Monday, December 30, 2013

The Establishment

The Establishment is finally selling. As expected, these are tiny studio units although not as tiny as those found in Bangkok. Unit sizes start from 445sf studios and goes up to 838sf 2-bedroom units. Out of the 600 units, 126 of them will be managed and run as the Alila hotel. 

They'll have 25 units per floor served by 6 lifts, not including the 2 service lifts. 

Pricing apparently starts from RM900psf fully furnished with discounts and DIBs but without a car park. But that per square feet price may have included the loft space in every apartment unit because when I last checked prices were hovering well over RM1,000psf.

After this 31st Dec, prices may be revised again since DIBs will have to be withdrawn and developers are working out another discount scheme to compensate for that. 

The 468sf Type A seems to be the dominant layout accounting for over 35% of units on each floor. 

With every studio layout looking pretty much the same, Type E would probably be the most sensible buy being the smallest at 445sf. There are only 2 of such sizes on each floor.

Types C and D however, being larger have an extra large balcony. But this is not expected to add much value in rentals so the extra money you pay for the space is wasted... not to mention the maintenance fees which is RM0.40psf

I think tenants will pay more attention (or pay) for extra windows. If this does not add more value to the rent, at least they will help push units up to be rented first in a competitive market. With over 600 units in the building, the extra windows in the Type F and Type G studios may help - especially the Type F which has a window in the bathroom.

It is reported that despite the early hype, people are not exactly falling over each other to grab a unit at the Establishment. The 2-bedroom Type H and B units are especially slow. The layout of these units are especially bad. The 2nd bedroom has no windows - always a no-no. Type H are corner units and it really baffles me why the architect does not want to orientate the 2nd room to the corner so it captures a window. The balcony also has an odd shape, in addition to being too large to serve a purpose. This is really an unfortunate failure of design. 

The Establishment is being peddled as a Bangsar address. The only claim to a Bangsar address I think is the link to the LRT station. Other than that, it really is a Brickfields address. People who do not take the trouble to investigate this will undoubtedly make a mistake of booking a unit with this wrong impression. Unlike neighbouring Singapore, our LRT is not quite an ideal transportation system if the Establishment is to be peddled at prices fit for those who can afford it. Thus the lack of a car park is especially glaring. This perception that expats in Malaysia do not drive or own cars is a wrong one. Expats in Kuala Lumpur are quite different to those in Singapore. I admit not all, but many have cars and therefore they need a car park.

Car Parks in KL are worth from RM45,000 up to over RM60,000 each. So, if you add this amount to the purchase price, you will find that you are getting much better value elsewhere. So, I still put my money in Bangsar South, in KL Gateway and Southview or even the KL Eco City. The Establishment, no matter what the concept is.... not gonna quite make it.

Sunday, December 29, 2013

The Charm of Old Town Ipoh

Ipoh Old Town White Coffee is now well known all over in this region, even up to Australia. So there is a lot that this quiet old town can offer. Being here on a weekday, you'll find Ipoh is actually quite a bustling busy town. Much like Penang, there is a heritage in Ipoh with many pre-war buildings. If you ask me, this should also be a Unesco city if even Penang and Melaka can be one. 

Some time ago, just before the Unesco announcement, I was interested to buy a double storey shop house in the Penang heritage zone. The 20feet x 100feet shop was really charming but needed a lot of work to restore it and the price reflected this situation... only RM360k. I missed the chance because I was too late...  somebody else got it. Today, any heritage house in Penang would be worth 3 or 4 times of that. So, forget about it.... 

But Ipoh may be somewhat affordable in comparison... except there may be a lack of tourists compared with Penang. There are many such delapidated buildings for restoration...

A survey walk around the old town of Ipoh, you'll discover many owners have made a mess of their restoration, installing modern fixtures, windows that totally destroy the facade and character of the buildings.

 However, there emerge some enterprising and artistic people who has done some really good work such as this one... a row of old shops turned in unison to charming cafes and restaurants.

They are located just diagonally across the road from the Ipoh HSBC bank and bar council building at Jalan Sultan Yusoff.

In fact, one of the shops, Burps and Giggles, still maintains the original look, without the roof that it once came with. 

The food and drinks are pricey, especially by Ipoh standards. But the atmosphere more than made up for it. Let's hope more people do this Ipoh. Our hero, Ng Sek San has also been here... converting one such heritage shop into a boutique hotel cum restaurant at Kong Heng.

Saturday, December 28, 2013

Vogue Suites I at KL Eco City

Vogue Suites I, as the name suggests is going to be a luxury residential development at KL Eco City. Somehow, I find it rather distasteful that Malaysian developers often have no creativity whatsoever in naming their projects that they have to steal names from already successful entities.  

Secondly, the picture of Vogue Suites I in the developer's website does not give you the real impression that this is going to be a very high density project with 3 towers clustered together and a total of over 2,000 apartments. The only views you are going to get are those of your neighbours, neighbouring office units or those lucky ones will get to see the Federal Highway and the Pantai Dalam sewer treatment plant in the horizons...

If anything is going to kill our property market, this is probably the one. We are going to be flooded by apartments, especially 1 or 2-bedroom small units in 3 years time - add the few more thousand units coming in from Bangsar South!

As more and more, smaller and smaller apartments are being built, there really isn't much to talk about the floor layout any longer. Probably the design that distinguish Vogue from the rest is the sunken bathroom concept - however, they are not the 1st to think of this as back in 2008, Swiss Garden Residences at Pudu has already done this.  

Nevertheless, there are rare 1-bedroom duplex units similar to those offered by YTL at nearby Centrio Pantai Hill Park. While Centrio's duplexes are selling in sub-sale at around RM700k, Vogue's are going almost RM2million each. 

About RM2million for a duplex 2-bedroom unit, as an investment.... it's not going to make it. Even the sales people at SP Setia admit that this concept is only suited to those who have too much money and want to buy for own stay. 

But in my opinion, for short term stay it's probably OK but if KL Eco City is going to be built out similar to Midvalley, to live in a place like this is probably going to be too much.... I'm not suggesting that the density is too much but have you ever noticed that Midvalley is very much like an island - encircled but roads with high traffic. During peak hours, thousands of cars are sitting on the roads emitting dangerous gasses and off peak, they are circling the buildings like a river caught in torrential stream.  To get in an out, you need a car or wait for a taxi.... or in Eco City's case, you may also take the KTM or LRT out. But you cannot wander off on foot anywhere on your own like those apartments in Bangsar, KLCC or Bukit Bintang.

Midvalley does not have any proper foot paths for pedestrians outdoors. Any paths they have leads you into the shopping malls to spend money. It is not possible to jog around the whole complex and you can't exactly walk to neighbouring places... not that there is anywhere you can walk to which is within walking distance... Let's hope Eco City won't be like this.

Thursday, December 26, 2013

Bugger this City Hall! - City Hall’s revenue forecast shows rate hike a foregone conclusion, says house-buyers’ group

DECEMBER 27, 2013

Kuala Lumpur City Hall’s (DBKL) expected assessment collection of about RM1.2 billion next year showed the authorities had already decided on property valuation before consulting residents, says the House Buyers Association (HBA).
DBKL has now cut its forecast by RM70 million to RM1.13 billion after Federal Territories Minister Datuk Seri Tengku Adnan Mansor's decision to cut the assessment rate from 6% to 4% of the new property valuation.
“It’s a premeditated conclusion by City Hall even prior to the public consultation in January,” HBA secretary general Chang Kim Loong told The Malaysian Insider in Kuala Lumpur.
“It serves no purpose to have dialogues with local councils when they have made up their mind. The objection letters are just a whitewash,” he added.
KL mayor Datuk Ahmad Phesal Talib had said on Tuesday that City Hall had initially anticipated getting RM1.2 billion from property assessment but would now take in RM70 million less.
“Assessment tax is the main contributor to City Hall’s overall income at 56%,” Ahmad Phesal had said.
DBKL's certainty over its expected income from assessment tax collection has drawn doubts over the purpose of town hall hearings to address ratepayers’ objections.
“The filing of objection letters just looks like it was done for the sake of filing to comply with the local government act,” Chang noted.
“We have been hoodwinked,” he added
Following public protests over  DBKL's notice to property owners informing them of a hike in property valuation, Tengku Adnan had said last month that the proposed increase would be deferred until the public hearings are held from January to March 2014.
DBKL had increased its valuation of properties after maintaining property value for 21 years. Ratepayers had been expected to pay 6% tax on the newly revised valuation figures.
Complaints soon emerged that the increase in property valuation had soared to as high as 300%. In a span of one month, DBKL received over 153,000 objection letters from some 500,000 property owners.
Last week, Tengku Adnan had announced that the assessment rate had been reduced and assured ratepayers that they could still pay the old sum until revisions are reflected in the July 2014 assessment tax bill.
Chang said that DBKL’s decision to conduct town hall hearings shows the administration’s disregard towards each property owner’s complaint.
“This means in one shot, they will listen to a few thousand peoples’ complaints and with a stroke of a pen, reject all the objections simultaneously,” he said.
“Every complaint must be heard individually by the panel. In a town hall meeting, only a few will get to speak up,” he added.
Calling for a fairer system that allows individual property owners to privately voice their concerns, Chang said that owners also have the right to inspect the valuation on neighbouring lots to ensure fairness in valuation.
Moreover, if DBKL maintained its new valuation figures, it is more reasonable to lower the tax rate instead, he added.
“HBA’s stand is that a reasonable tax on residential properties should be 2% based on the revalued figure,” he said.
“For those whose properties are ridiculously revalued, they should be dealt with individually and City Hall should conduct fresh valuations,” he added.
Last year, DBKL collected RM810.53 million from assessment tax. It estimated this year’s amount to be RM880.8 million.
Based on the estimate provided by DBKL for 2014, the administration would be collecting an additional RM200 million in income per annum. – December 27, 2013.

Monday, December 23, 2013

Happy Mansion PJ

This is probably the Tiong Bharu of Malaysia. This is Happy Mansion in Petaling Jaya section 17, consisting of 4 - 5 blocks of large 12 storey apartments.

Petaling Jaya Section 17 has always been famous for eating places. In fact, Happy Mansion is just walking distance to the morning wet market which despite being wet and smelly, serves good hawker fare in the evening. Fortunately, they are not within smelling distance. 

Within the grounds of Happy Mansion, quite a number of hip and trendy outlets have also appeared joining MM Cafe which has been here for ages. Butter and Beans and Food Foundry below are some of such places serving good coffee and food, although a bit pricey. 

While the influx of trendy businesses and customers is welcome always, the parking situation however worsened especially in the afternoon. Although the car parks are under the purview of MBPJ, the local council, there is no parking charges applicable.

There is also no reliable public transport besides the RapidKL bus service. In the future, there will be a Section 16 MRT station - estimated completion in 2017.

Just in July this year, a corner 1000sf unit apartment was advertised and sold for RM340,000. One used to baulk at such prices on a low-medium cost apartment but not anymore. Especially, since it's freehold.