PROJECT WILL COVER DANGA BAY IN THE WEST AND TEBRAU IN THE EAST
THE word “kang” (pronounced as chiang in Mandarin) means straits and “hoo” or “her” means river and somehow Datuk Lim Kang Hoo is fated to be digging rivers. He has spent close to a decade digging up the three rivers that converge to become a waterfront city as part of the Danga Bay project.
He explained that it has been one exhausting process to clear layers of mud and sludge and tonnes of rubbish but today many appreciate the serenity of a park that has been developed nearby, a bay area for yacht as well as commercial and residential areas in Danga Bay. The job is far from over and detractors have questioned why the entire redevelopment of the area was taking so long. Lim is also at the centre of a recently-announced consolidation exercise where a vehicle called Iskandar Waterfront Holdings Bhd (IWH) will become the owner of all major property development spanning the east to west of the waterfront of Johor Baru city. Lim, through his vehicle Credence Resources Sdn Bhd, will have 60% of this vehicle with the balance 40% to be held by the Johor state, in a pioneering private public partnership attempt. Their goal: transform the entire southern tip of Johor Baru into a waterfront city that would be remembered for decades. But would it work?
StarBiz deputy news editor B.K. Sidhu spoke to Lim in his office in Danga Bay yesterday. Below are excerpts of the interview:
StarBiz: What was the rationale for IWH buying a stake in Tebrau Teguh Bhd?
Lim: As you know, we have been developing Danga Bay since the 1998/99 economic crisis. Then we saw it as an opportunity as the location was good for an integrated waterfront city though there were heaps of rubbish and sludge that we had to clear before we could build anything. To be frank, it was worse than the Gombak river. And until today we are still digging and cleaning and in all, we also had to reclaim land to create what we had in mind.
The Danga Bay area is next to the Iskandar Corridor, which is on the west side of Johor Baru, but in order to expand to the east to complete the loop, we needed to work with someone else. We also needed to expand into the east for the lifestyle portion.
In the middle is the central business district (CBD) development which will be turned into a heritage city to attract international tourists. So with Tebrau, we would have a complete strip spanning from west to east. It is a big task but we are very grateful that the state government is supporting the entire Iskandar development master plan and we have formed a public-private partnership to develop the whole area.
It is such a huge development that would benefit the local community and the developers.
There is a perception that KPRJ is selling its state-owned assets to private parties like yourself.
The Johor state government is not selling out. It is just consolidating its interest into the holding company. This is a private-public partnership. I am also injecting my own assets into IWH.
Would Tebrau remain listed?
It would, and we like to keep it like this.
Why did Kumpulan Prasarana Rakyat Johor choose to work with you?
We have proven ourselves in understanding and undertaking water development projects and we have never run away from any job from the day we proposed it despite the challenges. What we are doing is planning and building for our future generations.
Actually, I am a very bad businessman as I am still with the project. Many other property developers would have made so many houses and sold them during this time but I am still working on this project.
Would IWH be listed?
One day, we are still preparing. It would be listed.
You talked about being master developer and to get investors to develop parcels, are they coming?
We have some, such as Dijaya Corp, the Azea Group of Singapore, Waz Lian Group and also Australia's Walker Group. They are all undertaking some development on our landbank. We are aggressively going out to attract investors. That is also why we are consolidating the landbank under one holding company. With the new structure, people will know who we are.
Some property developers think we are their competitor, but we are not. We are not doing townships, we are a master developer and we want to work with local and foreign developers. They are our clients and by undertaking the Danga Bay project we wanted to show them that it could be done. We had to take the lead and invest first.
Since last year we are getting a lot of enquires after the two governments (Malaysia and Singapore), resolved the POA agreement, and every day there are several parties coming to take a look at our landbank with a view for investment.
You have been on the Danga Bay project for a long time and some people think you have not lived up to expectations.
The first thing we have to do is to clean up the area and that took a long time because it is not easy getting the mud, sludge and rubbish out.
We have thus far completed the entire infrastructure and while you may say that we have taken a long time, the real rush to grab land in Johor is only happening now.
Today, we have created a park, some commercial and residential units, a yacht bay and more development is coming up. Ours are long-term projects and it may take up to the next generation to complete all that we have designed.
What we like to see is a waterfront like that of Sydney Harbour or even Hong Kong.
This is why the Government agreed to form a private-public partnership with us. As for infrastructure, there is now a six-lane highway connection from two-lane previously.
Did you get the land for Danga Bay free from the Government?
Never, the land is not given to us, we bought it over with its liabilities.
When did the actual work for Danga Bay begin?
It only began in 1999 and the infrastructure and cleaning has cost us RM280mil while the residential and commercial gross development value is about RM400mil.
When do you expect the full completion of Danga Bay?
The urban planning design is for 2,000 acres. It is a long-term development ... there are many phases. We are the master developer and we need developers and investors to come in to develop parts of the land and it would take a long time; maybe the full completion would not be in my lifetime.
What is the property market outlook in Johor?
It is only since the end of 2011 that we are seeing large numbers of local and foreign developers rushing to invest in JB.
This is something we have not seen in the last 15 years. Today we see the big, medium and small developers in town. That is a good sign as people are rushing to buy up land for future development.
Property prices from housing to land prices are gradually going up and all these investors that are coming in are the early birds. We have not seen the real big boom in the property sector.
Is the land bank under-valued?
It is still an early bird price when compared with prices in Singapore and Kuala Lumpur. There is still room for improvement and we believe more investors and developers will come in.
What is delaying the waterfront projects?
If you look at history, all water front cities have a history of 100 to 200 years. We have just started and to see the transformation it may take generations. But somebody has to start it.
How will Ekovest benefit from this development in JB?
Ekovest is very focused on design, construction and building infrastructure projects. Obviously with Iskandar, which is a huge project, there are plenty of opportunities to participate in the building of infrastructure. Of course like everything else, there is a tender process, it would be an open tender basis where everyone can participate and Ekovest can be one of them.
You are said to be close to the Johor Sultan.
Like any businessman, we have friends all over and whoever is the leader, we need to know and respect them.
Are you also involved in the Tanjung Piai project?
I have nothing to do with that project.
Once upon a time you were linked to buying Kulim. Was there any interest at all?
How can I take over a company as big as Kulim? If it belongs to me, I would be very happy.
As a master developer, where is the entire financing coming from?
That is why we need investors, local and foreign, to invest in it. It can be PNB, EPF or any developer that wants to be part of the project.
How did you start?
I have been in business for 40 years and started from doing small renovations to big renovations. I was also involved in plantations with Felda and from there we just learn and moved on. Slowly, we started getting bigger contracts and everything just got bigger. But it did not come easy, it has been a lot of hardwork and years of experience.
We did jobs everywhere from Lahat Datu to Pahang and Kuala Lumpur to Johor. Nowadays I spend about 70% to 80% of my time here in Johore. Once you have a vision, you have to look towards achieving it.
No comments:
Post a Comment