Why Kuala Lumpur’s luxury residential property market is a smart choice for Asian investors
Interiors by British celebrity designer Kelly Hoppen, or Hong Kong design luminary Steve Leung. A sky-high infinity pool, 64 storeys above the city. A home in the heart of the new Kuala Lumpur International Financial District. This is just a glimpse of the kind of lifestyle amenities developers are infusing into high-end residential projects in Malaysia’s capital city.
As testament to the increasing sophistication of the sector, Dominic C. Heaton-Watson, associate director, international project marketing at Knight Frank, says branded residences set the benchmark.
“Branded residences are very well accepted in the international market nowadays and Kuala Lumpur is home to a number,” he says. Names like Ritz-Carlton, Four Seasons and Banyan Tree are “great examples of an instantly-recognisable five-star brand”, says Heaton-Watson, while new branded property 8 Conlay, with interiors by Kelly Hoppen and Steve Leung, brings a designer influence. “These projects demonstrate that Kuala Lumpur is a city that has worldwide appetite for luxury and designer products,” Heaton-Watson says.
From an investment perspective, owners can earn a “decent income” of around 3.5 to 4.5 per cent on such branded properties, he adds.
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Joanne Kua, CEO of KSK Group, developer of 8 Conlay, a new landmark in the heart of Kuala Lumpur, says 75 per cent of buyers to date are foreigners, including those from Hong Kong, tier-one mainland cities, Taiwan, Japan, South Korea and Singapore.
Situated between Kuala Lumpur City Centre (KLCC) and the bustling Golden Triangle neighbourhood, 8 Conlay is an integrated development consisting of three towers on top of a four-storey lifestyle retail podium. It is defined by the world’s tallest twin spiralled towers devoted exclusively to branded serviced residences, called YOO8 and serviced by the Kempinski hotel group.
Buyers will find exclusive interior design concepts by Steve Leung & YOO (Tower A) and Kelly Hoppen for YOO (Tower B), with in-house services provided by the adjoining five-star Kempinski Hotel.
Compared with other destinations in Southeast Asia such as Thailand, Hong Kong and Singapore, Kuala Lumpur has the most “affordable” price per square feet in branded service residences and offers high-quality residential products at lower entry costs, Kua adds. “Foreigners can buy freehold properties in Malaysia and share the same rights with locals as it is under the British Torrens system,” she says. Under this land registration and transfer system, the state creates and keeps a register of land holdings.
When Hong Kong people realise Malaysia offers good health care, education and quality of living, they realise it is a good package
The appeal of Malaysia as an investment destination with robust GDP and a rapidly growing and diversified economy, is also an attractive factor, Kua says.
Nick Siew, associate director at Hartamas Real Estate, which markets Malaysian properties in Hong Kong, says educational opportunities are another big pull factor.
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“Many buyers want to relocate their kids to study in Malaysia, which has many prestigious international schools and universities at least 50 per cent cheaper than in Hong Kong,” he says, citing Epsom College and Marlborough College from the UK, Monash University from Australia, and British tertiary institutions Heriot-Watt University, and the Universities of Reading, Nottingham and Sunderland.
“When Hong Kong people realise Malaysia offers good health care, education and quality of living, they realise it is a good package,” Siew adds.
Projects Hartamas is currently marketing include Star Residence in KLCC, Agile Embassy Garden (between the prestigious Embassy Row & KL international central business district) and Somerset KL Metropolis, a branded residence strategically interconnected with MITEC, Malaysia’s largest international trade and exhibition centre.
Asian international property company Juwai IQI says Malaysia was last year’s sixth most popular country for Chinese buyer inquiries on the company’s website.
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“When it comes to Chinese luxury buyers, about three-quarters are predictably in the more accessible price ranges, between US$250,000 and US$500,000. That’s about one to two million ringgit,” says Georg Chmiel, Juwai IQI executive chairman. Apart from upmarket condominiums, Chmiel notes that Chinese buyers like the fact Malaysian luxury single-family villas are relatively affordable.
“Kuala Lumpur is still under the radar for many cross-border buyers, but it’s a full-on Asian hub and increasingly popular with expats. The city offers a secure legal system that protects buyers, positive demographics and economic growth trends, as well as a lifestyle that is a pleasant combination of efficient modernity and traditional food and values.”
Heaton-Watson says other areas on the city fringe are luring overseas investors. “Damansara Heights is an affluent, established area that appeals to wealthy individuals – as is evident by the sales of Pavilion Damansara Heights, an upscale integrated development by the Pavilion Group, and Aira Residence, a prime property by Selangor Properties. This shows a trend of good, reputable developers (building) top-notch products in Malaysia,” he says.
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Cheaper than Bangkok, Hong Kong and Singapore – but with branded luxury serviced residences, international schools and good health care – KL is next hotspot for investors and expats alike