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Loft threatens legal action on AirBnB business
Published on: Saturday, August 11, 2018

Kota Kinabalu: The Loft Residences had banned all commercial short-term rental business such as AirBnB and similar business operating from its condominium units.

Its developer Syarikat Kapasi Sdn Bhd has instructed its legal firm – Shelley Yap & Co. to issue notice dated August 3, to all owners or tenants of Block A, B, C, D & E to cease and discontinue all such commercial short term rental activities within 90 days.

A delighted resident said: "We bought condominium unit parcel to live in peace and security, and found that we are living amidst lodging homes full of noisy foreigners dominating the swimming pool and facilities, depriving owners and long-term tenants of enjoyment of what they pay management fee to maintain and upkeep."

The reasons given are that "the Kota Kinabalu City Hall has declared all such commercial activities in respect of short term lodging by way of license and not by proper tenancy as illegal, and that the approved Development Plan for The Loft Residences was not designed and approved for commercial use."

In the past, DBKK brought a court case against a serviced apartment business at Waikiki Condominiums after residents complained.

Furthermore, for the safety of lodging paying guests, the legal notice cautioned tourist accommodation operators that The Loft Residences does not fulfil the fire safety requirements set by the Fire Department or Bomba for short term lodging by way of licence.

Syarikat Kapasi Sdn Bhd also reminded the residents or occupants that "it is a clear breach of the Deed of Mutual Covenants and the House Rules" mutually agreed with the purchasers of the condominium units that the private residential purpose of the development cannot be changed to operate like a hotelier business.

The developer reserves its right to fine offenders after the 90-day period under the Houses Rules RM2,000 and RM500 per day if they continue the banned business, and their key access cards will be deactivated to deny them entry.

AirBnB, is the Internet holiday accommodation booking site that lets you rent out your spare rooms, or your entire home, to tourists, which is one of Silicon Valley's brightest start-ups' great idea in the sharing economy like Uber for transportation at more reasonable fee.

One of the KK's most prominent property management firm Taylor Hobb's principal Sr. Liaw Lam Thye, said he learnt of cases where more than 10 foreign tourists cramped into one condo unit, in some cases left smelly rotting garbage behind when they left, discovered only when the unit parcel was open for the next customer.

There is more cleaning to be done, and more maintenance of utilities like lifts and swimming pool, besides garbage disposal from food and leftovers the foreigners bought to cook themselves.

Some condos have to engage more guards to cope with complaints.

According to Liaw, only Jesselton Residences management is able to strictly prohibit any type of Airbnb business nuisance within its project as the developer has his own residence unit there.

The AirBnB controversy and articles motivate the Institution of Surveyors Malaysia (ISM) Sabah Chapter of which Sr. Liaw is a member, and the Subsidiary Titles Owners and Purchasers Association of Sabah (STOPS) to organise two seminars this year to inform the public on the many issues relating to such business.

STOPS next seminar is on Saturday, September 8 by Sr. Robert New on the roles and responsibility of management corporations and property manager.

AirBnB type businesses in Sabah riding on the tourism boom is helping many property investors to fill up their properties' occupation rate where high paying tenants are hard to find nowadays to repay their bank loans which otherwise would cause NPL rate to increase and foreclosure action to rise in a stagnant property market situation.

Local AirBnB hands-on business operators reported profits from a few thousand per month to RM36,000 depending on the occupancy rate of the number of units they operate for their enterprise. - David Thien

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