Friday 29 Mar 2024
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This article first appeared in City & Country, The Edge Malaysia Weekly on August 29, 2022 - September 4, 2022

Developed by Seng Fuat Enterprise Sdn Bhd in the late 1960s to early 1970s, the commercial hub of Ara Kiri is a lively area in Lucky Garden, Bangsar, Kuala Lumpur. It is also frequently known as the Lucky Garden commercial centre, with the well-known TMC Supermarket a prominent anchor in the locality, says Savills Malaysia Sdn Bhd managing director Datuk Paul Khong.

The area consists of Lorong Ara Kiri to Lorong Ara Kiri 3 and Persiaran Ara Kiri.

Restoran Mahbub, a popular eatery, has been around since 1974 and is managed by the founding family’s third generation. Operators of other notable older establishments such as Ban Joo Chinese Trading Co and Nam Chun Kopitiam have changed hands over the years.

The area is accessible by a left turn from the northbound Per­siaran Ara Kiri, off Jalan Ara, which is connected to the main thoroughfare of Bangsar, Jalan Maarof. As a major suburb in Kuala Lumpur, the location is extremely accessible via Jalan Bangsar and Jalan Maarof.

According to Khong, the Ara Kiri commercial area comprises mainly 2-storey shopoffices and the 5-storey Kompleks Lucky Garden, which consists of shopoffices on the first and second floors, offices on the third floor and shop apartments (duplexes) on the fourth and fifth floors.

Businesses here comprise healthcare-related ones like pharmacies; beauty and aesthetics; food and beverage and groceries; tailoring; household appliances; and financial-related ones such as banks and pawnbroking. “Properties here are at least 90%-occupied, as it is a well-known locality serving local residents in Bangsar and Damansara Heights. It is a good destination to do one’s shopping or get local services without heading directly to the nearby Bangsar Village,” says Khong.

Data from Savills shows that a 2-storey shopoffice with a land area of about 1,680 sq ft and a built-up area of 3,200 sq ft was transacted at RM2.1 million in 2004 and another unit was transacted at RM4.5 million in 2020. Though there were limited transactions for the strata shopoffices in Kompleks Lucky Garden, Khong notes that a 1,670 sq ft unit on the third floor was transacted at RM660,000 in 2007 and another unit was sold at RM1 million in 2017. The popular commercial area has been in demand in the last decade, with capital values that are still going strong.

The monthly rent for the ground-floor units of the 2-storey shopoffices with built-ups of 1,700 sq ft ranges from RM10,000 to RM13,000 per month while the first-floor units measuring 1,500 sq ft are being rented out at RM3,000 to RM6,000 per month. At a market value of about RM4.5 million, the gross yield is 3% to 4.5% per year. Rents for offices on the second floor of Kompleks Lucky Garden are slightly lower at RM2,000 to RM3,000 per month, which translates into yields of 2.5% to 3% per year.

As for the residential segment, Khong says there is a mix of 1- and 2-storey terraced houses, semi-­detached houses and 2-storey detached houses in the Lucky Garden residential area. The residential properties here have an occupancy rate of 90%.

Transaction data shows that the market value of a 2-storey terraced house with a land size of 1,920 sq ft and built-up area of 1,700 sq ft was transacted at RM600,000 in 2004 and sold at a higher price of between RM1.6 million and RM1.75 million in 2021.

Khong notes that the 1-storey terraced houses with land sizes of 1,540 to 1,920 sq ft and built-up area of 1,000 sq ft were transacted for RM380,000 to RM420,000 in 2004 and were recently sold at an average price of RM1.25 million. A 2-storey semidee with a land size of 4,000 sq ft was sold for RM840,000 in 2004 and is now valued at RM2.2 million to RM2.4 million. In addition, a 2-storey detached house with a land size of 10,000 sq ft was priced at RM2.5 million in 2004 and its value is now closer to RM4 million now.

“The asking rent for a 1-storey terraced house is RM2,000 to RM2,500 per month while [that of] a 2-storey semidee ranges from RM5,000 to RM7,000 per month, depending on the location and quality of the building and renovations,” Khong says.

The main caveat to these latest prices, he adds, is usually its location, land size and built-up area, especially the physical and repairing conditions as well as actual renovations undertaken by the land owners to their specific units. This is because many of the properties here are largely dated and already close to 50 years old or even slightly more than that.

In recent years, there have been a lot of new rebuilds in the neighbourhood under the DBKL renovation guidelines, where a 1-storey house can be extended into two storeys, and a 2-storey unit can be renovated into a 3-storey unit, says Khong.

Owing to high demand and good pricing of terraced houses in this locality, Khong says, more of this sort of new residential redevelopment projects are coming through, as it makes economic and commercial sense to undertake such redevelopments here. The neighbourhood regeneration factor will continue to be a driving force and will keep pushing up the demand of older terraced houses (for redevelopment purposes) in the vicinity.

Given its strategic location and proximity to the KL city centre, Khong says, Bangsar and Lucky Garden are expected to thrive well, along with the nearby prime Bangsar Baru and Damansara Heights. “Properties within the Ara Kiri locality are anticipated to remain appealing and will continue to enjoy high demand and occupancy in the foreseeable future because of very limited supply and scarcity of land, especially in Bangsar.”

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