PETALING JAYA: While property valuers and real estate agencies are convinced that Bangsar South in Kuala Lumpur will continue to sell despite an expected name change to “Kerinchi” given its established location, they are divided as to whether it will impact the value of property there.
Managing director of VPC Alliance (Malaysia) Sdn Bhd, a company of property consultants, valuers and estate agents, James Wong, believes a name change would negatively affect property values in the area.
“In our considered opinion, it is not advisable to change the name from ‘Bangsar South’ to ‘Kerinchi’,” he said, adding that foreign buyers are not familiar with “Kerinchi”.
Wong said the developer, UOA Development Bhd, wanted to differentiate the new development from Kerinchi, which comprises mostly low- and medium-cost flats.
“Hence, the name ‘Bangsar South’, although it is not adjoining Bangsar. The word ‘Bangsar’ connotes an upper class and desirable residential and commercial development. It was clever that UOA Development managed to get DBKL to approve the name ‘Bangsar South’,” he said.
Wong said the name of a project plays an important part of a property development’s success and names like “Damansara”, ‘”Bangsar” and “Jaya” sell well, even though they may not be adjoining Damansara or Bangsar.
“A clear-cut example was when Bandar Baru Sungai Buloh township had a name change to ‘Kota Damansara’ and, immediately, there was a noticeable increase in property values in Kota Damansara. The new branding definitely improved the selling prices, rentals and take-up rates in Kota Damansara compared to the previous name, Bandar Baru Sungai Buloh,” he added.
Malaysian Institute of Estate Agents past president Siva Shanker agreed to certain extent, entailing the role of branding among buyers who are more discerning and selective in their purchase decisions.
“Nowadays, branded developments and developers sell, which is why a branded developer can sell 75% of his project within two months, while a not-so-branded developer can only sell 20% in the same area,” he told SunBiz.
Siva said there are two aspects to branding, one is associated with the developer, for example Pavilion, SP Setia and Eco World while the other is associated with the property, which is where the project name comes in.
Acknowledging the value in branding, Siva does not agree with the name change mooted by Lembah Pantai MP Fahmi Fadzil.
“In the last 10 years, a lot of time, effort and money has been spent to build a name at Bangsar South and I think the name change is a step in the wrong direction. Instead of changing the name of the entire area, perhaps the government could consider excluding the new enclave and maintain the name ‘Bangsar South’ for that enclave,” he suggested.
Siva, however, stopped short of saying that the move will impact property prices there, considering that it is a well-established location, with developers with planned projects there likely to continue using the Bangsar South branding.
“Real estate agents will also continue selling their properties there as Bangsar South projects. The area has grown too strong for a name change to make a difference,” he added.
Meanwhile, CBRE-WTW managing director Foo Gee Jen believes available ground facilities and infrastructure will trump branding.
“The name change is irrelevant. New buyers going in will see on the ground the facilities and infrastructure available,” he said, adding that developers will continue to sell upmarket products there despite a name change.
Source: The Sun Daily