RESEARCH REAL ESTATE HIGHLIGHTS 1ST HALF 2014 KUALA LUMPUR PENANG JOHOR BAHRU REAL ESTATE HIGHLIGHTS RESEARCH rates in Malaysia could rise by the Due to its attractive pricing, the project sq ft to RM3,000 per sq ft. Meanwhile, triplex penthouse measuring 18,000 sq ft KUALA LUMPUR second half of the year. received overwhelming response with all the former site of Lai Meng Primary for sale at RM25 million (or circa RM1,390 available units reportedly taken up. School at Jalan Ampang is proposed for per sq ft). The selling prices for its typical HIGH END a 60-storey twin towers project. One of units range from RM1,100 per sq ft. Expressionz Professional Suites @ Tun Supply & Demand the proposed towers will accommodate CONDOMINIUM Razak by Exsim Group of Companies Although there were significant a mix of serviced apartments, hotel and The cumulative supply of high end was launched in March 2014 at an completions totalling some 1,507 units in MARKET offices, while the other tower will house condominium in Kuala Lumpur stands average pricing of RM1,300 per sq ft. The KL City, asking prices continued to hold Grade A office. at 36,222 units following the completion project offers 447 serviced apartment firm while rents were marginally down of eight notable projects offering units of various layouts - studio, dual-key in selected less prominent schemes. In Market self-correcting with an additional 1,659 units [includes and duplex units sized from 643 sq ft to Prices & Rentals Bangsar, asking prices were marginally noticeably less previews and projects that are physically completed 1,405 sq ft. As of May, it has reportedly higher during the review period while launches but pending issuance of Certificate of achieved circa 65% sales. The cooling measures have dampened rents continued to hold steady. Completion and Compliance (CCC)]. Out market activities, both primary and of the eight completions, five are located Berjaya Corporation Bhd expects the secondary. There were noticeably less With no significant completions noted in The lacklustre market in KL City and they are SOHO Suites @ take-up rate for its newly launched previews and launches in the first half of the localities of Ampang Hilir / U-Thant, performance may receive a KLCC, Six Ceylon, Suasana Bukit Ceylon, luxurious Ritz-Carlton Residences the year with many developers pulling Damansara Heights and Mont’ Kiara, boost in 2H2014 ahead of the Laman Ceylon and VUE Residences in Kuala Lumpur to hit 60% by year-end. back as buyers adopt the “wait-and- asking prices and rents generally implementation of the goods and KL City. The remaining three projects are The upscale project, located at the see” approach. Despite lower volume remained stable. services tax (GST) in April 2015 intersection of Jalan Sultan Ismail and Dedaun and Damai206 @ Embassy Row of transactions, prices continued to Going forward, with a high supply with demand expected to pick up Jalan Ampang, consists of 287 suites in Ampang / U-Thant, and Richmond, hold firm in the secondary market. In pipeline of existing and incoming with unit sizing ranging from 1,023 sq ft Kiara 3 @ Mont’ Kiara in Mont’ Kiara. the primary market, however, sales projects, the rental market is expected to 4,284 sq ft. Average selling price starts performance for new launches were Challenging outlook with cooling Most of the newly completed projects to face further pressure amid weak from RM2,500 per sq ft. mixed depending on the location, measures implemented still in such as SOHO Suites @ KLCC, Six occupational demand in selected product and pricing amongst other key place and ahead of potential Ceylon, Suasana Bukit Ceylon, VUE Notable projects targeted for launch later locations and heighten competition factors. interest rate hike Residences and Richmond, Kiara 3 @ this year include Cecil Central Residence, between unit owners. Yields will continue Mont’ Kiara have been well received with Platinum Park Serviced Apartment and Early this year, Mulpha Land Berhad to be compressed in line with the lagging The Robertson (Tower 3) in KL City as disposed a 5-storey low-rise apartment rental market. Developers shifting focus to sales rates ranging from 97% to 100%. well as Nova Pantai @ Pantai Dalam and block known as Raintree Residence at affordable, mid-range products The developer of Laman Ceylon, with Meanwhile, the debut of more branded circa 85% sales, has reportedly revised Cecil Central Residence Resonance @ South Bangsar. Jalan Wickham, Off Jalan Ampang Hilir to and township developments residences into the Kuala Lumpur market their marketing strategy and is now Cecil Central Residence will be Hong the Government of the Islamic Republic appears to have had a positive effect on offering full furnishing package for the Kong-based Cheuk Nang (Holdings) of Iran for a total cash consideration of the pricing of new high end condominium period, reflecting developers’ concerns unsold semi-furnished units. Ltd’s premier project in the heart of Kuala RM34.30 million (or RM1,100 per sq ft on projects. on the adverse impact arising from the net floor area). The property comprises In the Ampang Hilir / U-Thant area, Lumpur. Controlled by tycoon Cecil Market Indications cooling measures announced in October 12 apartment units with floor areas Dedaun reported 85% sales rate while Chao, its unit, Martego Sdn Bhd, will 2013. ranging from 2,045 sq ft to 3,735 sq ft. Malaysia’s economy expanded strongly few owners of the fully sold Damai206 @ develop upscale residences comprising in the first quarter of 2014, posting an Embassy Row are releasing their units for The previews and launches include The three 50-storey blocks (total 832 units) In May, Amphil Corporation Sdn Bhd, exceptional growth rate of 6.2% (4Q2013: sale in the secondary market. Ritz-Carlton Residences Kuala Lumpur, with typical sizing from 569 sq ft to 2,499 the developer of the on-going Rimbun 5.1%). The robust economic performance Vortex Residence and Expressionz sq ft. The freehold project is located @ Embassy Row, officially launched its is driven by stronger expansion in A high impending supply totalling some Professional Suites @ Tun Razak in KL off Lorong Perak, facing Menara Kuala domestic demand and a turnaround 2,884 units is expected to enter the City; KL Gateway Premium Residences Lumpur and KLCC Park. Knight Frank in net exports. Bank Negara Malaysia market by the end of 2014. Ampang Hilir (Tower 2) and Inwood Residences @ Malaysia is the exclusive marketing agent (BNM) expects the economy to maintain / U-Thant will account for circa 48% Pantai Sentral Park in Kerinchi / Bangsar for the project. TABLE 1 of the total upcoming supply, followed South; DC Residency @ Damansara Completion of High End Condominiums in 1H2014 its growth momentum with GDP to range Other upcoming integrated projects that by KL City (33%), and Mont’ Kiara / Sri City in Damansara Heights; and 28 from 5% to 5.5% for the remaining are set to alter Kuala Lumpur’s skyline quarters of the year. Hartamas (19%). Some of the notable Dutamas (Tower A), TWY Mont’ Kiara and Project Location Area Total Units projects slated for completion include include the RM3.5 billion mixed use Residensi 22 (Block B) in Mont’ Kiara. SOHO Suites @ KLCC Jalan Perak KL City 480 Headline inflation edged up 0.4% to Crest Jalan Sultan Ismail, 188 Suites and “Oxley Towers” at Jalan Ampang that register at 3.4% in 1Q2014 mainly due Setia Sky Residences (Celeste Tower) Following the completion of its will comprise two 6-star hotels, luxury VUE Residences* Jalan Tun Razak KL City 272 to higher prices in the housing, energy- in KL City; 9 Madge, Madge Mansion, successful projects in KL City, ViPod serviced apartments, niche retail mall Six Ceylon Jalan Ceylon KL City 215 consumption and transport categories. Nobleton Crest, The Elements @ Ampang Residences and The Quadro Residences, and customised offices and KSK Group’s Suasana Bukit Ceylon Persiaran Raja Chulan KL City 310 developer, Monoland Sdn Bhd, held a RM4 billion Jalan Conlay project that Although BNM has kept the Overnight (Tower 1) and D’ Suria Condominium in Laman Ceylon Jalan Ceylon KL City 230 preview for its latest project, Vortex Hotel will feature three towers (a 60-storey Policy Rate (OPR) unchanged at 3% Ampang / U-Thant; One Kiara (Tower A) Dedaun Off Jalan Ampang Ampang / 38 Suites & Residence KLCC, in January to house the 5-star hotel cum serviced since May 2011, with strong domestic and The Icon Residence in Mont’ Kiara U-Thant 2014. Located at Jalan Sultan Ismail, apartments and two towers of 50 and demand, ample liquidity in the financial and The Signature in Sri Hartamas. Damai206 @ Embassy Row* Lorong Damai Ampang / 18 along the same stretch as Hard Rock 55-storey for luxury condominiums) system and low cost of borrowing leading U-Thant Compared to a total of some 16 project Café, Concorde Hotel, Menara IMC and and a 200,000 sq ft retail podium. The to household debt reaching a record level Richmond, Kiara 3 @ Mont’ Kiara Jalan Kiara 3 Mont’ Kiara 96 launches in the second half of last year, adjoining Menara Prudential, Vortex indicative pricing for the luxury serviced of 86.8% of GDP at the end of 2013, there were only nine notable previews offers 248 units of residences priced from apartments and condominiums in these *Pending Certificate of Completion and Compliance (CCC) there is strong indications that interest and launches observed during this review RM980 per sq ft up to RM1,190 per sq ft. two projects range from RM2,500 per Source: Knight Frank Research 2 3 REAL ESTATE HIGHLIGHTS RESEARCH The focus of the residential market in the Midfields 2 address.