Location, Location, Location – The Mantra of Real Estate Investors

Ask any real estate investor what is the most important aspect of a property investment and the first thing they will tell you is ‘Location’, because location is not just important for getting to work in the least time possible; it is also important for businesses where employees and international visitors can get to their workplace with the least amount of fuss and stress.

That being the case, the Kuala Lumpur Sentral business district nestled within the KL Sentral area is a prime piece of land, proven by the numerous MNC companies that have set up shop in the area – including Google.

To the uninitiated, KL Sentral may be just a public transportation hub that has always been there, a place where they can conveniently take trains and busses to and fro from. But unbeknownst to them, KL Sentral is actually more than a train station hub – it is a 19 million square feet transit-oriented development that encompasses office buildings, high rise homes and shopping malls.

In short, KL Sentral is actually a purpose-built transit-oriented development that was planned and built by Malaysian Resources Corp Bhd (MRCB).

The blueprint of the entire 19 million square feet of KL Sentral was designed by Kisho Kurosawa who also designed the Kuala Lumpur International Airport (KLIA).

50% of the developments within the KL Sentral CBD comprises of Grade A office towers, international hotel brands, retail and F&B offerings. Attracting businessmen to run their business from KL Sentral is its MSC status that encourages ICT-facilitated businesses. Little known to many is also that KL Sentral is also future-ready with its 10GB data backbone.

KL Sentral the Ultimate Business & Financial Centre

KL Sentral was and is intended to be the ultimate business and financial centre of Kuala Lumpur. Being a city dweller, everyone has had the experience of getting stuck in traffic congestion at all times of the day – even at 2am. Hence businessmen with tight time constrictions will find living and working within a transit-oriented development like KL Sentral appealing.

Completing the picture perfect KL Sentral is its unrivalled accessibility and connectivity via seamless integration with the country’s largest transportation hub – KL Sentral. Almost every single one of Malaysia’s trains stop at KL Sentral. The station caters to the eight key rail systems – KLIA Express Rail Link (ERL), KLIA Transit, Putra LRT, Star LRT, KTM Komuter, KTM Intercity, KL Monorail and future MRT extensions.

Coming up soon, although they will not be stopping here, will be the High Speed Rail (HSR) which commuters can get to from KL Sentral within a few short minutes. The high speed train akin to Japan’s bullet train will be able to get its passengers to Singapore in only 99 minutes from Kuala Lumpur, or to Johor in an even shorter amount of time.

As previously featured in PropertyGuru, residents of KL Sentral have the benefit of being conveniently connected to all the city’s sweet spots along with being able to check-in at KL Sentral and get to KLIA in under half an hour.

There is also no shortage of entertainment outlets in KL Sentral, with Nu Sentral in the house and Mid Valley Megamall literally one train stop away. Want to go to Suria KLCC but don’t want to deal with the traffic? No problem, it’s only 5 stops away from KL Sentral.

In fact, all the city’s major commercial and entertainment spots are literally only a few stops away. Fancy a night out in the exciting Bukit Bintang area? Hop on the train, you’re only five stops away.

So what does KL Sentral’s location say about its value? Upon the launch of the final piece of residential development in KL Sentral, a study was done on the value of property in KL Sentral. The results showed that the value of properties within KL Sentral, be it rental yield or capital appreciation, has maintained a steady growth even in times of uncertainty.

The Suasana Sentral Condominium which was completed almost 14 years ago used to have an average price of RM360 per square feet, which has increased to RM1,000 per square feet in the year 2016. Its average rental rates are rather impressive at RM2.37 psf in February, RM2.50 psf in March, RM2.81 psf in April, RM2.61 psf in May and RM3.09 psf in June 2016. At its worst time, the rental yield here stood at 5%, and in usual times it stabilises at approximately 7%.

As a matter of fact, properties in this area do not even need to exactly be within the borders of KL Sentral to enjoy the benefits of increasing property value. Even the older developments within Brickfields – also known as Little India – enjoy the benefits of increasing property value.

Almost literally across the road from KL Sentral, officially within the borders of Brickfields, sit approximately 12 such condominiums that were rather stagnant in price until the development of KL Sentral. One such example is Villa Scott. In the year 2008, property buyers were questioning if a 1,130 sq ft unit was worth RM305,000. Now in the year 2016, these homes are selling for a minimum of RM710,000.

The rental rates at Villa Scott are also proving to be very good, with an average rental price of RM1.93 psf in February, RM2.04 psf in March, RM2.27 psf in April, RM2.31 psf in May and RM2.17 psf in June 2016.

Attracting tenants from all over the world and all walks of lives to the KL Sentral hub are offices such as Menara Shell, 348 Sentral and Quill 7 which was renamed as Menara Axiata and now houses the Google Malaysia office. The rental rates of offices here are a minimum of RM24,500 per month.

Unfortunately for property investors, there are no more new properties in KL Sentral with the final installation of the masterplan completed with The Sentral Residences. The Sentral Residences is located next to the newly opened six-star St Regis Kuala Lumpur hotel and residences, and is expected to be completed in Q1 2017. The launch price of this highly exclusive development was between RM1,392,000 and RM6,954,000, and currently there are less than 10 units of the total 752 units left.

The KL Sentral End Game

The long-in-discussion and very highly anticipated High Speed Rail (HSR) that will be providing Malaysians with a direct route to Singapore is predicted to further boost the value of properties in KL Sentral, as this transport-oriented development will be able to get its passengers to and fro either country in less than two hours. The price of using the HSR will be more affordable than flying, and the transit time shorter.

Fortunately for property buyers and investors who cannot afford to buy a property in KL Sentral, they will have one last chance of owning a residential property at the upcoming Sentral Suites that will be located just opposite Menara Shell. At a 500-metre walk away from the public transportation hub of KL Sentral and an affordable launch price, Sentral Suites is being very highly anticipated.

This article was contributed by Diane Foo Eu Lynn, the Senior Content Specialist from PropertyGuru. The property game is her passion and she loves spotting new potential projects. She gets her information on some of the latest projects in Klang Valley from here.