KL auction property market update #10 -Marc Residence @RM935 PSF
I see a 3 bedroom unit at Marc Residence at Jalan Pinang is coming up for its third auction next month at RM935 PSF. In the current soft market, I suspect there won't be any buyers until the price is cut to below RM800 PSF. Unlike the Troika (my personal 5* KLCC condominium benchmark) Marc Residence has more than 660 units and has less upmarket facilities.
A unit at Troika which previously won several awards for its architectural design was up for auction recently at just RM863 PSF (well below its launch price of around RM900 PSF) .
By my reckoning rentals of 3000+ SF luxury apartments in the city centre have plummeted by around 30% over the past 10 years. Unlike other regional property markets that have bounced back post pandemic, the KL high end property segment is still burdened by an oversupply of luxury apartments plus a dwindling pool of expat tenants.
I hope the rental market for 3000sf luxury apartments in the city centre has bottomed out. My 3000sf+ unit at Kirana Residence just next door to Marc Residence is currently fetching less rent in 2022 than when I first got the keys to it in 2000.
When it was launched in 2007 Marc Residence was initially priced at RM450 PSF for the one bedroom units compared to RM500 PSF for Kirana (launched in 1999) because the standard of interior fittings was inferior. Just check out Marc's homogenous bathroom tiles versus the marble bathroom tiles at Kirana. Sanitaryware and tapware at Kirana are more upmarket German brands eg ‘Grohe” versus the local brands eg “Toto” installed at Marc.
In a previous post at 360 KLCC I introduced the New Luxury Equation : “Privacy + Space + Exclusivity = Luxury”
Post pandemic, anectodal evidence suggests high density luxury apartments without balconies or lanais (open air spaces) or access to rooftops will be less attractive to tenants or buyers compared to low density projects with large balconies, lanais and access to rooftops.
The 3000sf auction unit at the Marc has small balconies compared to the wrap around balconies of Kirana. And Marc owners will have to share facilities with 659 other units. With just 66 units, Kirana residents enjoy greater privacy and access to outdoor dining facilities absent from Marc. Why pay MORE for LESS ? It doesn't make sense to me why investors pick properties in high density projects yet to be completed when there are many KLCC 5* properties below their launch prices 10 years ago.
