Shophouses or commercial properties in the central business district (CBD) are now worth up to RM5 million.

In an interview with The Borneo Post, C.H. Williams, Talhar & Wong (Sabah) Sdn Bhd director Sr Cornelius Koh said the shops along Gaya Street are worth between RM4 million to RM5 million.

On the other hand, properties along Lorong Dewan now cost about RM2.5 million, or up to RM3 million for renovated premises.

He said the shop operators in CBD are mostly tenants as the owners are not eager to sell their properties.

The owners, as Koh said, are generally old folks or children who inherited the properties from their parents.

"They will only sell if buyers offer them a ridiculously good price that they cannot reject. But for that to happen is very rare" he pointed out.

Additionally, Koh said rental of commercial properties in the CBD is dictated by the location.

"It is extremely difficult to give a ballpark figure of the rental for commercial properties because it is not fixed.”

Nonetheless, it was said that the rental for a ground floor unit in Kota Kinabalu city has hit RM10,000 per month.

But rental is secondary to business folks so long as the commercial premises is located in a high pedestrian traffic area with opportunities of making a profit, he said.

"The market will decide how much it is depending on the profitability of occupying that commercial unit.”

In recent years, more and more decades-old businesses in the city have been replaced by newcomers. Lorong Dewan, or Australian Place, that used to house a few printing houses are now occupied by coffee shops and restaurants, such as October Coffee House, Nook Café, Woo Café, Chopping Block and The Workshop, each with its own unique design. With the new players in town, Lorong Dewan has been transformed into a bustling place where the young crowds hang out.

On that, Koh said the use of properties would evolve as an area modernised.

"In the good old days, the printing (business) was good enough to justify the value (of the properties).

"Now that the city has expanded, to use the premises (at Lorong Dewan) as printing shops would be underutilising the properties.

"Therefore, the properties are converted to budget hotels, bed and breakfast (B&B), cafes and pubs, for a higher use of property" he said.

When a property is of higher use, its value will also go up accordingly, Koh added.