Property
Adenland moving to the next level
Sonia Ramachandran 
advertisement[x]
IN recent years, many companies with no background in the property industry have jumped on the bandwagon of property development. Some have succeeded while others fell by the wayside.

In the case of Adenland Group, which has started making waves in the property scene, it was an unlikely partnership between a lawyer and a former banker who were initally clueless about construction.

Adenland was established in 2012 by its director Datuk Seri Eric WT Wong, a lawyer, and CEO Nicholas Chang Hon Nyan, a former banker. Prior to setting up the company, the duo had collaborated successfully in various property investments.

Adenland was established in 2012 by Wong (right) and Chang

In just five years, the group has successfully kicked off a township development in Kuantan, Pahang, a mixed development in Rawang and two condominium projects – in Damansara Jaya and Cheras – in the Klang Valley.

Its next and biggest project thus far is a planned township development in Kundang, Selangor, with a gross development value (GDV) of over RM1 bil. In total, its completed, on-going and planned developments have a total GDV of about RM2 bil.

Kuantan opportunity
The Kuantan development, Taman Kuantan Jaya, was Adenland’s maiden project and ironically, it was something Wong, 44, and Chang, 38, didn’t plan for or even wanted.

For their first project, they had wanted to buy a piece of land in Cheras. However, the seller said he would only sell if they took up another piece of land in Kuantan as well. “The truth is we only wanted to buy the land in Cheras, not Kuantan,” says Wong.

“The seller told us that if we want to purchase Cheras, we must also purchase Kuantan. He said ‘If you take the meat, you must also take the bones too’,” he says with a laugh.

They received feedback from their developer friends in Mentakab, Pahang, who said it was buying something “terrible” and that they would not be able to sell houses as it was “not in a good location”.

But they pressed ahead and bought the land as they felt they could somehow make it a success.

Taking up this opportunity eventually proved to be a blessing in disguise.

For the first phase, launched in 2014, they built 213 single-storey terrace units with a GDV of RM50 mil and it was 100% sold halfway through construction.

Phase Two, Aspen, with a GDV of RM100 mil, was launched a year later and is 95% sold while the third phase (GDV: RM120 mil) will be launched by year-end.

Phase Two consists of 283 landed units comprising single-storey terrace, double-storey terrace and villa houses. Of this, 162 units were allocated for the 1Malaysia Civil Servants’ Housing Project (PPA1M).

“The beauty is that we are the first to complete the 1Malaysia Civil Servants’ Housing Project (PPA1M) scheme,” says Wong, adding all 162 PPA1M units were sold out.

PPA1M is a government programme to provide quality affordable homes for civil servants at 30% below market price. “We put a lot of effort into PPA1M because it is a build-and-sell concept and we still need to find buyers the conventional way.

“We can only collect 10% upon signing the sale and purchase agreement [S&P] and the balance 90% only upon the issuance of the certificate of completion and compliance [CCC].

“To do this, the company has to be financially strong. We injected almost RM30 mil cash into this project,” he says.

Chang says Phase Three is a 20.2ha fully gated and guarded landed strata development comprising single-storey terrace, double-storey terrace and superlink homes, with prices starting from RM250,000.

Cora Plus & 9ine
One of the success factors for the group is that it has been astute in buying small plots of land in popular locations, giving it a higher probability for success.

For example, its Cora Plus development in Damansara Jaya, a leasehold low-rise condominium of 46 units, has all been snapped up. The units range from 1,066 sq ft to 1,729 sq ft with prices starting at RM788,000.

“In fact, we encountered around 20% of cancellations because they could not qualify for loans. We subsequently sold that 20% at a slightly higher price than our launch price.

“Since the demand was so good, we upped it a bit, but people still came. In fact, there is a waiting list and we still have cheques waiting [to buy] in case there are any cancellations,” says Chang.

He says the 9ine@Cheras condominium development in Cheras is 90% sold and awaiting the CCC.

Launched in 2013, 9ine consists of 224 units within a 23-storey high-rise tower and three low-rise villa blocks.

Avia Plus
Adenland’s other project in the Klang Valley is its mixed development project in Rawang – Avia Plus. The development on 1.4ha will comprise serviced apartments, shoplots, a convention hall and a hotel.

The serviced apartments are expected to be around 1,000 sq ft and have 2+1 rooms.

There will be 25 three-storey shoplots which will have two wings. The design differs a little from the ordinary with connected corridors outside each shoplot for customers to walk along and access the shops much like a shopping mall.

The shoplots’ soft launch was held early last month. It was open to friends, relatives and agents with the take-up rate thus far already hitting 60%, including foreign buyers, says Chang.

Adenland is also looking at bringing in an international operator to run their business hotel. Wong says they have just returned from Jakarta and are in the midst of doing a deal with a prominent businessman and developer there who also owns hotels.

“We are going to tie up with him and take over his hotel in Bali and we are going to build new hotels in Karimun, Bintang and Jakarta.

“The hotel we are taking over is operated by an international operator. We are going to use our connection with the businessman to bring that international operator to run our hotel in Avia Plus too,” he says.

In explaining why it decided to have a hotel business, Wong says the most important thing for a property developer is cash flow.

“We made some money from Kuantan and we have to use that money to develop Rawang. At the end of the day, where is the money?

“So I told Chang that we have to get some monthly recurring income and it has to be land related, so hotels are the best thing,” he adds.

Kundang plans
Moving forward, its planned township development in Kundang will be pivotal in elevating Adenland to the next level as a developer. The group currently has 60.7ha there, which it considers as its “trophy”.

Adenland is not alone in seeing the potential of Kundang with many big players such as Gamuda Land, Mah Sing Group Bhd, Tan & Tan Developments Bhd and Glomac Bhd launching developments there.

“It is our prized asset. Kundang is the next big thing in the northern Klang Valley, just like Semenyih, because this is the only land left.

“It is just before Rawang,” says Wong, adding they acquired the land there last year and plan to start development three years from now. He says the reason why they do not want to start now is due to “technical issues”.

“Secondly, we do not want to waste it. We do not want to develop it in a hurry and do a slipshod job,” he adds.

He says plans for the development include an international school, hypermarket, shopping mall as well as landed and high-rise developments and Rumah Selangorku affordable housing.

“We want to develop a real nice township and to do it properly and thoroughly. We want to make this mixed development a masterpiece,” says Wong.

‘Realistic’ developer
On how they classify themselves as a developer, Wong says it would depend on the development in question.

“Kuantan is a township development, Damansara Jaya is boutique and high-end, Rawang is a mixed development with affordable apartments while Cheras is mid-range.

“I would say we are probably a ‘realistic’ developer. I don’t want to paint a picture that I have this big piece of land in Jalan Yap Kwan Seng, or KLCC and I can sell at it RM1,000 psf at this time.

“I don’t want to lie to my purchasers. I don’t want to lie to my friends. I believe in cash flow. Without cash flow at this moment, you cannot do anything,” he says.

Chang adds that whatever their development, they all have one thing in common. “We always value-add to whatever we do. We give more than we promise. This is shown in all our projects.”

He also highlights that trust and integrity are vitally important. “We do well because we believe in taking care of our customers and stakeholders. Only then will they return the favour.”

Investment consultancy firm Absocap Holdings Sdn Bhd director Alexander Woo says Adenland is a relatively new developer which “seems to be having a good start”.

“So far they have been offering projects with good value and in rather strategic locations. Despite the soft market, such projects have the potential to sell well,” he says.

Woo says that Adenland had also “over-delivered” to their buyers such as in their 9ine project in Cheras where they provided additional facilities to what was initially promised. This, he says, puts the developer in good stead with their existing and potential buyers.

“As long as they are selling quality projects at strategic locations and at reasonable pricing, the market is there,” he says.


Capitalising on land bank

ADENLAND Group plans to fully leverage on its 121.4ha of undeveloped land in Selangor, Pahang, Perak and Kuala Lumpur.

“Our land bank is all ready for development. Because we are doing so well in Kuantan, we intend to replicate that success in other states,” says director Datuk Seri Eric WT Wong

“The next place that we are looking at is Perak at the moment because both of us [the founders]are from Perak,” he adds.

The company already has 10.9ha near Ipoh, which it plans for a landed development.
It is eyeing more land in Cheras as well as in Perak, Pahang and even Perlis.

“We are currently looking at 19ha in Cheras. The purchase price is valued at about RM110 mil with a potential gross development value of RM2 bil,” says Wong.

The group also has plans to venture abroad. “We are looking at Indonesia, Myanmar and Australia,” he adds.

Moving forward, Wong says it will “definitely list within five years”.

“Two listed companies have approached us for a joint venture where we pump in our projects into their company in exchange for their shares.

“Another option we are looking at is the Leading Entrepreneur Accelerator Platform (LEAP) launched recently for smaller firms. There is only one catch. Not any Tom, Dick or Harry can purchase your shares. It has to be ‘sophisticated’ investors.”
Wong adds the group is looking at all possible options currently.


How it all began for Adenland

IN 2006, Nicholas Chang Hon Nyan was a commercial banker with United Overseas Bank (UOB) in Malaysia while Datuk Seri Eric WT Wong was a lawyer in the corporate and conveyancing field.

These two Perak boys connected in their working life, with Chang passing many case files to Wong’s firm during that period.

“One day Chang called me up about a piece of auction land in Country Heights Damansara.

“We swiftly bought the land and successfully resold it at a much higher price within a short few months. This [was] how our partnership began,” says Wong, an Adenland director.

During the 2008 economic crisis, Wong and Chang saw opportunities in Sierramas, Sungai Buloh where the bungalows were selling at just between RM1.6 mil and RM1.7 mil.

“Within months we bought almost 18 units, some with funding from the bank, some in cash. Our plan then was to slowly refurbish the bungalows and sell it,” says Wong.

But that didn’t happen. In early 2009, the property boom began. “Even before we got the chance to refurbish the bungalows, people were already asking for it at a higher price.

“We managed to sell everything and made some money from there,” he says.
From buying and selling land to refurbishing bungalows, they took the plunge to set up Adenland in 2012.

The first piece of land they bought was in Damansara Jaya, Selangor, where its Cora Plus low-rise condominium comprising 46 units is being developed.

They asked their engineer and developer friends to look at it and the feedback was grim. They all advised them to forget about developing the land as it was “too small” – at only 0.31ha.

They did not waver, and was proven right when Cora Plus was quickly sold out with no official launch or show gallery earlier this year.

How did the group get its name?
Wong shares that the name comes from his nephew. “I always wanted to start something with the alphabet ‘A’ because alphabetically you are number one.

“So we were thinking of what to call the company and Aden is also pretty biblical, so why not Aden?” Wong explains, probably alluding to the Garden of Eden.

The secret to their success is trust and going the extra mile. “We want to become a household name in terms of value-adding to our development and delivering more than we promise,” says Chang, the group CEO.

Wong chips in and says it is also about “people”. “Do unto others what you would have them do unto you. I believe in treating my customers and staff with respect.

“My dream is to make every one of my staff a shareholder in my company just like Starbucks,” he adds.

This article first appeared in Focus Malaysia Issue 240.