues to attract.

Today See Hoy Chan soft launched their Uptown Residences which consists of 2 towers - a Family Tower consisting of 30 storeys with 200 apartments and a Lifestyle Tower, 32 storeys with just 170 apartments. So, this is extremely low density considering the cost of land in Uptown which beats Mayland's SS12 Subang Jaya blind-folded and hands down, See Hoy Chan still manages to price their fully furnished units just above RM800psf compared with Mayland's RM760psf. Needless to say, even before the doors opened for their soft launch, all units in the Lifestyle Tower were sold out. On the 2nd day, 50% of the multi-million RM units in the Family Tower have been sold.

Apparently what happened was, beginning yesterday, punters started receiving sms-es inviting them to preview and book units today 23rd of March 2012. Whether they were plain stupid, ignorant or just trying their luck and being smart, they started to converge at the sales room yesterday itself. Then they "beat down the door" and "almost at gun point forced" the sales people to take their money and sell them units of this property. Scary as it sounds, this was very close to what happened yesterday.

So, what's this fuss about?

While Mayland is peddling 2000 odd of their tiny bedrooms with kitchen without car parks arranged in long rows like the hospital wards next door, See Hoy Chan gives buyers 6 units per floor, all corner units served by 4 lifts. Their Family Tower has 8 units per floor and every 2 units are served by 2 lifts - with their own personal lift lobby. Up to 3 car parks are provided for each unit! The furnishing, which in my opinion is very good quality is optional and you may opt not to have it and pay less. And if you change your mind just before the Vacant Possession, you may still have the furnishing by topping up the purchase price. This is in contrast to the cheap furnitures that Mayland forces down your throat.

Above: The Lifestyle Tower floor plan with 6 units per floor ranging from 734sf to 1040sf

Below: The Family Tower with 8 units per floor, every 2 units are "autonomous" with their own lift lobby

I will post some pictures later but I think the website probably serves more justice to this project at Uptownresidences.com.my.

Speculating the Mayland Dorsett

Finally, there is going to be a "preview" launch this 23rd March weekend of Mayland Dorsett. There are two 23-storey towers in this project, connected by a facilities deck on the 4th floor. Tower 1 has the pool and most of the hotel facilities and it is also the higher density of the 2. There are 82 units per floor in Tower 1 compared with 35 units in Tower 2. The ratio of units/lifts for Tower 1 is much higher than Tower 2 - 12 lifts serve Tower 1 while 6 units serve Tower 2.

It's the same layout for every floor from 5th to the 20th. The biggest and most expensive units, which are the duplex are on the 21st floor. There are only 36 units of duplexes (out of a total 2000 units), priced around RM800k for these 920sf units.

This weekend, only Tower 2 will be launched - almost 600 units in total. Majority of these consists of 590sf one-bedroom units facing the lake and 410sf studio units facing Subang Jaya. There appears to be a premium for the lake-facing units - from RM820psf vs RM750psf for the Subang Jaya view. So, the cheapest unit is priced from just over RM310k and with the preview discount of around 11%, the cheapest unit starts from only RM275k.

In my opinion, if speculation is the main purpose, the bet would be on these 410sf units. Why? Because there are only 200 of these. The other 400-odd 410sf units in Tower 1 are facing the Subang Jaya Medical Center which is not so desirable. So, the 410sf units in Tower 2 are a good buy - especially units 33 and 34. These 2 units are in the minority wing, there are only 9 doors sharing the corridor compared with 29 doors on the other wing.

However, nothing beats the corner Type B1 which is 500sf. Although these units occupy the "majority wing", there are only a total of 17 such corner units in the entire project of 2000 apartments. The other corner, the Type B2 is not so desirable due to the unit layout. The type-B1 has a bedroom and the bathroom can be accessed from both the bedroom and the living room. Both bedrooms and living room has large windows to let in natural light. But the type B2 is not designed in the same way. There is only a partition for the sleeping area with no windows although this is a corner unit. The bathroom is only accessible from the partitioned area - quite a stupid design and more expensive as well at over RM400k per pop compared with RM370k for the B1.

If the lake is something you like, then go for the Type C2, 590sf - but the only units worth buying are the corner. This is due to the internal design which has a living room with no windows, separated from the bedroom by the bathroom. If you get the corner units, the living room has windows.

As with all speculative projects, one has to get in there fast and early. The total number of corner units are 68. The total number of duplexes are 36. And the total number of desirable small units in the "minority wing" is 34. These will be grabbed up 1st and these are the ones who will appreciate most even if the others have to depreciate. They will be easier to flip or rent when in competition with others.

Updated: Mayland's Dorsett Place Waterfront

Studio units specialists, Mayland is back with their latest launch, the Dorsett Place Waterfront at Subang Jaya's edge of the Subang Ria lake gardens. This parkland has been controversial. Owned by Sime Darby, they've been carving parts off the green lung park to construct the expansion of Subang Jaya Medical Center. And just before the 2008 elections, Sime Darby seeked a development order from the previous state government to develop up to 30% of the park for residential as well as commercial purposes. Of course, the land being Sime Darby's they think they have every right what they want to do with it. But not according to many purchasers of the few early phases of Subang Jaya. These purchasers claim that they were enticed by Sime to purchase their plots back then with the promise of this green lung. Now it seems the "promise" is to be broken when money is to be made. So, this became an election issue and the previous as well as current state government has decided to hold back on the approval to develop.

Mayland's plot is at the edge of this controversial park. Unlike Sime Darby, their plot is much more straightforward. Couple of years ago, Mayland took over the Sheraton Towers hotel and rebranded it as their trademark Grand Dorsett. This obviously gave them the valuable car park plot adjacent to the convention center of the hotel.

This car park is to be demolished and the serviced apartment takes over. Typical as Mayland be, there will be over 2,000 units built into these 2 towers. Little info is provided as yet, there will be 10 types:

TYPE A-410 SF

TYPE B1-500SF

TYPE B2-550SF
TYPE C1-543 SF
TYPE C2-588 SF

TYPE D1

TYPE D2

TYPE E1

TYPE E2
TYPE DUPLEX A-919 SF

TYPE DUPLEX B

Prices starting from about RM275k... that is after the 2% + 10% discount during the preview this weekend starting 23rd March 2012.

Location wise, this is debatable. There is only one very congested access into Subang Jaya SS12 where this project will be located. The lake is a very nice spot for fishing, jogging or early morning walks. The 2 hotels here, the Holiday Villa and Grand Dorsett are quite well subscribed and there is a popular medical center right next door. As of now, everytime Grand Dorsett's convention center hosts an event, be it a wedding or a ceremony, the whole area becomes a havoc with haphazard parking and various kinds of violations, stress included. So, it will be interesting to see how such a high density project gets approval.

Najib ill-advised on ‘ridiculous’ first home scheme, says house buyers’ group

By Shannon Teoh
March 09, 2012

KUALA LUMPUR, March 9 — A house buyers’ group has labelled the My First Home scheme an “ill-advised” policy after it was reported this week that not a single loan application has been approved under Putrajaya’s home ownership scheme for low-income earners.

The scheme, launched by Datuk Seri Najib Razak a year ago, has come to a grinding halt as banks are unwilling to hand out 100 per cent financing for property worth up to RM400,000 to applicants earning less than RM3,000 a month.
National Homebuyers Association (HBA) honorary secretary-general Chang Kim Loong told The Malaysian Insider that setting a ceiling of RM400,000 under a scheme for “affordable housing” was “ridiculous and somebody must have told the prime minister the wrong facts.”

“It is obvious that our honourable PM was ill-advised by parties with vested interest on setting the price range of RM400,000 for income earners below RM3,000,” he said in an interview.

He said the association had run checks with banks and found that most applicants were those who have been blacklisted or lack proper proof of income.

“The feedback was simply that if people can’t afford it, then don’t buy. How can you take a 100 per cent loan for such an amount without commitment?” he asked.

Chang said that a 20-year loan of RM400,000 at the industry standard two per cent below base lending rate would require a monthly repayment of RM2,552, or 85 per cent of RM3,000.

He added that a 30-year agreement would still require monthly instalments of RM2,051 or 68 per cent of RM3,000.

The scheme’s website also states that to qualify for the programme, the repayment commitment cannot exceed 55 per cent of the applicant’s gross income.

“It is not surprising there have been zero approvals as borrowers would be living beyond their means and default in a matter of time.”

He said that based on Bank Negara’s guidelines that loan repayments cannot exceed one-third of income, the ceiling for the scheme should be set between RM150,000 and RM180,000.

The prime minister announced in October when tabling Budget 2012 that the initial RM220,000 ceiling would be raised to RM400,000 as property prices continued to spiral.
The government had earlier said that a state-owned mortgage agency would put up the initial 10 per cent deposit required to purchase the houses.

Chang suggested that if the government was serious about affordable housing, it should “go into a joint venture with reputable developers and not cronies” that want to keep prices closer to RM400,000.

He said the government should write-off land cost by “unlocking strategic locations” such as its landbanks in Sungai Besi and the Rubber Research Institute’s acreage in Sungai Buloh.

“Instead of pushing for these lots to be ‘high-value,’ go for affordable housing,” he said.

Chang added that qualified applicants must live in the homes bought for at least 10 years and only be allowed to resell them to the government so it can then be reallocated to “the next generation of qualified buyers who need affordable housing.”
Property prices in urban areas, such as Penang and Kuala Lumpur, rose by up to 40 per cent in 2010, fuelled by low interest rates and a surge in speculative buying, although prices grew slower last year due to dampened sentiment from tightening measures such as a hike in the real property gains tax for early disposals.
Some reports have also estimated that property prices jumped from 5.9 times income in 1989 to 10.9 times in 2010.

The Demographia International Housing Affordability Survey rates markets whose property prices are 5.1 times median income or more as “severely unaffordable”.
The HBA last year warned that an entire generation of young adults are at risk of being locked out of the property market due to runaway house prices.

Klang Valley Gross Yield 4th Quarter 2011

According to the Edge Property's report on the 5th of March 2012, landed property is still popular. However, performances of high rise remains encouraging although some areas like Mont Kiara and KLCC are not doing as well today.

Year-on-year price growth (monitored from 2nd Q 2010 to 4th Q 2011) for landed property is around 20% to 30%, highest being 40% for Bandar Kinrara single storey terraced houses. Other top 5 are:

TTDI dsl 38.89%
Bandar Sri Damansara dsl 34%
TTDI ssl 32%
Bangsar Park ssl 29.03%
Bandar Utama dsl 28.57%

Price growth for condos is not so interesting, most places seeing hardly any growth and in fact some prices declined such as for Marc Residence (-3.65%) and Stonor Park (-18.14%), both in the KLCC area. Highest appreciation is USJ's Good Year Court (39.47%) probably due to the start construction of the LRT station just outside the USJ6 area. In the last quarter of last year alone, USJ Good Year Court prices climbed 20% while no other high rise properties recorded double digit growth.

In terms of rental yield, condos remain the better investment although yield has fallen to around 4%-6%. The top 5 are:

Parkview 6.6%
Mont Kiara Sophia 6.55%
Plaza Damas (Mayfair) 6.5% - interestingly, Plaza Damas Mayfair prices has risen 14% over the year. One of the top performers
Marc Residence 6.23%
Mont Kiara Pines 5.79%

Developer Mayland must be pleased to have 2 of their properties in the top 5 rental yield category. It will be interesting to see how the Regalia fare when it is ready in the coming weeks.