High-end condominiums that cost RM2mil to RM3mil each are being snapped up by cash-rich consumers and foreign investors.  

While condominiums in the Kuala Lumpur City Centre area have famously set landmark prices of RM1,000 per sq ft, those in the suburbs have also reached record prices, which have not deterred buyers.  

One of the latest projects launched, One Menerung, that is developed by Bandar Raya Developments Bhd, is almost all sold.  

Located in the upmarket Bangsar area, the project opened for sale in November and most of the units in all its six blocks is understood to have been sold.  

One Menerung was priced at an average of RM750 per sq ft, a record for Bangsar, and unit sizes ranged from 3,200 to 5,000 sq ft. This means the prices ranged from about RM2.4mil to RM3.7mil a unit.  

Interestingly, many of these condo buyers are understood to be fund managers and brokers who would then have known the project sold well. That may be the reason Bandar Raya's share price has risen, from about RM1.05 last month to RM1.49 yesterday.  

Meanwhile, condominiums have been successfully marketed at over RM500 per sq ft in the Mont Kiara area of Kuala Lumpur from developers' prices of about RM400 per sq ft previously.  

Sunrise Bhd's 10 Mont'Kiara condominium, launched late last year, is understood to have sold well too. Enquiries with its marketing department found units on the higher levels were no longer available. An official said she could only offer a few units on the lower floors as the project is more than 85% sold.  

This project, with a gross development value of RM540mil, priced its units at an average of RM530 per sq ft, with apartment sizes ranging from 3,500 to over 4,000 sq ft. Each unit would thus carry a price tag of about RM1.8mil to RM2.1mil.  

Bandar Raya's One Menerung 8-acre development is its last landbank in prime Bangsar and the developer is paying particular attention to details and product. The development offers buyers a choice of ultra modern and elegant living in low- and high-rise units with prices starting from RM2mil, or averaging RM750 per sq ft, which is what some KLCC projects are going for.

“There are a lot of people with cash who are just waiting to buy good properties in good locations,” said a real estate agency's director. That would certainly be true considering that banks are flushed with deposits.  

Nomura Malaysia Sdn Bhd noted in a 31-page report on IGB Corp Bhd that take-up rates at its Northpoint residential units have reached 100% from 30% at end-2005, and there was a 92% take-up rate for its U-Thant Residences at its launch last August.  

The brokerage estimated that IGB would register a compound annual growth rate of 20% in its earnings between 2005 and 2009 based on its property sales and an 89% increase in net lettable area at its Mid Valley City project in Kuala Lumpur.  

Nomura set a fair value of RM2.50 for the stock based on a 7% discount to IGB's revised net asset value. In addition, IGB could issue a capital repayment of 20 sen a share to raise its return on equity, the brokerage added.

Source : The Star  16/1/2007