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City&Country: Sprucing up Brickfields

Facelift to boost property values


Brickfields is a study in contrast; on one side are gleaming skyscrapers of glass and steel, and on the other, rows of aged shophouses and pre-war structures that offer a gentle reminder of its humbler, simpler past.

altOne of the pioneer settlements in Kuala Lumpur, Brickfields was developed in the late 19th century by the last Kapitan Cina, Yap Kwan Seng, who foresaw a demand for good, quality bricks and decided to build a kiln in the area, hence the birth of Brickfields.

The old Brickfields began slipping away in the 1970s when shops and flats were constructed, slowly replacing the kampung houses, reminisces Sandra Segaran who was born in 1941 and is a long-time resident of Brickfields.

“The first few developments in the area were a few flats on Jalan Thambipillay and Jalan Berhala, and shophouses on Jalan Scott. One of the first developers was a Chinese family from the area who bought a few small plots of land to build flats and shophouses,” recalls Sandra Segaran.

Life in Brickfields changed as more businesses came to the neighbourhood, from eateries to budget hotels. Sandra Segaran’s family sundry shop had to close as larger shops opened in the area.

Despite their age, the old shophouses in the area have gained value over the years. Recent measures by the Malaysian government to spruce up the area and give Brickfields a facelift will positively impact the values of these properties even further.

GMAC Realtors’ chief operating officer, Jonathan Lee concurs: “The old shoplots which are at least 30-plus-years-old along Jalan Tun Sambathan and the streets behind are very valuable. It is difficult to find an empty lot for rent or sale as they are always tenanted and most of the properties have been passed down from generation to generation. People are often surprised by the value of these old properties.”

According to Victor Lim, managing director of iProp Realty, a 4½-storey shoplot with good frontage and in good condition was sold for RM1.7 million in 2002 and can now command around RM2.8 million.

Lee concurs, estimating the selling price of the shoplots to range from RM800,000 to over RM2.5 million per block depending on the location. The rent for a ground floor unit can go up to RM10,000 a month while the upper floors can command RM1,500 to RM2,000 a month.

“Sometimes, a tenant or buyer can be found within a few days, and there are always real estate agents with ready clients looking out for properties,” says Sandra Segaran.


KL Sentral
Besides the location of Brickfields right on the fringe of KL, much of the strong value of the properties here can be attributed to the Kuala Lumpur Sentral development — Malaysia’s largest transit hub, which houses six rail networks, including the KLIA Express, KTM and the LRT.

KL Sentral’s development began in 1996 and the entire development will be completed in 2016. It is being developed by Malaysian Resources Corp Bhd (MRCB). The 72-acre development was envision
ed as an urban rejuvenation project — bringing an area like Brickfields into the 21st century, while retaining its identity, culture and heritage.

An official with MRCB tells City & Country that KL Sentral is currently the largest commercial development in Kuala Lumpur and is valued at RM12 billion. About RM3 billion worth of developments have already been completed and about RM7 billion’s-worth are in various stages of progress.

“Property prices here shot up after KL Sentral opened in 2001 and have been going up steadily over the years,” says Sandra Segaran.

“Since KL Sentral was built, human traffic has increased tremendously, which is good for the shops and businesses. When business is good, people are willing to pay more to secure a shop and this will bring up the shop prices since the returns are higher than before,” says Lim.
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Commercial
Offices in KL Sentral were selling at about RM470 psf in 2003. Today they are going for about RM960 psf.
“Demand for offices in KL Sentral was so good in the early years when there were fewer units, that even the agents were hard-pressed to find units to sell or rent. Of course,
since then demand has tapered off but values are holding up because rents are still very strong,” says GMAC’s Lee.

Offices enjoy high demand due to their Multimedia Super Corridor status and convenient location in a transit hub.  Rents range from RM6 psf to RM8 psf, adds Lee.

The impact of the recent global financial crisis, however, has caused the rents for some of the offices to drop as low as RM5.50 psf compared with the average of RM7 psf before the crisis. Rents have since recovered slightly to an average of RM6 psf, though the newer buildings such as Quill 7 can command an average of RM7 psf.

Regardless, the values remain strong and the demand good, says Lim.

However, Lee thinks that the outlook for the office market here may be challenging as more office space enters the market. “Take the new UOA Bangsar for example, it’s right next to the Bangsar LRT station, the rents are lower at RM4 psf to RM5 psf and traffic in that area is not as bad as in Brickfields. Overall, in terms of price movement in Brickfields, I do not expect much change in the current climate. There will be growth but it will be slower,” Lee says.

Lim is more optimistic, expecting demand for all properties here to remain strong with steady price growth.

Residential
Condos in KL Sentral such as Suasana Sentral and Sentral Loft are commanding RM550 psf to RM650 psf with rents of RM3.50 psf to RM4 psf, according to Lee.

In 2002, a unit in an older condominium in Brickfields with a built-up of 1,650 sq ft and selling at RM330,000 is now going for RM400,000. Older condos such as Pines Condo and Palm Court Condo are mostly owner-occupied.

“The rental yield for condos in KL Sentral is around 6% to 7%. About 60% to 70% of the owners are investors and most of the condos are tenanted by expats. The prices have held steady over the years and there is more demand than supply for these condos. They have two things going for them; one, prices are more affordable compared with condos in the city centre, which command rents of RM4 psf and above, and two, it is within a transport hub, which means accessibility is extremely easy,” says Lee.

“The condos in KL Sentral can be taken up within a day or two. At the most, we’re looking at three weeks or so. It also depends on where the units are facing and the condition. If the unit faces construction sites, then it might take longer, perhaps up to a month,” he adds.

The recent recession saw some of the condo owners selling and renting at a cheaper price but in general, the effect was minimal.

The makeover of Brickfields
“I have heard comments from people that it’s odd that two of the best hotels in Malaysia (Hilton and Le Meridien) are sitting in a rundown area with high crime rate and terrible traffic conditions like Brickfields,” says Lee.

That might change soon with the government allocating RM110 million for a traffic dispersal scheme and a RM35 million-makeover aimed at turning Brickfields into a cultural hub, dubbed Little India.

The makeover work is expected to commence in June and completed by the end of the year. Among the proposed upgrading works are an entrance archway at the end of Jalan Brickfields, the construction of an information pavilion and food bazaars along Jalan Chan Ah Tong, fruit and flower kiosks and Indian-styled street lighting along Jalan Tun Sambanthan

The traffic dispersal scheme is being undertaken by MRCB and is split into six packages to be implemented on a schedule.

Package 1: Construction of flyover at Jalan Travers/Jalan Bangsar Intersection
Package 2: Construction of flyover from KL Sentral to Jalan Damansara and Lebuhraya Mahameru
Package 3: Upgrading and beautification of Jalan Tun Sambanthan and conversion of roads to one-way.
Package 4: Construction of pedestrian bridges and linkages
Package 5: Upgrade and repair roads at KL Sentral
Package 6: Construction of an elevated road from Jalan Bangsar to Jalan Maarof.

Works under Package 1 began last October and the whole project is expected to be completed in early 2011.

Package 3 of the traffic dispersal scheme has met with objections from the residents.  When contacted, S K K Naidu, chairman of  Rukun Tetangga Brickfields (RKB), says the residents’ main concern is the conversion of Jalan Sultan Abdul Samad into a one-way street.

“There are 12 schools along Jalan Sultan Abdul Samad as well as places of worships and most of Brickfields’ residents stay around this area. The proposal will turn Jalan Sultan Abdul Samad into a main road, forcing residents to cope with more congestion, pollution and noise. It will also endanger the lives of school children and the visually impaired,” laments Naidu.

According to Naidu, a letter of objection signed by over 40 associations was sent to Kuala Lumpur mayor, Datuk Ahmad Fuad Ismail on Nov 9, 2009, and they have met Fuad to voice their concerns.

“That is why we were so surprised when the papers reported that the project was given the go-ahead as we thought talks were still ongoing. So we have no choice but to take this to the prime minister,” says Naidu. 

A memorandum on the issue was handed to Datuk Sahlan Ismail,  the prime minister’s political secretary, on April 14.  Sahlan will be meeting the residents and representatives of the associations soon, adds Naidu.

Long-time hawkers and traders along Jalan Thamby Abdullah are also reluctant to shift their businesses to Jalan Chan Ah Tong as proposed by the government.

The temporary lots  reserved for the 17 traders in Jalan Chan Ah Tong is not ready  for operation as of May 5, despite reportedly being served notice to move within 30 days from April 6. On April 29, Minister of Federal Territories and Urban Wellbeing Datuk Raja Nong Chik Raja Zainal Abidin said that the ministry is willing to make changes to the proposed one-way traffic dispersal scheme and the makeover in order to achieve a win-win situation, Bernama reported.

The business community, however, welcomes the change, says Barath Maniam, president of Brickfields Business Council (BBC).

“You must look carefully at the plan. Traffic is dispersed in a way that will not cause heavy jams. It’s just a perception that it will. Look at how developed KL Sentral is and then look at Brickfields. The condition is deplorable by comparison.  I don’t see one solid reason for objection, unless they want Brickfields to stay the way it is,” Barath tells City & Country.

IProp Realty’s Lim adds, “You can’t please everyone. In any redevelopment, there is bound to be protests by certain parties. I think MRCB has done a good job on turning Kuala Lumpur’s old railway marshaling yard into a modern transit hub. It has lifted the image of Brickfields. With the MSC-status obtained recently, KL Sentral has made a name for itself in international business communities. That in return brings in more job opportunities for the locals, which I think is a good thing.”

GMAC Realtor’s Lee agrees, saying the redevelopment will not only ease traffic conditions but also add more value to the properties in the area.

According to an MRCB official, the developer has big plans for KL Sentral, which will indirectly benefit Brickfields. Developments in the pipeline are KL Sentral Park, a RM720 million development which will house Malaysia’s first green office campus; Lot G, an integrated development comprising a retail mall, office towers and a boutique hotel; and 348 Sentral, a green office development.

There are, however, potential downsides. As property prices and rents increase, the locals may no longer be able to afford to stay or do business in Brickfields and will probably need to move to other areas, says Lim.


Brickfields from a long-time resident’s point of view

“There was a time when you could hardly find a car on the road. We moved around walking, cycling or on bullock carts,” reminisces Sandra Segaran.

The Brickfields of his childhood was one where boys gathered in the evenings to play football, where boats paddled down the Klang River to the kampung houses here.

Today, a walk through the neighbourhood is an assault on the senses as cars crawl on the streets, exhaust fumes linger in the air, music blares from the shops and crowds of people pass by. Yet every step one takes is steeped in history.

As Brickfields evolved, more structures were erected, some of which still stand today.  Along Jalan Tun Sambanthan (formerly Jalan Brickfields) is Vivekananda Ashram, a colonial structure built in 1904. Just down the road, on Jalan Rozario, is “100 Quarters”, the former dwellings of railway workers, mostly Indian immigrants brought in by the British administration to work on the railways when Brickfields was the main depot for Keretapi Tanah Melayu (KTM).

The visually challenged are a common sight in Brickfields. The Malaysian Association For The Blind (MAB) houses its headquarters in Kompleks MAB on Jalan Tebing. Also, visible from the main road is Brickfields’ most notable landmark, the Young Men’s Christian Association (YMCA) and hostel, built in 1905.

Brickfields is also well known for its diverse religious structures; the Buddhist Maha Vihara, the Holy Rosary Church, Sri Kandaswamy Temple and Our Lady Of Fatima Church.

According to Kuala Lumpur City Hall (DBKL), the 203 ha Brickfields borders Jalan Travers in the north, Jalan Scott in the east and the Klang River in the south.

With the proposed makeover and ongoing development by MRCB, more changes are in store for Brickfields.

But whatever the future may hold for Brickfields, one thing is certain as far as Sandra Segaran is concerned — he is not leaving Brickfields.

“My son asked me to move to another area in Petaling Jaya a few years ago. I told him, no. Brickfields is my home, I was born here and I have everything I need right here,” the 69-year-old says proudly.


This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 805, May 10 - 16, 2010


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