INTRODUCTION OF BANGSAR SOUTH
Background
Ask a local person born and bred in Klang Valley, they wouldn’t relate Bangsar South as a part of Bangsar. It was an area filled with squatters with minimal road access until YTL Land came in to develop Pantai Hillpark in the early 1990s. Subsequently, UOA unveiled the Bangsar South Masterplan in the 2000s and transformed the area to what everyone now knows as Bangsar South.
In this review, we will not cover the location, accessibility, infrastructure, surrounding amenities, as it has been covered in our previous overview of Bangsar South in https://propcafe.net/bangsar-south/. It is recommended that you read the Bangsar South overview review in conjunction with this review.
Bangsar South vs Other Integrated Developments
Integrated developments combining Retail, Office and Residential elements have been a key strategy for property developers to unlock value from their undeveloped land and create perceived or actual value to better monetise their land cost. Following the success of the successful integrated developments of KL Sentral (MRCB Land), Mid Valley City (IGB Group) and Bangsar South (UOA), the more recent new launches of integrated developments are by no means cheap. Recent examples (excluding ultra-premium iconic developments such as TRX and KL118) are as follows:
Laurel Residence covered under this review is priced from RM715psf and is competitively priced, given the maturity of Bangsar South, relative to other integrated developments outline above.
As an integrated development, UOA has connected the various components in Bangsar South well via the various link bridges between the LRT, offices, retail and residential (proposed) components where possible. This improves the integration and walkability of the living and working community in Bangsar South.
Offices in Bangsar South
Bangsar South is recognised as an IT Hub with over 11 million sq ft of office space and its offices are accredited with MSC status which enables eligible companies to obtain tax incentives with MDEC. As at Q2, 2021, the offices in Bangsar South boasts a healthy average occupancy rate of 91%, outperforming Mid Valley and KLCBD at 78.5% and 67.3% respectively. Note that the occupancy rates were steady and remained healthy throughout the COVID-19 pandemic.
However, its average rental rates are the lowest relative to its peers at RM5.44psf. Nonetheless, if you are looking the offices’ spillover effect to the residential components of the residential and retail components, the occupancy rate is the most important pull factor in bringing more human traffic and economic activity into the integrated development.
PROPERTY REVIEW – LAUREL RESIDENCE
Location and Road Access
Sharing the same driveway as Camelia Serviced Suites and Goodwood Residence, UOA has unveiled their next residential development in Bangsar South – Laurel Residence. UOA intends to develop the 2.1 acre leasehold land, into 2 blocks of 47-storey towers with 630 units per block (1,260 units total) of serviced apartments.
Laurel Residence is located behind Nexus and is sandwiched between Goodwood Residence and an undetermined future development. Similar to Goodwood Residence, UOA has included another entrance/exit in Jalan Pantai Permai as an alternate route to ease traffic concerns into/out of Laurel Residence. The Bukit Gasing forest reserve is also accessible via Jalan Pantai Permai within 800m of alternate entance. While this is a convenience to residents, it will also increase the maintenance cost of the development as additional CCTV, security guards etc are required to be positioned in this alternate entrance.
Distance to LRT Stations
Laurel being located behind Nexus may provide more privacy and less noise as compared to Novum, Southlink, Southview and KL gateway (“Jalan Kerinchi Kiri 2 properties”) as it is further from Federal highway and SPE. However, it is further from the LRT station.
|
Station |
Distance |
Remarks |
|
LRT Kerinchi |
1.2km (18 mins walking distance) |
Predominantly covered via the link bridges throughout Bangsar South |
|
LRT Universiti |
900m (12 mins walking distance) |
Along Jalan Kerinchi main road (not well covered) |
This is generally further than the generally acceptable walking time of approximately 10 mins (+/- 750m) under our Malaysian hot and humid climate. Hence, individuals requiring LRT access may prefer to reside in the Jalan Kerinchi 2 properties compared to Laurel.
It is rumoured that the highly speculative MRT3 alignment will have a “Pantai Permai station” which may share the same road as Laurel’s alternate entrance. IF realised, this station will potentially be the most convenient train station for the development but will take many years before it takes form and becomes operational.
Common Facilities
UOA has improved tremendously in its common facilities offering; boasting an elaborate grand lobby and alcove that greets its residence as they return. The design is an improved USP relative to the medium to smaller residential projects segment in Bangsar South like Southlink, Novum and KL gateway, whereby the lobby is not overlooking the entrance, unimpressive and doesn’t incite a “premium impression” to the development.
Design-wise, Laurel is an improvement from its predecessor (Southlink) as:
- It is built on a north-south orientation so that the units don’t have to face the scorching hot Malaysian sun into the unit in the evening.
- It is built with 2 blocks and follows a “box design” with the lift core in the middle. This allows for better privacy between units (reduced units/floor and no adjacent units) and improves natural lighting and ventilation (with reduced echo and noise) in the unit corridor.
Laurel’s units-to-lifts ratio is very generous at an average 90 units per lift and has a good speed at 4m/second. For each block, there are a total of 7 lifts (3 (high zone) + 3 (low zone) + 1 (service lift)) serving 630 units.
As a pure-play residential development, the demographics appeal for Laurel will be more for young families as a first home while mixed-developments with a retail component would appeal to bachelors or couples seeking conveniences.
Typical Floor Plan, Unit Size and Layout
All units are segregated with a void area (semi-D style) with the exception of the smallest unit (Type A 495sq ft 1+1). This “semi-D style” design is a great advantage for the type B and C units (2 bedrooms) relative to type A in terms of unit ventilation for the 2nd bedroom and bathroom and (slightly) better natural lighting into the unit. For an approximate price difference of 35k (between type A and B) and 65k (between type A and C), the 2bedrooms has better value relative to the 1+1.
For all corner units and selected intermediate units for certain floors, the unit comes with an accessory parcel for storage (ranging between 32sqft and 44 sqft – priced into the selling price of the unit) in the core of the block. For own-stayers, this space will enable adequate room for storage of bicycles and other bulky belongings. However, for investors, this space may not command extra rental premium from tenants and would also be subjected to additional maintenance fees as it’ll be factored into the share unit calculation for accessory parcels to the unit.
For all windows facing north and south (facade view), UOA has provided decent window size/height. However, for windows facing inwards/sides (including the corner units or studio portion of the dual key), single panel windows are given and are shorter in height.
All units come with 1 floating car park lot, regardless of its size. Despite type D (dual key 903sq ft) being almost double in size (and price) relative to type A, buying 2 type A units will entitle you the use of 2 floating car parks with the similar “dual key” functionality of 2 type A units, with the extra flexibility to liquidate them separately in the future.
Partial Furnishing
UOA has improved in its provision of fittings by giving full top and bottom kitchen cabinets (for Southlink, only a portion of the top cabinets were included). Also, the floor tiles included are textured and the balcony railings are matte black which gives a more premium feel to the unit. UOA has also provided free aircon for all rooms and living room, boiler type water heater and decently finished toilet (with marble-like vanity top and a small shower screen).
The latest Scaled Model of Laurel
Overall Supply of Laurel and Residential Units in Bangsar South
Over the past decade, Bangsar South has 8,057 new residential units (including Laurel). Majority of these supplies are 1 bedroom and 2 bedrooms, the actual percentages of this segment is actually higher as most of the dual key layouts (categorised as 2+1 bedroom or 3 bedrooms) will be used/rented as a studio and 2bedroom separately. And most of the layouts in Laurel needs to compete with the most common supply types within Bangsar South.
Goodwood Residence is the next development expected to be completed in 2022. Take note that there are no new launches since Goodwood was launched in end 2018 until 3 years later for Laurel Residence. In our view, this is a good period of time for the market to absorb the yearly back-to-back new supply in residential blocks since 2016 to 2022 (7 years in a row).
Future Supply of Residential and Commercial developments in Bangsar South
PRICING AND OVERALL CONCLUSION
For early birds, UOA has priced the project attractively as low as 715psf for the lowest floor, with an average price escalation of rm500 (gross) per floor. This pricing is very attractive as it results in an overall low absolute pricing of rm352k 1+1 bedroom (495sq ft) and rm420k 2bedroom (590sq ft) for a partially furnished unit in Bangsar South proper.
This is great for young professionals, looking for a starter home and wanting conveniences around within KL or for investments to the catchment of residents who works in the companies within Bangsar South or those within the LRT Kelana Jaya line. The project however, doesn’t come with HOC as the APDL is not expected to be obtained until end of the year which coincides with the expiry of the HOC (unless the government extends the HOC further).
Design wise, it is a tremendous improvement from its predecessors in Bangsar South in the similar segments in terms of facilities and privacy as a pure-play residence development. However, the rental liquidity of Laurel may be underperform those in Jalan Kerinchi 2 due to its longer distance from the LRT Stations. Further, there may be potential risks that the future developments will further increase the competition from a rental and subsale perspective in the future. Also, its maintenance fees is higher at 33sen psf (including sinking fund) relative to UOA’s predecessor developments in Bangsar South, though reasonably estimated due to the improvement in common facilities.
There is no perfect property in the market as there will be pros and cons. Nonetheless, the overall value proposition for Laurel Residence from a Bangsar South perspective and from an integrated development fee perspective is attractive in terms of the price relative to the location.
Happy investing folks!