Monday, February 25, 2013

Ready For Orders : Meridian 101 Degrees

Earlier I posted some concerns about Meridian 101 Degrees. After seeing the booking form, I realized the developer has not yet received the Development Order (DO) from the authorities. Nevertheless, they have started to take orders. Apparently, a Japanese investor has blocked booked 100 units. So, now only 59 units are left for sale. We have 1st pick and it will be 1st come 1st served.

We now have a block of 20 buyers. However, the developer is reluctant to negotiate with us until they have seen this block committed with booking cheques. The cheques shall be issued in the name of their solicitor, "Messrs FL FOO  & Co" as Stakeholder. The selling price is now RM1,410psf with no early bird discount. Here is the deal:

1. We might be able to negotiate some percentage of discount from the developer once we have this block committed with cheques. However, the amount may not be huge, possibly around RM2k - RM5k. No promises

2. We will have 1st pick - only 19th, 22nd and 23rd floors open to us for picking

3. All units and all floors are the same price. However, for KLCC view, you must buy a car park! You can own the car park for 10 years only

Please also note that the developer is a new company, Meridian 101 Degrees Sdn Bhd with unknown track records. They have set up an office at Plaza 138, Jalan Ampang and it is really a very small set up. So, you need to take note that there are risks!

Tuesday, February 19, 2013

More Details of The Dang Wangi Project - The Meridian 101 Degrees

This Dang Wangi project we talked about earlier is the Meridian 101 Degrees KL. The website provides MOST of the details that you need to know about EXCEPT who is the actual developer. This is shrouded in mystery, similar to the Bangsar Trade Center launched a couple of years ago. Therefore, we should thread with slight caution.

Same as the Bangsar Trade Center, the Meridian 101 Degrees is linked to Best Western Hotel who will be providing a fantastic 10 year Guaranteed Rental Return:

Year 1 - 7: 6%
Year 8 - 10: 7%

But unlike the Bangsar Trade Center, the density of this project is relatively low - only 156 units of 400sf and 480sf rooms. They are essentially hotel rooms here because there is no kitchen, just bathroom, toilet and sleeping area.

The whole building is half car parks and half hotel rooms with the facilities at the roof top. The lower floors are retail but I think they will struggle to find any meaningful tenants in this part of town, especially with such low density and neighbourhood.

Each floor will just have 13 units served by 3 lifts.

The misinformation I received earlier is regarding the price. I was told the price range is between RM400k and RM500k. However, at a early bird price of RM1400sf, they are really between RM560k and RM680k. Well, it doesn't really matter since you are not paying anything for 10 years. At a GRR of 6% to 7%, that should well cover your interests payments as well as the RM0.50psf maintenance fees every month. The price is also apparently flat across all floors and units, no matter if you are facing KLCC or the other side which is Jalan Tuanku Abdul Rahman or SOGO. Car park is not provided. You may however, purchase a 10-year use of the car park for RM50,000!! I think this is not necessary....

For anyone who is still in doubt about the location, pay a visit to Yut Kee and behind the restaurant, look out for a row of abandoned shops with this distinctive window facade...


the actual buildings are these below...

But rather suspiciously, the development sign board erected here is for something else.

So I would say the developer integrity is really a big concern, especially since it is a new unknown and secretive entity.

Sunday, February 17, 2013

Upcoming Project in Dang Wangi

How many of us actually know Yut Kee Restaurant along Jalan Dang Wangi? This is one of the very few old style and original coffee shop (KOPITIAM) still left in Kuala Lumpur. For a good taste of Hainanese fare, this is the place to go, even if it means queueing close to an hour during peak hours.

A few months ago, I have read in the news that Yut Kee is moving. But fortunately, they are not moving far. You can read more here in this link.

Yut Kee's location is actually really good. It's close to many office buildings and within 5 minutes off the Dang Wangi LRT station. The happening drinking and party hole, the Heritage Row is also steps away.

Those of us who frequently go to Yut Kee might notice that there is a row of dilapidated shop houses behind the restaurant. A developer has purchased this lot and there is a plan submitted to develop a serviced apartment. With such location, they are going to launch at no less than RM1000psf but the units will be smaller, around 400sf - therefore, average selling price will be about RM400k to RM500k.

If this is not exciting enough, I have heard that there will be DIBS packages thrown in plus a 10-year Guaranteed Rental Return!! No more details are available unfortunately.

There are few drawbacks... Besides the official secrecy about the whole project, Jalan Dang Wangi as well as the off-shoot, Jalan Kamunting are both one-way street. So the apartment can only be accessed by car one-way from Jalan Raja Abdullah. This is going to be a pain. Also, this is not yet a nice part of town. Not quite high class touristy place and at night there are many undesirables such as drug addicts hanging around. However, this will hopefully change with the development but as we can see with Capsquare adjacent to this plot is not particularly flying successfully....

Nevertheless, at the "affordable" price tag and nothing to pay for 10 years, you bet I am queueing up. Apparently, an investor has already blocked 100 units and I am wondering if we will be able to raise sufficient volume to negotiate a deal as well. If you are as crazy as me, get in touch at

Friday, February 1, 2013

The Manhattan at Jalan Raja Chulan

This is UEL, a Singaporean developer's 1st project in Malaysia. UEL being a reputable company back in Singapore will hopefully do it Right First Time to stamp their mark here. They have already got it right with the location. You can never beat this one. In the CBD fronting Jalan Raja Chulan with access from 2-way traffic. This is one up from St Mary Residences or direct competitor The Tribeca in Jalan Imbi which can only be accessed from a one-way lane/road or Idaman Residence or KLCC Parkview which are located inside some unknown small lane.

Having lived in St Mary, I can tell you how terrible it is when you only have a one-way access. I am not saying that it gets jammed or clogged up. Everywhere else, including in the suburbs get traffic jam during peak hours. But it's the non-peak slow moving traffic which gets at you when you need to make that frustrating long crawl around the block just to get home.

It has been over a year since I mentioned in this blog about an up-coming project on this plot of land. If I can recall, the land was sold at around RM150million in 2010. This is hearsay. But the figure seems about right for the location and size. It's really a very tiny plot, flanked by Wisma MPL, a Grade C office complex and a bigger car park which is awaiting development. At the back of it is a Chinese temple and Menara MPI.

I had a little scare a couple of months ago when there was news that the MUI group is selling Menara MPI to Mayland. That would have meant the building would be torn down and rebuilt completely blocking the KLCC views from my apartment in Seri Bukit Ceylon. But apparently, the plans was thrown out by DBKL... so, safe for now....

Surprisingly for such a location, despite the small plot of land, UEL has only packed in 139 units of mostly 2 bed-room units in the Manhattan. The 1-bedroom units are in the minority and the top floor consists of 900+sf duplexes. With a going price averaging RM1.4million per unit, the total development value assuming all units are sold out is just under RM200million. So, you may call it magnanimous or simply not greedy, UEL may just be trying to do it Right and Nice the 1st time. Or perhaps, DBKL was not allowing the project to be too dense... Anyway, every unit comes with a car-park and in fact, the bigger units, gets 2 car parks each. Not bad and certainly a good lesson for all those money-minded Chinaman developers in Malaysia who are stingy with car parks...

The pricing obviously reflects the low density. The cheapest units are just under a million. The best buy is the 588sf 1-bedroom corner units which has a really lovely layout and there were less than 10 of them. Needless to say, they were sold out, despite the RM200+psf premium i.e. RM900k and up. The deal is, early birds gets 8% discount and a further 5% rebate from the SPA price. All units are fully-furnished and if you buy a unit up to the 19th floor, you get a 5% guaranteed rental return over 2 years, which essentially is there to allow the developer to charge you more for the lower floors.
Picture Above: The 588sf 1-bedroom corner unit

Anyway, at this 5% rental return, that's implying that you are renting it out for RM3700per month. That's quite the going rate for 1-bedroom apartments in the CBD but not easy in the sluggish over-supply market these days. Even Singapore's Ascott has vacated their 110-unit inventory at Seri Bukit Ceylon. With the low density at the Manhattan, there will be hardly any internal competition but the challenge will be going against the more modern and established apartments in the CBD who have owners going-in at much lower investment such as SixCeylon, Verticas Residency, Fairlane Residence, One Ceylon, One Residency and Suasana Ceylon. That's where the Manhattan's location is so so very important. And that's why I think, the cheapest 1-bedroom units in terms of per square feet, the 603sf Type B2 are not going to make it. They are elongated intermediate units with the bedroom taking all the  windows leaving the living room and kitchens in the dark. No tenants in their right mind is going to sign a 1 year tenancy agreement to rent these for RM3700/month!

Pictured left: The 603sf Type B2

With the 588sf corner units sold out, the other 1-bedroom units worth considering is the Type B3. However, the cheapest unit is RM1.2million - after discount...

To me, if I am spending close to a million, I can never justify buying a 1-bedroom condo. For just about 15% more, I can get a 2-bedroom unit and most expat tenants tend to have a little more budget for 2-bedroom units. As a bench-mark, a 2-bedroom apartment at Seri Bukit Ceylon can fetch RM5000 - RM6000/month. Over at St Mary's, they start from RM8000/month (although an agent sent me an sms saying he has a client with a RM6500 budget and I wonder who would be that desperate...)

The 2-bedroom apartments at the Manhattan have quite nice layouts since most of them are corner units.  My only complain is the bedrooms being too cramped - especially the master-bedroom. There are mainly 4 variants about 1000sf with slightly different sizes due to the balcony being either an indoor-Lanai, a large balcony, a small balcony or no balcony altogether. The design with the Lanai is the most rediculously wasted space as there is a large post in the middle of it. I am rather surprised that the developer has chosen this design to be represented in their show room. Also, taking a close look at showroom, one can't help but notice that the quality of the furnishings especially the wardrobes are extremely poor. Now most showrooms you see in Malaysia, usually you don't quite get what you see - the delivered furnitures are normally low quality. So, if UEL is using low quality furnitures in their showroom, either they are being painfully honest or you might be getting something really terrible at the end.

The 2bedroom unit layout
With 7 floors of car parks, the 2-floor facilities deck lies on the 8th and 9th floor. The swimming pool is rather nice, designed like it's hanging over the 8th floor. The gym however, looks like it's going to be very small. E&O has made this big mistake with putting a small and ill-equipped gym in St Mary's. This has turned away many potential tenants, including all the British expats from my company. Most expats are very health conscious these days and they want a good gym to work out at when they're home.

Surprisingly, the maintenance fee is only RM0.40psf. I am not sure if this is sustainable for such a low density apartment. With 139 units, they're looking at a collection of about RM50k per month. I think this will hardly cover electricity costs and security, 2 of the main costs of running an apartment. It's freehold, but commercial-titled. So, the overall costs of maintenance may be higher than you think.