Malaysian apartment building takes legal action over short term rentals

Malaysia: The Loft Residences in Kota Kinabalu has banned all commercial short-term rental business such as Airbnb from operating at its condominium units.

The building’s 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 blocks A, B, C, D and E to cease and discontinue commercial short term rental activities on sites such as Airbnb and HomeAway within 90 days.

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.”

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.

One resident said: “We bought a 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.”

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