When Sunway Property launched its first phase of residential property – V Residence as part of the integrated mixed development project – Sunway Velocity in 2014, the selling price from RM8xx psf to around RM1,000 psf in Cheras has freaked out many investors. Still, it was sold out! Similar reception happened again for its V Residence 2 and V Residence Suites even though developer continued to hike the price and offered it above RM1,000 psf. Yup, a whooping price that close to 2nd tier KLCC property value! Amazing! It does not stop there, buyers still “BBB” and the “hot” scene continued in the recent Sunway Velocity TWO launch. Let’s PROPCAFE covers this latest project and share some insight for all PROPCAFE followers.
Why the buyers willing to pay the premium for property under Sunway Velocity?
For the first three phases, PROPCAFE believe that it was mainly due to (1) buyers’ belief on Sunway’s execution; (2) Sunway Velocity’s masterplan that apparently nicely crafted and meet most of the daily needs for residents. The 5 Vs – V Retail, V Office, V Residence, V Boulevard and V Garden, on paper, look impressive; (3) the infrastructure upgrade in this southern part of Cheras which include MRT and redevelopment plan of Cochrane. Summary? One layman word – CONVENIENCE!
Of course, the convenience does come with price like any other similar projects! The general perception among investor community was that the selling price seems fully factored in all these positive potential values. Well, being the market price leader in Cheras can never be easy! Kudos to the developer.
This article will not repeat all the unique selling points of Sunway Velocity that mentioned many times by various published articles over the years. PROPCAFE will focus more on what have been delivered to gauge the potential by looking at the current Sunway Velocity together with the offering of Sunway Velocity TWO. PROPCAFE hopes these information would help readers to determine Sunway Velocity TWO’s value and potential upside in future.
How is Sunway Velocity doing now?
V Retail – The lifestyle retail mall is executed well and it is probably the best mall to hang around in Cheras, with plenty of eateries, entertainment and shops. The footfall is very reasonable during both weekdays and weekend. No one will expect it to draw customers with high spending powers like the shoppers in Mid-Valley or Bandar Utama, so far it is doing very well and it is very commendable in this part of KL.
This mall is currently the ONE to go for Cheras folks, however, PROPCAFE sees the increasing crowds at its neighbour – MyTown mall, thanks to IKEA’s presence. In future, some crowds are expected to diverse further to Eko Cheras Mall once its retail shops fully opened. It is due to the great location of Eko Cheras which is sitting at the centre of Jalan Cheras with many mid and up market residential enclaves there (e.g. Taman Billion, Bukit Segar and etc). Although three big malls in Cheras could be very competitive, Southern KL is still underserved. So, it is a good news to Southern Kuala Lumpur shoppers as varieties and choices will always benefits the customers. Directory of the Velocity retail listing is available here. To add, previously PROPCAFE was there to witness the the mall pre-opening (coverage of the mall – article).
V Office – It is important to have offices near or at the mall as it will at least pull some weekday crowds to spend at the mall. Currently, the good occupancy and some co-working space in Sunway Velocity do bring in traffic which is rather positive. Having said that, the Velocity office’s lobby look grade but it may not be grade A office and in fact, based on the facade, Eko Cheras Office tower looks more “glassy” and classy.
V Boulevard – Plenty of activities and eateries there. It will only get better! Good crowds too.
V Residence/V Residence Suites – PROPCAFE feels the facade is a bit “Dull”. With market pricing of RM1000-RM1200psf, one may expect more fanciful building to live in. Sunway did keep its high standard in term of landscape and facilities there though.
V Garden – The 2 acre garden, well, definitely a lot of room to improve. 🙂 It is a bit below the expectation from the artist illustration in the brochure. After couple of visits, we still could not see anyone there. Sorry, something might not be right here. Could be the timing of my visits i.e. too hot in the afternoon. Or maybe due to its location, design or simply not green enough?
Hotel component is completed and Sunway Medical Center will be ready in 2019 (see the recruitment advertisement below). Certainly it will improve the tenant profile in Sunway Velocity and future Sunway Velocity TWO. Checked!
The education center for professional courses will be set up at the current office block. It will only bring in few faculties from Sunway College and occupy about 5 floors. We do expect some tenant queries from lecturers, rich students. Good news indeed for investors. Not sure whether residents welcome the news.
What do you need to know about Sunway Velocity TWO?
There is no doubt that Sunway Velocity TWO has all conveniences and everything you needs However, there are still plenty of things that buyers need to take note as well while considering this project.
Location
Sunway Velocity TWO, strictly speaking, is not located at Sunway Velocity integrated development but at the opposite land.
In other words, Sunway Velocity and its previous residential properties are sitting at the triangle land surrounded by Jalan Cheras, Jalan Peel and Jalan Shelley. This Sunway Velocity TWO is located at Jalan Peel itself which is directly facing Sunway Velocity with a dedicated link bridge (to be built) to connect the mall and other facilities at Sunway Velocity.
Even though Sunway Velocity TWO may not be as convenient as Sunway Velocity site that comes with a great ingress and egress for Jalan Cheras and Jalan Peel direction, there is not far away for Sunway Velocity TWO to connect and drive over to Jalan Cheras from Jalan Peel. It is acceptable. 🙂 Anyway, with only 4-5km to reach Kuala Lumpur City Centre, Sunway Velocity TWO still allows residents to fully enjoy downtown lifestyle.
Surrounding of Sunway Velocity and Sunway Velocity TWO. Not so pretty. That is the price you pay for getting a matured location in the old part of city centre.
Land Title
Although the land is right opposite the freehold Sunway Velocity, Sunway Velocity TWO is residing at a leasehold land. This is one of the factors that this project is launched at a much lower price than V Residences/ Suites. If general rule of thumbs applies, it means the leasehold property should come with a discount of 10-15%, some investors even have the perception of 20-25%. No one like to buy condominiums with 70 year left in the lease and also it is not favoured by bank when comes to loan application when lease drops below certain years. So while it may not reflect the negative value fully in short term, it would show in long term for sure when buyers comparing the freehold V Residences/Suites with Sunway Velocity TWO. Having said that, since this land is so close to the amenities given by Sunway Velocity, 15% discount is rather fair. Buyers just need to know that this project may probably always be marked in discount with the benchmark of Sunway Velocity’s freehold residential towers in future. If the price of Sunway Velocity freehold residential towers stagnant means it could be very hard for Sunway Velocity TWO to move beyond it. In short, it always needs to directly rely on its “parent” to perform, which is not PROPCAFE’s cup of tea.
Public Transportation
One of the biggest plus points for Sunway Velocity’s residential property and Sunway Velocity TWO is its fantastic commuting facilities. Two MRT stations and one LRT are all within walking distance. Sunway Property is smart enough to ensure that the link bridges are all over the place to connect all properties here which includes Sunway Velocity TWO.
Both Cochrane MRT and Maluri MRT stations are about 300-400m away from Sunway Velocity TWO (Maluri Station is relatively nearer for SV2 residents but Maluri LRT is a bit way too far). Good news is most of the pathway are covered, credit to the developer. Again, V Residence/Suites are in better position in term of the distance to MRT station (especially Cochrane station). Well, additional 200m will probably burn more calories, good for Sunway Velocity TWO residents. 🙂
According to developer , they will open the access route via the mall for Sunway Velocity TWO residents according to MRT station operation hours, therefore, residents do not need to worry about the need to walk at the main roads in this part of Kuala Lumpur during off hours :). Two stations to Bukit Bintang and six stations to Kuala Lumpur Transportation Hub – KL Sentral, you simply cannot complain much about it.
Forget about the LRT station and MRT 2 line interchange at Chan Sow Lin mentioned in the brochure, it is hard to imagine Malaysian to walk that far under Malaysia hot weather.
What do you get from Sunway Velocity TWO?
- Sunway Velocity TWO will be sitting at 3.89 acres land with a total unit of 872 from two towers (each with 436 units). This translate to a pretty high density ratio of 224 units per acre!
- Each floor comes with 10 units which sharing six lift. Lift sharing ratio is about 73 units per lift within the tower and again the ratio is at high side.
- The ceiling height of 3.3meter (near to 10 feet) is something to cheer about.
- The unit is bare i.e. no kitchen or electrical items. Think positively, at least air conditioners and heater(s) are given. Bathroom is comprehensive enough to have full wall tiles, shower screen (without door), basin with solid top.
- All units come with at least one carpark lot. Type D, E, and F are allocated with two side by side car park bays. For the largest unit type F, high floor units (22nd floor up) are given additional carpark lot (2+1 i.e. one is tandem carpark lot).
Sunway Property’s project will not short with nice facilities. You would expect all standard facilities to be available together with some thematic facilities to wow the buyers (see below). If Sunway Property can delivery similar quality of facilities as V Residence/Suites and V Residence 2 then it will be certainly a Plus for Sunway Velocity TWO given the price is at easily around 15pc discount. Double volume grand lobby is spotted in the brochure which can be a key differentiating factor when come to competing the tenant or buyers with other residential properties nearby. The exposure of such lobby to main road of Jalan Peels will make it more noticeable unlike Sunway Velocity’s earlier phases.
Layout
There are six different layouts available at Sunway Velocity TWO.
Type A 635sf (1+1 Bedroom + 1 Bathroom)
An efficient layout that occupies a reasonable master bedroom with an extra study room that can still fit for a single bed. The yard is a plus point as many small pad could hardly fit it in the layout. Nothing much to pick and if there is really one then it will be the kitchen that without an window which nowadays doesn’t really exist for small unit anyway.
Type B 840sf (2 Bedrooms + 2 Bathrooms) – Dual Key Ready
This unit has some advantages as it comes with a balcony, yard, and windows for kitchen. The kitchen location also nicely sit at the end corner without fully expose to dining and living area. However, PROPCAFE is never a fan of dual key unit as many times the extra ROOM is way too small for tenant to live even for short term stay, not to say a year. Come on, Malaysia is not in such a bad condition like Hong Kong to squeeze human being into four narrow walls. The master bedroom that means for extra unit has limited natural daylight via only a small window. If one buy it for own stay, would this room to be used as master bedroom? It is unlikely that the master will stay there with such a small window without much natural light! Also, Sunway Velocity TWO does not supply kitchen, so owners need to build two fully equipped kitchens in this unit.
In short, this will be the unit solely for investors who believe a better yield in dual key concept. PROPCAFE does not have any statistics on the rental rate for such a “tiny unit” but we wish all investors the best of luck in future. Bear in mind, when come to investment, yes rental yield is key but not everything. Exit plan is the ultimate end game when you sell the unit to subsales buyers at premium. For a dual key unit to fly, you need another similar minded investor/subsale buyer because own stayers may not fancy this layout with such a tiny window. This means the pool of your subsale buyers will be restricted. Anyway, based on the sales chart and according to the ballot session, dual key type was the hottest and sold out in no time! So, let’s leave it to the market to determine the outcome in future.
Type C – 883sf (2+1 Bedrooms 2 Bathrooms)
PROPCAFE likes this proper 2+1 unit because it has all the plus points mentioned in Type B – Balcony, Kitchen with window, and yard. Study room can also fit a single bed or a baby room for a small family. Alternatively, use it as utility/store room (yup, many buyers only realised the importance of it when they don’t have enough to store all their accumulated stuffs!).
Type D – 969sf (3 Bedrooms 2 Bathrooms)
The only difference of this unit from type B is that it is corner unit with extra bedroom. This dual key unit has all the same issues in the “split room”. Room without much natural sunlight, doom!
Type E – 1044sf (3+1 Bedrooms 2 Bathrooms)
A very decent layout that all units come with wide windows and good ventilation with natural sunlight. All are good except if you do not mind small rooms. Ya, four rooms fit into around 1ksf is a bit too stretch.
Type F – 1281sf (4+1 Bedrooms 3 Bathrooms)
This corner unit is the only layout that comes with horizontal combination in living + dinning area. Horizontal layout always makes the living area more spacious. Too bad, in the case of Sunway Velocity TWO, it is only available for those who can afford it! The rest may need to stuck into the longish vertical living cum dining. Just think about it and pull out your memory on visiting the luxury condo above RM1k psf, you will always see living and dining are side by side not head and tail! :).
Overall, the layouts are reasonable except what has been highlighted – lack of natural sunlight for the split unit in dual key concept, narrow (10ft wide) and longish living and dining area.
Orientation
Oh my, this is the bad topic to talk about. Based on the floor plan below, you would notice smallest unit Type A, B and D are facing Cheras. The first block (which has launched) will be affected by the developer’s future office block. It may not directly block the view but Type D, B and A toward the office block will be partially affected without having a full wide view. Also, the same units could be slightly obstructed by SDB’s UNA project which is parallel with the developer’s future office block. Second Tower will not be affected but be prepared for minimum 5% increase of price (indicative by sales personnel).
Brochure mentioned about facility facing instead of KL Tower view. Why? Because the first block of Sunway Velocity TWO that face this direction will be totally blocked by the future development (residential) . Buyers should prepare to have their units with “wall paper and window” view, probably 100-120m distance (you may check with developer). Even half of the units from future second tower (to be launched in few months time) that facing this direction cannot escape this. To add salt on it, all units will be hit by West Sun in the evening. Hot x 3. Thanks to its North West orientation. Well, the consolation is that the future building in front will probably shield some of the heat for these units.
All new phases that including Sunway Velocity TWO, future office block and residential towers are all integrated with Sunway Velocity via the bridges (see pictures in below). Well planned by developer.
What is the pricing?
The price tag on the chart are all near to RM1,000psf. However, everyone know that it cannot be sold at this price given the current market price of freehold fully integrated V Residence, V Residence 2 or Residence Suites are just slightly above RM1,000psf. After all the rebates, the net price should be about 11-12% discount from list price. Let’s zoom into the pricing. We obtained this pricing when it was launched and revisited to the sales gallery in late November which showed the late comers do not lose much as the net price is just around 2-3% higher due to the changed of package. In general, incremental price for each floor is about RM1k.
- The smallest unit Type A – 635sf was listed as RM614k to RM646k.
- Type B (840sf), the list price starts from RM738k to RM770k before the rebate.
- Type C (833sf), the gross price range is RM763k to RM795k.
- Type D (969sf), the gross price was set at RM897k-RM1.04mil. We observed that there is a jump of price about RM75k from 45th to 46th floor onward.
- Type E (1044sf) – Gross price listed from RM925k to RM1.034mil. Similar to Type D, there was large adjustment on price from 45th floor – RM954k to RM1.031mil (46th floor).
- Type F (1281sf) – All units are listed above RM1 million gross price with the range of RM1.057mil – RM1.124mil.
You may easily work out the net price with the estimate rebate around 11-12%. Some large units should get below nett RM800psf and as usual smallest unit price will be at the high side which can go near to nett RM890psf.
Is Sunway Velocity TWO cheap (compare to Sunway Velocity earlier phases)?
The scene of the launching day proved that buyers/investors believed Sunway Velocity TWO is value buy! Many would think that if the market price of Sunway Velocity earlier phase is now above RM1kpsf, Sunway Velocity TWO that priced from RM7xxpsf to RM900psf would be SAFE! It is under the perception that Sunway Velocity TWO having the same unique selling points like Sunway Velocity. It sound right. But, is that really true? Maybe. As a sophisticated buyers/investors, we should also think differently here. RM800/900psf is not cheap in Cheras for sure in the first place. It looks cheap because of the price of earlier phases was high. Have the buyers checked the capital appreciation of earlier phases? The price of earlier phase apparently did not move much from the previous launched price because the property is still in Cheras in the end of day. To break and move way above RM1,000psf is not an easy cake. Therefore, the assumption of cheap will be challenged when the market price of Sunway Velocity earlier phases continue to be stagnant. It means Sunway Velocity TWO could be stuck too with discount against SV Residence as it will likely not be able to over take V Residence (due to all the factors mentioned) i.e. it will rely on the market price trend of Sunway Velocity that is rather saturated around RM1,000psf at the moment.
No right or wrong answer. This article is to help all of us to think more than convention with all the factors listed here. It is all down to the value in your heart in term of Leasehold vs. Freehold, Bare Unit vs. Kitchen Fitted Unit, distance (slightly further) to public transportation, convenient of retail/facilities – cross the road vs. down stairs, good vs. undesirable view offered, And finally, instead of keep thinking it is cheap because of Sunway Velocity previous phases launch or market price, one should also try to think about the value of the property itself and compare it with other development nearby to fully understand the potential and sustainability (and room to grow) of such pricing in Cheras. Good thing is, those competitors within walking distance are pretty much priced at the similar range. It should be safe but capital appreciate to move above current price is a big question mark which is a million dollar question to answer. PROPCAFE certainly has no crystal ball to see it. So, let’s pray for property market in next 5 years! Lol. Happy Hunting!
Note: Master plan, commercial video and layout were sourced from public domain and credit to Sunway Property.