Developer of affordable housing LBS Bina Group Bhd has set its sights on creating a new corporate image and outlook for the company, having completed its recent internal transformation initiatives.
This coincides with the changes that are afoot with the Pakatan Harapan government helming Putrajaya, and seeking to reform various government institutions.
Malaysia is now in the season where change and transformation is in the air, says LBS Bina group managing director Tan Sri Lim Hock San. “Similarly, LBS Bina too has undergone a physical transformation to reflect our steady progress,” he says.
The company has come far from its early days when it first opened its doors in Serdang, Seri Kembangan in the 1990s.
“We started with a small but dedicated team which contributed to our success in meeting the group’s targets each year,” Lim says.
In 2003, the company shifted its headquarters to Sungai Way, Petaling Jaya. This year, in conjunction with the newly formed Pakatan Harapan government, the company revamped its headquarters, giving it a fresh look to reflect the company’s new outlook.
LBS kick-started the year with two new launches in the Klang Valley - Residensi Bintang Bukit Jalil and Zenophy Residences in Seri Kembangan.
The Bukit Jalil development, which has a gross development value (GDV) of RM954.7 mil, consists of two-tower condominiums strategically located at the epicentre of the education, sports, entertainment and leisure amenities.
“We had (modern) home buyers in mind when we designed Residensi Bintang Bukit Jalil. This is our strength at LBS and the strategy that has made us a resilient property player in Malaysia. Bukit Jalil is a strategic location for families and young home buyers to reside in,” Lim says at the launch.
In addition, the Tzu Chi International School, scheduled to be completed in 2020, is expected to complement Residensi Bintang Bukit Jalil well, he adds.
Residensi Bintang Bukit Jalil resides on a 2.2ha parcel of land with a 47-storey North Tower and 50-storey South Tower comprising a total of 1,342 units. Priced from RM553,000, the North Tower, with a total of 730 units, offers three layouts ranging from 805 to 1,209 sq ft. Type A1 units come with two-bedroom and two-bathroom layout, while Type B and C have three bedrooms and two bathrooms. The Type C unit also has a yard and utility room.
Sales of the units exceeded the 50% mark by the first half of the year. South Tower has yet to be launched.
The second project, with GDV of RM312 mil, features a 32-storey mixed development with 398 serviced apartment units ranging from 823 to 2,031 sq ft, along with 51 commercial shop units and 23 affordable shop units.
Priced between RM454,300 and RM604,000, the project features low-density floors of no more than 17 units on each level, served by six elevators, according to Lim.
Units with a built-up area of 1,012 sq ft feature three bedrooms, two bathrooms, a dining and a living room configuration.
Families favouring larger units can opt for a built-up of 1,128 sq ft which features a similar layout with an additional utility room.
Also launched this year are the PPA1M Mercu Jalil in Bukit Jalil and Kita@LBS Cybersouth in Dengkil. It is part of the previous government’s property ownership initiative for civil servants under the 1Malaysia Civil Servants Housing Project (PPA1M).
The RM354 mil PPA1M Mercu Jalil comprises two blocks of 47-storey apartments totalling 1,360 units. Built with a nine-storey car park facility, the units have built-ups of 1,000 to 1,200 sq ft, accommodating three bedrooms and two bathrooms. The price starts from RM245,000.
Kita@LBS Cybersouth is yet to be valued as it is part of a larger development, which is a Malay reserve titled property. The property saw a significant take-up rate during its launch on Nov 13. “Kita @ LBS Cybersouth is our newest development catering to Malay home buyers seeking landed affordable homes set in a community and family-focused environment,” Lim says.
The 20ft x 60ft double-storey terrace homes in Phase 1A are priced at RM530,000 and sold over 120 units. Meanwhile, Phase 2A comprising 22ft x75ft double-storey town houses priced at RM399,900 has sold close to 100 units.
Yet to launch
LBS has yet to launch Laman Bayu in Bandar Putera Indah, south of Batu Pahat. The development consists of 365 units of two-storey terrace houses with build-up areas from 1,426 sq ft. These 20’ x 65’ homes come with 4 bedrooms and 3 bathrooms configurations.
Bandar Putera Indah is a mixed development comprising over 2,000 units of residential and commercial properties. This phase of the freehold 521.2ha township, located next to major towns such as Muar and Yong Peng, is expected to be launched in December.
Despite the prolonged slowdown in the property sector, Lim is confident of the company doing well this year.
“Amidst challenging market sentiments in the property industry, LBS continues to enjoy steady growth within our portfolio and healthy sales from our offerings throughout the year.
“For next year’s figure, we will share it during LBS Media Briefing which will be held in January. Although the market has been sluggish, we believe the industry will continue to see a steady demand from first-time house buyers for properties in the affordable and medium market segments in locations close to or easily connected to major cities,” he tells FocusM.
In Budget 2019, the government initiated several house-buying incentives such as the exemption of Real Property Gains Tax (RPGT) for properties priced below RM200,000; and stamp duty exemption for the first RM300,000 for houses priced up to RM500,000 as well as for existing units priced from RM300,001 to RM1 mil.
In the Budget, the government also announced RM1.5 bil funding for affordable housing via government agencies such as 1Malaysia People’s Housing (PR1MA), 1Malaysia Civil Servants Housing Project (PPA1M) and Syarikat Perumahan Negara Bhd (SPNB).
“LBS will work together with the government and continue to offer houses that fall within the affordable and medium-range price segment,” he says.
However, not everything is without its challenges. LBS’ new launch targets this year was revised downward by RM545 mil to RM1.48 bil, as it made some changes to land development strategies for certain projects.
“The biggest revision was related to affordable housing projects worth RM381 mil. This includes the Civil Servants Housing Project developments in Bukit Jalil and Alam Perdana, as well as Bandar Saujana Putra’s Rumah Selangorku, as LBS is making some changes to its development strategies,” says RHB Research Institute Sdn Bhd analyst Chiong Tong Chai.
Residensi Bintang Bukit Jalil also suffered an earlier “pushback”. An additional RM283 mil in new launches were included into LBS Kita@LBS Cybersouth.
How this will eventually affect LBS’ sales target of RM1.8 bil remains to be seen as there is still one more project to be launched next month.
Between January and August, RM698 mil worth of projects were launched, or 47% of the full-year new planned launches.
“New sales as of August are still encouraging at RM1.14 bil vs RM802 mil for the same period last year,” Chiong says. However, new sales (as of Aug 26) and unbilled sales (as of end-June) stood at healthy levels of RM1.14 bil and RM1.7 bil respectively, he says.
However, revenue and net profit for 2Q 2018 saw a drop from the corresponding period of 2017. It posted a revenue of RM304.7 mil and net profit of RM24.1mil for the quarter under review compared to a revenue of RM346.9 mil and net profit of RM30 mil a year ago.
Year to date, LBS has had a poorer performance compared to last year. For the first half of the year, it recorded a revenue of RM544.9 mil and a net profit of RM50.1 mil compared to RM592.2 mil and RM50.8 mil respectively for the first half of 2017.
Nevertheless, Lim is confident of hitting the target or at worst, close to it.
In the meantime, LBS is looking forward to the future.
Still land banking
As for its land bank, it is sizeable at about 1,294.2ha as of Nov 15. And word has it that the property developer is on the lookout for more parcels of land within the Klang Valley. Lim points out that the company will continue to focus on buying land, given its continued stance in providing affordable housing.
“We are still acquiring more land bank within the Klang Valley and the locations we are looking for are mainly based on the three important pillars of affordability, connectivity and community,” he says. FocusM