Demand for high-end projects in KL remains strong

May 16,2011

The demand for high-end condominium and serviced residences in Kuala Lumpur remains strong, said Christopher Boyd, Executive Chairman at CB Richard Ellis (CBRE) (Malaysia).

“Take-up rates range from 65 percent-88 percent as of the end of the first quarter of 2011,” he said at the Eastern & Oriental Bhd’s “Invest in Malaysia, Invest in Kuala Lumpur” Forum.

He cited Soho@KLCC and M Suites serviced apartments as prime examples. Soho@KLCC reported 85 percent sales with its 300 condominiums having a selling price of between RM700 psf and RM850 psf. M Suites, located within the Ampang Hilir enclave reported 70 percent sales with 442 service apartments having an average price of RM850 psf.

According to a report by CBRE, the total supply of existing condos and serviced residences, which have an average price of RM350 psf or higher, in Kuala Lumpur rose four percent to 32,742 units since end-2010.

About 44 percent, or around 14,514 units, are located in the Golden Triangle, Ampang areas and the CBD, while 34 percent, or approximately 11,121 units, are located in Mont’Kiara and Sri Hastamas.

Approximately 38 percent of the available condominiums and serviced residences are listed from RM350 psf to RM499 psf, with an additional 38.6 percent listed from RM500 psf to RM799 psf.

Meanwhile, more than 24 percent were listed at RM800 sq ft and up, which is categorised as luxury residential units, with many located in the Suria KLCC shopping centre area.

Mr. Boyd said the average capital values for KLCC, Bangsar and Mont Kiara in Kuala Lumpur – the three main condominium markets – have remained stable since the global financial crisis in 2008.

A CBRE report last year said there were 2,156 transactions for luxury condominiums in KL with an average value per transaction of approximately RM1.09 million.

“Less than a quarter of Kuala Lumpur luxury condominium buyers are foreigners. Also, most of the local buyers are not highly leveraged and they are not buying for speculative purposes,” he said.

Fionna Chuah, Head of Sales for Property Division at Eastern & Oriental Bhd, said the company’s high-end developments such as Dua Residency condo in the Kuala Lumpur embassy enclave and the Idamansara@Damansara Heights development have seen strong capital appreciation of between 50 percent and 60 percent in the past few years.